4 Questions New York Physicians Should Ask to Beat a Non-Compete Agreement
Mar 27, 2023
| By Ottinger Employment Lawyers
| Read Time: 6 minutes
For workers in any industry, non-compete agreements are bad news. If you’re a medical professional, these contracts can prevent you from seeking more competitive pay or pursuing your professional goals by starting your own practice. According to the New York Times, 45% of primary care physicians in a survey of five states were bound by covenants not to compete. Because of the negative impact that non-compete agreements have on workers and the economy, many states have restrictions on when they can be enforced. In New York state, non-compete agreements have to meet four essential criteria — otherwise they’re invalid. In this blog post, we’ll walk you through what the law in New York says about non-compete agreements, the key factors that make an agreement enforceable, and how doctors can fight these restrictions. If you are a physician, and have questions about non-compete agreements, please contact us online or call 347-492-1904 today. What Are Physician Non-Compete Agreements? A non-competition agreement prevents a doctor from competing with their current employer, partners or associates during and after the end of the current relationship. These clauses (usually included in your employment contract) can include specific limits on the geographic area where physicians can find jobs, as well as the time period when they can take a new one. For example, an orthodontist whose company is located in Manhattan might be forced to join a new practice in Brooklyn or Queens. Supporters of physician non-compete agreements say that these contracts legitimately protect employers’ investments in providing specialized training for doctors. These protections also prevent unfair competition, loss of the employer’s confidential business information, and the loss of patients from established practices to departing physicians. But for medical professionals, non-compete agreements don’t just risk harming doctors’ career goals and potential wages. They can also inhibit patient care by preventing doctors from continuing to treat current patients after they leave their current employer. For instance, a non-compete could prevent a surgeon who moves to a new hospital from seeing any previous patients for up to two years after they end their previous position. Some states, like Massachusetts and California, place severe limitations on physician non-compete agreements, or have them banned altogether. These states may disfavor any and all “restraints on trade.” Or they may assess patient choice and continuity-of-care as higher imperatives of the healthcare industry than its commercial interests. In New York, courts generally are not in favor of enforcing employer non-compete agreements. Contracts restricting physicians from competing with a former employer or associate will be enforced only if they meet certain requirements. Valid non-compete agreements must be: What Makes A Physician Non-Compete Agreement Enforceable In New York? An employer’s non-compete agreement can only be enforced if it meets these four criteria. When courts consider if one of these contracts should be enforced for a medical professional, they’ll consider the following questions. Is The Restriction Reasonably Limited In Time, Geographic Area, And Scope? Non-compete agreements need to have “reasonable” limits for physicians. But what a court considers to be reasonable can vary according to the specific facts and circumstances of each case. For instance, in 2007, a New York court found a three-year ban on competition to be reasonable in the case of an ear, nose, and throat doctor who left his prior practice. Whether a geographic limit is reasonable can depend on where you are. Many agreements prohibit competition in specific counties, or in a 15-30 mile radius around the location of the former employer. But for a physician practicing in Manhattan, a restriction of 30 miles may not be considered reasonable. In this case, a 30-mile ban would more than encompass the entire area of Manhattan, and thus would almost certainly exceed what would be necessary to protect the employer’s legitimate business interests. The non-compete agreement’s terms also have to be limited in scope, meaning the agreement has to name specific branches or sub-specialties of medicine that the employer or firm considers its competitors. An agreement that prohibits a doctor from practicing any kind of medicine whatsoever is too broad. In that case, a judge could throw it out, or demand that it’s revised. Is The Restriction Necessary To Protect The Employer’s Interests? Employers seeking to enforce physician non-compete agreements must be able to demonstrate that they have a protectable business interest — not just a desire to avoid competition. For medical practices, these interests could include proprietary techniques, investments in professional or specialized training provided to physicians, or goodwill and established client relationships. In New York, professionals such as physicians are considered to provide “unique or extraordinary” services. This means courts can give greater weight to the interests of employers in restricting competition within a confined area. In the past, courts have enforced non-compete bans on those grounds: for instance, when an employer can show they’ve gone to great expense to bring a doctor to a specific community, without which the physician wouldn’t have been able to get the position with a nearby competitor. Is The Restriction Harmful To The Public? Since physician non-compete agreements can limit the rights of patients to receive care from the doctor of their choice, there is usually some case to be made that a non-competition agreement would be harmful to the public. There could be cases where enforcement of a non-compete agreement might lead to a shortage of doctors in a particular area or within a particular specialty. Or, it might prevent a patient from being able to continue a course of treatment without disruption. These types of negative impacts are even acknowledged and addressed in the American Medical Association’s Code of Medical Ethics. The Council on Ethical and Judicial Affairs, which maintains and updates the AMA’s Code of Medical Ethics, warns physicians that they should avoid entering into contracts that unreasonably restrict their ability to practice medicine. They also warn to not enter into contracts that don’t make “reasonable accommodation for patients’ choice of physician.” Ultimately, though, the AMA’s Code of Ethics doesn’t prohibit doctors from […]
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What are the Meal and Rest Break Requirements for California Employees?
