Time and geography are common elements in a non-compete agreement for physicians.
The Element of Time
The first element in a non-compete agreement is time, which restricts your being able to compete within a certain amount of time. This might mean one year or two years after you leave your employer, you would not be able to compete with them.
The Element of Geography
The second element is geography. Where in Florida will you locate your office? Geography also differs depending on what your position was, but whether it’s a non-compete within five miles, within 20 miles, 100 miles, or the entire state, the location of your business is limited.
Physicians have a unique exception to some of these non-compete clauses because patients come usually within a certain mile radius although there are exceptions to this depending on the kind of medical procedures.
The Provision of Confidentiality
The other important provision to consider in a non-compete is the confidentiality of patient records, who owns the patient records, and who owns the relationship with the patients.
Sometimes you may have come to a practice with a thousand patients from your previous position. Even some of these patients may also fall under the non-compete, so your employer will try and limit your ability to continue to see them if you go somewhere else. You could also not be able to work in the same hospital, you may not be able to work in several buildings or clinics, or even be listed on a provider list that you may not control.
In Florida, we at Roush Law Group have seen all kinds of attempts by employers to limit and enforce the non-competes.
Understanding Your Non-compete
It’s important to understand your non-compete so you don’t violate it.
Let’s say you leave your employer and go and work for a competitor. What typically happens is your old employer doesn’t sue you directly. They file what’s called an injunction against your new employer. Now what this injunction does is it keeps your new employer from hiring you because it allows you to compete against them.
Your New Employer Gets The Injunction
A resulting injunction names physicians and most employees, but it’s the new employer that receives the injunction, and the injunction just says, “You can’t hire this person because by doing so they’re violating the non-compete.”
Some competitors understand the injunction and are willing to pay the legal fees and the costs of defending that non-compete, but some don’t. Some employers may just say, “Hey, you can’t work here because they’re going to sue us. You need to resolve it or you need to go work somewhere else for a year and then come back.”
Some former employers would be willing to do a carve-out. They would carve out some portion of the market, whether it’s patients or a geographical area, or even reduce the amount of time from a year to six months.
What We Look For
In going through your contract, we look at the different areas to identify what the employer wants to protect most.
Under Florida law and most states, the employer can only enforce the contract in such ways that it protects a true business interest.
For example, you can’t steal your employer’s clients or customers. You also can’t take your best nurse with you and start your own practice across the street. This goes for any non-compete, not just medical professionals. Consequently, you can’t take your customers with you, you can’t take your vendors with you, and you can’t take your employees
Let’s Make A Deal
Now, you could negotiate to open up your own practice a couple of miles away. You can also agree to take on some level of work at some point for a while under a contract with them, and you can also agree to only practice in a certain area. Depending on what kind of specialty you have, you may be able to see some patients about certain things. Then if something comes up that is not in that area, you could agree to send the patient back to them.
For example, let’s say you’re a pediatrician. You may send a surgical patient back to your previous employer, but you would see all the in-office patients. There are all kinds of creative ways to negotiate some kind of settlement. However, you don’t want to walk away from a situation and end up in a lawsuit because you just didn’t bother to ask your employer what it is they want, what it is they’re trying to protect, and if could you work out some kind of agreement.
And sometimes it does come down to money or it comes down to some creative alternative. They want to protect their nurses and staff. They don’t want you taking the staff with you.
It depends on the practice, the market, and the area. Your relationship with your former employer, whether it’s the managing physician or the managing partner in the practice, goes a long way.
I’ve seen nasty relationships turn into nasty lawsuits. I’ve also seen difficult relationships turn into wonderful relationships. Once the two parties quit working together, they communicated. They didn’t have to see each other, and they could do things their way. Without that restriction, they were ultimately better partners.
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