In part 3 of this series, I discussed the 3 main pay structures in an employment contract. As pay rate is only 1 factor when negotiating an employment contract, in Part 4 of this series—the final part—I talk about the nonsalary items you should include: requirements/expectations and benefits.
Requirements/Expectations
To ensure you and the new associate are both on the same page, be sure to spell out in the employment contract expectations, such as schedule requirements, on-call responsibilities, and any other professional duties you might require. For example, you may require active participation in your state’s optometric association.
Additionally, don’t forget to include the terms of the employment agreement, including the start date and termination requirements (ie, “the associate must provide a __-day notice if leaving the practice”).
Further, include conflict-of-interest stipulations, such as that the associate is not allowed to work at another practice during their employment with you, and any noncompete clauses, as well. An example of a noncompete would be that the associate is not allowed to work in a comparable role within 5 miles of your practice for 1 year after termination (voluntary or involuntary). Make sure to check your state laws to determine whether a noncompete is enforceable, however.
Pro tip. Always make sure to follow any state guidelines regarding employment when addressing requirements and expectations and be aware that many states will not enforce noncompete requirements (see https://www.dol.gov/agencies/whd/state for additional information).
Benefits
Employment contracts for associates can include nonsalary benefits, such as paid time off, maternity or paternity leave, a professional allowance, licensure fees, a uniform allowance, retirement planning (such as a 401k or IRA), eyecare benefits, and health care benefits.
While you certainly do not have to offer all these items, you should be prepared to discuss them openly with your associate during the contract process. Listen to what the associate values (time off, health care benefits, etc) and be willing to adjust your offerings accordingly. For example, if you are planning to offer 2 weeks PTO, health insurance, and a 401k match, but the potential associate would prefer a professional allowance instead of insurance, you could amend the offer to reflect that compromise.
Prepare ahead of time by formulating what is the approximate total spend (salary plus benefits) that you are willing to invest. This will allow you to quickly know if you can accommodate any changes during discussions to remain competitive and appealing to your candidate. Many times, these nonsalary benefits are as important, if not more impactful, to new hires than their actual pay rate.
During this part of the contract process, don’t be afraid to think outside the box. For example, you may want to offer a stipend the associate can put toward personally funded health insurance should providing it through the office not be possible.
Negotiation and Execution
As mentioned above, it is imperative to ask your potential associate what is most important and listen to their areas of concern, if any. By doing so, you can tailor the employment contract to benefit both parties, thus increasing the likelihood of successful employment. Make sure to establish a timeline for contract review (yearly, biyearly) to ensure the relationship is mutually beneficial and that expectations are being met, and to allow for adjustments, if needed. Finally, fully execute the contract. This means having both parties sign the written employment contract, acknowledging all areas negotiated. This will protect both the business and the new associate and provide a reference for any future discussions or misunderstandings.OM
