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The Professional's Employment Agreement
This firm is devoted to practitioners and understands the situation of the practitioner on the verge of entry into an employment experience. We are aware of the considerations of experienced vs. new practitioners and can assure your matter will be handled promptly and efficiently by experienced counsel. Be sure to ask about our introductory reduced hourly rates for new practitioners.
The first employment agreement may be the most important a practitioner will ever execute as it can dictate: future income and security; ability to remain in a specialty and geographic area; participation on provider panels of various insurers and third party payers; and upward mobility and career development. Unfortunately, after years of education, the issue of compensation frequently overcomes consideration of these other factors allowing a practitioner to fall victim to bottom line income concerns of the institution and practices with which they become affiliated.
The key elements to be considered in a first employment contract include:
Nature and Scope of duties and assignments. Agreements should assure gaining experience in the intended specialty or subspecialty area; time commitments, travel and on call coverage obligations. Can the employee engage in outside income producing, research, writing or academic pursuits?
Compensation, bonus and percentage incentive agreements. This includes so called threshold oriented bonuses and factors such as lost of unvested benefits, application to post employment year/termination collections and the prospect of realizing bonus packages.
Benefits and Perquisites. Consider CME, health insurance coverage (family/individual), professional liability coverage (including possible tail requirements which bind the practitioner to material financial obligations post termination), retirement and profit sharing (including loss of non-vested portions of contributions to retirement or profit sharing plans), use of automobile, communication services, vacation and educational leave. What are sick leave/disability provisions?
Termination provisions. Accord special attention to so called "without cause" termination and "for cause" termination provisions. The latter may actually be "without cause on notice" termination provisions. Don't forget to consider the employee's right to terminate and withdraw without liability and the right to compensation and notice on termination without cause.
Malpractice Coverage. What kind of insurance will be provided and at what level of coverage. Will insurance be "claims occurrence" offering continued coverage for claims after termination or "claims made" requiring payment for a "tail" to maintain coverage of post termination claims. If the latter who will pay for it?
Restrictive Covenants and Non-solicitation provisions. Will the employee be forced to leave the geographic area? Can areas or institutions be carved out of the restrictions? Is employment tied into hospital privileges or vice-versa?
Term and Future Prospects and Renewals. Non-renewal can have the same consequences as a without cause termination especially where there is inadequate notice. Often a letter of intent can be obtained which, although non-binding, indicates where the employment is leading and is especially relevant in a private practice.
Track Record of Employer. Association with a hospital or private practice specialty group that has a negative track record or questionable billing practices can impair future endeavors. How many predecessors have there been in the position and what happened to them?
Hospital Issues. Often Hospitals use an employment letter the informality of which can leave much in question. Special issues frequently arise in agreements and contracts with Hospitals including, more recently, the use of Relative Value Units (RVUs) to determine compensation. In addition, issues of compensation, termination and advancement are spread among a faculty practice plan, the hospital and/or a medical school, requiring close review of each of such organization's rules, regulations and bylaws. Frequently such rules, regulations and bylaws supersede the content of letters and contracts of employment.
Analysis of Goals. Do the employment terms and prospects represent progress toward future goals?
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The Law Offices of Joseph J. LaBarbera, P.C.
55 Washington Street, Suite 602
Brooklyn, New York 11201
Voice: 718 596-9366 / Fax: 718 596-9167
Email to: jlb@nyhealthlawyers.com
This document is for informative and educational purposes and its
content is not intended to constitute or be relied upon as legal advice.
Any reader's specific issues or matters should be analyzed with experienced counsel.
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