Non-Compete Clauses for Dentists in Ontario: What Dentists Should Know

Restrictive covenants are common in dental associate agreements and partnership agreements. One of the most significant restrictions dentists may encounter is a non-compete clause, which can limit where and how a dentist may practice after leaving a clinic.

While these clauses are often presented as standard terms, they can have a major impact on a dentist’s ability to continue practicing in a particular area. Dentists reviewing employment or associate agreements should carefully examine any restrictive covenants before signing.

What Is a Non-Compete Clause?

A non-compete clause is a contractual provision that restricts a dentist from practicing dentistry within a specified geographic area for a certain period of time after leaving a clinic.

These clauses are commonly included in:

• dental associate agreements

• employment agreements

• dental partnership agreements

• dental practice sale agreements

The purpose of a non-compete clause is generally to protect the goodwill of the dental practice, including its patient base and business reputation.

Geographic Restrictions

One of the most important aspects of a non-compete clause is the geographic scope.

For example, a clause may restrict a dentist from practicing within a certain distance from the clinic, such as:

• 3 kilometres

• 5 kilometres

• 10 kilometres

The reasonableness of the geographic restriction can significantly affect whether the clause may be enforceable.

Dentists should consider whether the restriction would prevent them from practicing in their preferred location or community.

Duration of the Restriction

Non-compete clauses also specify the length of time during which the restriction applies.

Common durations may include:

• 12 months

• 24 months

• 36 months

Longer restrictions can significantly affect a dentist’s ability to continue working in the same region after leaving a clinic.

Non-Compete vs Non-Solicitation Clauses

Many agreements include both non-compete and non-solicitation clauses.

A non-solicitation clause typically prevents a dentist from actively contacting former patients or employees of the clinic after leaving.

Unlike non-compete clauses, non-solicitation clauses generally allow the dentist to continue practicing dentistry elsewhere, provided they do not actively solicit patients from the former clinic.

Understanding the difference between these provisions is important when evaluating the impact of restrictive covenants.

Are Non-Compete Clauses Enforceable?

In Ontario, restrictive covenants must generally be reasonable in order to be enforceable.

Courts may consider factors such as:

• the geographic scope of the restriction

• the duration of the restriction

• the nature of the professional relationship

• the interests the clause is intended to protect

If a restriction is overly broad or unreasonable, it may not be enforceable.

However, each situation depends on the specific language of the agreement and the surrounding circumstances.

Why Dentists Should Review Non-Compete Clauses Carefully

Non-compete clauses can affect a dentist’s future career opportunities, particularly if the restriction limits where the dentist may practice.

Before signing an associate or employment agreement, dentists should carefully review any restrictive covenants to ensure they understand their potential impact.

Obtaining legal advice before signing can help identify overly restrictive provisions and allow dentists to negotiate more reasonable terms.

Speak With a Lawyer Before Signing a Dental Agreement

Dentists reviewing associate agreements, employment contracts, or partnership agreements should carefully consider any restrictive covenants before signing.

If you are reviewing a dental agreement and want guidance on non-compete or non-solicitation clauses, you can Book a Consultation to discuss your situation and determine the appropriate next steps.