Should a firm hire a dental attorney to negotiate an associate employment agreement? | Fox Rothschild LLP
When hiring an associate dentist, it is essential for a dental practice to have a strong and clear employment contract.
Although law firms often understand the importance of hiring a lawyer to prepare the agreement, they are usually in a hurry. They may also not know how to find an experienced healthcare attorney to draft the agreement.
As a result, the practice may hire an attorney the owner knows, even if the attorney does not have experience negotiating dentist employment contracts. Or, the firm may try using an old template or document from the Internet in hopes of saving time and money.
However, if not drafted properly, associate employment contracts can be a headache for dental practices and can lead to lost clients and increased expenses. Additionally, the partner could hire a lawyer to review and propose changes to the agreement, leaving the firm in the position of having to hire a lawyer after the fact to represent the firm.
Health care attorneys who regularly negotiate dental employment contracts can be a valuable resource for practices. They can prepare the employment contract effectively and efficiently, using a well-drafted template with clear, employer-friendly provisions. They can also allow you to rest easy knowing that you are prepared in case the associate tries to broker the deal.
Regardless of which practice chooses to go with an attorney, there are certain provisions that a practice should keep in mind when negotiating an agreement with an associate dentist. Here are some general tips and pitfalls to avoid:
- Compensation. If any part of the associate’s compensation is based on recoveries, it should be clear in the agreement how the compensation will be calculated and when it will be paid (including how the final reconciliation of the associate will be done). The last thing you want are potential arguments and litigation over what the firm owes the partner in compensation, either during or after employment.
- Tail insurance. If the firm has professional indemnity insurance in the event of a claim, the cost of the partner’s tail insurance after termination of employment must be taken into account. Generally, the firm will want the partner to be liable, but in any case, they should be entitled to purchase the insurance and deduct the cost from the partner’s final compensation.
- Corrective work. The Associate should be responsible for covering the cost of all corrective work, both before and after termination. The firm should have the option of requiring the partner to return to perform the work at a reasonable cost to the partner, or of performing the work and billing the partner for it.
- Restrictive clauses. Non-competition and non-solicitation covenants (including those prohibiting the solicitation of employees and patients) must be well drafted to protect the practice. Among other things, the agreement should allow the firm to enforce the covenants without posting bail with the court and prohibit the partner from asserting a defense to the enforcement of the covenants.
- Program. It may be advantageous for the firm to have the partner’s schedule detailed in the agreement. However, the firm should also retain the authority to change the partner’s schedule if deemed necessary and require prior approval for PTO time.