Mar 24, 2023
| By Ottinger Employment Lawyers
| Read Time: 6 minutes
California Meal And Rest Break Requirements For Employees Although employees in California are protected by some of the strongest employment laws in the U.S., workers here also experience some of the highest rates of employer wage theft in the country. One of the most easily overlooked ways that employers steal from their workers? Violating their rights to meal and rest breaks. Cutting short required break times, pressuring or incentivizing employees to work through them, or making it impossible to even take a break in the first place — all of this is considered a form of illegal wage theft under California law. And it costs California workers an estimated $2 billion per year. In this blog post, we’ll break down what California’s labor law says about meal and rest periods. We will also go over what kinds of workers are and aren’t entitled to these breaks, and what actions you can take to get restitution when your right to a break is violated. If you have questions or would like to speak with an experienced California meal and rest break lawyer, please contact us today. When Are Workers Entitled To Meal Breaks In California? Under California law, a meal break is an unpaid, uninterrupted period of at least 30 minutes during which employees are totally free of their work duties. Employers are required to respect workers’ rights to these breaks — it’s illegal to discourage you from taking them or incentivize you for skipping them. In California, the timing of your meal breaks is determined by the number of hours you’ve worked in your shift. Nonexempt employees — workers paid hourly — are legally entitled to one 30-minute meal break for every five hours of work. According to the law, your break should technically come before the end of your fifth hour of work. So if you’re a dishwasher and your shift started at 12 p.m., the law says that you’re due a meal break before 5 p.m. Working more than 10 hours? You get a second 30-minute meal break sometime before you reach that tenth hour of work. Despite what its name implies, you’re not required to eat during your meal break. Employees can spend this time however they want — on meals, personal business, or even running errands. During this period, the law says you’re free from any work responsibilities and are entitled to come and go as you please from your place of work — for at least 30 minutes. There are some situations when workers may not be able to exercise as much freedom during their meal breaks due to the nature of their jobs. Employees who are on a shift alone, or in a remote location — like a nighttime security guard, or a lone worker at a coffee kiosk — can’t be totally relieved of their duties, as the law requires. In these cases, “on-duty” meal breaks can be allowed, as long as both the employee and employer agree to them in advance and in writing. Workers must be allowed to revoke their agreement at any time. They also must be paid for their break time according to their regular rate of pay. Another special case is when employees are required by their jobs to stay on-site but can be fully relieved from their duties for meal breaks. In these situations, workers are also entitled to be paid for their 30-minute breaks, as well as access to a sheltered place where they can prepare and consume hot food or drink. Want to skip your meal break? That’s fine, as long as you’re working a shift that’s no longer than six hours, and both you and your boss consent to it. Your waiver doesn’t have to be formalized in writing — a verbal agreement is fine. If your shift is longer than 10 hours (but no more than 12), you can technically waive your right to the second meal break, as long as you take your first one. Waiving both breaks in one workday is prohibited. Also, be aware: Opting out of your meal break doesn’t necessarily mean you’re allowed to leave work any earlier. In California, the majority of workers who are covered by meal break protections are nonexempt or hourly workers. But many exempt or salaried employees who work in certain professions and meet minimum earning requirements must also receive them. When Are Workers Entitled To Rest Breaks In California? In California, in addition to meal breaks, some workers are also entitled to rest breaks: one 10-minute break for every four hours of work. California law recommends that employers give these breaks as close to the middle of the four-hour work period as possible. But in cases when that’s difficult, breaks can be legally taken at another point in the work period. Like meal breaks, these rest breaks are required to be uninterrupted blocks of time when workers are fully relieved from their job responsibilities. Also like meal breaks, they’re timed and calculated based on total daily work time. Employees should receive a break for every four hours worked, or after a “major fraction” of that work period. A “major fraction” of a four-hour work period is anything more than two hours of work. So if you’re working a seven-hour shift, you get two 10-minute breaks: one for the first four hours, the next for the last three hours (which is more than half of a four-hour work period). But if your daily shift is less than 3.5 hours long, you’re not entitled to a rest break by law. Rest breaks are also different from meal breaks in a couple of ways: Importantly, only “non-exempt” (hourly) workers are entitled to rest breaks under California law — employees designated as “exempt” workers are not. However, if you’re an employee with an infant child, your employer is required by law to allow you lactation breaks to express milk for your child — provided they don’t exceed a “reasonable” amount of time. If your employer refuses, […]
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Why California Executives Can’t Afford to Ignore Non-Compete Agreements
Feb 23, 2023
| By Ottinger Employment Lawyers
| Read Time: 5 minutes
