Typically, in Illinois, employment is at-will with no written contracts. However, in certain situations, employment contracts are more common. For instance, severance agreements and non-compete agreements.
Severance and Separation Agreements
Typically, in a severance or separation contract, the employer will require the employee to waive all legal claims in exchange for severance pay and/or other benefits, and more often than not, the employer also forbids the employee from disclosing the existence or terms of the agreement. By signing a waiver and release of claims, an employee may relinquish important rights, even if the employee is not aware of those rights. Because of these waivers, it is important that employees have an employment attorney review the contract
At Choate Herschman LLC, we have negotiated numerous severance agreements. In some instances, we have counseled the client behind the scenes on how to negotiate the agreement, normally, it is because the attorney believes that due to specific circumstances, it would not be in the client's interest to involve an attorney in the negotiations.
Non-Compete and Non-Solicitation Agreements
Generally, a non-compete agreement forbids an employee from working for or owning a competitor for a specific period of time. A non-solicitation agreement forbids an employee from soliciting employees to work for another employer for a specified period.
Some employers may require employees to sign non-compete and/or non-solicitation agreements at the time of hire, during the course of employment, or, most commonly, as a condition for a severance agreement. Although such an agreement might be unenforceable, it could still deter prospective employers from hiring an employee who is subject to a non-compete restriction.
Employees should consult an attorney before signing such agreements as they may seriously impact future employment goals. Employees who are thinking of leaving their employers to work for a competitor or to start their own business with co-workers should make sure that they are not bound by a non-compete or non-solicitation provision.
If you would like to have an employment agreement reviewed, revised, or negotiated, feel free to call Choate Herschman LLC at (312) 870-5800.