The North Carolina Court of Appeals ruled on July 15, 2026, that non-compete agreements signed by two nurse practitioners are overly broad and unenforceable. This decision affects the ability of healthcare professionals to work in their field after leaving their employer, potentially impacting patient care in the region.
The case, Southeastern Regional Physician Services v. Scott (Docket No. 25-1046), involved Southeastern Regional Physician Services, a subsidiary of Southeastern Regional Medical Center, and two of its former employees, Allison L. Scott and Chastity Benson. The court's ruling emphasizes the balance between protecting business interests and ensuring individuals can earn a living in their chosen profession.
Background
Southeastern Regional Physician Services operates several medical clinics in North Carolina. The plaintiff hired Scott in February 2021 and Benson in July 2023. Before their employment, both signed Provider Employment Agreements that included non-compete clauses. Scott's agreement prohibited her from practicing medicine within Robeson County for one year after leaving, while Benson's agreement extended the restriction to a 35-mile radius around any of the plaintiff's clinics.
After notifying their employer of their resignations in 2024, both Scott and Benson began working for Southeastern Integrated Care, a competing healthcare provider. Southeastern Regional Physician Services then filed a complaint in March 2025, claiming that the two had breached their non-compete agreements. The defendants argued that the agreements were overly broad and unenforceable, leading to a legal battle that culminated in the recent appellate ruling.
The Ruling
The Court of Appeals, led by Judge Jefferson Griffin, upheld the trial court's decision to grant judgment on the pleadings in favor of the defendants. The court found that the non-compete agreements imposed unreasonable restrictions on the defendants' ability to practice medicine. The opinion stated, "The covenants not to compete place an undue hardship on Defendants’ ability to meaningfully engage with their careers and are too broad to protect Plaintiff’s legitimate business interests."
The court highlighted that the agreements not only limited the defendants' ability to work but also created potential public harm by restricting access to healthcare services in a region already facing challenges in medical care availability. The ruling emphasized the importance of balancing an employer's business interests with the public's right to access healthcare.
Impact
This ruling sets a significant precedent for non-compete agreements in North Carolina, particularly in the healthcare sector. It reinforces the notion that such agreements must be reasonable in scope and not impose undue hardship on employees. The decision could encourage more healthcare professionals to challenge similar agreements, potentially leading to a shift in how employers draft these contracts.
Moreover, this ruling may have broader implications for other professions where non-compete agreements are common. It signals to employers that overly restrictive clauses may not hold up in court, thereby encouraging more balanced agreements that protect business interests without infringing on employees' rights to work.
What's Next
The plaintiff may consider appealing the decision to the North Carolina Supreme Court, although details regarding any potential appeal were not available in the court filing. This case highlights ongoing discussions about the enforceability of non-compete agreements and their implications for the workforce.