Noncompete Agreements in 2025 (Physicians, pay attention!)

It's official - there will be no federal ban on noncompete agreements. The Biden-era rule banning noncompete agreements never took effect because the rule was appealed to the Fifth Circuit, and the Federal Trade Commission (FTC) asked the court for more time as it decided what to do with the rule under the new administration. Late Friday, the FTC officially announced that it will dismiss the appeal and vacate the rule.

Without a federal ban on noncompete agreements, state law will apply to your employment contracts. Make sure you know what is enforceable in your state --

The following states had new laws take effect this year regarding noncompete agreements (with a large focus on favorable terms for physicians):

ARKANSAS. Effective August 5, 2025, Arkansas implemented new legislation that voids any agreement that restricts the right of a physician to practice within the physician's scope of practice. (Arkansas Code Section 4-75-101)

COLORADO. Effective August 6, 2025, new restrictions went into effect for healthcare providers by nearly eliminating the circumstances in which noncompete agreements are enforceable against those licensed to practice medicine, physician assistants, registered nurses, midwives, and dentists. And the wage threshold for their highly compensated workers exception increased. (SB 25-083)

FLORIDA. Effective July 1, 2025, Florida went the opposite direction of the other states mentioned here and expanded its non-compete law. For example, the new law extends non-compete periods and allows injunctive relief against new employers who hire individuals subject to enforceable noncompete agreements. (HB 1219)

INDIANA. Effective July 1, 2025, Indiana banned noncompete agreements between physicians and a hospital, parent company of a hospital, affiliated manager of a hospital, or hospital system. (Senate Enrolled Act No. 475)

LOUISIANA. Effective January 1, 2025, Louisiana implemented new restrictions on the duration and geographic scope related to noncompete agreements for physicians. (Act 273)

MARYLAND. Effective July 1, 2025, Arkansas implemented prohibitions and significant restrictions on noncompete agreements for healthcare and veterinary professionals. (HB 1388)

MONTANA. Effective April 16, 2025, Montana expanded its ban on noncompete agreements by expanding the definition of "healthcare providers," adding naturopathic physicians, certain nurses, and physician assistants. (HB 198). And coming January 1, 2026, the ban on noncompete agreements will expand to physicians of all specialties. (HB 620)

PENNSYLVANIA. Effective January 1, 2025, Pennsylvania implemented new restrictions on noncompete agreements for healthcare practitioners. (HB 1633)

TEXAS. Effective September 1, 2025, Texas also implemented new restrictions on noncompete agreements for healthcare practitioners (although Texas has a broader scope than Louisiana, including physicians, dentists, nurses, and physician assistants). (SB 1318)

UTAH. Effective May 7, 2025, Utah prohibited a “health care services platform” from requiring a health care worker to enter into a noncompete agreement. (SB 228)

VIRGINIA. Effective July 1, 2025, Virginia implemented significant changes to its noncompete laws by banning noncompete agreements for non-exempt employees and those previously defined as low-wage employees. (SB 1218)

WYOMING. Effective July 1, 2025, absent a few specific exceptions, Wyoming now prohibits noncompete agreements in general, and any provision restricting a physician's practice after their employment terminates is void. (SF 0107)

Make sure you read the referenced legislation to know who is included in the state's definition of "healthcare practitioners", the specific restrictions on time and scope related to your contract, and whether any rules are retroactive to previously signed contacts.

𝘊𝘰𝘯𝘵𝘢𝘤𝘵 𝘮𝘦 𝘪𝘧 𝘺𝘰𝘶 𝘯𝘦𝘦𝘥 𝘵𝘰 𝘥𝘪𝘴𝘤𝘶𝘴𝘴 𝘺𝘰𝘶𝘳 𝘳𝘪𝘨𝘩𝘵𝘴 𝘸𝘩𝘦𝘯 𝘦𝘯𝘵𝘦𝘳𝘪𝘯𝘨 𝘪𝘯𝘵𝘰 𝘢 𝘯𝘰𝘯𝘤𝘰𝘮𝘱𝘦𝘵𝘦 𝘢𝘨𝘳𝘦𝘦𝘮𝘦𝘯𝘵.