Allowed if reasonable

Non-compete law in Pennsylvania

Pennsylvania has no general noncompete statute; enforceability of employee covenants is decided by courts under a reasonableness standard (case law, not cited here). The Fair Contracting for Health Care Practitioners Act (Act 74 of 2024, effective 2025-01-01) voids noncompete covenants entered into after that date between an employer and a physician, osteopath, certified registered nurse anesthetist, certified registered nurse practitioner or physician assistant, except a covenant of one year or less where the practitioner was not dismissed by the employer. It also requires patient notification within 90 days of a practitioner's departure.

Last verified · confidence medium. Clauseworthy is not a law firm and does not give legal advice.

Employee non-competes
Not banned; conditions apply
Pay floor
None in the statute
Duration
No statutory cap for workers outside Act 74; health care practitioners: no more than one year, and unenforceable if the practitioner was dismissed (Act 74 s. 4(b)).

Exceptions and special rules

  • Act 74 s. 4(c)(2): nothing voids a covenant with a practitioner holding an interest in a business entity solely because of a sale of an ownership interest or substantially all assets, a sale or transfer of control (including merger), or the practitioner's receipt of an ownership interest; a pre-existing covenant may still be voided if the practitioner is not a party to the sale or transfer.
  • Act 74 s. 4(c)(1): an employer may recover reasonable expenses from a practitioner if directly attributable to the practitioner, accrued within three years before separation (unless the practitioner was dismissed), related to relocation, training and establishing a patient base, and amortized over up to five years from separation.
  • Health care practitioners (medical doctors, doctors of osteopathy, certified registered nurse anesthetists, certified registered nurse practitioners, physician assistants). A 'noncompete covenant' (an employer-practitioner agreement in Pennsylvania that impedes the practitioner's ability to continue treating patients or accepting new patients, practicing independently or for a competing employer after the term of employment) entered into after 2025-01-01 is void and unenforceable by the employer, except one no longer than one year where the practitioner was not dismissed by the employer. After a practitioner departs, the employer must notify patients seen within the past year of the departure, how to transfer records, and the option to stay with the employer, within 90 days; this applies to practitioners with an ongoing outpatient relationship of two or more years with the patient. The Health Care Cost Containment Council must study the Act's effects within three years. (Fair Contracting for Health Care Practitioners Act, 2024 Pa. Laws No. 74 (P.L. 846), ss. 3-6)

Non-solicitation clauses

No statute outside Act 74. Act 74's definition covers agreements that impede continuing to treat patients or accept new patients; the text has no separate patient non-solicitation provision.

Contracts naming another state's law

None found.

Remedies

Act 74 provides only that covered covenants are void and unenforceable by the employer; no penalty or fee clause.

Which agreements it covers

Act 74 s. 4(a): covenants entered into after the effective date of that subsection (2025-01-01, s. 7); agreements signed earlier are not covered.

Recent changes

  • 2025-01-01. Act 74 of 2024 (HB 1633, approved 2024-07-17, P.L. 846) took effect. Source

Primary sources

Checker

What the statute says for these facts

Four facts. The answer leads with what the statute does at that pay, then names any change already enacted, then quotes the details with their citations.

The person who would sign

Several statutes treat contractors differently.

Other states on file