The FTC logo with comment bubbles behind it.
Epic Systems' tight control over the job options of its former employees has drawn pained criticism in public comments received by the Federal Trade Commission.
In January, the FTC proposed a nationwide ban on employers imposing noncompete agreements on their employees. Such requirements are unfair to both workers and would-be entrepreneurs, the regulators argue, because they hamstring their economic opportunities.
Epic’s noncompete policy, which rules out jobs in approximately 4,500 companies, as Isthmus reports in its June cover story, “Lost Opportunity,” typically lasts from one to two years for departed employees.
During the comment period, which closed April 19, the FTC received more than 20,000 responses on its proposed ban. Only a handful of those comments mention healthcare IT goliath Epic Systems by name, but the ones that do uniformly bemoan its power over workers.
Of note: The proposed ban drew the opposition of the Wisconsin Hospital Association and the support of the Wisconsin Medical Society. Wisconsin Manufacturers & Commerce is another opponent.
The essence of the FTC complaint is that noncompetes undermine job mobility and business innovation, while suppressing wages. The FTC asserts that banning noncompetes would increase workers’ total earnings by close to $300 billion a year.
Epic did not file a position paper with the FTC. But in a statement to Isthmus, it said noncompete clauses are common in the tech industry. “Our employee agreements help us protect our intellectual property,” the company said. “Our agreements say that after employees leave Epic, they can work anywhere they wish as long as, for a certain period of time, the work they’re doing doesn’t involve Epic software.”
As for the proposed ban, the FTC says the public comment component of rulemaking helps guide the commission in its mission to combat “monopolies, false advertising, privacy invasions, scams, and other unfair or deceptive conduct, as well as by addressing unfair methods of competition.”
Here are edited and condensed excerpts of Epic-related comments.
Evan Underwood, posted Feb. 28, 2023
If companies are worried about employees bringing their skills and experience to competitors, they should prevent it in a fair way — through appropriate compensation, good work conditions, and fair employment contracts. This lays the burden where it belongs: on employers with wealth and structural power, not individual employees.
I'm a software developer in my 30s, and I grew up in Madison. I've seen first-hand how companies like Epic prey on people who have just graduated from college with no other job experience. They offer an attractive starting salary and the promise of prestigious work — but Epic has a dark side.
I've known literally dozens of peers who accepted positions with Epic — then left after one to three years, because Epic expects enormous and unsustainable amounts of [uncompensated] overtime from software developers. Epic also has an extensive noncompete agreement — it includes literally thousands of companies…[that] touch Epic's software or corporate structure in any way.
I've seen…dozens of ex-Epic employees struggle to find employment. Many industry jobs in the area are affected by the noncompete, and over half of them have been forced to leave the state to find work, or leave IT completely. Some have even lost their visas to stay in the United States because they couldn't find work [that] wasn't banned by the noncompete — at an age where they are just starting to settle down, marry, and start families. This is devastating and unfair, and it shouldn't be allowed.
Michael Papa, posted April 9, 2023
Epic holds a tight grasp against any former employee who wants to work in any capacity with an Epic customer or partner; their HR department will provide a surprisingly-lengthy list of forbidden companies to work for during your non-compete period.
Many brilliant ex-Epic employees who could help improve healthcare IT implementation and support in the United States are forced out of their area of expertise to work in a tangentially-related and often for-profit business…that isn't restricted by an agreement enforced by Epic Systems.
As an individual who worked at Epic for over five years, became an expert in electronic medical records, and later went to work for a non-profit Epic customer after the terms of my noncompete agreement ended, I can honestly say that my expertise during the time of my noncompete agreement would have been better spent improving patient outcomes in Minnesota compared to the lack of meaningful work allowed per Epic's non-compete agreement. Do for
Elsa Calhoon, posted Jan. 17, 2023
My daughter worked for Epic for seven years and is excellent at what she does. She was well paid by Epic, but…the work expected [of employees] does not fit well with family life. [S]he would work 12-hour days for three to seven days when a new facility was brought on to their system. In return, she was given one day off, even though she routinely worked through entire weekends. She was able to save enough money to leave and pay her living expenses for a year. Many others cannot do this. Noncompete clauses allow companies to mistreat employees.
