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Oftentimes, when an employee is offered new employment or a severance package, a non-compete agreement is intertwined. These binding contracts must be negotiated with extreme caution, as not knowing your rights can later result in serious legal problems with potentially major consequences. If you have been asked to sign a non-compete or severance agreement, contact the Zoldan Law Group, PLLC. We can schedule a free consultation to discuss the matter further, call (312) 980-9992 or contact us online.
Executives and professionals eager to start or continue a new job often sign non-compete agreements, also known as restrictive covenants, that are disadvantageous if the employment relationship ends. These agreements can restrict your right to accept another job within your field of expertise, even if your employer terminates you. Employers have a keen interest in these agreements because they mean less competition for the attention of consumers.
Employees, on the other hand, typically do not like the agreements because they directly affect their ability to earn a living. Additionally, it may be stipulated that any knowledge they acquired from their relationship with the company cannot be used. This includes trade secrets, business practices, marketing strategies, and other competitive advantages such as client lists and other good will assets.
A severance agreement is an offer of pay and benefits when an employee is leaving a company. Many severance pay packages offer a week’s salary for each year the worker was under employment. The agreement can also include payment for unused sick time or vacation time, stock options, insurance benefits, and other benefits. Although it will likely consist of some form of pay, the agreement may contain other types of provisions. Those might consist of confidentiality, a release of claims, and clauses that can restrict your future employment or ability to contact clients.
An employer may have several reasons for offering a severance agreement to a departing employee. One example is to minimize the risk of the employee suing. Severance packages are voluntary, unless they are part of a written contract or a collective bargaining agreement. Though many employees sign severance agreements without the help of a legal professional, only to find out later that they did not realize they were giving up certain rights when doing so. A violation of a signed agreement can subject the previous employee to a court order and liquidated damages.
Hiring a skillful Chicago employment attorney to create or review these types of agreements is crucial. Without such guidance, employers could open themselves up to potential liability, and employees could indirectly forfeit important rights. These types of employment claims also tend to be factually and legally complicated, requiring the knowledge of Illinois’s labor laws. In some cases, an attorney with experience in handling disputes involving non-compete and severance agreements, may be able to challenge the validity of them in court.
Our desire is to help you work at what you do best without any restrictions. Call (312) 980-9992 and schedule a free consultation today.