Non-Compete – Yes or No?

We’re pleased to share an insightful perspective from Dr. Peter Bowie, DVM, on a timely and often debated topic in the veterinary field… Non-compete agreements. In his article, Dr. Bowie explores the implications of non-competes on workplace culture, innovation, and employee growth, while offering thoughtful alternatives that foster trust and long-term success. Whether you're an employer navigating hiring decisions or simply interested in shaping a more positive work environment, Dr. Bowie's perspective is well worth the read.

 

Here is a set of reasons that a company shouldn’t use a non-compete in negotiations with potential new employees. Great companies have a positive workplace environment that attracts top talent, engenders trust, fosters innovation, empowers individuals, encourages employee growth, that subsequently leads to long term success within a competitive environment. When evaluated carefully, nothing on that list is encouraged by non-competes.

 

The theory behind non-competes is that it allows employers to spend more money on employee training, to increase wages, and protect creativity and innovation within that company. While there is some evidence that employers do spend more money on training in an environment that allows for non-competes, those benefits to the company may be negated by lower motivation and productivity for employees in a company with strict non-competes¹. Most research has shown that non-competes actually reduce worker wages because of diminished competition in the workforce space². And further, in environments that are conducive to non-competes, there ends up being less innovation, creativity, and ongoing growth for businesses within that market. Remember, some competition is always better for all parties, so a freer flow of talent and information may lift all boats up.

 

So, the simple answer is: be the employer of choice in your market. Then you don’t have to worry about all that legal mumbo jumbo and you won’t have to spend all the time and effort it takes to protect your turf. Still, if you really must have some protection so that you can sleep at night, consider a well thought out NDA, an ethical non-solicitation agreement, and even an arbitration agreement. While you won’t get all that you want from those three agreements, you will likely get an employee who CHOOSES to come to your workplace every day and is motivated to grow with the company and add their creativity to your thriving business!

 

 

1.    On Amir and Orly Lobel, “How Non-Competes Stifle Performance.” Harvard Business Review. Jan/Feb 2014. https://hbr.org/2014/01/how-noncompetes-stifle-performance

2.    US Treasury Report 2022. https://home.treasury.gov/news/press-releases/jy0634

Article by Dr. Peter Bowie, DVM