If you’ve recently received a new employment contract, congratulations. You’re about to start a new job and a new chapter in your life.
But don’t rush to sign it just yet. There are a few things you’ll need to know first.
From compensation models to termination clauses, here are seven things you’ll want to keep in mind before signing a physician contract.
- Hire a Contract Review Lawyer
The first thing to know about physician contracts is that they are binding, and it’s never a good idea to sign a binding agreement without having a lawyer review it first.
Contract review lawyers with experience in physician contracts know all the ins and outs of what should and shouldn’t be in the agreement.
While receiving a new employment offer can be exciting, take the time to hire a lawyer that can review it thoroughly before you sign your name.
- Contracts Can Be Negotiated
Until you sign a contract, it’s not set in stone. Physician contracts contain many different terms and clauses, many of which can be negotiated to be more favorable to you.
There are a variety of contract elements that you can negotiate or have your contract review lawyer negotiate for you, including compensation, signing bonuses, and restrictive covenants.
To learn more about how a contract lawyer can help you negotiate your contract, read this definitive guide to physician contract review.
- The Compensation Model
Unlike most employees in most industries that earn a straight salary per year, there are a variety of physician compensation models. The compensation model detailed in your contract will affect how much you’ll actually earn each year.
The most straightforward compensation model is the straight-based salary, where you’ll earn X amount per year and work X amount of hours per week.
Another common compensation model is the RVU-based production model. In this scenario, your salary depends on your level of productivity and how many RVU you bill for.
Checkout this article to learn more about the pros and cons of the different physician compensation models.
- The Call Schedule
Contracts should be very specific about the details of call coverage. If yours isn’t, you’ve got a problem.
For many physicians, being on call is an unavoidable part of the job, and how often you get stuck doing it depends on how it’s detailed in your contract.
Beware of vague language about call coverage. Your contract should specify how many days you’ll need to be on call per month or, at the very least, state that call coverage won’t exceed a certain amount. If your contract doesn’t spell out a specific call agreement, you could find yourself working many more nights and weekends than anticipated.
- Restrictive Covenants
Almost all contracts include restrictive covenants to some degree, but it’s the non-compete clause that you have to pay extra attention to.
Non-compete clauses often stipulate that you cannot work within a certain radius of the employer for a certain period of time after your employment ends. For example, it may state that you can’t work within a 10 mile radius for a two year period or that you can’t work within the same county for a one year period.
Radiuses range considerably between rural practices and metropolitan practices, so make sure that yours is a reasonable one. If it’s not, it could mean having to relocate or making a lengthy commute for a set period of time.
- The Termination Clauses
It’s normal to accept a job offer with the optimism that you’re going to love the job, enjoy working for the employer, and want to renew your contract when it ends.
But it doesn’t always work out that way.
All employment contracts include termination clauses that discuss what happens in the event that the employer terminates you or that you decide to end your contract early. In some cases, a termination clause may put you on the hook financially.
If you end your contract early, you may have to pay for your own tail coverage for malpractice insurance. You might even have to pay back recruitment costs or signing bonuses.
Even if you’re expecting this job to be the dream job you’ll never want to leave, pay special consideration to termination clauses before signing.
- Is Anything Missing From the Contract?
What the employer fails to include in your contract is equally as important as what they do include. Earlier we mentioned the importance of hiring a lawyer for contract review, and this is another reason why.
Lawyers don’t just look at what’s in the contract. They also look for what’s missing.
Employment contracts should spell out all of the terms of the employment agreement in specific detail. The more details included, the less ambiguity there will be for both the employer and the employee.
In Conclusion
Employment contracts are complex, and they’re also binding. No matter how excited you may be to sign your name and get to work, protect yourself by taking the time to hire a contract review lawyer to review it for you.
