What else to ask for in contract negotiations

[JClaw7]

Do you all have any suggestions for additional clauses to include in your contract during negotiations? Anything you wish you had negotiated or added? Any unique "asks"? I'm aware to always negotiate non competes, salary, partnership details etc but just curious if there were some other ideas. Thanks!!!

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[eyeeye_captain]

The practice setting will dictate some of this. PE, academics, and practices with a lot of associates are probably going to hand you the standard contract and not budge much.

You can usually get a little bump in base and collections bonus by negotiating, but not world changing. One relatively easy thing to ask for is a relocation/signing bonus, I’ve found most practices don’t complain and it floats you until you start. I would recommend having it in the bylaws that all docs taking call take it equally. Sure, some folks age out, but you don’t want to be the only one around after office hours.

Non-competes you’re probably not going to make any headway. It’s a small red flag to me when an interviewee is grabbing their parachute before getting the job, despite it being the smart move. I would just ask to have the same conditions for one as the partners. Also, the FTC may blow up non-competes anyway, so not as big a deal.

 

[dgdg]

First, I assume you are going to read the entire contract. I've seen some odd things over the years. Read every single page, every single word, assume nothing.
You can't negotiate if you can't walk away. Have at least more than one contract offer at the same time.

Termination clause - this applies to employee and employer
Immediate termination conditions need to be exactly spelled out. What exactly has to occur for immediate termination.
General termination - how much notice must they give you, and how much you must give them.

Malpractice insurance -
Employer should include a tail, or you'll wind up paying your own tail to cover the statute of limitations. If they disagree, at least you'll know to financially plan for that.
They should be required to provide you at your request (yearly), a copy of your malpractice coverage.

Exclusivity -
For those doing primarily contract 1099 work, make sure you are not excluded from other work, or at least the entire scope of what you could do.

Non-compete -
Three variables in non compete clauses: scope of practice, geography, and time duration.
Make sure you can live with whatever you agree to here.
For example, if a hospitalist, you could request permission to do focused outpatient work in your hometown, or vice a versa.

Supervisory role - NP, PA's?

Hold harmless -
This is THE big one. If you see a hold harmless clause in your contract, STOP and read it very carefully. Then read it again.
If you are not 100% completely comfortable with this clause, I strongly recommend seeking legal advice. This could be a massive financial liability for you that your malpractice won't cover.
One might accept to hold another harmless except in cases of 'willful misconduct or gross negligence'. I would never contractually agree to hold someone harmless if they were grossly negligent, willfully acted with misconduct, or engaged in criminal activity. If it's not in the contract, it's not in the contract.
A blanket all encompassing hold harmless is not good - run away.
For my contract work I have successfully negotiated this expected clause to reasonable, and equal (reciprocal), language several times.

Vacation, sick dates, call coverage.

 

[cde]

Don't forget buyouts by private equity. Can you terminate without any non compete, etc?

 

[TheLesPaul]

200% ^^^^

noncompete/restrictive covenant should not apply in the event of sale of the practice (stock or asset sale), or in termination without cause.

 

[JinxADC&MD]

The practice setting will dictate some of this. PE, academics, and practices with a lot of associates are probably going to hand you the standard contract and not budge much.

You can usually get a little bump in base and collections bonus by negotiating, but not world changing. One relatively easy thing to ask for is a relocation/signing bonus, I’ve found most practices don’t complain and it floats you until you start. I would recommend having it in the bylaws that all docs taking call take it equally. Sure, some folks age out, but you don’t want to be the only one around after office hours.

Non-competes you’re probably not going to make any headway. It’s a small red flag to me when an interviewee is grabbing their parachute before getting the job, despite it being the smart move. I would just ask to have the same conditions for one as the partners. Also, the FTC may blow up non-competes anyway, so not as big a deal.

I see it from a practice owner's point of view but as a prospective associate it also feels like a red flag when a non-compete is not budged on as it feels like the practice isn't confident in retaining employees. We are getting more and more training at conferences to specifically negotiate non-competes. How do you think the potential abolishment of non-competes by the FTC would affect future associate contracts?

 

[eyeeye_captain]

I see it from a practice owner's point of view but as a prospective associate it also feels like a red flag when a non-compete is not budged on as it feels like the practice isn't confident in retaining employees. We are getting more and more training at conferences to specifically negotiate non-competes. How do you think the potential abolishment of non-competes by the FTC would affect future associate contracts?

As I stated, I think the fair compromise is to ask for exactly what the partners have in their contracts since a non-compete is almost certainly there. A practice should be equitable, including with associates. Practically speaking, partners are unlikely to rewrite all of their own contracts for an associate. Good luck getting PE practices to negotiate at all since their entire goal is to dominate markets. I understand why it gets beaten into your heads and why it’s important. I’m just saying it will probably be tough sledding.

For reference, my practice won’t budge for exactly the above - every doctor keeps the same terms. Our retention rate to partner is nearly 100% because everyone is equal.

If the FTC does kill non-competes, I think it’s good in the grand scheme. EDIT: It might make compensation go up to try to retain docs and avoid them setting up shop. Probably less likely in saturated areas since it would be harder for someone to open up next door if they leave or make a rival practice way stronger.

As mentioned above, it’s probably more useful to have a sale to PE covered by cancellation of a non-compete and compensation/buy-in clauses.