Unions in the Veterinary Industry: Pros, Cons and What to Consider

In the summer of 2017, a small group of veterinary personnel formed the National Veterinary Professional Union (NVPU). The members of this grassroots movement are largely from Seattle, and they have prompted plenty of conversation about the benefits of unionizing the profession, as well as the challenges that will likely arise. It should be noted that, in rare instances, unions have already existed in the veterinary industry, but these have been isolated ones under unique circumstances.

Here are more specifics about the current situation.

More About the NVPU

The organization has been called the brainchild of Morgan VanFleet, a veterinary technician who is leaving the industry to work in nursing. Another technician, Liz Hughston, is serving as the organization’s communications director and is listed on the group’s website as president. She has pointed out how quickly credentialed staff are leaving the profession, calling the current environment unsustainable and a motivation for unionization.

More specifically, citing a 2016 demographic survey by the National Association of Veterinary Technicians in America (NAVTA): the average veterinary technician works in the field for seven years, with Hughston saying that reasons for the exit are numerous, with one of them clearly being compensation levels. And, because not enough people are graduating in the field to fill in empty positions, people involved in the NVPU are seeking solutions for a labor shortage that has the potential to become a real crisis.

One initiative of the NVPU is their Wage Transparency Project. A representative of the NVPU has said that wage uniformity is not a goal, but transparency is important because it’s difficult to bargain for pay increases if it isn’t clear where the wage basement and ceiling currently exist. As the organization has gathered wage information from people willing to disclose specifics, they have discovered that significant discrepancies exist, with new employees sometimes making more than employees with long tenures. To keep employees engaged in the workplace, achieving more parity is important, as is letting them know what monetary compensation is possible if they work hard and commit to staying in the industry.

The NVPU is currently local and, to nationalize their efforts, they are using Facebook to spread the word (https://www.facebook.com/NationalVeterinaryProfessionalsUnion/) and receiving some print coverage. They also have a basic website at http://www.natvpu.org and, as they get more dues-paying members, they plan to expand their outreach. Hughston expects this movement to grow slowly, first in Washington, then in the West Coast and then elsewhere around the country.

Obtaining better wages and benefits is a key focus, with other foci including requiring practices to invest more in training and providing enough quality protective equipment along with an overall safe working environment. Goals also include more workplace support for employee veterinarians, as well as technicians, unlicensed assistants, reception staff, client-care coordinators and other unlicensed support staff.

Hughston compares this movement to the 1960s and 1970s when nurses began to unionize, pointing out how it is a well-respected profession today. And, in fact, a longer-term goal of NVPU may include joining a larger union, such as the Service Employees International Union, for greater impact and bargaining power. This union represents about two million members who are nurses, nurses’ aides and home health care workers.

American Veterinary Medical Association Position

They are remaining neutral, saying the following. “We respect the right of our members who are employees to self-organize; to form, join, or assist labor organizations, and to bargain collectively through representatives of their own choosing. Similarly, we also respect their right to refrain from any such activity.”

Corporate Buyouts

 Is it reasonable to argue that corporate buyouts of individual practices are the impetus for the unionization movement. The reality is that increasing numbers of practices are consolidating, largely through corporate buyouts. In fact, Mars Petcare alone now owns about ten percent of the animal hospital market in the United States. As corporations own more hospitals, there will be less market competition, which means these corporate practices will be able to have more control over wages in the industry – which are currently staying flat.

Is unionizing the solution? Well, it depends upon whom you ask. If you’re an employee who struggles to meet expenses, the solidarity of a union will might seem attractive. Or, even if you make a reasonable salary, the benefits of unionizing may seem like a positive if you have crushing student loan debt. Yet another group of people who may find unions appealing: those who work at a corporate practice where there is disconnect between headquarters and the needs of the practice site. Hughston from the NVPU notes that, overall, non-corporate-owned practices typically take good enough care of their employees that they aren’t calling for a union. Instead, mostly it’s corporate staff that are clamoring for help and support.

We’ll now look at the pros and the cons of unionizing, as well as two additional related issues.

