The legal framework for psychotherapy in Ontario has changed significantly in recent years. Since the Psychotherapy Act, 2007 came into force on April 1, 2015, and with psychotherapy becoming a controlled act in 2017, both individual therapists and group practice owners are facing new legal questions – and none is more common than non-solicitation clauses.
Why Non-Solicitation Issues Arise So Often
Many psychotherapists begin their careers in a group practice to build experience and a client base. Eventually, many choose to move on and open their own practice, and it is natural for clients to want the option to follow their therapist.
From the group practice owner’s perspective, however, this can be alarming. They may feel that they invested in the therapist’s early career only to risk losing a large portion of their client base when the therapist departs.
To manage this risk, group practices frequently include non-solicitation clauses in their employment agreements (or, commonly, in independent contractor agreements). These clauses aim to prevent therapists from actively encouraging clients to leave the group practice after the relationship ends. If you are a therapist planning to launch your own practice, or you operate a group practice worried about client loss, the key question is the same: Are these non-solicitation clauses actually enforceable?
When Is a Non-Solicitation Clause Enforceable?
A non-solicitation clause in an employment contract will be enforceable “only if it is reasonable between the parties and with reference to the public interest“.
Generally speaking, to be enforceable, a non-solicitation clause must be:
- clear,
- unambiguous,
- reasonable in scope, duration, and activities restricted, and
- protects a legitimate business interest.
A non-solicitation clause is unenforceable if it is:
- ambiguous,
- overly broad, or
- goes beyond what is necessary to protect that interest.
Moreover, non-solicitation clauses that restrict an employee’s ability to accept business, rather than merely preventing solicitation, may constitute an unlawful non-competition clause and can be unenforceable on that basis.
The enforceability of the clause needs to be assessed on a case-by-case basis in light of the language of the clause and the surrounding circumstances.
Our firm has advised both individual psychotherapists and group practices on these issues. Because we have seen both sides of these disputes, we understand the legitimate concerns that each party brings to the table. In our view, a balance can be found that protects the business of the group practice while allowing clients to choose to follow their psychotherapist to the new practice if they choose to.
Client Choice Must be Protected
In order to find an appropriate balance, it is important to ensure that clients are able to choose their therapist. A non-solicitation clause that prevents psychotherapists from giving clients the option of following their current therapist to a new practice would force the client to sever the therapeutic relationship and disrupting that relationship without the client’s input is rarely in the client’s best interests.
The College of Registered Psychotherapists of Ontario (“CRPO”)’s Professional Practice and Jurisprudence Manual states the following about non-solicitation clauses:
“From CRPO’s perspective, the client’s best interests are paramount. [Registered Psychotherapists (“RPs”)] should not enter into agreements that prevent a client from making an informed choice of where to receive care, e.g., RPs should not promise their employer that after their employment ends they will never treat a client who they saw through the employer.”
In practical terms, a clause that prevents a therapist from offering clients the option to continue therapy at a new practice may be difficult to justify on public interest grounds. Although we are not aware of a court decision in Canada directly addressing this issue in the context of the modern psychotherapy profession, it remains an important consideration when assessing enforceability.
A More Balanced and Practical Approach that Protects all Parties and the Clients
Rather than relying on a strict non-solicitation clause, psychotherapists and group practice owners may wish to consider an alternative that protects both parties while respecting client choice. A balanced approach often involves three key components:
- Clients are given a genuine choice. When the psychotherapist leaves, they inform clients of their departure and give them the option to either remain at the group practice with a new therapist or continue treatment with the departing therapist at their new practice.
- The therapist refrains from active recruitment. Beyond informing clients of their options, the therapist does not take steps to solicit or encourage clients to leave the group practice. The goal is transparency, not persuasion.
- A fair transition fee is paid for clients who follow the therapist. If a client chooses to continue with the departing therapist, the therapist pays the group practice an agreed-upon fee for a limited period, typically mirroring the former revenue split. For example, if the practice and therapist previously operated on a 60/40 split, the therapist may continue remitting 40% of fees earned from former clients for a reasonable transition period.
Whether this model is appropriate for a particular practice will depend on the specific circumstances and structure of the relationship. However, this approach often provides a fair and practical balance: it protects the group practice’s legitimate business interests, allows therapists to progress in their careers, and most importantly, preserves client choice.
How We Can Help
Whether you are a psychotherapist planning a transition or a group practice owner seeking to protect your business, we can help you navigate these issues with clarity and confidence. Because we have advised both individual psychotherapists and group practice owners, we understand the practical realities on each side and can offer balanced, effective guidance.
We assist departing therapists in understanding their contractual obligations, managing client transitions ethically, and avoiding unnecessary legal risk. For group practices, we help prepare agreements that are enforceable, fair, and aligned with both business needs and client choice.
If a dispute has already arisen, we can step in quickly, whether that means resolving the matter efficiently or advocating forcefully on your behalf to protect your interests. And if you are entering a new working relationship, we can review your contract to ensure that any restrictive covenants are appropriate and reasonable.
Wherever you are in the process, please feel free to contact us to get legal advice. Let us take care of the legal issues, so that you can continue focusing on what you do best – helping your clients.
