Non-Compete Agreements: Contract Considerations for Audiologists and Speech-Language Pathologists

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Considerations for Employees
Considerations for Employers

Considerations for Employees

Being offered a new job or contract is exciting! It’s tempting to skim and sign the paperwork to get on to the important work of helping people and, of course, getting paid for your work. However, it’s vital that you take your time to carefully read each document, including the fine print.
When reviewing a contract, it’s critical to understand any provisions that could impact your future employment should you decide to leave. Non-compete agreements (“Non-competes”) can vary widely in the limitations they provide on geographic distances, settings, and duration, so it’s essential to understand the full implications prior to signing. Additionally, you should understand what local, state, or federal laws allow (or do not allow) as part of a non-compete agreement.

Employment options where you live

In a large city, a non-compete agreement barring employment within a few miles of your current employer may not be too restrictive as there are many potential employers. However, in a small town, a few miles may mean all your employment options are in a completely different city. Consider the location of other employment opportunities in your area, as well as how multiple satellite locations of the same employer will be handled, before committing.

Commutes

You should also consider the physical distance of future employment vs. the actual commute time. In rural or suburban areas, 20 miles may equate to 20 minutes of travel time. In large metropolitan areas or mountainous regions, 20 miles could take hours due to traffic and/or terrain. Think about what commuting outside of the non-compete agreement’s geographic area would realistically look like day-to-day.

Settings

Is the non-compete agreement setting specific? Are you barred from providing any audiology or speech-language pathology services within a certain radius for a set amount of time or is it limited to specific settings (e.g., schools, hospitals) or populations (e.g., pediatrics, geriatrics) that are in direct competition with the current employer? For example, if you’re in a private practice, does leaving to work in a physician office, skilled nursing facility (SNF), or a hospital violate the contract? Are you able to pick up PRN or “as-needed” employment or private clients outside of your main employer?

Trade-offs

Is the employer offering anything to offset your potential limitation on earnings? Are they willing to pay a premium to compensate for your more limited employment opportunities for the duration of the non-compete? If not, are the terms of the non-compete negotiable? Is there a compromise (See alternatives to non-compete agreements) that will help the employer feel protected while maximizing your future employment opportunities?

Setting-specific considerations

Private practice: Does your non-compete bar you from contracting with other private practices? Starting your own private practice? Contracting with facilities as an individual practitioner? How will the employer handle requests from established patients to follow you to your next employer?

School-based contractors: Does your contract preclude you from being hired directly with the school district? What happens to your employment if your company loses the school contract?

Skilled nursing facility (SNF): If your facility changes contracts, are you able to stay on at the same facility, or will a non-compete compel you to change facilities? Are you barred from being directly hired by other facilities or working for multiple facilities simultaneously?

Telepractice: If your home is within the geographic radius covered by a non-compete agreement, are you barred from providing telepractice from your home? Does the non-compete exclude patients in the geographic area if they are being seen via telepractice and not face-to-face?

Signing a non-compete agreement can have significant limitations on your future employment and life choices. Reading carefully, asking questions, and negotiating can ensure that both you and your employer are comfortable with the terms of your employment.

For additional tips see Navigating the Offer and Before You Accept a Job Offer, Negotiate.

Considerations for Employers

As an employer, protecting yourself and your business is a key component of any employment offer. Non-compete agreements and alternatives, such as non-disclosure agreements, can be used to protect your business. If you are considering including a non-compete clause in your employment contracts, explore their legality in your state and consider alternatives to non-compete agreements. It’s important to consider whether such alternatives improve your ability to both protect your business and expand the pool of qualified candidates.

Referral sources

Promoting, marketing, and securing new client referrals requires an investment of time, money, and relationship building. What is your plan to maintain your referral sources? How will you balance employee access and fair market competition with securing a pipeline of future clients?

Clients

In service professions like audiology and speech-language pathology, the ability to retain clients despite employee turnover can make or break your business. Do you have a plan in place to ensure that employees don’t take their caseload with them when they leave? How do you plan to handle cases where clients require specialized care that remaining clinicians are not trained to provide? What action could or would you take if an employee does in fact take clients with them when they leave? How do you protect a patient’s right to see the clinician of their choice?

Education and Training

As an employer, investing in an employee’s training or education builds a skilled workforce for your company while boosting employee recruitment and retention. How will you ensure you are getting an adequate return on your investment? How will you protect yourself from employees who leave your employment as soon as their training is complete

Trade-Offs

Non-compete agreements can add a needed level of protection for employers. However, when recruiting, some candidates may be uncomfortable with a non-compete agreement because it could limit their future employment opportunities. If you are faced with the decision between maintaining a non-compete agreement as a condition of employment or hiring the best talent available, consider whether there is an opportunity for negotiation by using an alternative to a non-compete agreement. Would the employee be willing to accept future employment restrictions if they are compensated an additional amount? Will they accept a shorter timeframe on restrictions (e.g., 12 months post-employment instead of 18 months)? Would they sign a non-disclosure agreement or other document that adequately protects your investment as an employer?

Engaging in open discussion with potential hires and considering alternatives to non-compete agreements can help you find a mutually beneficial employment agreement. Additionally, considering alternatives to non-compete agreements can provide adequate protection for your business while ensuring employee satisfaction.