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Illinois Employment Contract

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What is an Illinois Employment Contract?

In Illinois, an employment contract is an agreement executed between an employer and an employee that serves as the framework for the business relationship. Common terms and conditions covered in an employment contract include:

  • Job title and duties
  • Compensation
  • Benefits
  • Vacation and days off
  • Disciplinary procedures
  • Causes for termination
  • Severance packages
  • Company policies and standards

Illinois is an at will employment state. This means that employers are free to release workers from employment at any time without a reason and without advanced notice. One way to be protected from this law is to have an employment contract that outlines causes for termination and other clauses that protects an employee’s job.

Employment contracts can also protect employers through the use of restrictive covenants. A restrictive covenant is a clause that prohibits employees from certain actions like competing against the employer (non-compete clause) or revealing trade secrets (non-disclosure clause).

Are Employment Contracts Enforceable in Illinois?

Yes. Once an employment contract is agreed upon and a valid contract is formed under Illinois contract laws, an employment contract can be enforced in court. This applies to employment contracts that include agreements regarding wages, working hours, severance packages, and reasons for termination.

In January of 2022, Illinois, like many other states, revised its enforcement laws surrounding restrictive covenants like non-compete agreements. The new laws make it harder for employers to enforce these clauses against their employees.

Some changes in the new laws include:

  1. Restrictive covenants must be supported by adequate consideration if the employee has worked for the employer for at least two years after signing the agreement and the employer has provided the employee with benefits that may constitute consideration.
  2. Non-compete agreements are not enforceable if the employee makes less than $75,000 per year.
  3. Non-solicitation agreements are not enforceable if the employee makes less than $45,000 per year.
  4. Employers must provide employees with at least 14 days to review a restrictive covenant agreement

For more information on the changes to restrictive covenant enforcement laws, you can read the full Illinois Freedom to Work Act.

What Are the Legal Requirements for Illinois Employment Contracts?

According to the Illinois Employment Contract Act, employment contracts can be written, oral, express, or implied.

  • Written contract. The agreement and all terms and conditions are in writing and signed by both parties. This is the easiest contract to enforce.
  • Oral contract. An agreement created verbally without being recorded in writing.
  • Express contract. An exchange of promises where the terms are agreed upon by both parties and declared either orally or in writing.
  • Implied contract. Legally binding obligation that is formed based upon party’s actions, conduct, or circumstances.

The contracts cannot violate state or federal law and cannot go against public policy.

Types of Illinois Employment Contracts

Illinois employers use various types of employment contracts depending on the type of employee and the type of work contracted. The following contracts are most commonly used for hiring employees and workers:

  • Permanent. A more common type of employment contract used by an employer to hire a permanent employee. The employee will have regular hours and be paid regular compensation.
  • Fixed term. Used for workers who will only work for a specific period of time or to complete a specific job. At the end of the contract, employees are either brought into permanent employment or a new contract with a new term is executed.
  • Independent contractor agreement. Companies need a specific contract when hiring a contractor or a freelance worker because these workers are not company employees and will have different rights and responsibilities.

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Talin H. on ContractsCounsel
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Melissa G. on ContractsCounsel
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Melissa G.

Managing Attorney
Free Consultation
Chicago
20 Yrs Experience
Licensed in DC, IL, MI, OH
University of Michigan

My name is Melissa “Mel” Green and I provide legal counsel to entrepreneurs, start-ups, and small businesses that is clear, concise, and focused on the practical impact of decisions. As trusted legal counsel, I proactively identify risks, and develop effective, practical solutions that protect my clients businesses, create positive outcomes, and help mitigate legal exposure. My areas of expertise include business formation, contract law/commercial transactions, healthcare law, and intellectual property. I also provide services as an outside general counsel or “fractional general counsel”. Prior to starting my own law firm, I spent the majority of my career in-house at large and small corporations, both for profit and not-for-profit, working with senior and executive management, in addition to other stakeholders at a variety of management levels. to proactively identify and address risks, mitigate legal exposure, streamline processes, lead persuasive negotiations that are integral to ensuring positive outcomes for the organization, and deliver hands-on, spectacular client service. There came a time when I realized that individuals and smaller entities were not receiving the same level of legal support and guidance as mid-size to large companies and as a result, individuals and small businesses were not growing and sustaining on the same level. I wanted to use my expertise to provide those that were underserved by the legal market with competent counsel at an affordable price. With the increasing number of new businesses, I knew that I could make a difference to those that needed legal guidance but were putting it off in fear of “Big Law” prices. I love to “partner” with my clients, get a deep understanding of their business, develop lasting professional relationships and watch them prosper. I want to find a way to help my clients maximize the reach, value and impact of their business. Services that I have provided over the course of my career: (i) reviewing, drafting and negotiating commercial agreements (leases, MSAs and SOWs, consulting services agreements, confidentiality agreements, SaaS agreements, coaching agreements, independent contractor agreements, coaching agreements, photographer agreements, waivers and releases, licensing agreements, etc.), (ii) business formation (operating agreements, written consents, bylaws, etc.), (iii) preparing policies and procedures for businesses in highly regulated industries, (iv) conducting federal trademark searches and filing trademark applications/preparing trademark opinion letters after conducting appropriate legal research, and (v) general business counsel.