Union Pros

 Well-paid veterinary technicians, according to the 2016 NAVTA demographic survey, are paid only slightly above the poverty line, when income taxes are factored in. So, it’s clear that a problem exists, one that will continue to affect the industry’s ability to retain quality workers. Collective bargaining is one avenue towards helping workers obtain fair compensation and, therefore, boost retention rates at practices, although not everyone agrees it’s the right one.

From an underpaid worker’s point of view, there is a power in numbers. When, as just one example, an independent practice is sold to a corporate buyer, employees will likely feel powerless, and may desire a union to help them to navigate their new environment. And, there is reason for concern. Approximately 27,000 to 30,000 veterinary practices are operating in the United States today. The majority are still one-to-two doctor practices or at least individually owned. But, over the past decade, corporate ownership is increasingly taking hold, with Mars, Inc. owning more than 975 practices. And that was before they announced a successful acquisition of another corporate holding, VCA, Inc. This corporation owned 800 veterinary hospitals in the United States and Canada. This means that Mars now owns just under 2,000 practices in the United States and Canada, with about another 1,000 veterinary hospitals owned by other corporations. And, as the ownership landscape changes, the environment becomes increasingly riper for unionization.

As more practices become corporate, as already alluded to, there is naturally less competition, which gives the practices more ability to control wages. This seldom benefits the worker. According to a paper written by Richard Freeman, Harvard University economist, union members in the United States earn five to fifteen percent more in wages than their non-union counterparts. These figures do not factor in differences in pensions or health insurance, vacation or any other benefits. Unions can help.

 And, there are additional benefits of unionization, at least from the worker’s point of view. Hughston points out that unions can help with work/life balance and can help to create professional boundaries that are respected. These can include putting safe procedures and protocols into place; ensuring there is enough staffing for safety reasons; and more.

Let’s reiterate another point. Hughston acknowledges that unionization won’t be an attractive option to employees in private practices, especially those who feel comfortable and effective in negotiating directly with employers. She sees unionization as a valuable strategy to address the growing number of employees who are employed by corporate practices.

Union Cons

Independent practice owners may already be paying their team as much as they can to still manage their budgets, and they may already be doing all they reasonably can to create a quality environment for workers. Because the veterinary industry is cash-based (meaning most clients they see do not have health care insurance for their companion animals), there is a monetary cap of what an independent practice can afford to pay. Wage increases beyond that, then, will translate into increased prices, which may cause clients to go elsewhere to a non-union practice or not make appointments as often. It can also mean that, going forward, these practices will need to hire people with lower skill sets, which could harm the skilled workers, the practices themselves and the clients and their companion animals. Wages increased beyond what a private practice can bear could also lead to staff layoffs.

Hughston’s viewpoint is that there are other ways to boost wages, perhaps by having corporations accept a lower profit margin and for the entire industry to work together to create a sustainable profession. In the long run, she says, this will save all practices (independent and corporate) money. But, that may an idealistic comment, not a practical one, with private practices potentially hurt by unions as difficult industry problems are addressed.

Some people believe that unionization won’t necessarily improve pay and benefits or provide improved patient care. According to the executive director of NAVTA, unionizing will not necessarily be cheap for members, with the NVPU looking at a union model where members would pay two to three percent of their wages to belong. So, the net result in their paychecks may be disappointing.

Here’s another potential negative to consider. How would the patients suffer if practice employees went on strike?

Proactive Actions for Practices to Take

When employees at a practice unionize, life becomes more complicated for management. The practice would need to bargain with union over wages, terms of employment, hours of work permitted and other issues. Independently negotiating with unionized employees would violate federal labor law; going through collective bargaining, meanwhile, can be a drawn-out and often frustrating process.

To try to prevent employees from seeking to unionize, here are tips. First, don’t create fertile ground for unions. If your employees feel ignored or treated unfairly, or if they feel as though dealing directly with employers would be futile, that’s fertile ground for unionization.

