Negotiator-in-chief: You (How to Negotiate a Winning Contract on YOUR Terms)
Today’s blog will complete the radiology job contract trilogy, wrapping up a discussion of the key elements, previously outlined.
In this post, I’ll give you a run-down of several other major contract components and important related considerations you’ll want to have on your radar. In addition, I’ll provide some insider information on how, and to what extent you might succeed in getting the terms you want.
The discussion of benefits, in particular, might pique your interest. Keep reading, though, because for the grand finale, I’ll impart a few words of wisdom along with some very practical advice on the art of negotiation.
Find out how to negotiate the best possible terms for an employment agreement that will leave both you and your employer feeling good. Plus, a surprising conclusion (you won’t want to miss)!
First, a very important part of every contract that you don’t want to ignore:
Almost all contracts (in any practice type) will include a non-compete clause, which prohibits the employee from practicing a certain distance from the practice for a certain length of time after leaving the practice. For example, a non-compete covenant in a contract may require that on termination of group employment, a radiologist cannot compete for 1 or 2 years within a 5-mile to 25-mile radius of the group’s city, county, or hospital(s) of practice. Courts abide by a standard of reasonableness, which requires that the restraint not exceed the requisite protection of the employer, not inflict undue hardship through an unreasonable time period or geographic scope, and not be injurious to the general public . Non-compete clauses are governed by state law, and some states place strict limits on its use. It’s particularly worth noting that breach of a non-compete clause is the most common cause of action between a radiology group and its members .
Most large health systems are unwilling to eliminate non-compete clauses, but you may be able to negotiate the number of miles from 15 to 5, for example, or specify which facilities and types of facilities are included. Unless the contract specifies otherwise, a large health system with multiple facilities in multiple locations may prohibit the employee from practicing near any of them. In some cases, this could mean that an employee could accept a new job across the country but end up being less than the restricted number of miles from a facility owned by her original employer. Although most judges would not enforce this restriction, the market may enforce it—meaning that new employers might be hesitant to hire the employee .
Common benefits include retirement options (including employer matching), insurance (e.g., health, dental, vision, life, disability, malpractice), paid vacation, sick leave, parental leave, maternity leave, continuing education allowance (including time off and reimbursement for conference attendance, professional organization dues, and licensing and other professional fees), provision of office supplies and equipment (e.g., office and/or home computer and printer, and high-speed internet service), moving/relocation allowance, cell phone allowance, and student loan forgiveness.
Although it varies, typical vacation allowance in private practice is 8-12 weeks. It is generally less in academic practice (but academic radiologists often have a more generous allowance for conference attendance, particularly if presenting). In some practices, senior members are given first dibs in choosing vacation days, potentially freezing out new hires from taking vacation during prime times (e.g., holidays, summer, and spring break).
Since it’s advantageous to the employer if the employee makes a connection to the area, moving expenses can be a relatively easy perk to negotiate. Recent tax reform legislation requires employers to include all moving expenses in employees’ wages, subject to income and employment taxes.
Increasing income and salary
Increasing income can be problematic if it creates inequity within the group. This may be more of an issue in groups where all employees are paid the same amount. In academic practice it is not uncommon for there to be a range of salaries for radiologists of a certain rank based on total years of experience, seniority in the group, and productivity.
Salary is more easily negotiated if the candidate can present published salary data to show that her ask is reasonable, would not create inequity in the group, or if the candidate offers a special skill or is willing to assume a leadership position.
If an increase in salary creates inequity, an alternative can be a sign-on bonus. Although this is a one-time offer and doesn’t affect future salary increases, an employer may be willing to offer a substantial sign-on bonus during times of radiologist shortage (like at the time of this writing). This may make up for a few years of a lower salary, and at the end of that period the candidate can resume salary negotiations.
If a higher salary is not negotiable, a candidate can ask for something else such as paid time off, a new title, academic or administrative time, an educational stipend, office space, or access to assistants.
