Illinois noncompetes are easy to get wrong and expensive to enforce, and 2026 added a new twist: while the federal picture shifted, Illinois law stayed strict. If you are an employer still using the noncompete you copied years ago, there is a real chance it is void as a matter of law. This guide covers the seven rules that decide whether Illinois noncompetes hold up, including the current salary thresholds, the procedural steps the Freedom to Work Act demands, and what the FTC’s reversal does and does not change.
The short version: state law is what actually governs your agreements, the dollar thresholds move over time, and the paperwork around signing matters as much as the restriction itself.
What You’ll Learn
- The 2026 salary thresholds that make Illinois noncompetes enforceable or void
- The Freedom to Work Act’s notice and consideration requirements
- What the FTC’s 2026 reversal means for your agreements
- Which workers can never be bound in Illinois
- How courts treat overbroad covenants
- What to fix before you ask anyone to sign
The 2026 Salary Thresholds Behind Illinois Noncompetes
The Illinois Freedom to Work Act, codified at 820 ILCS 90, sets hard income floors. In 2026, a covenant not to compete is only enforceable against an employee who earns more than $75,000 per year in actual earnings. A non-solicitation covenant is only enforceable against an employee earning more than $45,000. Below those numbers, the restriction is void and unenforceable, not merely voidable at a judge’s discretion.
Those floors rise on a schedule. Effective January 1, 2027, the noncompete threshold climbs to $80,000 and the non-solicitation threshold to $47,500, with further increases to $85,000 in 2032 and $90,000 in 2037. Employers should map every restricted employee against the current number, because a raise or a new hire can move someone across the line. You can read the statute on the Illinois General Assembly site.
The Freedom to Work Act’s Notice and Consideration Rules
Hitting the salary floor is necessary but not sufficient. The Act also imposes procedural steps that void an otherwise-valid agreement when skipped. The employer must give the employee at least 14 calendar days to review the agreement, and must advise the employee in writing to consult an attorney before signing.
Consideration matters just as much. Illinois courts generally require at least two years of continued employment after signing, or other adequate professional or financial benefits, before a restrictive covenant is enforceable. Dropping a noncompete on a new hire’s first day with nothing more than the job offer is a classic way to end up with an unenforceable clause. Our deeper walkthrough of the Illinois non-compete agreement rules covers the mechanics in detail.
What the FTC’s 2026 Reversal Means for Illinois Noncompetes
For a while it looked like Washington would settle this nationally. It did not. The FTC’s 2024 rule banning most noncompetes was blocked by a nationwide injunction in Ryan LLC v. FTC, the agency withdrew its appeals in 2025, and it formally removed the Non-Compete Clause Rule from the Code of Federal Regulations effective February 12, 2026.
The practical result is that noncompetes are governed by state law, which for Illinois employers means the Freedom to Work Act, full stop. The FTC has not walked away entirely; it can still challenge specific agreements under Section 5 of the FTC Act, and in recent enforcement it pushed large employers to release tens of thousands of workers from broad restrictions. The FTC’s noncompete page tracks that case-by-case approach. Do not treat the rule’s withdrawal as permission to over-reach.
Which Workers Can Never Be Bound
Some Illinois workers are off-limits regardless of pay. The Act bars noncompetes for employees covered by certain collective bargaining agreements and for construction workers. It also restricts covenants against employees terminated or furloughed because of business circumstances like a public health emergency unless the employer keeps paying them through the restricted period.
Layer on the general rule that covenants must protect a legitimate business interest, be reasonable in time and geography, and not impose undue hardship, and you can see why so many form agreements fail. For employers who lean on confidentiality and customer relationships, a well-drafted non-solicitation or trade-secret clause often does more real work than a broad noncompete.
How Illinois Courts Treat Overbroad Covenants
Illinois courts can reform, or blue-pencil, an overbroad covenant, but they are not required to, and many decline when an agreement is so sweeping that fixing it would mean rewriting the deal. Judges are especially skeptical of nationwide scope, multi-year terms, and clauses that would keep someone from working in an unrelated role.
The lesson is to draft narrowly the first time. A tight, defensible covenant beats an aggressive one a court will not save. The same discipline applies across the region; see our companion guides to Wisconsin noncompetes and Wisconsin employment agreements for how a neighboring state handles the same tension.
What to Fix Before Anyone Signs
Run the checklist before your next hire signs anything. Confirm the employee clears the current salary threshold, provide the 14-day review window and the written advice to consult counsel, ensure real consideration, and narrow the scope to a legitimate interest. Then align the restrictive covenant with your other policies, from pay transparency to data handling, so the whole employment package is consistent.
Employers juggling multiple Illinois obligations should also review our notes on Illinois paid leave and pay transparency and Illinois BIPA and fingerprint timeclocks, because the same handbook update is the natural moment to fix all three. When a departing employee actually violates a covenant, enforcement moves to litigation, handled by our colleagues at Howard Law Group. Cannabis operators, who often use noncompetes for key licensees and managers, should coordinate with Cannabis Industry Lawyer so a covenant does not collide with licensing rules.
This summary is specific to Illinois. Check your state’s law before acting elsewhere.
Frequently Asked Questions
What is the Illinois noncompete salary threshold in 2026?
In 2026, a noncompete is only enforceable against an employee earning more than $75,000 per year, and a non-solicitation covenant only against an employee earning more than $45,000. Agreements with workers below those numbers are void as a matter of law.
Did the FTC ban noncompetes?
No. The FTC’s 2024 rule was blocked in Ryan LLC v. FTC, the agency withdrew its appeals in 2025, and it removed the Non-Compete Clause Rule from the federal regulations effective February 12, 2026. Noncompetes are now governed by state law.
How long must an Illinois employee be given to review a noncompete?
The Freedom to Work Act requires at least 14 calendar days to review the agreement, plus written advice to consult an attorney before signing.
What counts as adequate consideration for an Illinois noncompete?
Illinois courts generally require at least two years of continued employment after signing, or other adequate professional or financial benefits.
Will the thresholds change after 2026?
Yes. On January 1, 2027 the noncompete threshold rises to $80,000 and the non-solicitation threshold to $47,500, with further scheduled increases in 2032 and 2037.
Next Steps
Not sure your restrictive covenants still hold up? Have them reviewed before you need to enforce one. Contact Howard East to bring your Illinois noncompetes in line with the 2026 rules.
This article is general information, not legal advice. No attorney-client relationship is created by reading it. Attorney Advertising.