The unionizing process would go like this. An employee (or more than one) would work with a union organizer to distribute literature to coworkers, and they would be asked to sign authorization cards. If 30 percent of the staff signed them, showing interest in the union, an election is held. Then, if the majority of people who show up to the election vote yes, the practice has been unionized.

As an example, let’s say your practice employs 30 people. If at least ten sign authorization cards, the issue of unionization is put to a vote. If only three people show up to the election? Then two yesses unionizes the practice.

So, self-audit. Are you paying the fairest rates you reasonably can? Offering the best benefits that fit within your budget? What creative yet low cost benefits can you offer? What can you do to improve morale? Fix any fertile ground.

Also consider creating a written policy, if you haven’t already, that restricts any solicitation, distribution of literature and the like at the practice. If you enforce the policy strictly, then employees can only distribute union literature in non-working areas during non-working times. But, if you don’t have a written policy, or if you have one that you sporadically enforce – perhaps by allowing sales of Girl Scout cookies, local charity donations, sign-ups for races and the like – then you can’t effectively prevent the distribution of union literature because that’s a violation of anti-discrimination provisions in federal labor laws.

If employees express interest in a union, you cannot threaten them, interrogate them or retaliate against them. You cannot promise them benefits if they switch positions to begin opposing the union. Be sure to train your managers so they know the law and how they can and cannot respond, and get advice from experienced labor counsel, as needed.

What If Employees Change Their Minds? Getting Out of a Union

According to a Forbes article, A Deep Secret That Labor Unions Don’t Want Workers to Know, “It is, quite simply, nearly impossible for workers to get rid of a union once it has been certified as their monopoly bargaining representative.” That’s because the National Labor Relations Act (NLRA) does not require an election when a designated term ends, such as the expiration of a contract. This means that workers will likely not get a chance to vote on whether they want to continue union representation.

And, in non-right to work states, if you are a private sector worker who works in a union shop, union membership will be a job requirement. You want the job? You join the union.

The only option for a practice where workers have changed their minds is what’s called a decertification election, “held after the expiration of a contract or a narrow 30-day window near the end of the third year of a contract. The union can circumvent a time window by agreeing to a new contract before the window opens—thus moving the window to the end of the new contract, when they can move it again.”

The bottom line is that it’s important to think very carefully about voting in a union, understanding that, while it’s not literally impossible to vote it out, it can be extremely challenging. This is especially true in non-right to work states, but not exclusively so.

What’s Next?

Practices concerned with unionization should proactively listen to employees and see how concerns can be addressed in a way that doesn’t require a union. Although increased wages are typically seen as the primary goal of collective bargaining, a more abstract but perhaps equally important goal is respect. Practice owners who find ways to contribute meaningfully to their employees’ work experiences and environment and who become increasingly aware of and respectful of their employees’ contributions have the potential to create win/win non-unionized solutions.

7 Steps To Take When Employees Refuse to Sign Disciplinary Notices

Originally Published in Today’s Veterinary Business, April 2018

You’ve created disciplinary policies and procedures that are clear, fair and approved by your attorney, and so it appears you’ve got all your bases covered. You carefully document misconduct and poor performance, discuss these acts with all relevant parties – and then an employee throws you a curve ball by refusing to sign a disciplinary notice. You really want this signature as proof of the discipline meeting, so what do you do now?

Here are seven steps you can take to get that signature and help prevent this refusal from happening again in the future. These steps also help you to protect your practice when an employee ultimately does not sign the disciplinary notice.

Step One: Stay Calm

It isn’t unusual for employees to refuse to sign notices related to disciplinary matters and there are reasonable actions you can take to manage the disciplinary process and protect your practice if this meeting later becomes part of a legal matter. The calmer you can remain, the better.

Step Two: Carefully Describe the Signature’s Purpose

At the beginning of disciplinary meetings, it’s best to first provide an overview of what’s about to transpire, which includes discussing the undesirable behaviors that led to the meeting along with any discipline that will occur. You should let the employee know that he or she will have time to review the written document detailing the situation – and that his or her signature at the bottom will only show that he or she has received the document and read it, not serve as an indication of agreement of the document’s contents.