Matthew Lower, posted Jan. 30, 2023
I am essentially a corporate “nobody” who worked at Epic Systems, a behemoth healthcare software company, for 11 years. I possess no strategic knowledge or trade secrets.
I am bound by a two-year noncompete that prevents me from working with EPIC’S OWN CUSTOMERS, which represents a majority of the healthcare market, to use my skills.
This is broad overreach and must be stopped.
Greg Ledray, posted April 19, 2023
My role at Epic was as a software developer working on improving a narrow aspect of their scheduling software. Epic's noncompete requires that former employees do not work at a list of their competitors. This list has thousands of entries, and includes many of the large, high paying companies in the healthcare software industry. The contract also prevents former employees from working for [Epic] customers. Epic's market share is so large that this precludes working at all large hospital systems in the United States. I have attached an old version of this list.
I believe that this non-compete:
* Substantially and adversely affects the ability of former Epic employees to be employed at the market value of their skills and services
* Forces former Epic employees into work outside of the healthcare industry, where their previous work experience is less relevant….
Epic has signed contracts with their customers, as well as with any consulting companies who work with their customers, [that] prohibit those companies from employing former Epic employees. Epic enforces this contractual agreement by not giving former employees access to key pieces of job functionality for their (potential) new role working for their customer. They do this by restricting "UserWeb" access. Without UserWeb access, [an] employee's ability to perform job tasks in Epic-related hospital IT is degraded to the point where they are unemployable by these organizations.
Anonymous, posted March 22, 2023
I work for a large electronic health records company, Epic Systems, that is known for hiring staff right out of college, myself included. I was impressed with their starting salary and well-advertised benefits, so I was quick to accept their offer. After accepting their offer, I was surprised to receive a contract outlining a strict noncompete agreement — for 18 months after my employment is terminated.
I may not work for any direct competitor of the company, establish a new business enterprise to compete with the company, or even seek employment related to software with any of their customers or “active prospective customers.”
This list names thousands of employers. Gaining work experience should open doors for employees, but working at my employer has shut every door to me. For an extensive period of time, I am unable to use virtually any of the skills acquired at my job to obtain another job in this industry. I feel disappointed that this information was not made apparent to me prior to my acceptance of the position, and now I feel stuck in a job that I’ve quickly discovered is not a good long-term fit for me.
Anonymous, posted March 15, 2023
The use of a noncompete, specifically in niche industries, allows employers to blacklist ex-employees from working in their specialized field and keep their wages low. Epic Systems is an egregious perpetrator of this.
Anonymous, posted Jan. 17, 2023
Throughout my career I have been prohibited from hiring employees that worked at Epic Systems because the companies I have worked for needed to access Epic's software as part of our business. Epic has required every vendor and company that might touch its software to agree to not cause an Epic employee to violate their employee agreement — which includes a clause that they are not allowed to work for any customer or company that has signed a "consulting agreement."
Because of the nature of Epic's position in the healthcare market, literally thousands of healthcare technology, service, and care organizations need to sign such an agreement with Epic in order to operate their business.
As such, Epic has one of the most overreaching noncompete clauses in any business — preventing employees from working for literally thousands of healthcare businesses, which often leads them to find employment outside the industry and basically start their careers back as an entry level position when they leave Epic.
Anonymous, posted March 13, 2023
Epic Systems…has a very broad noncompete list of over 4,000 companies within healthcare technology and consulting. They wield their power by threatening to harm companies that hire ex-Epic employees by increasing costs of licensing their software or removing a company's access to their software. Beyond that, this particular company has been known to punish former employees by not allowing them to access their software even after the noncompete period, which can prevent them from working in hundreds of jobs they'd be qualified for.
Anonymous, posted April 30, 2023
Even as someone not interested in continuing in the field of healthcare IT, I had a great amount of difficulty finding a new job in the Madison area because of the noncompete agreement. Many former employees of Epic joined new jobs in the area only to quit once the noncompete was up, so local employers were reluctant to hire former Epic employees within the time limit of the non-compete agreement.
[See related story, "Lost Opportunity," about the impact of Epic System's noncompete agreements on former employees and the growth of tech startups in Dane County.]
