Non-solicitation Clauses for Allied Health Clinics in New Zealand

If you run an allied health clinic, a staff departure can quickly turn into a client retention problem. Physiotherapists, occupational therapists, speech language therapists, podiatrists, psychologists, dietitians and other practitioners often build close relationships with patients and referrers, which means a poorly drafted restraint clause can leave your clinic exposed. Common mistakes include copying a generic clause from another contract, making the restraint so broad it is unlikely to be enforceable, or relying on a verbal understanding instead of clear written terms.

A non-solicitation clause can help protect your clinic’s client base, referral network and team stability, but only if it is tailored to your business and realistic under New Zealand law. The real question is not whether you can add one to a contract, but whether the wording is fair, necessary and likely to stand up if challenged. Here’s what this kind of clause usually covers, what to check before you sign, and where clinic owners often get caught out.

Overview

A non-solicitation clause stops a departing worker or contractor from actively approaching certain people connected with your clinic for a set period after the relationship ends. In an allied health setting, that usually means patients, referral sources, employees, contractors or sometimes suppliers.

In New Zealand, these clauses sit within the wider law on restraints of trade. They may be enforceable if they protect a legitimate business interest and go no further than reasonably necessary.

• Identify exactly who is restricted, employees, contractors, clinic directors or all of the above.
• Define what counts as solicitation, such as direct contact, marketing messages, targeted social media outreach or encouraging a patient to move clinics.
• Limit the clause to a reasonable time period and geographic scope, if geography is relevant.
• Separate patient non-solicitation from staff non-poaching and referral source restrictions.
• Make sure the clause matches the worker’s real role, access to client relationships and level of influence.
• Check the clause works with privacy obligations, especially around patient information and contact details.
• Review whether the restraint appears in an employment agreement, contractor agreement, sale agreement or shareholder document.

What Non-solicitation Clause for Allied Health Clinic Means For New Zealand Businesses

A non-solicitation clause for allied health clinic arrangements is a practical tool to protect goodwill, but it is not a blanket ban on competition. New Zealand businesses can use these clauses, but they need to be carefully drafted and justified.

Allied health clinics are relationship-driven businesses. Patients may follow a practitioner because of trust, continuity of care and convenience. Referral partners, including GPs, insurers, sports clubs, schools and employers, may also associate the service with an individual practitioner rather than the clinic brand.

That creates a real commercial risk when someone leaves. A clinic owner may have spent years building referral pathways, paying for marketing, introducing practitioners to local referrers and supporting a practitioner to grow a caseload. A non-solicitation clause is meant to stop that worker from taking unfair advantage of those connections immediately after departure.

What the clause usually covers

The wording varies, but a clause for an allied health clinic often deals with several distinct risks. Those risks should usually be addressed separately rather than bundled into one vague sentence.

• Patients or clients of the clinic, including current patients and recent former patients.
• Referral sources, such as GPs, specialists, schools, aged care providers, sports organisations, insurers and corporate clients.
• Employees and contractors, where the clinic wants to stop a former worker from encouraging the team to leave.
• Business opportunities or accounts introduced through the clinic.

For example, a physiotherapy clinic may want to stop a departing contractor from emailing current patients with an invitation to follow them to a new practice. A psychology clinic may want to prevent an employee from contacting referral partners they only met because of the clinic’s network. A multidisciplinary clinic may also want protection against a former senior practitioner recruiting the reception team or other clinicians to join a competing practice.

Why clinics often need more than a one-line restraint

One of the most common drafting problems is trying to solve every risk with a single broad restraint clause. That approach often creates uncertainty and makes enforcement harder.

A better contract usually distinguishes between:

• non-solicitation of patients or clients,
• non-dealing clauses, where the person must not provide services to certain clients even if the client approaches them first,
• non-poaching of staff or contractors, and
• confidentiality and privacy obligations covering patient records, treatment notes, referral lists and business information.

These obligations do different jobs. A practitioner may argue they did not solicit a patient because the patient contacted them first. That is why some clinics also consider a non-dealing clause in appropriate cases. Whether that is reasonable depends on the role, the patient relationship, and the broader contract.

Employment agreements and contractor agreements

The legal context matters. A restraint in an employment agreement is not assessed in exactly the same practical way as one in an independent contractor agreement or a sale of business agreement. Courts generally look closely at whether the restraint goes further than needed.

In clinics, contractors are common, but simply calling someone a contractor does not guarantee the restraint will be treated more generously. If the person works like an employee, that may affect how the overall contract is viewed. Before you rely on the provider's standard terms, make sure the arrangement reflects the real working relationship as well as the clinic’s commercial needs.

