Enforceability of Non-Compete Agreements for Health Care Workers in Utah

 

On March 24, 2026 Utah's governor signed H.B. 270, the Healthcare Worker Post-Employment Amendments, into law. This law enacts meaningful changes to Utah's restrictive covenant law for healthcare providers in Utah.

H.B. 270, titled Healthcare Worker Post-Employment Amendments, reflects a growing policy trend in Utah limiting the enforceability of non-compete agreements arising out of employment for licensed healthcare professionals in Utah.  The new law prohibits the use of post-employment non-compete agreements that restrict a "healthcare worker" from practicing within the scope of their license after separation from employment. It also places limits on certain non-solicitation provisions, particularly those that would prevent a departing provider from communicating with patients about continued care or a new practice location. 

The definition of “healthcare worker” under the statute is notably broad and extends well beyond physicians. It encompasses individuals licensed and practicing in a wide range of roles, including advanced practice registered nurses (including interns and CRNAs without prescriptive authority), licensed practical nurses, registered nurses, nurse midwives, and medication aides. It also includes numerous behavioral and mental health professionals, such as clinical mental health counselors, psychologists, clinical and certified social workers, marriage and family therapists and their associates, substance use disorder counselors, behavioral health coaches, and behavioral health technicians. For a full list of the excluded providers, look at the definition of "healthcare worker" under Utah Code Section 34-51-102(5)(a).

In addition, the statute applies to a variety of other licensed providers, including physicians, physician assistants, dentists, naturopathic physicians, podiatric physicians, optometrists, physical therapists, respiratory care practitioners, radiology practitioners, genetic counselors, certified dietitians, licensed massage therapists, and licensed behavior analysts and assistant behavior analysts. The inclusion of both traditional medical providers and a wide array of allied health and behavioral health professionals underscores the legislature’s intent to regulate restrictive covenants across the full continuum of licensed care.

Of particular note is the bill’s fee-shifting mechanism. If an employer attempts to enforce a prohibited agreement and does not prevail, the employer may be required to pay the healthcare worker’s attorneys’ fees and costs, and potentially other damages. 

The policy rationale underlying the legislation is consistent with developments in other jurisdictions. Lawmakers have increasingly focused on the effect of restrictive covenants on patient continuity of care and on the mobility of the healthcare workforce. In many other states, these types of restrictions were not enforceable due to restrictions on patient choice. Non-compete agreements can disrupt ongoing treatment relationships by forcing providers to relocate or exit local markets, and they may contribute to provider shortages by limiting where clinicians are able to practice. House Bill 270 reflects a legislative determination that these concerns outweigh the traditional employer interests in such restrictions, such as goodwill, trade secrets or other legitimate business interests.

From a compliance perspective, healthcare employers in Utah should promptly evaluate existing employment agreements and contracting practices. Agreements containing non-compete provisions or expansive non-solicitation clauses may no longer be enforceable and, more importantly, may create exposure if enforcement is pursued. Employers will need to consider alternative mechanisms to protect legitimate business interests, such as confidentiality agreements and trade secret protections, while ensuring that any remaining restrictive provisions are narrowly tailored and consistent with the statute.

A number of questions still exist under Utah law, including the application of such agreements to independent contractors, how court's will apply common law provisions to covenants regulated by the new statute and the enforceability of overly broad non-solicitation provisions.

Navigating employment law issues can be challenging. Whether you are an employee or employer with questions, Stavros Law P.C. is here to help. If you have questions about restrictive covenants, non-compete and/or non-solicit agreements, you can contact one of our Utah employment lawyers at Stavros Law by calling (801) 758-7604,  emailing us at scheduling@stavroslaw.com, or visiting stavroslaw.com.