April 25, 2024

I saw the news that the IRS voted 3 to 2 to ban noncompetes. Does this mean I’m finally free to leave my hospital job without a restriction?

Appreciate your insight.

Dr. J

Let’s not get too excited.  The rule (https://www.ftc.gov/news-events/news/press-releases/2024/04/ftc-announces-rule-banning-noncompetes) was passed by a vote of five people, 2 dissenting and 3 approving and is sure to be challenged in the next 120 days prior to implementation by many groups, and directly by large employers, looking to maintain an economic edge on the competition.  Of note, the rule as presented has certain exceptions, including excluding not-for-profit employers, which your hospital may qualify as.  Other exclusions are for executive employees who have authority to command change in policy at a high-level of the organization (likely will not implicate treating doctor), and also exclusions for non-employment restrictions, such as related to purchases and sales of practices.  I have a high level of confidence that this rule will either not go into effect, or will be substantially modified prior to implementation.  My advice at this time is to adhere to your contractual restrictions until further notice that an applicable rule has taken effect.   We will be following developments closely and updating you here.  Any questions in the interim, please let Jennifer know.