Is a 2 Year Non Compete for a Nurse Practitioner Reasonable? | NP Non Compete
Is a two-year restriction on a non-compete for a nurse practitioner reasonable? Before I get into that, I’m just going to briefly go over what is a NP non-compete. A non-compete clause is typically listed in your restrictive covenants in your employment agreement or contract. And the non-compete clause is to protect your employer’s interest so that you just don’t cross the street and take all the training and everything that they’ve taught you and then take all their business away and compete with them. That’s where you get the non-compete from. A non-compete clause is enforceable in most states, but you should always check your state law or check with an attorney and have them review your contract.
Should 1 Year Be Listed in the Agreement?
However, if it is enforceable in your state and you have a non-compete, there are normally two parts to it. The first part is going to be the time that you’re restricted from competing with your employer. That’s anywhere from one to three years typically that I have seen. I’ve never really seen it shortened by less than a year, but it’s possible that it could be out there. And then the second part of the non-compete is the restricted area. So, for that period, you may not become employed in that restricted area. And that can be, well, this really varies depending on where you are in the United States. It can be anywhere from one mile or city blocks if you’re in New York City, even to tens of miles. It just depends. And you can always try to negotiate your non-compete clause.
It’s something that I always review when I’m looking over an employment contract because a non-compete clause is serious. And a lot of times, clients don’t think about it until after their employment ends. And then now there are some serious consequences. They may have to move and leave the area after you’ve established yourself there. And it’s difficult. And you also don’t want to worry about violating your non-compete clause because that can have some serious consequences. There could be injunctions, which are basically like a restraining order that your employer will get, saying you cannot work in that area. Sometimes there are liquidated damages which say if you violate the non-compete clause, you must pay tens of thousands of dollars. Other topics of interest include:
- Is 10 Miles a Reasonable Non Compete for a Nurse Practitioner?
- How Many Locations Should Nurse Practitioner Non Compete Apply To?
So, it’s serious. The non-compete clause is an area of concern I always look at when I’m reviewing an employment contract. Back to our question at hand, is two years reasonable for a non-compete? In my opinion, no. I would always try to encourage our clients to negotiate it down to one year or less. Two years is long, and it gets even trickier depending on how the employment contract is written, and I’ll give you an example. Sometimes multiple locations will have that restricted area attached to them. We’ll say something like you’re restricted from 10 miles from any location of the practice. That’s concerning because the practice could grow. So, there could be additional locations. And if you’re restricted for two years after your employment has ended and that practice expands and they add more locations, then you have a serious problem there.
You could have been working at a location and not violating your non-compete, but now you are because they added a location. So, you always want to be careful. One year, in my opinion, is reasonable. But after one year, I think it’s just too much and it’s hard to keep track to know if you’re in violation of it or you’re not. So, yes, I would always try to push for less than two years, absolutely. And again, non-compete clauses are one of the most common things that a prospective employee will negotiate. You always want to be respectful to your employer knowing that they are going to be protecting their interests, but you also want to protect yours as well. And having to worry about that for over a year is just unreasonable, in my opinion. So, I would always push for one year. Two years, I would say, is unreasonable. One year or less.
Is a Health Care Non-Compete Enforceable?
Is a non-compete enforceable against a nurse practitioner? This depends on several factors, but first, let’s start with what is a non-compete. A non-compete clause is normally located in your restrictive covenants within your employment agreement. The non-compete clause is just going to state that for a period, normally anywhere from one to three years, you’re restricted from working in a certain area. And normally, it’s within miles, and depending on your state law, it might be a little bit different how that restricted area is calculated. But for that period, you’re restricted from working in that area so that you’re not competing with your former employer. Non-compete clauses can get really complicated and they’re unique to each situation.
Sometimes it is difficult to know if it’s enforceable. I also think there are a lot of misconceptions out there that if the non-compete clause is stated a certain way that it’s unenforceable and you can get out of it, it’s difficult, I would say, to get out of a non-compete clause that you have signed. Now, if we’re talking about the beginning when you’re negotiating, it’s much easier to negotiate your non-compete clause, but if you are currently employed, you are giving the notice to terminate your employment, and you want out of your non-compete clause, or you want to know if it’s enforceable, this gets a little complicated and I would always advise everyone to meet with an attorney and have the attorney review your documents just so that you make sure because you can have serious consequences.
If your non-compete clause is enforceable and you violate it, there are really two types of legal remedies. The first one, it’s normally listed in your employment contract, this is the most common way. It’s under equitable relief. What this means is that if you violate your non-compete clause, your former employer can take you to a court and normally court for equitable relief. A judge would look at the contract and if it’s enforceable, they would sign something which is like a restraining order or an injunction saying that you cannot work in that area, and you may have to pay for those legal fees. I also have seen contracts where there are liquidated damages. And what that means is, if you violate the non-compete clause, your employer can ask you to reimburse them for tens of thousands of dollars.
It’s serious, so you want to make sure if you’re going to violate it, you really need to know if it actually is enforceable, and furthermore, even if it isn’t enforceable, I would highly recommend advising an attorney because you did sign that employment agreement and therefore, your employer may try to fight this with you. And that can be expensive in legal fees. So, you always want to be careful. Now, going back to, is a non-compete enforceable? If you are in a state which has a law, it is becoming more common. There are about three of them that do not allow contracts or do not allow your employer to enforce a non-compete clause. So, if you’re in one of those states, that’s great. It’s not enforceable.
You should always check your state law though, just to make sure. Now, there is a new trend that I’m seeing some laws going into effect that a non-compete clause is unenforceable if you make below a certain amount of money annually, so you want to check your law there and you want to see how much you’re making. Is it more than that threshold? If it is more, it may include bonuses, so you want to be careful, then the non-compete is enforceable. So, state law is going to be the first place you should look. If your state law does allow for non-compete clauses, most of them stay enforceable, if they’re reasonable. Reasonable is extremely vague, and it’s hard to give clients an exact number of miles or an exact number of years, but normally there is some discretion there.
What is a Reasonable Time Restriction for a Nurse?
A nurse wants to be careful. If it’s over three years, in my opinion, then it’s probably unreasonable for the period. And then also, if it’s wiping out huge areas of a state or even an entire state, something like that, that would likely be unreasonable, but again, you really want to be careful. Most of the time they are enforceable. And so, you want to be careful, you want to protect yourself and you want to make sure you’re doing your research and your due diligence to know if it’s something that you should be concerned about. Now, you can also ask your employer to be let out of your non-compete clause. You are at their mercy there if they’re going to waive that for you. If they ever state that they do, it should really be in writing and signed by both parties. Sometimes I’ve also seen you can buy out of your non-compete clause.
Your employer will say, we will waive this agreement if you pay us a certain amount of money. It’s normally high, but that’s something that you could negotiate. There are some ways around it. But if you signed it and it would be considered reasonable in the court’s eyes, and in your state law, then yes, it would be enforceable. So, you always want to be careful when you’re terminating your employment contract to make sure that you know if you’re going to be violating that non-compete clause.
We are Here to Help
Nurses, if you are considering signing a professional contract with a new employer, we want to help. Please contact us and allow our office to set you up with someone who can review the documents that have been presented to you. We want to ensure that everything that your potential future employer is offering you is in your best interest. Get in touch today to get the process started.
Nurse Practitioner Contract Questions?
Contract Review, Termination Issues and more!