Restrictive covenants in the dental employment contract are one of the most important and most contentious sections to negotiate. Once you are beyond the compensation the next important question you need to ask yourself is … “ are these restrictions reasonable and can I live with them?”

In Pennsylvania the courts do not particularly like restrictive covenants but will enforce them if they are carefully drafted. Keep in mind that what the courts find reasonable for rural vs. urban, and generalists vs. specialists will differ. The restrictive covenant  generally needs to be negotiated at the beginning of the employment arrangement. Some other significant consideration must be added if it is later entered into by the parties. Non-solicitation provisions are more easily added later and will be discussed in a bit.

There are two components to the restrictive covenants, the number of miles and the amount of time. In a rural area there is Pennsylvania case law that has held up a 50-mile radius, and the courts have repeatedly found twenty-four months reasonable. In an urban setting three to five miles would be reasonable for a general dentist but for a specialist a longer distance is acceptable to the courts. There is a public interest prong to the court’s evaluation in these cases. When the public would be harmed by the loss of a particular practitioner’s services they will try to mitigate that harm to the community.

So what if there is a violation? Injunctive relief and liquidated damages are commonly forms of agreed upon relief in the event that the restrictive covenant is violated. Pennsylvania courts are comfortable with both forms of relief.

The important take away is to not enter into a restrictive covenant that you can’t live with. The legal battle will be expensive and devastating to your career. In the case of a corporate employer they will have the deep pockets to go after you and will be happy to make an example of you.

Restrictive covenant language is often combined with non-solicitation language. The non-solicitation language usually prohibits both the solicitation of employees and patients and I will discuss both of those in my next post.

This document is intended to provide information of general interest and is not intended to offer legal advice about specific situations.  The author does not intend to create an attorney-client relationship by offering this information, and anyone’s review of the information shall not be deemed to create such a relationship.  You should consult a lawyer if you have legal matters requiring attention.