Never – ever – sign employment contracts without your own attorney reviewing the agreement with you. Particularly in a rural area, a 75 mile non-compete clause is probably overly broad. But the time to negotiate that was when the contract was signed, not six years later when there is a dispute. Thomas claims that she was fired, and therefore the clause is void. The remaining FMC partners say otherwise, and are enforcing the clause. Both parties will be spending legal fees over a bad contract. A radius of 5-10 miles is often reasonable, but 75 miles? Oh, please.
In Campbell County, WY, the hospital has completed a study calling for several more primary care physicians, so a non-compete may really not be a necessity. What could be reasonable would be a non-solicitation clause, whereby the doctor who leaves cannot solicit patients of their former practice. Patients are free to follow, of course.
Here’s the issue: FMC wants to hire another physician, in this case Thomas. They will pay her a salary, they already attract a flow of patients, some of whom will be directed to her, so Thomas is able to build a practice partially based upon the goodwill that FMC and the physicians have developed over the years. If this physician, in this case Thomas, leaves and sets up their own practice, why should they benefit from the investment and goodwill that flowed from FMC? Shouldn’t FMC be compensated in some way for this, or, shouldn’t there be restrictions on where Thomas conducts business to restrict the ability to benefit from FMC’s investment and goodwill?
Non-compete and non-solicitation agreements are a good practice when hiring new physicians. If you are the candidate being hired, don’t just roll over and take whatever is handed to you. Get your attorney to review it, and if it is unreasonable – as the FMC clause is, regardless of what the court rules – don’t sign it, even if you have to walk away from the job. You can offer a more reasonable clause as a negotiating tactic – one that offers some protection to the employer, yet allows you to earn a living by practicing your profession. And this is the key point: both parties want and need reasonable protections, and there is a middle ground. Someone may have told them to ask for a big radius, so you may have to convince them that a 75 mile radius – or a 25 mile radius – is unreasonable and inherently meaningless. Convince them that you understand and respect the needs of t he practice, and you have some needs as well, so your proposal is a reasonable compromise that protects both parties. Throwing in a non-solicitation clause may also sweeten the proposal – that’s what the practice is really concerned about anyway.
Business advisors such as attorneys are valuable to a practice and to you on a personal level. What you want to look for is someone who knows the law – and understands that this is about doing business together, it’s about people working together. It’s not about beating the other guy, it’s about making something happen.