Non-Compete Clauses for Veterinarians in Ontario: What Veterinary Associates Should Know

Restrictive covenants are commonly included in veterinary associate agreements and partnership agreements. One of the most significant of these provisions is the non-compete clause, which may limit where a veterinarian can practice after leaving a clinic.

Although non-compete clauses are often presented as standard contractual provisions, they can have a substantial impact on a veterinarian’s future employment opportunities. Veterinarians reviewing associate agreements or partnership arrangements should carefully examine any restrictive covenants before signing.

Understanding how non-compete clauses operate can help veterinarians make informed decisions when entering into or leaving a veterinary practice.

What Is a Non-Compete Clause?

A non-compete clause is a contractual provision that restricts a veterinarian from practicing veterinary medicine within a defined geographic area for a specified period of time after leaving a veterinary clinic.

These provisions are commonly included in:

• veterinary associate agreements

• veterinary employment agreements

• partnership agreements

• veterinary practice sale agreements

The purpose of a non-compete clause is generally to protect the goodwill of the veterinary clinic, including its client relationships and reputation within the community.

Geographic Restrictions

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

For example, a non-compete clause may restrict a veterinarian from practicing within a specified distance from the clinic, such as:

• 3 kilometres

• 5 kilometres

• 10 kilometres or more

The geographic restriction determines where a veterinarian may or may not practice after leaving the clinic. Restrictions that cover a large geographic area may significantly limit employment opportunities.

Veterinarians should carefully review how the geographic boundaries are defined within the agreement.

Duration of the Restriction

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

Common durations may include:

• 12 months

• 24 months

• 36 months

Longer restrictions can affect a veterinarian’s ability to continue practicing in their preferred location after leaving a clinic.

When evaluating a non-compete clause, veterinarians should consider whether the duration of the restriction is reasonable in light of their career plans.

Non-Compete vs Non-Solicitation Clauses

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

A non-solicitation clause generally prevents a veterinarian from actively contacting former clients of the clinic or recruiting employees after leaving the practice.

Unlike non-compete clauses, non-solicitation provisions typically allow veterinarians to continue practicing veterinary medicine elsewhere, provided they do not actively solicit clients from the former clinic.

Understanding the difference between these provisions is important when reviewing a veterinary associate agreement.

Enforceability of Non-Compete Clauses

Courts generally require restrictive covenants to be reasonable in order to be enforceable.

When evaluating a non-compete clause, factors that may be considered include:

• the geographic scope of the restriction

• the duration of the restriction

• the nature of the professional relationship

• the legitimate business interests the clause is intended to protect

If a restriction is overly broad or unreasonable, it may be more difficult to enforce.

However, the enforceability of any restrictive covenant depends on the specific language of the agreement and the surrounding circumstances.

Why Veterinarians Should Review Non-Compete Clauses Carefully

Non-compete clauses can significantly affect a veterinarian’s ability to practice within a particular community after leaving a clinic.

Before signing an associate or employment agreement, veterinarians should ensure that they understand:

• the geographic scope of the restriction

• how long the restriction will apply

• whether other restrictive covenants are included in the agreement

Obtaining legal advice before signing an agreement can help veterinarians identify restrictive provisions and understand their potential impact.

Speak With a Lawyer Before Signing a Veterinary Agreement

Veterinarians considering an associate position or reviewing a veterinary agreement should carefully examine any restrictive covenants before signing.

If you are reviewing a veterinary associate agreement or have questions about non-compete clauses, you can Book a Consultation to discuss your situation and determine the appropriate next steps.