Depending on the type of practice, groups may offer one or more of the following retirement options: 401k, 401a, 403b, 457b (deferred compensation), cash balance plan, alternative retirement plan, and pension. Pensions are generally not offered by private practice groups but are common in academics. Be aware that not all retirement plans are created equal; some have high fees and limited investment options. It’s a good idea to ask a knowledgeable person in the group or the group’s business manager to explain the retirement plans, matching benefit, vesting period, and investment options. Sometimes a generous employer contribution to a retirement plan can more than make up for a lower salary. Employers may also be more flexible with indirect expenses such as matching 401k contributions because it is a pre-tax benefit and does not increase income.
Most disability plans are not negotiable and the same for every member of the group, but the candidate should inquire about the parameters of the policy (e.g., short or long term, “own occupation” or other definition of disabled, at what percentage of prior compensation level is disability coverage offered, and whether payments are pre- or post-tax) so that she can augment the policy with an independent policy, if needed.
There are two types of malpractice coverage . Occurrence policies and claims-made policies. Occurrence policies cover radiologists for events that happened during employment, even after they have left the facility and are no longer paying premiums.
A claims-made policy covers events and claims filed only while the radiologist is employed and paying premiums. The down side of this type of policy is that coverage must be continued indefinitely to assure coverage for claims filed in the future for actions that occurred in the past. Essentially, once the policy has lapsed the radiologist no longer has coverage. In this case the radiologist can purchase “tail” insurance to protect her from the past.
Ideally, the contract will state that in the event of a claims-made policy, the employer is responsible, because tail coverage is very expensive. Many employers are reluctant or unwilling to cover tail insurance for this reason, and because doing so would make it easier for the employee to leave, but it doesn’t mean it can’t be negotiated.
For example, the employer may be willing to assume part of tail coverage cost based on the length of service (e.g., a portion of the cost per year of service). Another compromise that would allay the employer’s concerns of the employee leaving is for the employee to pay two-thirds of the tail in the first year, but then the employer would pay two-thirds in the second year and the full premium in the third year and beyond.
It is also advantageous if the contract states that in the event of a malpractice suit, the employee has a right to the patient’s medical records without a subpoena, even when no longer employed. It’s important to know whether the practice will provide indemnification (i.e., cover the radiologist if the malpractice verdict or settlement is in excess of the malpractice insurance limits). A contract lawyer can be particularly helpful in explaining the malpractice coverage offered by a group.
Benefits with “strings”
Some benefits, such as student loan forgiveness or sign-on bonus, may come with strings attached, most commonly that the employee stay at the job for a certain length of time or be required to repay some or all of the benefit . The contract should clarify if the entire benefit must be repaid or only a prorated amount based on length of service. The contract should also clarify if repayment is required even if the employer is the one who terminates employment.
To further protect yourself, there should be a clause in the contract stating that if the employer terminates without cause, or the employee becomes disabled or dies, neither the employee nor her heirs will be responsible for repayment. Having these terms spelled out in the contract helps the candidate make a decision to accept the position or not, particularly if she may not want to stay in the position for long due to her long-term objectives.
|Some benefits, such as student loan forgiveness or sign-on bonus, may come with strings attached, most commonly that the employee stay at the job for a certain length of time or be required to repay some or all of the benefit.|
Required work locations (e.g., hospital, outpatient imaging center, or home), travel requirements, and expected work hours should be clear in the contract, including whether the employee will be expected to work at any facility owned by the health system or only a specific facility or set of facilities. The needs of a group will change over time and the employee may be asked in the future to cover additional sites.
You can mitigate this unknown by negotiating that you will only be asked to move within a certain mileage of the original assignment, and that the group will cover relocation or travel expenses.
The contract should specify the scope of work required (e.g., general versus subspecialty and what percentage of each, and procedures responsible and not responsible for), and parameters of call (including scope of clinical coverage, hours and whether prorated for part-time, frequency, and available ancillary support). In addition, you should ask about the volume of work while on call (e.g., is it home call with an occasional study, or is it non-stop high-volume in-house call?).
In some practices, a member can sell her call days to another member who wants to earn more money by doing more work. It is worth asking if this is allowable and if so, whether the call payment is at market rate or a fixed rate. Knowing the number of work RVUs generated by each group member will indicate whether it is a high-volume, average-volume, or low-volume practice. Often, a higher than average salary and/or generous vacation time is accompanied by a requirement to do a large volume of work, potentially leading to cutting corners and a higher rate of physician burnout. You need to decide if the tradeoff is worth it.
