Negotiating Employment Contracts
Figure Out What’s Right for You
The goal of every negotiation is to reach an agreement that meets all parties’ needs. One of the most important things to consider when evaluating a potential job is the type of practice (solo, partnership, small practice, employer) in which you would like to work. Practice style (private, hospital owned, urgent care, locum tenens, etc) and location (urban, suburban, rural) are also important to consider.
Although compensation itself may not be negotiable, you often can negotiate details such as schedule, office and call hours, administrative and meeting duties, funding for CME activities, and vacation time. By prioritizing your needs — clinical, professional, and personal — you can enter contract negotiations with a clear vision of the position that’s right for you.
Know Your Own Worth
As a new physician, you can expect compensation to be determined by regional market factors and comparable to that of physicians with similar skills and experience. There are numerous salary surveys available to help you find out how much physicians in your region are earning.
Connecting Family Physicians & Employers
Research the Practice
Knowing the practice style, size, and location can help you determine the amount of flexibility there might be in a contract’s terms. For example, a rural practice may have a greater need for your services and therefore be more willing to negotiate terms than a larger urban practice.
If possible, learn about the business and clinical reputation of the group that has offered you a job. Ask potential employers where they see the practice five years from now and where you’ll fit into their long-term plans.
Know the Elements of a Contract
Before signing anything, ask a senior physician, recruiter, or an attorney to examine the contract. Make sure the following items are clearly and completely addressed:
- Where required to have admitting privileges (which facilities)
- Work status (part-time, full-time)
- Conditions of employment
- Term (length of contract), renewal or future negotiations
- Compensation package (base salary, percent of collections, bonuses, etc.)
- Business expenses (CME, licensing, professional dues, staff fees, journals, stipends)
- Fringe benefits (health and life insurance, retirement plans, etc.)
- Malpractice insurance (occurrence or claims made and tail coverage)
- Paid time off (vacation, sick leave, maternity, disability, etc.)
- Co-ownership, if applicable (partnership, buy-ins, payouts)
- Restrictive covenants (noncompetition, nonsolicitation)
- Termination (“at will” versus “for cause,” notice period, payment, and post-termination obligations)
- Schedule (on-call, phone calls, prescription refills, unassigned ER, inpatient census for practice)
Optional Contract Elements
- Forgiveness of guarantees
- Educational loan forgiveness
- Moving expenses
Understand the Agreement
Make sure you understand the compensation package being offered. Don’t be afraid to ask questions about unfamiliar or unclear terms or to probe for specifics. If an employer is unwilling to clarify information or provide more details, you may want to reconsider the offer.