Education: New Salary Posting Requirement Takes Effect January 1, 2012
Illinois School Code provisions requiring the reporting and posting of administrator and teacher salaries have gone through multiple revisions recently.
Illinois Supreme Court Clarifies Employer’s Burden in Enforcing Post-Employment Covenants Not-to-Compete
A decision issued last week by the Illinois Supreme Court clarified the requirements in Illinois for enforceable post-employment restrictive covenants. In Reliable Fire Equipment Co. v. Arrendondo, the Court reaffirmed the longstanding requirement that a “legitimate business interest” is, in fact, a necessary element in determining the enforceability of a post-employment covenant not-to-compete. At the same time the Court rejected the view prevailing for many years among the lower Illinois courts that the only means to establish a legitimate business interest was for an employer to demonstrate either a near-permanent customer relationship or the existence of confidential and/or trade secret information. Under the Reliable Fire decision, courts must now look to the “totality of circumstances” to determine whether a non-compete restriction is justified by a legitimate business interest and otherwise is enforceable.
IL Supreme Ct's Decision in Reliable Fire Broadens Enforceability of Restrictive Covenants
Many clients who deal regularly with employee restrictive covenants have eagerly awaited the Illinois Supreme Court’s decision in Reliable Fire Equipment Co. v. Arredondo et al. The court was faced with answering the question of whether employers seeking to enforce restrictive covenants must show a legitimate business interest—in, for example, customer relationships and/or confidential information—in addition to demonstrating the reasonableness of the time, territory and activity restraints. There has been disagreement recently among the Illinois appellate courts as to whether a protectable interest need be shown at all, a position which, if adopted by the supreme court, would significantly alter how restrictive covenants are written and enforced in Illinois.
Illinois Supreme Court Expands Scope of Covenants Not to Compete
On December 1, 2011, the Supreme Court of Illinois issued its opinion in Reliable Fire Equipment Company v. Arrendondo, Case No. 2011 IL 111871, addressing and clarifying several issues relating to the enforceability of noncompetition agreements in Illinois and setting forth a standard that may result in employers facing a lighter burden to enforce such agreements against former employees.
Illinois Supreme Court Resolves Split in Appellate Courts and Rejects Use of Rigid Tests to Evaluate Restrictive Covenants
On December 1, 2011, the Illinois Supreme Court issued a unanimous opinion in Reliable Fire Equipment Company v. Arredondo, No. 111871, 2011 WL 6000743 (Dec. 1, 2011) holding that courts cannot use rigid, structured tests to determine whether restrictive covenants are enforceable. Specifically, the Illinois Supreme Court held that while courts must continue to evaluate whether an employer has a legitimate business interest that justifies the use of a restrictive covenant, courts should not use isolated, inflexible factors in making this assessment.
Illinois Joins the Mainstream With Respect to Non-Competes
The Illinois Supreme Court recently brought Illinois into the mainstream of non-compete agreements. Like a majority of states across the country, Illinois courts must now determine whether an employer has a legitimate business interest that warrants the imposition of a restrictive covenant, whether the covenant presents an undue burden, and whether it is contrary to the public interest. In short, Illinois courts must determine whether a restrictive covenant is reasonable under the circumstances.
Am I Obligated to Pay a Pro Rata Bonus to Employees No Longer With The Company?
As the end of the year rolls around, we inevitably are asked questions related to the payment of bonuses, particularly for those employees who are terminated before annual bonuses are paid out.
Recent IL Case - Important Distinctions Between Restrictive Covenants in the Sale-of-Business
Recent Illinois Case Highlights Important Distinctions Between Restrictive Covenants in the Sale-of-Business and Employment Contexts
Amendment to Open Meetings Act Requires Posting of IMRF Employee Compensation
Public sector employers need to be aware of changes to the Open Meetings Act (OMA) brought about by Public Act 97-0609 (formerly Senate Bill 1831). The Act, which became effective on August 26, 2011, contains changes in addition to providing new accelerated payments for certain salary increases provided to members of the Illinois Municipal Retirement Fund (IMRF). It also amends the OMA to require an employer participating in IMRF to post on its website the total compensation package for each employee that has a total compensation package that exceeds $75,000 per year. Additionally, the new law also requires an employer participating in the IMRF to post on its website, at least six days prior to approval, any employee compensation package in excess of $150,000.
Illinois Amends Data Breach Notification Law, Adding Data Disposal Mandate
Illinois Governor Pat Quinn has approved a measure amending his state's data breach notification law to increase protections for Illinois residents. The changes will become effective January 1, 2012.
