Illinois Wields New Power to Challenge Noncompete Agreements
- 7 years ago
Illinois Wields New Power to Challenge Noncompete Agreements
On Wednesday, the Illinois attorney general sued Check Into Cash, accusing the company of violating
a state law prohibiting noncompete agreements for workers making less than $13 an hour.
Illinois sued Jimmy John’s last year, arguing that its noncompete agreement violated the state’s consumer fraud act — the new noncompete law hadn’t been passed yet —
and reached a settlement in which the company agreed to remove the clause
In addition to alleging that Check Into Cash broke Illinois’s new noncompete law, the suit takes a page from the economic literature by arguing
that noncompetes hurt the state’s economy by suppressing wages and preventing workers from leaving for better pay.
The bill never passed, but last year the Illinois legislature passed a law prohibiting noncompetes for employees who make less than $13 an hour.
“And what we have found is that the use of unfair noncompete agreements have scared a lot of low-income
workers into staying in low-paying jobs when they could, based on their experience, get better pay.”
Check Into Cash did not return several calls seeking comment.
Last year, the Treasury Department and President Barack Obama’s Council of Economic Advisers released
papers on the economic harm wrought by noncompetes and other restrictive employment contracts.
On Wednesday, the Illinois attorney general sued Check Into Cash, accusing the company of violating
a state law prohibiting noncompete agreements for workers making less than $13 an hour.
Illinois sued Jimmy John’s last year, arguing that its noncompete agreement violated the state’s consumer fraud act — the new noncompete law hadn’t been passed yet —
and reached a settlement in which the company agreed to remove the clause
In addition to alleging that Check Into Cash broke Illinois’s new noncompete law, the suit takes a page from the economic literature by arguing
that noncompetes hurt the state’s economy by suppressing wages and preventing workers from leaving for better pay.
The bill never passed, but last year the Illinois legislature passed a law prohibiting noncompetes for employees who make less than $13 an hour.
“And what we have found is that the use of unfair noncompete agreements have scared a lot of low-income
workers into staying in low-paying jobs when they could, based on their experience, get better pay.”
Check Into Cash did not return several calls seeking comment.
Last year, the Treasury Department and President Barack Obama’s Council of Economic Advisers released
papers on the economic harm wrought by noncompetes and other restrictive employment contracts.