Physician Contracts: Navigating Side Gigs Restrictions from Employers
- Nisha Mehta, MD
- 3 days ago
- 7 min read
With approximately 40% of doctors reporting that they’d like to pursue or are currently doing side gigs, and ~70% of physicians being employed, the question of whether side gigs are allowed by a physician’s employer comes up frequently on our online physician communities. There are many reasons why an employer may want to restrict a physician’s ability to engage in side gigs, or why they may feel entitled to have a final say (or even a financial cut) in a physician’s activities outside of clinical work. As such, they may incorporate clauses in a physician’s employment contract which limit their ability to take on additional roles. While we encourage every physician to discuss these issues with a contract attorney that is familiar with working with physicians prior to signing their contracts, there may also be ways to retrospectively address issues that come up. Below, we cover things that doctors should be aware of when negotiating their employment agreements so that they retain flexibility to pursue side gig opportunities, the rights to their intellectual property, and the earnings from their side gigs.
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Does my physician employment contract allow me to pursue side gigs?
This question comes up often on our online communities, and while everyone’s answers are different and depend on their individual employment agreements, we find that many contracts do have some wording that relates to outside activities (particularly if they involve your role as a doctor). Common language, restrictions, and limitations often seen in physician contracts regarding side gigs include:
A need to get approval prior to engaging in any side gig opportunities
A right to a physician’s intellectual property
A right to earnings a physician makes (for example, this comes up with pharmaceutical or medical device related speaking or expert witness work, where they may argue that your role at their institution gives you credibility as an expert)
A note that the employer’s malpractice insurance will not cover any outside activities as a physician
An ability or inability to moonlight, and where, when, and how many hours this is permissible
Restrictions on who you are allowed to work with (may not be allowed to do locums or moonlight with competitors)
A limitation on the hours when you can engage in side work (many will not allow you to work on other projects while you are on site working for and being compensated by them)
Restrictions on engaging with pharmaceutical companies
Non-disparagement or confidentiality clauses related to the employer
Needing to include relevant disclaimers about not representing the institution with any statements made to the media or on social media, speaking, podcasts, or other engagements
If I’m negotiating a new contract or renegotiating a contract, what should I make sure is included in my employment agreement to allow me to pursue side gig opportunities without burdensome limitations?
You’ll want to review this carefully with your physician contract attorney, and try to make the employment agreement the least restrictive possible. If you already know what side gig(s) you want to pursue, or if you have an existing side gig, you‘ll want to be especially careful about including language specifically granting permission for you to be able to do that side gig, as well as revoking the employer’s rights to your intellectual property or income. We’ll cover some specific cases you should pay attention to here.
Need to get permission or sign off from the employer, or have specific paperwork signed by anybody you contract with as an independent contractor
As we know from our side gigs matching services, many side gigs fill very quickly. You may not have time to get permission from your employer, or if a side gig is very popular, the hiring party may not have the incentive to review your legal paperwork and go back and forth on negotiating the exact wording and terms. If at all possible, try and get this language removed from your employment agreement for maximum flexibility.
This may be harder to do at a big institution, but it’s certainly worth trying to address, or to tailor the wording to make it less restrictive. This could include:
Asking for language that only requires this if the side gig you are engaging in is related to your role as a physician
Asking for language that only restricts specific side gigs that they have concerns about (for example, if they only care about moonlighting but don’t care about expert witness work, let the wording reflect that you only need permission for moonlighting)
Pursuing language that allows you to engage in side gig work as long as you can sign a form saying that it doesn’t violate ‘x’ criteria (removes the need to get the hiring party for the side gig involved in the legal paperwork)
Excluding side gigs already in existence or that you plan on pursuing and have already gotten verbal permission from them for; if it's not in writing, it may be hard to enforce.
Rights to side gigs compensation
Be careful about onerous clauses where the employer retains the right to a percentage, or all of, your side gigs earnings. While they may still allow you to engage in side gigs, if your employer takes 70% of your earnings from the side gig, it’s effectively going to disincentivize you from doing the side gig regardless. Additionally, if this is work that’s being done outside of what you are contracted to get paid for for the work that you do for your employer, it feels like a little bit of an overreach to ask for money for work that you do that you never said you’d do for the employer. We are big advocates of being able to retain the money that you make outside of work!
Some exceptions that may be reasonable include if your ability to get the outside work is influenced by your role at your employer (for example, a title you hold at work that establishes you as a desirable consultant, expert witness, or speaker). Again, work carefully with your physician contract attorney to make sure these terms are reasonable and as favorable to you as possible.
Rights to intellectual property
This is a big one for those that are developing products or medical devices, creating medically related apps, or creating content such as courses, social media content, or medical writing. You want to make sure that you retain the rights to anything that can be copyrighted, trademarked, or patented if at all possible. Similarly, you want the rights to anything that you author or content that you create.
There are some nuances here, particularly if you work for an academic institution or a private employer that has an innovation arm, as if you use the employer’s materials, equipment, or resources, they may have some claim to these.
Again, this is why it’s very important to include language in your contract that is favorable to you during contract negotiations. You’ll also want relevant language about what happens when you leave a job. A good physician contract lawyer that’s accustomed to working with institutions can help you with this.
What are other things I should consider in regards to my employer when taking on a side gig?
Remember that just because you technically can do something within the rules of your contract, doesn’t mean that you should, or that you shouldn’t ask permission. You don’t want to get into an ugly legal battle with your institution or employer, as they likely have deeper pockets than you - not to mention the fact that for most physicians, their employment likely brings in more income than their side gig.
As such, always assess whether a side gig will jeopardize your career in any way, whether it be by motivating an employer to terminate your employment agreement, causing you to be reported to the medical board and potentially losing your license, or by discrediting your expertise.
Other things to think about include:
What liability protection you will have, since most malpractice insurance will not cover outside activities. You may need to speak to a malpractice broker or somebody that can provide errors and omissions coverage.
Whether you need a legal entity such as an LLC for asset protection
Whether you need to talk to an intellectual property attorney or protect your intellectual property in regards to a specific side gig
What disclaimers you may want to include in any content or product you create (“This is for educational or entertainment purposes only” or “This does not reflect the views of my employer” are two popular ones, but you should consult a healthcare attorney)
Ensuring that you have proof that you are not engaging in this side gig during working hours
Gut checking that nothing that you do reflects poorly on your employer or your profession, or may influence a patient's decision to choose you as their physician
Conclusion
Side gigs are becoming increasingly popular amongst physicians, and employers are also aware of this trend. Increasingly, they are including clauses within your employment contract to ensure that they have some say in what you can and cannot do. We’re big advocates that you should retain the right to do what you want outside of work as long as it doesn’t affect your job, but you also shouldn’t do anything that risks your primary income. As such, carefully reviewing your employment agreement for any restrictions alongside an attorney that’s used to working with physicians is crucial to minimize any limitations or unintended consequences.