Physicians should be aware that definitions contained within a physician employment contract may have one meaning today, but will have a very different practical effect years from now.
One of the most importation components of a physician employment agreement is the non-competition provision. Those provisions typically provide that the physicians may not engage in competing behavior after the termination of the contract for a specified period of time within a defined geographic area. The definition of prohibited geographic area varies from contract to contract. In some cases, the definition will be a specified radius from the primary location of the employer’s office (ie: 10 miles from the employer’s office located at 10 Main Street, Anywhere, USA).
Other times however the prohibited geographic area might be defined as a certain specified radius from wherever the employer may conduct business. This latter type of definition may have a profound effect. For example, consider that at the time the physician begins employment, the employer only does business at 10 Main Street, Anywhere, USA. However, five or ten years down the road, because of mergers or aggressive growth, the employer now does business throughout most of North, Central, or Southern New Jersey, New York, Connecticut, etc. Then, when the employment agreement is terminated, the employer may very well successfully argue that the physician must essentially relocate to another part of the state in order to avoid being in violation of the literal terms of the employment agreement, as the geographic area in which the employer does business – has grown.
Definitions are important. Contact Romanowsky Law today in order to avoid pitfalls which may impact your career.