Signing your first non-compete agreement

Published: 2011-07-20 10:01:30
Author: Jean Murray | ChiroEco | July 2011

A non-compete agreement is arguably the most controversial part of any contract. It’s difficult to set a general rule, and the courts won’t enforce the agreement unless it’s “reasonable.”

First, consider the general terms of a non-compete agreement. This part of an employment contract is designed to protect the hiring doctor in case you decide to leave and try to take his or her patients with you.

Non-compete agreements usually take the form of a restriction on three factors:

  1. Scope of activity (practicing chiropractic versus practicing a specific technique),
  2. Range of activity (prohibiting practice within a certain radius from the hiring doctor’s practice), and
  3. Period of restrictions.

What’s reasonable?

Here’s where it gets tricky. What is a “reasonable” restriction? Most agreements broadly restrict “practice of chiropractic.” In regard to a time period, in most cases, two years or less are considered a “reasonable” time to prohibit you from practicing within the region of the hiring doctor’s practice.

The distance restriction is more problematic, as it depends on the area in question. In an area that has a lot of people, such as a suburb, the area of restriction might be no more than five miles. In a rural area, the restriction might be as much as 25 miles.

Non-compete agreements are based on the concept of “restraint of trade.” If the non-compete agreement unreasonably restricts the former employee’s ability to practice, its provisions are not going to be upheld. If the former employee merely engages in “ordinary competition,” i.e., the same level of competition as any other chiropractor setting up practice in the area, prohibiting the former employee from practicing is unreasonable.

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