Are Doctors, Psychologists, and Accountants Subject to a Restrictive Agreement Not to Compete?

HNWEmployment Law

Restrictive agreements of physicians are still enforceable. The Supreme Court found nothing in the nature of the medical profession requiring exemption from the general rule, and thus held restrictive agreements between physicians enforceable to the extent they are reasonable in the circumstances of a particular case. The legitimate interest a physician may seek to protect through such a restrictive agreement is his/her interest in his/her ongoing relationship with patients.

A post-employment restrictive covenant in an employment contract between physicians is not unreasonable and unenforceable. Our Courts have held that such contracts or similar ones between a physician and a hospital and are not per se unenforceable. Rather, post-employment restrictive covenants of physicians are considered on a case-by-case basis to determine if they are unreasonable and unenforceable.

Psychologists and Restrictive Covenants Agreements

However, as to psychologists, the Appellate Division held in Comprehensive Psychology Sys., P.C., that because the State Board of Psychological Examiners has adopted a regulation restricting psychologists from entering into restrictive covenants because of the unique nature of the patient-psychologist relationships, a restrictive covenant in an employment contract of a licensed psychologist is not enforceable.

Accountants and Restrictive Competition Agreements

Accountants are subject to the general rule, as are individuals in other service industries professing especially personal relationships with clients. But, while a former employee-accountant can be barred from soliciting clients of his former employer, the clients had the right unilaterally to continue their confidential business relationship with their accountant.

To discuss your NJ employment law matter, please contact Fredrick P. Niemann, Esq. toll-free at (855) 376-5291 or email him at  Please ask us about our video conferencing or telephone consultations if you are unable to come to our office.

By Fredrick P. Niemann, Esq. of Hanlon Niemann & Wright, a Freehold Township, Monmouth County, NJ Employment Law Attorney

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