Legitimate business interests in an allied health setting

The strongest restraints protect something specific and defensible. For clinics, legitimate interests often include goodwill, confidential business information and established patient or referral relationships that belong to the clinic rather than the individual alone.

The clause is less likely to hold up if it looks like a simple attempt to stop someone competing. New Zealand law is cautious about restrictions that interfere with a person’s ability to work. The clinic usually needs to show why the restraint is necessary, not just convenient.

Legal Issues To Check Before You Sign

The main legal question is whether the clause is reasonable in scope and genuinely tied to a protectable clinic interest. Before you sign a contract, check the details that would matter if the clause ever had to be enforced.

Is the clause protecting a real business interest?

Start with the commercial reason for the restraint. Ask what the clinic is trying to protect and why this worker creates that risk.

Examples may include:

• access to a patient list built and paid for by the clinic,
• close relationships with referral sources introduced by the clinic,
• sensitive pricing, service or growth plans,
• the stability of a specialised clinical team, or
• goodwill attached to the clinic brand and location.

If the person has little client contact, no referral influence and no access to strategic information, a strong restraint may be hard to justify.

Is the time period reasonable?

A restraint that lasts too long may be difficult to enforce. What is reasonable depends on the nature of the services, the treatment cycle, and how long the clinic’s connection with the patient or referrer is likely to remain commercially sensitive.

For some clinics, a shorter period may be enough to allow a replacement practitioner to stabilise the relationship. In other settings, a longer period may be argued for, especially where treatment plans or referral arrangements run over many months. The key point is that the period should be based on business reality, not guesswork.

Does geography actually matter?

Geographic limits can make sense for some health services, but not all. A suburb-based clinic that relies on nearby walk-in and GP referrals may have a stronger case for a local radius than a telehealth-heavy practice with clients across New Zealand.

This is where founders often get caught. They insert a radius copied from another contract without asking whether the clinic’s patients, referrers or delivery model make that radius meaningful. A geographic restriction should reflect how the clinic actually operates.

What counts as solicitation?

The contract should say what conduct is restricted. Vague wording creates room for dispute.

A well-drafted clause may address conduct such as:

• directly contacting patients to move their appointments,
• sending targeted messages to referral sources,
• announcing a new clinic in a way that specifically invites current clinic patients to transfer,
• using clinic databases to identify and approach people, or
• encouraging employees or contractors to leave and join a competing practice.

General advertising is often more contentious. A practitioner may be allowed to update their professional profile or make a general announcement, while still being prohibited from targeted outreach to the clinic’s patient base. The wording should spell out where the line sits.

How does privacy law affect patient contact?

Privacy is a major issue for allied health clinics. Patient records, contact details, appointment history and treatment information are sensitive and should only be used for proper clinic purposes.

A restraint clause should work alongside privacy obligations in the contract and the clinic’s internal policies, including any privacy notice given to patients. If a practitioner leaves, there should be no uncertainty about:

• who owns and controls patient records,
• whether contact details can be copied or retained,
• how access to software and practice management systems is removed, and
• what patient communications can be sent during handover.

Even a strong non-solicitation clause will not solve poor data handling. If your systems allow a departing worker to download patient lists or referral histories, the clinic may face a practical problem long before any legal one.

Does the contract fit the role?

A clinic director, senior practitioner and part-time junior clinician should not always have the same restraint. The more influence and access the person has, the easier it is to justify tighter protections.

Tailoring matters. A court is more likely to view a clause as reasonable if it reflects the worker’s actual role, responsibilities and clinic relationships. Standard wording used across every position can look lazy and excessive.

Are there cascading clauses, and are they drafted properly?

Some New Zealand contracts use cascading restraint provisions, where multiple combinations of time periods or areas are listed so that an unenforceable option can be severed and a narrower option can survive. These clauses can be useful, but they need careful drafting.

If they are messy or internally inconsistent, they may create more argument rather than less. Before you sign, make sure the clause reads clearly and that each alternative level is commercially defensible.

What happens at the end of the relationship?

Enforcement often turns on the exit process rather than the contract alone. The agreement should cover practical steps on departure, including return of property, disabling access, confirmation that records have been deleted, and agreed patient handover communications where appropriate.

That matters because many disputes are really evidence disputes. If the exit obligations are clear, it is easier to show what the person was and was not allowed to do after leaving.

