Independent Contractor Non-Compete Agreement

First, Thank You for your time and reply. I am an independent 1099 health and life insurance agent. I would be working for the company in Illinois. I am considering employment with a Florida based insurance agency that wants me to sign a one sided, restrictive, 2 year non-compete agreement. It's important to note that they specifiy in the agreeement that there is no employeee and employer relationship that exists. I pay all my expenses and get zero benefits - the position is 100% commission. Can they enforce this agreement on me as an independent agent and non-employee ?

1 answer  |  asked Jun 10, 2009 01:18 AM [EST]  |  applies to Illinois

Answers (1)

Neil Klingshirn
Non-competition agreements are not limited to employment relationships. They show up in other types of contractual relationships as well, like independent contractor agreements and agreements for the sale of a business.

The further a contract is from the employment relationship, the less scrutiny courts tend to give it for overreaching restrictions. Courts have upheld non-competition agreements for up to five years in connection with the sale of a business, for example. As an insurance agent, though, I suspect that most courts would interpret and enforce an insurance agent independent contract non-compete the same way they would for an employee.

I realize this answer is a bit late to help you with the situation that prompted your question, but I thought it a good question and thought it deserved a better late than never answer in case someone has it again.

posted by Neil Klingshirn  |  Oct 4, 2014 1:50 PM [EST]

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