Nurses respond to noncompete ban

Erica Carbajal – Becker’s Hospital Review

Contract provisions that stick nurses with the cost of training programs if they leave or are terminated before their contracts are up will largely be prohibited under the Federal Trade Commission’s April 23 ruling to ban noncompete agreements — a decision National Nurses United is applauding.

“We know that [training repayment agreement provisions] and other stay-or-pay contracts exploit vulnerable new graduate nurses at the very start of their careers,” Nancy Hagans, RN, NNU president, said in an April 24 statement. “We see the chilling effects these contracts have on nurses’ ability to advocate on behalf of their patients when they face harassment, termination and potentially ruinous financial consequences for speaking out about unsafe conditions that affect patient care. We commend the FTC for taking this important step towards protecting nurses from these exploitative practices.”

Training repayment agreement provisions have been highly contested in healthcare. Last year, a report from NBC News found the practice has become increasingly common, with some hospitals requiring nurses to pay back as much as $15,000 if they try to leave or are fired before their contract expires.

Nurses argue the provisions restrain them from speaking up about unfair working conditions and coerce them into staying in facilities with unsafe staffing. Hospitals and health systems, on the other hand, have said embedding training repayment into contracts is a long-standing practice, noting that comprehensive training programs are a significant investment.

Stay-or-pay provisions are in the purview of the FTC’s ban when they are so “broad or onerous” that it prevents a worker from seeking or accepting another job or starting their own business. Some hospitals have moved to end the practice in recent years, including Nashville, Tenn.-based HCA Healthcare and UCHealth in Aurora, Colo.

“This functional noncompete ban should include many of the stay-or-pay contracts imposed on nurses,” NNU said.

The FTC estimates the noncompete ban will save nearly $200 billion in healthcare costs over the next decade. About 30 million Americans (18% of the workforce) are covered by noncompete agreements, including an estimated 35% to 34% of physicians.

Hospital groups slammed the ruling, saying it will further complicate recruitment and retention and threaten access to care.

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