Employees who refuse to sign typically do so for one of two reasons (or both). First, he or she may refuse because of a disagreement over the contents. Or, the refusal may come from a belief that the form is invalid without the signature. To move forward, it may be helpful to first decipher why the signature is being refused. If it’s a disagreement over the contents, see steps three and four. If it’s the second reason, see step five. In either case, armed with the knowledge found in those steps, cordially educate your employee about options available when he or she disagrees with the content and/or about the validity of the document without his or her signature.

Step Three: Add Comments and Clarifications

Many practices allow employees to add comments to the form, which can make them feel better about signing it, as they may feel as though they can provide their own points of view in writing. It is also acceptable and often helpful to have wording above the employee’s signature line that clearly states how a signature does not mean the employee agrees with the content of the document, only that he or she has read it.

If the ability to add comments and/or the clarifying statement above the signature line allows your employee to feel comfortable enough with the process to sign the document, then you’ve solved the refusal-to-sign problem. If not, read on.

Step Four: Suggest A Rebuttal

Perhaps an employee feels strongly enough about the information contained in the disciplinary notice that he or she would agree to write a written rebuttal that could be attached to the disciplinary notice. If so, this helps your practice because it demonstrates that the employee was aware of the discipline and that the practice was following its policy of progressive discipline.

Plus, the rebuttal may bring up points that practice management was unaware of, and it’s important for managers to be open to explanations given. Some rebuttals consist largely of emotional statements (“my co-worker is a jerk” or “my manager has always hated me, so why should this be any different?”) without any information of significance being given.

In other instances, though, the employee being disciplined may bring to light new information that may be relevant to the disciplinary actions being taken. Perhaps your employee will provide written documentation that alters the situation being addressed. What if he or she gives you names of witnesses who tell a different story?

If so, at a minimum, you can correct information on the form, adding and deleting details to make the form accurate. At that point, with correct information and an attached rebuttal, your employee may be willing to sign the notice. In relatively rare instances, this new information may cause you to rethink the disciplinary procedure you’ve started. If doubts are raised about the employee’s misconduct or poor performance, don’t rush through the disciplinary process. Make sure you have all the facts before proceeding.

Step Five: Employee Still Elects Not to Sign: What’s Next? 

Some employees may still refuse to sign, even after being offered the chance to rebut the statements made in writing. You could recommend that the employee write the words “I disagree” before signing. On occasion, that works.

Step Six: Employee STILL Elects Not to Sign: Now What? 

If there are two people from management and/or human resources in the meeting, add a statement to the document that details what happened in the meeting and note that the employee elected not to sign. Then have both managers/human resources representatives sign below that statement. If there aren’t two people in the meeting that represent management, invite one into the meeting at this point so you can get dual signatures.

By this point, you may feel very frustrated, but don’t attempt to force the employee to sign the notice – and definitely don’t threaten to fire him or her to increase pressure.

Step Seven: Adjust Policies and Procedures Accordingly

You may be reading this article right when you’re in the middle of a disciplinary procedure, one where your employee refuses to sign the notice. If so, then you may not be able to follow these steps exactly as written, needing to adapt them to the stage of the process where you currently are. After that particular disciplinary process is over, though, you should review your relevant policies and procedures to see what needs modified, based upon what you’ve learned and experienced to make future disciplinary processes run more smoothly.

Link to article https://todaysveterinarybusiness.com/break-the-impasse/

 

Workplace Gossip – and How to Control the Rumors

Originally Published in Today’s Veterinary Business, April 2018 

“Maria’s skirt is awfully short, isn’t it? And she sure doesn’t have the figure to pull that off!”

“You’re not going to believe what I heard about our new client . . .” 

“Did you hear who is getting divorced? You’re not going to believe what happened!” 

“We’re not getting bonuses this year because of what happened between Fred and Susan.”  

“Did you hear why Martin got that raise? And did you hear how much it was?”

Statements like this are heard in workplaces around the country, including veterinarian offices, with victims of gossip being managers, coworkers, clients – and anyone else the gossiper runs across during his or her day. While gossip can contain kernels of truth, stories shared are often blown out of proportion, and are sometimes completely false.

