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To Compete or Not to Compete?

by  |  General

1221952_to_sign_a_contract_3As a business and healthcare litigation firm focused exclusively on advising and representing health care providers, we work virtually every day with contracts that involve non-compete agreements and other forms of restrictive covenants.  Almost all physician employment, for example, will involve a physician employment agreement that contains a restrictive covenant.  Typically, a restrictive covenant will apply to prohibit certain competitive activities both during the employment and for some agreed period following employment, often one to three years.  The details of such agreements can vary dramatically and, contrary to the impressions of many medical practice owners and employed physicians, there are not “standard” provisions for duration, geographic scope, etc.  Further, Georgia and South Carolina case law and relevant statutory provisions are subject to interpretation, about which reasonable minds can often differ.

As a healthcare law firm, we are exposed to agreements on the transactional end, when the parties get married (i.e., when they sign the contract), and when they divorce (i.e., when the employment ends).  If a non-compete issue is raised at the end of the relationship, the implications for employer and employee can be severe and, in unfortunate cases, devolve into litigation.  For a highly compensated physician, whose ability to ply his/her trade following many years of education and training is suddenly impaired by the signed contract, whether to proceed with certain employment opportunities (that might violate a non-compete agreement) can make for a highly stressful decision-making process.  Some factors that physicians may consider follow.

Should you determine if the non-compete agreement is enforceable?