The Importance of Dental Employment Agreements

When considering an associate dentist as a valuable addition to your practice, establishing an employment contract with terms that satisfy both you and the employee will set the tone for a positive work environment. More importantly, the formation of such contract will protect your dental practice from unforeseeable issues that could arise during the term of your dental associate’s employment. It is probable that legal issues could cause significant financial harm and damage the good name of your practice without the protection of an employment contract.

An employing dentist must include basic items in the employment contract to ensure that all parties involved have a clear understanding of their rights and responsibilities. Items normally included in the contract address what the associate dentist is expecting from his or her employer; including, but not limited to, the term of employment, expected obligations of the employee, benefits including health, life, or disability, vacation or sick day policies, reasons for termination, and the associate’s compensation. Both parties must thoroughly understand and believe that the terms of employment are fair prior to signing the contract. Additionally, all issues must be addressed while reviewing the document, providing little to no room for later issues to arise during the term of employment.

 

Along with the basics, there are items that an employer must consider when drafting the employment contract. It is strongly recommended that an employing dentist spend additional time placing in writing all potential situations that may cause issues between the parties involved. A legal expert would be of great assistance to draft a contract that takes into full consideration every factor that may put a dental practice at risk. It is crucial to provide as much detail as possible for each item included in the contract, such as the amount and structure of an associate’s compensation (i.e., bonuses, flat fees, guaranteed minimum salaries).

 

For the duration of an employee’s term, it is expected that an associate dentist will manage a portion of your client list. What occurs if and when the employee leaves your practice? Employers will want to prevent an employee from disclosing their client list to a competing dental office. For this reason, a confidentiality clause serves as a written policy that a dental associate will not disclose client lists and company policies during and after the term of employment. This protection provides a peace of mind for an employing dentist long after an employee has left their practice. Additionally, it is possible that a dental associate may seek work with a competitor or eventually open his or her own practice. Without an employment contract in place, the associate could become a competitor with the advantage of knowing your client list and the trade secrets of your practice. A signed non-compete clause (NCC) will restrict employees from joining the dental practice of your competition or start their own practice for a specified period of time.

 

On that same note, an employment contract will give better control of the expectations that are set for each employee. After hiring the best dental associate for your practice, you will want to retain the associate for as long as possible; given the employee is a valuable asset to your team. Considering the time it will take to train your dental associate and the skills they will adapt while employed in your practice, keep in mind that the goal is to design a contract that will keep your employee satisfied but will also prevent you from a frequent turnover rate. While you cannot force an employee to remain with your practice, the employment contract can state the specific duration of employment and the length of time required for an employee to provide their notice of resignation. In addition to the sufficient time allowed to hire and train a new associate, an employee is less likely to leave on a whim, considering the penalties listed for breach of contract.

 

Another important potential risk that a dental practice could encounter is malpractice. While employers do not anticipate their employees acting in a negligent manner, its occurrence is a possibility and a clause addressing this issue should be included in the contract. Listing the details of malpractice insurance, including who is responsible for obtaining and paying for this professional liability insurance, will prevent any legal and financial harm to your practice.

 

To learn which items are necessary to include in your employment contract, it is advisable to research the details that surround each potential pitfall of not having a signed agreement in place. Further, seeking legal help for options that may not be immediately apparent while drafting the contract could be your best ally for peace of mind to ensure that your employment contract will please your associate dentist and give you and your practice a tight level of protection.