When people who work at a veterinarian’s office gossip, and the manager doesn’t effectively address the situation, the workplace quickly becomes toxic. Some managers don’t address the gossip because they are turning a blind eye (or, more accurately, ear!) to what employees are doing. And, unfortunately, sometimes the managers are active participants in the gossiping, which makes the situation even worse.

Gossip, unchecked, can lead to significant productivity and morale issues. Star employees will likely begin to look for work at another practice, which leads to costly turnover, and significant cases of malicious gossip can lead to legal liability issues for the practice.

So, how should workplace gossip be handled?

Understanding Reasons Why People Gossip

It can be helpful to try to pinpoint why people are gossiping in your workplace. For example, do employees feel as though they aren’t being provided enough information about the workplace and so they are seeking out details among themselves? If the gossip being shared is largely about decisions being made in the veterinary office, then being more transparent about what’s going on can go a long way in quashing the gossip.

Are there trust issues in the practice, especially between employees and managers? If employees don’t trust what their managers say, they tend to rely upon one another to get the real story, and this easily lends itself to creating a gossip culture. Honest and open communicate is key, and that starts with the top.

Other times, certain employees gain a reputation, rightly or wrongly, as someone in the know. If these employees enjoy being perceived as a central source of information, they will continue to play this role to soak up attention. This creates a malignant cycle because, as the information-central employee is rewarded with attention, he or she will likely continue to provide even more gossip. So, what can you do? Once someone regularly engages in gossip, it can be challenging to correct this behavior but it can sometimes be addressed by helping the employee receive attention in positive and productive ways.

Put Policies in Place

Like any other human resource-related issue, employee manuals should contain policies to address the situation, including what is prohibited and the consequences that will occur if someone acts in an inappropriate way. This information should be highlighted during the annual meetings in which the manual is discussed.

It’s important to know the law when writing these policies. For example, it’s tempting to include that employees are not allowed to discuss their salaries – but it isn’t legal to prohibit that. It’s also important to differentiate between harmful gossip and normal workplace discussions. For example, someone might say, “Did you hear that Sara’s cat had six kittens last night? The cat is such a beautiful calico, so I’ll bet the kittens are really cute.”

Technically speaking, you could call this gossip, which can be defined as “casual or unconstrained conversation or reports about other people, typically involving details that are not confirmed as being true.”

The employee is talking about Sara in a casual way, providing details that may not be true. There might have been five kittens – or seven – and maybe none are calico. Or, maybe the cat didn’t even have her kittens yet. But, should that conversation be prohibited by policy?

Define what you mean by gossip. You might, for example, determine that, when conversations about others are disruptive, or have the potential to hurt feelings or damage relationships, that’s gossip. If it drains employees’ morale, that’s gossip.

Model Appropriate Behavior

After a long day, it might be tempting for you – as a veterinarian or practice manager – to make an off-the-cuff remark about a difficult client. But, beware. To help ensure that employees don’t gossip, it’s crucial that you watch what you say. When employees make a comment that can be construed as gossip, you can model how that same concept could be shared in a non-gossipy way or explain why it wasn’t appropriate to say. When an employee occasionally makes comments that cross over into gossip, behavior modeling and employee coaching generally work. Call yourself out, as well, when you slip into behaviors along the gossip spectrum.

Deal Directly with Problem Employees First

If an employee is a hard-core gossiper, then you will need to follow your progressive disciplinary procedure, a process that most likely starts with a verbal warning and ends with termination. Meet individually with a perpetrator in a confidential location and discuss the impact that his or her gossiping is having on other individuals and the practice. Review with each perpetrator the disciplinary procedures that will be followed, and then stick to them, even if it results in firing an employee who resists improving his or her behavior.

It’s important to meet individually with gossipers first, rather than going immediately into a team meeting or sending out an email blast, and here’s why. You might remember being a child in a classroom where a teacher vented about the high absenteeism rate – ranting, of course, to the students who did show up to class. Sending a group email or holding a team meeting without individual counseling and discipline is the grown-up version of the teacher chastising people with good attendance for absenteeism.

