Dos and don'ts of contract negotiations

After months of researching, exchanging emails, editing your CV and traveling across the country for interviews, the time has come: an employer has finally presented you with a formal offer and employment contract for you to sign. Chances are, you are elated by the offer and significant salary you will earn after years of receiving a pittance as a resident or fellow. However, as you read through the numerous pages full of legalese, you begin to feel a bit of anxiety. “Is this offer fair?” “What exactly does this non-compete mean?” “Is it okay to ask for more money, or will I look greedy?” “If I ask too many questions, will they be annoyed by me and rescind the offer?” These (and more!) are all normal questions most physicians find themselves asking.

Your employment agreement is the framework for your working relationship with your future employer and it is paramount that before you sign it, you feel confident that the agreement is reasonable and mutually beneficial. Understand that negotiating is an important part of the employment process. Before you dive in, however, there are a few “dos” and “don’ts” you’ll want to be aware of so that you can negotiate confidently, respectfully and effectively.

Don’t: Assume a contract is non-negotiable

Some employers may not be willing to budge on certain aspects of the contract, but remember, even in the most boiler-plate contracts, many terms remain negotiable. There are a plethora of things you can ask for in your contract so that it suits both your professional goals and your personal needs. When it comes to negotiating, it never hurts to ask for what you want! You may be pleasantly surprised by what the employer says yes to.

Don’t: Forget to do your own research

You can’t possibly know whether the compensation offered to you is fair if you don’t do any research on your own first. Try to gain a general idea of what the compensation is for your specialty and specific region of the US by utilizing online resources such as PayScale and Doximity. Or, better yet, work with an attorney or other resource that has access to reputable physician compensation data services, such as MGMA. An experienced physician employment attorney will help you to thoroughly examine the available compensation data and compare the package offered to you. Is your Total Compensation on par with what other folks are earning? What forms of compensation are available to you in addition to your Base? Is your productivity income based on Collections or wRVUs? Is the wRVU rate offered to you fair and reasonable? Further, an experienced attorney can inform you of what other financial terms your contract may be lacking that are standard, such as relocation reimbursement or a CME allowance.

Don’t: Ignore red flags

Contract negotiation can be a nerve-wracking experience and it’s normal to feel a little anxious over it. However, it’s imperative that you trust your instincts and don’t ignore any red flags. Significant red flags to be aware of include the following:

• an employer pressuring you to make a decision that feels rushed (i.e. giving you a short “deadline” to sign the Agreement).
• an employer discouraging you from consulting an attorney.
• an employer who is completely unwilling to negotiate or takes great offense to you asking questions.

Always trust your gut if things feel “off”. It’s much easier to walk away before signing than to try to get out of a contract after the fact.

Do: Be flexible but consider your non-negotiables

Understand that you may not be able to get everything you want in your contract - employers may have standard language in their contracts that they’re unwilling to budge on. For instance, what they’re offering you in terms of benefits and salary may be standard across the board for every physician new to the practice. Accordingly, you do need to be flexible on some items, but you don’t want to compromise so much that you feel you’re the one getting the raw end of the deal! Spend some time considering what your non-negotiables are. Make a list of your top priorities that you want memorialized in your employment agreement; is it a flexible schedule, the ability to hire your own NP or PA, student loan repayment, a specific location you will serve? By being prepared and knowing what you are and aren’t willing to sacrifice, the better you’ll be able to negotiate and advocate for yourself.

Do: Use an attorney to review your contract

Regardless of what an employer may tell you (e.g. “There’s no need to hire an attorney because our contracts aren’t negotiable anyway.”), or what you may hear from friends or colleagues, always consult an attorney, specifically, one who is experienced with physician employment agreements. Attorneys who are experienced in this field are the only ones who will be able to tell you what is standard, what is “normal,” what amendments are reasonable to request, what is reasonable and enforceable in terms of provisions that are specific to physicians such as Non-Compete Covenants, and so much more. Furthermore, an attorney will simply make you aware of the agreement you are entering into, which of course is contractual and therefore legally binding. Non-attorneys are not able to identify or understand the scope of potential repercussions of a contract’s terms, and therefore don’t know how to protect themselves. While you are incredibly educated and capable, remember that you don’t know contracts! And perhaps most importantly, keep in mind that the contract you are being offered was written by an attorney (or team of attorneys) who represent only the employer and therefore are bound to promote their client’s best interests, not yours. It only makes sense to have the same level of protection and guidance in this process.

Laura Lauth Andrews is the lead attorney with Lauth O’Neill, LLC. She works exclusively on behalf of physicians, advising her clients on all aspects of their employment relationships, including the job search process and negotiating their employment agreements. lauthoneill.com