Illinois appellate courts have adopted a bright-line rule that requires at least two years of employment for a restrictive covenant’s (e.g. covenant not to compete) enforceability. This means that an employee must work at least two years with the employer in order for the employer to enforce the restrictive covenant. In a recent case, one justice filed a dissenting opinion criticizing this approach, and advocated for a case-by-case determination. McInnis v. GAG Motorcycle Ventures, Inc., 2015 IL App (1st) 130097, ¶ 55 (Ellis, J., dissenting).
Some federal courts in Illinois that have dealt with this exact issue have rejected the two-year rule because the Illinois Supreme Court has not adopted it. Id. ¶ 67. Federal courts are obligated to follow the highest court in the state, or in the absence of an opinion on the subject, the federal court tried to predict how the state high court would rule. Id. Some federal courts think Illinois’ Supreme Court would reject the two-year rule. Id.
Thus, whether an employee’s restrictive covenant is enforceable can depend on what court system the case is brought—Illinois state court or federal district courts in Illinois. Until the Illinois Supreme Court addresses the issue, the adequacy of the length of continued employment as sufficient consideration for a restrictive covenant will remain in limbo.