When you do meet with your entire team, discuss the topic of gossip on a broad level. Invite your team to brainstorm solutions to help ensure that your workplace culture is as positive and gossip-free as possible. This can include rewarding employees when they share positive news with one another, perhaps giving kudos to a fellow employee who received an important certification or handled a difficult customer especially well (making sure that these “kudos” aren’t really a disguise for gossiping about the challenging customer!).

Finally, you need to protect employees who share instances of gossiping with managers. Ironically, you also need to watch to ensure that this reporting doesn’t become an insidious form of gossip. Remain firm and consistent in your efforts to root out gossip. This process can be challenging, especially if gossiping behaviors have been entrenched into your workplace culture, but the ultimate rewards are significant and worthwhile.

Click link to see article in Today’s Veterinary Business  http://todaysveterinarybusiness.com/?s=workplace+gossip

 

 

 

Veterinary Employment Contract Legal Issues

High turnover among veterinary associates is caused principally by the failure of practice owners and employees to properly articulate their respective expectations and negotiate and document the employment relationship. Time and effort invested up front will help avoid mismatched expectations, misunderstandings and separation down the road.

Can the practice even afford another full-time veterinarian? Management consultants estimate that a small animal practice vet needs to produce 3,000-4,000 transactions annually and collect a minimum of $225,000-$300,000 gross income (excluding OTC product sales) to be worth his salary.

I. WHAT IS AN EMPLOYMENT CONTRACT? A contract is a set of bargained for promises between two or more people, where one party promises to do X in exchange for another party’s promise to do Y. Courts require that an enforceable promise meet certain conditions. For example, the parties must be of age (no minors), of sound mind, and not under duress; there must be no fraud or mutual mistake over an important aspect of the transaction, and the deal must not be so one-sided as to be “unconscionable.”

Consideration. To distinguish binding promises from charity or gifts (you can’t sue Santa Claus because he didn’t give you enough presents last year), the law requires that the party to whom the promise is made give “consideration” for the promise in the form of a benefit to the promissor and/or detriment to the promisee. Thus, Dr. Newgrad promises to work 50 hours per week in consideration for an annual salary of $58,000 (i.e., a benefit to Newgrad and detriment to Oldguy). Oldguy promises to pay such salary to Newgrad in consideration for Newgrad’s labor (benefit to Oldguy and detriment to Newgrad). Consideration exists for each promise which is therefore enforceable.

Avoid Oral Contracts. Oral contracts generally are binding only if their performance lasts less than a year, because the law assumes that the parties’ recollections of what was agreed to become unreliable over time, increasing the tendency to remember events in a self-serving way. Few disagreements are less productive than the “you promised X,” “I don’t remember X but you promised Y” litany. Prevent such wasteful bickering by always insisting on a written contract, regardless of it’s term.

II. CONTRACT FORMATION. Legal theory provides that a contract is formed once an offer is accepted. Real life usually is a lot messier.

Offer An offer can be oral or written (e.g., employer advertisement in a professional journal, on a bulletin board or mailed to the applicant). Typically, the prospective employee will ask for clarification and wish to change the terms of the original offer by making a counter-offer. The employer counters such counter-offer with his own counter-counter-offer. This confusing and frustrating process continues until either the parties reach an agreement or, realizing they can’t make a deal, go their separate ways.

Acceptance Legally, the contract is formed as soon as the offer is accepted. This can be a trap for an impulsive party who accepts an offer, but who later (like Columbo) asks for “just one more thing.” After acceptance, it’s too late and the other party can sue for damages if the impulsive party doesn’t perform his or her obligations under the originally accepted offer.

Ideally, an accepting party will clearly indicate his acceptance to the offering party, at best by signing an employment agreement or acknowledging acceptance in writing on the offer. More difficult to prove, but still unambiguous is an oral “I accept” or words to that effect.

