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⚠️ Legal Disclaimer: This
article is shared by Dental Accounting Group for general informational
purposes only and does not constitute legal advice. The content was prepared
by Tyler Jones of Helsell Fetterman LLP. Dental practice owners, DSOs, and
associate dentists should consult a qualified attorney regarding their
specific agreements and circumstances before taking action. |
Washington Significantly Restricts Noncompetition Agreements: What Dentists
and Their Employers Need to Know
By Tyler
Jones, Helsell Fetterman LLP | Shared by Dental Accounting Group |
March 2026
Washington has enacted sweeping changes to the enforceability
of noncompetition agreements that will directly impact dental practices,
associate dentists, and dental service organizations (DSOs). House Bill 1155,
effective June 30, 2027, will render most noncompetition covenants void and
impose new compliance obligations on both employers and workers.
This is a significant development for dental practice owners
who have historically relied on noncompete provisions to protect patient
goodwill, referral relationships, and workforce stability. Here is what you
need to know.
Key Takeaways
|
Topic |
Key Provision |
|
Effective
Date |
June 30, 2027. Applies to noncompetition agreements regardless of
when they were signed. |
|
Most
Noncompetes Void |
Most noncompetition agreements — especially those involving
employees — will be unenforceable beginning June 30, 2027. |
|
Expanded
Definition |
The law broadly defines “noncompetition covenant” to potentially
include restrictions on accepting business from clients, patients, or
customers — capturing provisions that have historically straddled the line
between noncompetition and nonsolicitation. |
|
Patient
Restrictions |
Overly broad limitations on treating former patients may be
treated as noncompetition covenants and rendered void. |
|
Notice
Deadline |
By October 1, 2027, employers must notify current and former
employees and contractors that covered noncompetition agreements are void and
unenforceable. |
|
Penalties |
$5,000 statutory damages per violation, plus attorneys’ fees. The
Washington Attorney General may also bring enforcement actions. |
|
What Is
Still Permitted |
Nonsolicitation of employees and patients (generally limited to
18 months). Noncompetes tied to the sale of a dental practice with at least
1% ownership interest. Confidentiality and HIPAA-compliant protections for
patient information. |
What This Means for Dental Practice Owners and DSOs
Dental practices and DSOs have historically relied on
noncompetition agreements to protect patient goodwill, referral relationships,
and workforce stability. These tools will now be significantly limited.
Practice owners and DSOs should expect reduced ability to
restrict where associate dentists practice after departure, and will need to
place greater reliance on carefully drafted nonsolicitation and confidentiality
provisions. Retention strategies that go beyond restrictive covenants will
become increasingly important.
The broader definition of “noncompetition covenant” is
particularly worth noting. Provisions that restrict accepting business from
patients — which some agreements use in lieu of traditional noncompetes — may
now be captured under the new law and treated as void.
What This Means for Associate Dentists
Associate dentists — particularly those employed by DSOs —
should be aware that many existing noncompetition provisions may become
unenforceable under the new law beginning June 30, 2027. Associates should
review whether current agreements contain provisions that may be void under the
new law, how patient-related restrictions are structured and whether they are
overly broad, and evaluate opportunities to revisit restrictive covenants in
connection with employment changes or renegotiations.
What Is Still Permitted
Not all restrictive covenants are eliminated. The following
protections remain available:
•
Nonsolicitation agreements are still permitted, but are
generally limited to 18 months.
•
Noncompetition covenants tied to the sale of a dental
practice remain enforceable, provided the restricted party holds at least a 1%
ownership interest in the practice being sold.
•
Confidentiality provisions and HIPAA-compliant
protections for patient information remain valid.
Recommended Next Steps
|
For Practice Owners & DSOs •
Review and revise all associate and employment agreements now —
before the June 30, 2027 effective date. •
Update template agreements used for future hires to comply with
the new law. •
Plan for the required statutory notice obligation due by October
1, 2027. •
Invest in nonsolicitation and confidentiality provisions as your
primary protective tools going forward. •
Consider retention strategies that reduce reliance on restrictive
covenants. |
For Associate Dentists •
Review your current employment agreement, particularly if you are
affiliated with a DSO or multi-location group. •
Identify any noncompetition provisions and assess whether they
may be void under HB 1155. •
Evaluate whether patient-related restrictions are overly broad
and may be captured under the new definition. •
Seek legal advice before signing new or amended employment
agreements. •
Consult an attorney when negotiating changes to existing
agreements. |
|
|
Required Action for Employers: By October 1, 2027, employers must
make reasonable efforts to notify both current and former employees and
independent contractors that any covered noncompetition covenant in their
agreements is void and unenforceable under Washington law. Failure to provide this notice may contribute to violations that
trigger $5,000 in statutory damages per violation, plus attorneys’ fees. |
About the Author
|
About
the Author This article was prepared by Tyler
Jones of Helsell Fetterman LLP, a Seattle-based law firm. Tyler advises
dental practices, DSOs, and associate dentists on employment agreements,
noncompete provisions, practice acquisitions, and health care law. Dental
Accounting Group is sharing this content as a resource for our dental
practice clients. Read the original article at Helsell
Fetterman’s blog:
https://www.helsell.com/2026/03/26/washington-significantly-restricts-noncompetition-agreements/ Contact Tyler Jones directly:
tj****@*****ll.com | 206.689.2164 |
Questions? DAG Can Help You Navigate the Financial Side
While employment law questions should be directed to a
qualified attorney like Tyler Jones at Helsell Fetterman, Dental Accounting
Group can help you evaluate the financial and operational implications of these
changes on your practice. Whether you are reviewing your associate compensation
model, structuring a practice sale, or planning for workforce transitions, we
are here to help.
Contact us at ma**@*****ds.com or 425.216.1612, or reach out
to Tyler Jones at Helsell Fetterman for legal guidance specific to your
agreements.
|
Disclaimer: This article is shared by Dental
Accounting Group (DAG) for general informational purposes only. The legal
content was authored by Tyler Jones of Helsell Fetterman LLP and is reprinted
with attribution under a cooperative resource-sharing arrangement. This
article does not constitute legal, tax, accounting, or investment advice, and
does not create an attorney-client relationship between the reader and either
DAG or Helsell Fetterman LLP. Laws and regulations are subject to change.
Dental practice owners, DSOs, and associate dentists should consult a
qualified legal professional regarding their specific agreements and
circumstances before taking any action. Original
article:
https://www.helsell.com/2026/03/26/washington-significantly-restricts-noncompetition-agreements/ © 2026 DG Accounting Professionals LLC. All Rights
Reserved. |
