A closer look at associate contracts

You have a contract in your hand and you’re not sure if it is a “good” contract or not. How do you tell? Here are some items to look for and to avoid in an associate contract:

“¢ Are you identified as an employee? In some cases, the term “employment contract” is used. If it isn’t, are there other indications that you are an employee (for example, is the term “salary” or “benefits” used)? If your status is not clear, the doctor may be considering you an independent contractor, with the expectation that you will be paying your own employment taxes (Social Security and Medicare).

“¢ Is the term of the contract specifically stated? How long does it last?

“¢ Are the descriptions clear and unambiguous? For example, if a contract states, “Salary is $3000…,” is that monthly, yearly, or weekly? When you are reading, ask yourself, “Does this make sense?” “Is this complete?” Ask someone else to look at the contract to see if he or she has questions.

“¢ If you are receiving a bonus, how is that bonus calculated? Are the calculations clear? If you can’t understand them, how will you know if you’re receiving the right amount of money? Is there a way for you to verify the bonus?

“¢ What benefits and time off will you receive? You should receive the same benefits as other employees. Your time off should be clearly defined. For example, if you are receiving a “vacation,” is that paid? At what rate? (This calculation is particularly important if you are receiving both a base pay and a bonus or incentives.)

“¢ Under what circumstances can you leave the practice? What notice period is required? Are there penalties for leaving before the end of the contract period? This is a very important section, because there are many reasons why you might need to leave the practice before the end of the contract (a family emergency, for example), and you should not be penalized for doing so.

“¢ What other obligations do you have under the contract? Can you do outside work as a chiropractor?

“¢ Is there a non-compete agreement in the contract? It may or may not be “reasonable,” so a better question might be whether you can abide by the non-compete. In other words, are you planning on staying in the area and setting up practice within the non-compete area? If so, you might want to reconsider this practice or try to negotiate a different non-compete section.

“¢ Has this agreement been prepared by an attorney? One way you can tell is if there are typographical errors, incomplete sentences or other sentence errors, or if there are many phrases and sentences that don’t make sense. An agreement prepared by an attorney is almost always clear and complete and free of errors. If the agreement has not been prepared by an attorney, beware. It may not be valid because vital elements may be missing or misstated.

“¢ Finally, take the contract to your own attorney and ask for a review. The attorney should be practicing in your state, because different states have different laws, particularly when it comes to non-compete agreements.

Four things to remember about associate contracts in general:

1. Everything is negotiable. If you cannot live with a section of the contract, discuss your concern with the other party and see if you can find a way to agree on something. You will probably need to give up something else, but there is almost always a way to find agreement, if you work at it. Don’t be afraid to ask for changes; it’s your contract and you must be satisfied with it.

2. A contract is only as good as the parties who are signing it. If both parties want to work together and treat each other as equal professionals, the relationship will be satisfactory. A “good” contract is one in which both parties are satisfied.

3. If it isn’t in writing, it doesn’t exist. When you read a contract, forget what the doctor might have said to you about the job or what promises were made to you. They don’t count and they could distract you from problems. Promises mean nothing when it comes to contracts. A promise is not enforceable in court. If a doctor says, “I will give you an increase in six months,” and it’s not stated in the contract, you can’t hold him or her to this promise.

4. Don’t be afraid to walk away from a contract. If there are sections that are unacceptable to you (for example, huge penalties if you leave before the end of the contract term), you may need to find another place to work.