Avoid unclear contract formation situations. Courts have created the so-called “action in reliance” (promissory estoppel) doctrine to find enforceable contracts even when one of the parties thought no contract existed. Courts have found valid contracts in cases where an:

  • employer knew or should have known that the employee had acted “ in reliance upon the offer” such as incurring expenses to move to the job location, searching for lodging thereat, and informing other employers they no longer are job applicants; and
  • employee made the last offer or counter-offer, and such employee knew or should have known that in reliance thereon, the employer ceased advertising for the position, informed candidates that the job was filled, or bought new equipment or hired additional support staff in anticipation of the employees arrival.

Accordingly, a party considering an offer should not talk or act in a way it knows or should know will lead the other party to believe that such offer was accepted and should make sure that the other party is not taking action “in reliance” on anything it did or said.

III. CONTRACT TERMS. Assuming that the offer, counter-offer, counter-counter offer, etc. ballet results in the bliss of acceptance, the employment contract terms contain the nuts and bolts of the “meeting of the minds” of the parties. Following is a list of the main questions addressed in a proper employment agreement:

1.  How Long? Is there a fixed term (period) of employment (six months, one year, two years, or is it “at-will” (i.e., the contract continues until a party decides to terminate it)? Is the term automatically renewed on the expiration date?

2. Work Schedule. How many scheduled hours per week must the employee work, and beyond the schedule, how many additional hours will employees actually spend phoning clients, performing diagnostics, interpreting laboratory work, overseeing patient care, etc. What is the schedule for any required emergency work? Is it equitable?

3. Duties. What are the associate’s responsibilities? May employees decline (without penalty) to perform procedures they deem ethically wrong? How much emergency duty is required?

4. Compensation. Is compensation a fixed salary or commissions based on the revenue generated by the employee and collected by the practice, or is it a hybrid system under which the employee earns the higher of a base salary or a percentage of generated (and collected) revenue (a.k.a. percentage based compensation)? How are production bonuses calculated? Is there a performance bonus and if so what are the evaluation criteria? what is it based? Is emergency work paid extra? How much?

  • National starting salary information is published at least annually in the Journal of the AVMA. See also the latest biennial edition of the American Animal Hospital Association’s Compensation and Benefits-An In-Depth Look and the AVMA’s Economic Report on Veterinarians and Veterinary Practices Two periodicals, Veterinary Economics and Veterinary Hospital Management Association Newsletter, also regularly publish helpful articles.
  • Pay attention to deductions. What will be deducted from employee compensation? Some employers deduct not only the employee’s portion of payroll taxes but also the employer’s share.

5. Employee Benefits. Practices usually offer at least some of the employee benefits described below to their employees. The cost of many benefits (such as health, professional, and disability insurance, qualified retirement plans) are tax deductible business expenses to the employer and are not included in the employee’s income, resulting in a savings to the employee of 25 to 40%. Not taking advantage of this juicy gift from Uncle Sam is wasteful. On the other hand, employees must realize that the practice probably can’t afford all the benefits they desire. One leading veterinary management consultant has calculated that small animal veterinary employers cannot afford to allocate more than 23 to 27% of the collected income generated by an associate veterinarian to pay his or her salary and benefits (due to lower overhead, the range is 28 to 32% for large animal practices).

