What Southeastern Regional Physician Services v. Scott Means for Employers and Employees: NC Noncompete Law Update

The North Carolina Court of Appeals recently confirmed that noncompete agreements must be carefully tailored to the employee, the employer’s legitimate business interests, and the specific restrictions being imposed. In Southeastern Regional Physician Services v. Scott, the Court found the challenged noncompete agreements overly broad because they restricted too much professional activity, and it refused to rewrite the agreements under North Carolina’s blue-pencil doctrine. Employers should avoid one-size-fits-all restrictions, and employees should not assume a noncompete is enforceable simply because it has a familiar time period or mileage radius.

North Carolina noncompete law received important clarification in July 2026. In Southeastern Regional Physician Services v. Scott, the North Carolina Court of Appeals held that the noncompete agreements at issue were overly broad and unenforceable and declined to blue-pencil or rewrite the restrictions. The decision matters for North Carolina employers, employees, healthcare practices, and business owners who rely on restrictive covenants to protect customer relationships, confidential information, or other legitimate business interests.

For employers and employees, Scott reinforces an important point: there is no magic length of time or geographic radius that automatically makes a noncompete enforceable. Courts consider the restrictions in the context of the specific employment relationship and the employer’s legitimate business interests.

The Court found the one-year duration in Scott reasonable and noted that prior North Carolina cases have upheld restrictions lasting up to five years. But that does not mean every one- to five-year noncompete is enforceable. Time matters, but it is only one part of the analysis. Courts also consider the geographic scope, the activities being restricted, the employee’s role, and whether the restriction is tied to a legitimate business interest.

The Court also found a 35-mile radius and Robeson County reasonable under the circumstances. Again, employers should not assume that a particular number of miles will work in every agreement. Geographic scope should reflect factors such as the employee’s actual territory, workplace, the employer’s business, and the interests being protected.

The biggest problem in Scott was the scope of prohibited activities. The agreements broadly prevented nurse practitioners from engaging in the “practice of Medicine” or providing substantially similar services. The Court concluded that these restrictions went beyond what was reasonably necessary and could prevent the employees from meaningfully continuing their careers.

The decision also highlights the limits of North Carolina’s blue-pencil doctrine. Employers should not assume a court will simply rewrite an overly broad noncompete to make it enforceable. In Scott, modifying the challenged language would have required changing the substance of the restriction, so the Court declined to do so. That means the drafting choices made before an agreement is signed may determine whether the restriction can be enforced later.

The practical takeaway: North Carolina employers should draft noncompete agreements narrowly and tailor them to their actual legitimate business interests. A carefully drafted restriction is far more likely to hold up than an overly broad agreement drafted with the expectation that a court will narrow it later.

Key takeaways for North Carolina businesses: Review noncompete agreements before using them across multiple roles; connect each restriction to a specific business interest; avoid language that prevents an employee from working in an entire profession; and do not rely on a court to rewrite an overbroad agreement later. For employees, the case is a reminder that enforceability depends on the exact language and circumstances, not just the length of time or geographic radius.

If you are a North Carolina employer considering a noncompete agreement, or an employee who has been asked to sign or is currently subject to a restrictive covenant, Revolution Law can help evaluate the agreement, assess enforceability risks, and explain the practical implications under current North Carolina law.

Contact Revolution Law to discuss your employment agreement and your options.

Revolution Law Group is located in Greensboro, NC, and serves individuals and small businesses throughout the Triad and surrounding areas. To contact us please visit Revolution.law or call 336-333-7907.

The information included here is for informational purposes only, is not exhaustive of all considerations when creating documents, is not intended to be legal advice, and should not be relied upon for that purpose. We strongly recommend you consult with an attorney and do not attempt to create your own documents.