If you are a physician about to finish training, the concept of a non-compete clause may be relatively new to you. Non-compete clauses go back nearly one thousand years and were created so that employers could protect their business interests from skilled workers leaving their employment.
This is especially true for physicians, who continue to hold some of the most valued skills and expertise of any profession.
Employers claim that non-competes are crucial for protecting them from competition from former employees. This is true, to an extent. However, non-compete clauses can go too far, especially if a physician doe not have their contract negotiated or reviewed by a specialized physician contract attorney.
So what options does a physician, who is limited by an extensive non-compete, have after leaving a practice?
Here are few options:
Termination Without Cause
If you are fired without cause, you may have a good case for voiding your non-compete clause. When no good reason or cause is offered, the employer has essentially characterized you as non-essential to their business purposes.
As such, you would no longer pose an outside business threat if you were to practice with a competitor or a nearby community.
When you enter into an employment contract, the employer is equally responsible for holding up their end of the bargain. When they fail those duties, whether it be not meeting the agreed-upon compensation or disregarding your agreed-upon schedule, you may have a case for dissolving your non-compete clause.
Terms that the employer might not hold up include: insurance, vacation, and retirements plans. If your employer is not meeting these promises, it has important implications for the non-compete clause as well as the makeup of your entire contract. Make sure you have a physician contract attorney review your contract before making any of these determinations.
Physicians hold a unique position where their profession has large implications on the health of a population. Since non-competes are based on geographical location, restricting where physicians can and cannot practice can also have large public health implications.
This provides an avenue for physicians to dispute their non-compete clauses. If you can argue that your non-compete negatively impacts the level of care in a region, especially in a medical underserved area, then you may have a good case for escaping your non-compete, as it could be contrary to public policy.
Non-compete agreements are limited by time to ensure that employers cannot exercise too much power over physicians. Each state has its own laws as to what a reasonable amount of time is for non-compete enforcement.
For example, most states conclude that time periods between one and three years may be reasonable. If your contract falls into that category, a fact specific analysis would need to be done in order to determine if your non-compete is valid.
Also, each state has a maximum time cap, such as five or ten years, where a non-compete cannot still be deemed enforceable. This is specific to practice state and you should consult with a physician contract attorney if you have questions
Hard to Navigate
All the specific terms and conditions of your non-compete clause may seem hard to interpret. Do not give up and accept an unfair non-compete agreement because it seems too complicated to overcome. There are specialized physician contract attorneys that focus solely on making sure you get a fair employment contract.
If you have questions or concerns about your employment contract, contact Resolve. We contract with the nation’s top physician contract review team and we would be happy to help you with your needs.