Contracts are a vital part of running any veterinary practice. Whether you’re hiring associate veterinarians, forming a partnership, or selling your business, it’s common for contracts to include non-compete and non-solicitation clauses. These provisions are designed to protect the practice’s goodwill, client base, and staff relationships, but they must be carefully drafted and understood to be enforceable and fair.
At Mahan Law, we work with veterinarians across the country to draft, review, and enforce contracts that protect their practices without creating unnecessary legal risks. Here’s what every veterinary professional should know about non-compete and non-solicitation clauses.
What Is a Non-Compete Clause?
A non-compete clause is a contract provision that restricts one party, often an employee or former business partner, from starting or working for a competing veterinary practice within a particular geographic area and time period.
In the veterinary industry, non-competes are often used in:
- Associate veterinarian employment agreements
- Partnership or shareholder agreements
- Practice sale agreements
The goal is to prevent someone who has developed relationships with clients, employees, or referral partners from using that access to open or join a competing practice nearby.
Are Non-Compete Clauses Enforceable?
Enforceability depends on your state’s laws and the reasonableness of the clause. Some states severely limit or even ban non-compete agreements in employment contexts, while others allow them if certain conditions are met.
Generally, a non-compete must be:
- Reasonable in scope: It should only cover services the individual actually performed.
- Limited in geographic area: It should be narrowly tailored to the practice’s client base and market.
- Limited in duration: Most enforceable non-competes last between six months and two years.
- Protecting legitimate business interests: This could include confidential information, client relationships, or goodwill from a sale.
Courts are less likely to enforce overly broad restrictions that would prevent someone from earning a living or are not tied to a genuine business interest.
What Is a Non-Solicitation Clause?
A non-solicitation clause prevents a former employee or business partner from trying to “poach” your clients or employees after leaving the practice. These clauses typically prohibit:
- Contacting former clients with the intent to move their business elsewhere
- Recruiting or hiring current employees of the practice
- Using confidential information to target patients or staff
Non-solicitation provisions are often more enforceable than non-competes because they are seen as less restrictive and more focused on preserving the practice’s investments in relationships and personnel.
Common Pitfalls in Veterinary Contracts
Even with the best intentions, poorly written non-compete and non-solicitation clauses can lead to confusion or litigation. Some common issues include:
- Unclear definitions of services or competitors: Broad language like “any competing veterinary service” can be challenged. Be specific.
- Unreasonable geographic areas: A 50-mile radius might be excessive in an urban setting but fair in a rural one. Context matters.
- Lack of consideration: In some states, continued employment alone may not be sufficient to enforce a non-compete. There needs to be something of value exchanged (such as a bonus or promotion).
- Overlapping or conflicting provisions: Multiple agreements (employment, partnership, sale) may include different terms. These should be reviewed to ensure consistency.
Best Practices When Drafting or Reviewing These Clauses
To ensure your contracts hold up in court and support the practice’s goals:
- Tailor them to your specific situation. Avoid using generic templates or borrowed language from unrelated industries.
- Clearly define the restricted activities, time, and area. Ambiguity can make enforcement difficult.
- Consider the employee’s role and level of access. A vet tech should not be held to the same standard as a senior veterinarian with an ownership interest.
- Keep records of what information was shared. If you’re relying on confidential data as justification, document access and policies.
- Review regularly. As your practice grows or laws change, you may need to update your agreements.
What to Do If a Clause Is Violated
If you believe a former employee or partner has breached a non-compete or non-solicitation agreement, time is critical. Legal steps may include:
- Sending a cease-and-desist letter
- Seeking injunctive relief to prevent further harm
- Filing a claim for damages
- Negotiating a settlement
Before taking any action, consult with a veterinary-focused legal team to assess your options and the likelihood of enforcement.
Protect Your Practice the Right Way
Non-compete and non-solicitation clauses can be powerful tools to protect your practice’s hard-earned reputation and client relationships—but only when used properly. Poorly drafted or overreaching agreements can do more harm than good.
At Mahan Law – Veterinary Law Firm, we help veterinary practices create clear, enforceable contracts that align with legal standards and business realities. Whether you’re hiring, restructuring, or preparing to sell, we can help you put the right protections in place. Contact us today to protect your practice.