Doctor Employment Lawyer Blog

While you may think that the non-compete provision in your employment agreement is just a standard term that can be addressed when the time comes for you to move on, it is in fact a powerful tool to restrict you from practicing medicine in a specified geographic area.

Earlier this week it was reported on the Indianapolis Business Journal at IBJ.com that Indiana University (IU) Health Morgan Hospital has file suit against a primary care physician alleging that she signed a non-compete agreement with the hospital, and that she is now attempting to breach that agreement by moving her practice to Franciscan St. Francis Health. IU Health is seeking a preliminary injunction to stop the physician's move.

Even when a non-compete is unenforceable, being sued by a hospital with deep pockets is a strong deterrent to violation. Litigation can, and often does, take years. When accepting a new position, many physicians don't even contemplate the possibility that their employment agreement might interfere with future employment options.

Many of the physicians we work with do not believe that the employer who is hiring them might someday sue them for trying to leave. Before you sign a physician employment agreement, if the hospital or practice group tells you "we never enforce those provisions," ask them to put that in the agreement.

In Illinois, the terms of a doctor's non-compete agreement must be "reasonable." That can mean a lot of things. When the courts say reasonable in this context, they usually are referring to the time period and the geographic scope. Depending on the specifics, a 5 or 10 mile radius around your practice for a year or two is more than likely going to be considered "reasonable."

But, practice groups have gotten smart. Rather than be limited to a radius around the primary practice location, many employers are drafting their physician employment agreements so that the employees are restricted from employment within that radius around every location at which they practice. The effect is that an employed physician is completely blocked out of the market if his/her employment is ever terminated.

A doctor has very limited leverage through which to renegotiate a non-compete on the way out the door. Make sure that your definition of reasonable and your employer's definition of reasonable are consistent when you are starting your employment. Because it almost certainly won't be when you leave it.