Teaching responsibilities include scope of students (e.g., medical students, residents, fellows, peers, and ancillary health care members) and format (such as one-on-one teaching, conferences, and on-line education) and any other duties such as curriculum design or assistance with resident recruitment.
Research responsibilities may include securing grant funding and publishing a certain number of papers per year. The departmental expectations for both as well as the university criteria for promotion should be clear in the contract. The candidate should also inquire about the kind of support that will be provided, both in terms of dollars and protected time. Early in one’s academic career it is particularly important to obtain local seed funding in order to jump start research activity.
Administrative responsibilities may include leadership roles such as section chief, vice chair, director of a center or of faculty development, program director, or clerkship director. The support, both in terms of monetary recognition and protected time, should be spelled out in the contract. If a radiologist performs substantial administrative functions for the hospital (e.g., chief of the medical staff or committee chair), it is customary for the department to receive monetary support from the hospital for that radiologist’s contribution. At least a portion of those dollars should go towards the radiologist’s salary.
Many radiologists, especially those right out of training without prior negotiating experience, are afraid to ask too many questions if told, “This is our standard contract.”
This is understandable. The art of negotiation is not a part of the residency or fellowship curriculum. Radiologists right out of training are used to earning a salary based on their postgraduate level; they’re not negotiating their salaries for six years. They also don’t negotiate their benefits, but just accept what is given. Negotiation may not be a part of your formal schooling, but it should be part of your life-schooling—and it’s a skill that can be learned with a little effort.
Experts agree that there is always room for negotiation, even in large health systems. Furthermore, tactful negotiation can reap benefits beyond just better contract terms. It can also shape future relationships between the employee and employer . Most employers are not going to fight a limited number of changes that would make a candidate happy. After all, they spent a great deal of time and money to recruit you, and they really don’t want to start the process all over again.
Don’t sell yourself short. Even “standard” contracts that “every physician has signed” can be changed. Underestimating your value can substantially reduce your compensation—and that reduction can last a lifetime if future raises are based on initial salary. A person doesn’t get paid what they’re worth, they get paid what they negotiate. It is rare that the first offer made is the best offer one can receive. View receiving a contract as an invitation to bargain. As a general rule, initial contracts are worded in the best interest of the employer and should never be signed outright.
Factors that will influence bargaining power include who needs who more, external market forces, and what types of contracts other people are signing. You will have to examine your own individual priorities and potentially those of your family to make the best decision about what job is best for you. The parameters of every job will represent a compromise between lifestyle (e.g., commuting, proximity to cultural activities, schools, and spouse happiness), job satisfaction (such as low or high volume work and percentage of time spent in subspecialty area), and compensation (salary plus benefits).
It’s vital to determine what is most important to you and what can be compromised before heading to the bargaining table. Negotiations won’t get you everything you ask for, but the only way to get anything is to ask.
|A person doesn’t get paid what they’re worth, they get paid what they negotiate.|
You are your own best advocate and negotiator (not an attorney). At the same time, of course,you don’t want to go into negotiations with a ‘take no prisoners’ attitude. Think of discussing a contract as an opportunity to build relationships with future colleagues and gauge what it will be like to work with the practice partners in the future . Negotiating for a job isn’t like buying a car, where you might never see the dealer again. These are people you can expect to be working with for many years to come.
In sum, and in conclusion, let me refer you to the eternal wisdom of Kenny Rogers:
“You’ve got to know when to hold ’em
Know when to fold ’em
Know when to walk away
And know when to run
You never count your money
When you’re sittin’ at the table
There’ll be time enough for countin’
When the dealin’s done”
- Muroff JA, Muroff LR. Contracts in radiology practices: breaches and remedies. J Am Coll Radiol 2004; 1:553-558
- Yasgur BS. Hidden dangers in your employment contract. Medscape. April 12, 2017. Available at:https://www.medscape.com/viewarticle/876244. Accessed July 5, 2019