Common Mistakes With Non-solicitation Clause for Allied Health Clinic

The biggest mistake is treating a non-solicitation clause as a standard form add-on instead of a risk tool that needs to match your clinic. Most problems come from overreach, poor drafting or weak follow-through once someone leaves.

Using one clause for every practitioner

A dietitian who sees clinic-assigned patients one day a week does not present the same risk as a lead physiotherapist managing key referral relationships. Using the same restraint for everyone can make the clause look unreasonable.

Role-specific contracts are usually more effective. They also help with conversations at the start of the relationship, because the clinic can explain why the restraint exists and what it is trying to protect.

Trying to stop all competition

Many clinic owners really want a non-compete, then label it as non-solicitation. If the clause effectively stops the practitioner from working in their profession in a broad area, it may be vulnerable.

A focused clause aimed at active client poaching or staff raiding is often easier to justify than a blanket prohibition on practising nearby.

Forgetting referral relationships

Patient non-solicitation gets most of the attention, but referral sources can be just as valuable. If your clinic depends on a small number of GPs, specialists, schools or sports organisations, the contract should address those relationships clearly.

At the same time, the clause should not be drafted so widely that it covers every possible contact in the healthcare sector. It should target genuine clinic relationships, not the practitioner’s whole professional network.

Ignoring the privacy and systems side

A clinic can lose control of its client base through weak systems even if the contract wording is decent. Shared logins, unrestricted exports and unclear device policies are common gaps.

Before you rely on a restraint clause, make sure your clinic also has:

• individual user access controls,
• clear rules on downloading or storing patient information,
• signed confidentiality obligations,
• an exit checklist for returning devices and removing system access, and
• written policies on patient communications after a practitioner departs.

Relying on oral assurances

Clinic owners sometimes accept statements like, “I would never approach your patients,” and leave the contract vague. That is risky. Before you rely on a verbal promise, put the exact restrictions in writing.

Clarity also protects the departing practitioner. A plainly written clause reduces the chance of a dispute about what the clinic expected.

Failing to update old contracts

Allied health clinics change quickly. You might add telehealth, open another site, shift from contractor to employee models, or build new referral channels. A restraint drafted years ago may no longer fit the business.

Review contracts when your service model changes, when senior practitioners are promoted, or before you sign with a new clinic lead. Old wording can become both too weak and too broad at the same time.

Waiting until a departure to check enforceability

The worst time to examine a restraint clause is after a key practitioner has resigned. At that point, emotions are high and commercial options are narrower.

Contract review works best before you sign, before you accept the provider's standard terms, or before you roll out a new template across the clinic.

FAQs

Are non-solicitation clauses enforceable in New Zealand?

They can be, but only if they are reasonable and protect a legitimate business interest. A clause that is too broad, too long or aimed at stopping ordinary competition may be difficult to enforce.

Can an allied health clinic stop a former practitioner from treating patients who follow them?

Sometimes, but the answer depends on the contract wording. A non-solicitation clause may stop active poaching, while a non-dealing clause may go further and restrict treatment of certain clinic patients even if they make contact first.

Should contractors and employees have the same restraint clause?

Not usually. The clause should reflect the person’s real role, level of influence, access to clinic relationships and commercial risk to the business.

Do privacy obligations matter when a practitioner leaves?

Yes. Patient data, contact details and records need careful handling. Contracts should clearly address ownership of records, access to systems, deletion of copied information and permitted communications during handover.

What is the most common drafting problem for clinics?

Overly broad wording is a frequent issue. Clauses copied from generic templates often try to restrict too much for too long, which can make them less useful when the clinic actually needs to rely on them.

Key Takeaways

• A non-solicitation clause for allied health clinic contracts can help protect patients, referral sources, staff and goodwill, but it needs to be tailored to the clinic’s actual risks.
• In New Zealand, restraint clauses are more likely to be enforceable where they protect a legitimate business interest and go no further than reasonably necessary.
• The wording should clearly define who is protected, what conduct counts as solicitation, how long the restriction lasts and whether any geographic limit genuinely fits the clinic model.
• Employment agreements, contractor agreements and other commercial documents should not all use identical restraint language without considering the person’s real role.
• Privacy, confidentiality, patient record ownership and system access controls are just as important as the restraint clause itself.
• Clinic owners should review these clauses before they sign a contract, before they rely on a verbal promise, and before a key practitioner exits.

If you want help with contract drafting, restraint clause reasonableness, privacy and confidentiality terms, and contractor or employment agreement reviews, you can reach us on 0800 002 184 or team@sprintlaw.co.nz for a free, no-obligations chat.