Champaign-based Jimmy John's has reached a settlement with the Illinois Attorney General on the sandwich chain's non-compete agreements for its employees.
Lisa Madigan filed a lawsuit in June against Jimmy John's for imposing "highly restrictive non-compete agreements" against low-wage staff members, which she said at the time were illegal and unenforceable. Employees were required to sign the agreement which said they cannot work for another similar sandwich eatery within two miles of a Jimmy John's for two years after they stop working for the company. The restaurant chain has nearly 300 locations in Illinois.
But under the deal announced Wednesday, the sandwich company has to notify all current and former employees that their non-competition agreements are unenforceable and confirm that Jimmy John's does not intend to enforce them. The company also has to pay $100,000 for education and public awareness on the issue.
Starting in January, the Illinois Freedom to Work Act will prohibit use of non-compete agreements for employees earning less than $13 per hour.