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