Across America, almost 30 million workers have signed non-compete agreements as a condition of their employment. The purpose of these agreements is to protect trade secrets, confidential customer information, or intellectual property from competitors by placing restrictions on when and where certain high-level or technically skilled employees can retain work. But in the past few decades, employers have increasingly required more and more workers to sign these agreements as a matter of course — even when they may not pose a legitimate risk to an enterprise’s legally protected proprietary assets. In many states, including California, non-compete agreements are unlawful, but many employers still pressure workers to sign them. A 2019 Economic Policy Institute study revealed that 45% of California businesses surveyed subject some of their employees to non-compete agreements. How is this possible? Employees are often intimidated by these restrictions, don’t understand how to challenge their employers in court, or may not even realize that non-compete agreements are illegal. Let’s walk through the restrictions that non-compete agreements put on employees, how these agreements are handled under California law, and what you should do if you’re facing an invalid non-compete agreement. If you have questions about non-compete agreements, please contact the experienced California employment lawyers at Ottinger Employment Lawyers today. What is a Non-Compete Agreement? A non-compete agreement is a legal contract designed to prevent employees from working with businesses that are competitors of their current employer. It does this by placing restrictions on when, where, and for whom individuals can find future work. Employees could be prohibited from starting a new position for six to twelve months after they leave their previous job, or they could be banned from working with other companies in the same industry that are located within 50 miles of their previous employer’s main site of business. These agreements are generally found in employment contracts, but they could also appear as a separate document an employer requires as a condition of employment. They’re sometimes linked to other restrictive clauses, like non-disclosure agreements, or non-solicitation agreements. Historically, non-compete agreements were reserved for top-tier executives or individuals working in highly technical roles — e.g., individuals with access to confidential information or who had a hand in the research and development of business-critical intellectual property. Non-compete agreements helped businesses protect their assets by preventing employees from taking critical skills and information to competitors. But in the past two decades, it’s become more and more common for employers to present non-compete agreements to employees who would not normally have signed them in the past: mid-level executives, managers, and even lower-skilled, waged workers. A 2019 study estimates that 53% of American workers bound to non-compete agreements are non-salaried — and 14% of them make less than $40,000 a year. These restrictions can be crippling for individual workers’ career aspirations and earning potential. By preventing workers from seeking competitive pay and opportunities, non-compete agreements contribute to wage stagnation and further entrench pay inequalities. The Economic Policy Institute’s 2019 study shows that the limitations that non-compete agreements place on worker mobility also have a negative impact on the economy as a whole, restricting opportunities for innovation and growth that come with workers’ freedom to seek competitive opportunities. What is California’s Policy on Non-Compete Agreements? Because of the growing criticism of the negative impact that non-compete agreements have on worker mobility and the economy, many states — like North Dakota, Oklahoma, and recently Washington D.C. — have banned or severely limited their enforcement. In California, it’s illegal to enforce non-compete agreements that put limits on an employee’s future job prospects. According to California Business and Professions Code Section 16600, any contract that restricts an individual from “engaging in a lawful profession, trade, or business” is null and void. State labor law only makes exceptions to this ban on non-compete agreements in very specific cases: for example, when a business is being sold, or an LLC is being dissolved. But when it comes to the bulk of the circumstances where non-compete agreements arise (as contracts between a business and an individual employee), the law is simple and clear: a company can’t prevent you from working in a certain geographic area, for a period of time, or for a competitor. Importantly, this ban on non-compete agreements protects individuals who work in California even if your company is based in another state where non-compete agreements are legal. Many businesses who employ individuals living in different states include what are called “choice of law” provisions in their employment contracts. These clauses specify that any potential dispute must be adjudicated in the state where the contract was signed. So, if you’re an executive who lives in California but signed an employment agreement for a New York-based company, you may have technically consented to the application of New York law (which allows non-compete agreements) in any future suits. But according to California Labor Code Section 925, that clause would be invalid. If you primarily live and work in the state, California law must be applied in any lawsuits that arise between you and your employer. Your company can’t enforce any agreement that would deprive you of the protections of California labor law to adjudicate a suit in a different state. The only exception to this rule? If you were independently represented by legal counsel when you originally negotiated the terms of the employment agreement, then you are bound to any potential clauses favoring another state’s law that it includes. What to Do if You’ve Signed a Non-Compete Agreement in California Unfortunately, even though non-compete agreements are banned under California law, many companies still present them or try to coerce workers into signing them. These agreements are sometimes included in the fine print of employment contracts, where workers can easily overlook them. Even if an employee is aware they’re signing one, they may feel resigned to obeying its restrictions due to employer pressure or fear of potential legal consequences. California employees can report an employer to the California Attorney General’s office […]
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