The Connecticut legislature recently passed Public Act No. 16-95 (PA 16-95), which aims to increase competition among health care providers by, among other things, restricting physician non-compete agreements. Though passed by both houses of the legislature, PA 16-95 has not yet been signed into law by Governor Dannel P. Malloy. If signed by Governor Malloy, PA 16-95 will become effective on July 1, 2016.
PA 16-95 defines a covenant not to compete as a provision in an employment agreement or other agreement that establishes a professional relationship with a physician that restricts the physician’s right to practice medicine in Connecticut after the agreement has been terminated. Under PA 16-95 a covenant not to compete that involves a physician will be valid and enforceable only if it is (1) necessary to protect a legitimate business interest; (2) reasonably limited in time, geographic scope, and practice restrictions; and (3) otherwise consistent with law and public policy. The party seeking to enforce the covenant not to compete has the burden of proving these elements.
Please see full publication below for more information.