  • Health Insurance. Does the employer offer health insurance? If not, what does the employer do when he gets sick? If so, what kind of medical plan is it (e.g., fee for service, HMO, PPO)? What about pre-existing conditions, vesting, eligibility, deductibles and co-payments?
  • Disability Insurance. Employees at age 25 have a 58% chance of becoming disabled for more than three months (with an average disability duration of three years), so employees need disability insurance to protect their greatest asset: the ability to work. If the employer does not offer disability insurance, employees are well advised to get it on their own (after asking, of course how the employer, protects himself or herself against disability).
  • Professional Liability Insurance PLUS License Defense. Do employers pay the premiums on the employees’ professional liability insurance?
  • Retirement Plans. Has the employer established a retirement plan for the employees? (Profit sharing plans are the most common type of retirement plan offered by veterinary practices.) When do employees become “vested” or “eligible?” If the employer does not offer a retirement plan, employees will need to save on their own (and that means more than just the annual IRA contribution).
  • Vacation. One week? Two weeks? More? How many consecutive days may be taken? How much advance notice must be given? May unused vacation days be carried forward to next year? How are vacation days paid for percentage compensated employees?
  • Sick Leave and Disability. Does the employer offer paid sick leave? Disability leave? After how long can disabled employees be terminated? May unused sick days be carried forward?
  • Continuing Education. How many CE leave days are granted and are they paid? To what extent do employers reimburse CE expenses?
  • Association Dues. Are national, state and/or local veterinary association dues reimbursed?
  • Veterinary License Fees and DEA Registration. Are these fees paid by the employer? Should the employee register with the DEA so she is permitted to prescribe and order controlled substances (rather than just administer them under the supervision of a DEA licensed veterinarian)?
  • Relocation (moving) expenses. Most corporate and government employers provide some form of moving expense. Sometimes a “signing bonus” or short term loan can cover all or part of these costs.
  • Vehicle allowance or mileage payments. Employees using their personal vehicles for practice business should be reimbursed for a pro-rata portion of their insurance, general maintenance, registration and inspection fees, fuel, repairs, depreciation, and lost opportunity costs.

6. Performance Evaluation. Will the employer provide written and/or oral performance evaluations? How often? Will these be used to modify compensation?

7. Non-Competition. Many employers require their employees to sign non-competition clauses (also called restrictive covenants) forbidding terminated employees from competing with the employer. Such clauses must be limited in time (e.g., three years after termination) and geographic area (e.g., 15 air-miles from the practice) to be enforceable. The precise limits on the scope of such clauses vary from state to state. From the employer’s perspective, this is the most important reason to have a contract. Without a non-compete, employers cannot protect the goodwill they have worked so hard to build.

8. Termination. Does the contract have a specific term (e.g., “this agreement will expire after one year”) or is it employment “at-will”, in which case, either party can terminate the relationship at any time, for any reason? Contracts with no term are deemed to be “at-will” in most states. If there is a term, then an employee leaving or an employer firing before the term would constitute a breach unless the contract provides otherwise. Most contracts which provide for termination before the expiration of the term require that the terminating party give advance notice (e.g., 30 days) to the other party. Such contracts usually also contain a list of situations (e.g., suspension of the associate veterinarian’s license) permitting the employer to fire the employee at any time without notice (a.k.a. termination “for cause”).
Employees should make every effort to leave their employer on good terms even if they are not requesting a reference. The veterinary industry is quite small, and an employee’s reputation can easily suffer through casual conversation among colleagues.

9. Option to Buy-In. Experienced associates that have their own clientele, may not wish to enter into an employment agreement with a non-compete, without also being provided with an opportunity to buy an interest in the practice after a 1-3 year “try-out” period. These often are complex provisions to negotiate depending on the amount of security the associate wants up-front, and should not be undertaken without consultation with an attorney that has experience with medical practice transactions. Too often associates lock themselves into a non-compete, and agree to an “option” provision that turns out to be a smoke screen.

IV. LAWYER REVIEW. Negotiating and drafting an employment contract can be long, painful and complicated. It therefore makes as much sense to seek professional help in this endeavor as it does to take a pet to a qualified veterinarian when it is sick. Lawyers are expensive, of course, just as much as veterinarians…
Dr. Lacroix assists veterinarians nationwide with drafting and negotiating veterinary employment contracts and can be reached at her office at 908-782-4426 or through her website at www.veterinarybusinessadvisors.com.

V. ADDITIONAL INFORMATION. This is just a thumb nail sketch.

  • For an exhaustive study, consult, Contracts, Benefits, and Practice Management for the Veterinary Profession, written by James F. Wilson, DVM, JD; Jeffery D. Nemoy, DVM, JD and Alan J. Fishman, CLU, CFP.
  • For what you need to know as a new veterinarian associate, look for The Veterinary Associate Survival Guide published by AAHA.