Career and Life Planning Guidebook for Medical Residents

Each state has its own laws and judicial precedent regarding non-competes. Jon Appino, principal at Contract Diagnostics, states; “There are many state nuances - and it is changing by the month. There are many industries impacted by non-competes and the legislation going on currently is being driven by not only physicians but the tech sector as well. It is important to know this in the state you are working in. Many are beginning to add in liquidated damages or buy out clauses as well.” Courts will determine the enforceability of non- competition provisions based on the facts and circumstances of each situation so it is paramount to negotiate such provisions when entering into the contract and to understand completely how the provision will impact you under all circumstances of your potential termination of employment. An attorney can assist you in obtaining the best possible contract, provisions and understanding cost and benefit factors and limitations which will arise if and when you decide a change of employment is desirable. The non-compete clause is one of the most sensitive parts of an agreement from both the physician and employer perspective. Physician’s Perspective We understand you will have some anxiety about signing an employment agreement with a non- compete clause. It’s a challenge not to think about the “what if” scenarios, such as: What if I’m not happy in my position? What if my employer sells to another organization, the culture changes, and my values are no longer aligned? With a non-compete included in your agreement, you’ll most likely need to move, or at the very least, commute, outside of the employer’s service area in order to practice. Having to pick up and move after setting roots in the community may make you feel trapped if you decide to stay and overwhelmed if you decide to uproot your family. Employer’s Perspective on Non-Competes An employer takes significant risk when employing you regardless of whether you generate enough revenue to cover your salary, benefits, support staff, rent, and other office expenses. Further, unless there is a non-compete clause, employers will risk paying you hundreds of thousands of dollars only to see you setup shop across the street or join their biggest competitor down the road and potentially losing their patient panel and market share. Will An Employer Remove or Negotiate a Non- Compete? Because of the risk taken by employers, including the substantial investment in developing physicians and introducing them to patients, it is very unlikely that you can succeed in removing a non-compete from your agreement. On the other hand, your non- compete should reflect a narrow geographic region and contain a reasonable period of time following your termination of employment. Employment Law For Physicians 321 WWW.PHYSICIANCAREERPLANNING.COM