Daliah S. on ContractsCounsel
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Daliah S.

Principal Attorney
Free Consultation
Chicago, IL
20 Yrs Experience
Licensed in IL
University of Illinois College of Law

Daliah Saper operates a cutting-edge internet and social media law practice that regularly leads local and national media outlets to solicit her commentary on emerging internet law issues involving cyberbullying, sexting, catfishing, revenge porn, anonymous online defamation, domain name and user-name squatting, privacy, and the latest business decisions made by social media platforms such as Facebook, Twitter and YouTube. As a litigator Daliah represents companies bringing or defending business and intellectual property disputes. (She has argued cases in a number of jurisdictions including taking a case all the way to the Illinois Supreme Court.) As a transactional lawyer she helps clients choose the right business entity, drafts contracts and licensing agreements, advises on sweepstakes and contest rules, and ensures website terms of use and privacy policies are compliant, and provides comprehensive trademark and copyright counseling. Since founding Saper Law Offices in 2005, Daliah has been named a 40 Under 40 by Law Bulletin Publishing Co., a top Media & Advertising attorney by Super Lawyers Magazine 14 years in a row, and has been repeatedly recognized as a leading media and entertainment lawyer by Chambers and Partners. For the past eleven years, she also has taught entertainment and social media law at Loyola University Chicago School of Law.

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Billy Joe M.

Partner Attorney
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Chicago, IL
15 Yrs Experience
Licensed in IL
University of Illinois at Urbana-Champaign

I graduated from the University of Illinois at Urbana-Champaign in 2006 with a degree in Political Science, Finance, and Economics. I stayed around Champaign for law school and graduated in 2009. I then worked at a big law firm in downtown Chicago. It was boring, so I quit in early 2011. I thought that I could not be happy practicing law - I was wrong. After I quit the traditional law firm life, I began representing my own clients. I realize now that I love helping normal people, small business owners, and non-profits address a variety of legal issues. I hope to hear from you.

Daniel R. on ContractsCounsel
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Daniel R.

Managing Attorney
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Chicago
11 Yrs Experience
Licensed in IL
Gonzaga School of Law

Daniel is an experienced corporate attorney and works closely with corporations, privately held companies, high-net worth individuals, family offices, start-ups and entrepreneurs. Daniel graduated from the Gonzaga University School of Law and is licensed to practice law in Illinois.

Gerald W. on ContractsCounsel
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Gerald W.

Attorney
Free Consultation
Round Rock, Texas
10 Yrs Experience
Licensed in IL, TX
Valparaiso University School of Law

My clients know me as more than just an attorney. First and foremost, my background is much broader than that. Prior to attending the Valparaiso University School of Law, I earned a Master of Business Administration and ran a small business as a certified public accountant. Thanks to this experience, I possess unique insight which in turn allows me to better assist my clients with a wide range of business and tax matters today. In total, I have over 20 years of experience in financial management, tax law, and business consulting, and I’m proud to say that I’m utilizing the knowledge I’ve gained to assist the community of Round Rock in a variety of ways. In my current practice, I provide counsel to small to medium-sized businesses, nonprofit organizations, and everyday individuals. Though my primary areas of practice are estate planning, elder law, business consulting, and tax planning, I pride myself on assisting my clients in a comprehensive manner. Whenever I take on a new client, I make an effort to get to know them on a personal level. This, of course, begins with listening. It is important that I fully understand their vision so I can help them successfully translate it into a concrete plan of action that meets their goals and expectations. I appreciate the individual attributes of each client and know firsthand that thoughtful, creative, and customized planning can maximize both financial security and personal happiness. During my time as a certified public accountant, I cultivated an invaluable skill set. After all, while my legal education has given me a deep understanding of tax law, I would not be the tax attorney I am today without my background in accounting. Due to my far-reaching experience, I am competent in unraveling even the most complex tax mysteries and disputes. My CPA training benefits my estate planning practice, too. In the process of drafting comprehensive wills and trusts, I carefully account for every asset and plan for any tax burdens that may arise, often facilitating a much smoother inheritance for the heirs of my clients. Prior to becoming certified as a CPA, I made sure to establish a solid foundation in business both in and out of the classroom, and the acumen I’ve attained has served me well. Not only am I better able to run my own practice than I otherwise would be; I am able to help other small business owners fulfill their dreams, as well.

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