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Medical exam firm to end universal noncompete agreements

State Attorney General Eric T. Schneiderman, pictured at

State Attorney General Eric T. Schneiderman, pictured at an Oct. 1, 2014, news conference announced that Texas-based Examination Management Services Inc. can no longer require New York employees sign a noncompete agreement. Photo Credit: Charles Eckert

State Attorney General Eric T. Schneiderman announced late Wednesday that a national provider of medical information and examination services has agreed to stop requiring its rank-and-file employees in New York to sign noncompete agreements.

Irving, Texas-based Examination Management Services Inc., which has two of its three New York offices on Long Island, previously required all employees, regardless of their knowledge of trade secrets or sensitive corporate information, to sign noncompete agreements as part of their employment, the attorney general said. Under a settlement with him, EMSI will no longer require New York employees to sign such agreements. High-level executives, such as directors and officers, are excluded from the settlement.

A spokesman for EMSI declined to comment.

EMSI’s agreements prohibited all employees from working for competitors within a 50-mile radius of EMSI’s offices or locations where services were rendered for nine months after leaving the company, said Schneiderman, who called such policies “unjust and inappropriate.” Many of the employees work in “non-senior level” positions traveling to private homes to draw blood, conduct physicals and collect bodily samples for lab testing, he said.

“Workers should be able to change jobs without fear of being sued by their prior employer,” Schneiderman said in a statement. State law only permits the use of noncompete agreements for employees with unique skills or access to trade secrets.

The agreement with EMSI comes after the attorney general’s office received a July 12 complaint from Syracuse resident Margaret Beebe, a former traveling EMSI phlebotomist. According to Schneiderman’s office, Beebe was offered a higher-paying job with no travel requirements by a clinical laboratory, but the offer was withdrawn when the lab learned of EMSI’s noncompete clause.

“Now that I am released from my noncompete with EMSI, I can look for a good, stable job in my field without worrying about having a noncompete agreement,” Beebe said in the attorney general’s statement.

In June, Schneiderman settled investigations into noncompete stipulations for employees of sandwich chain Jimmy John’s and for editorial staffers at legal news website Law360.

Founded in 1974, EMSI is a provider of medical information and risk management services to insurance, health care and government clients, according to its website. The company has 160 offices nationwide, including offices in Huntington Station, Rockville Centre and Albany, the attorney general said.

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