THE noted personal coach Thomas Leonard wrote that all problems exist in the absence of a good conversation. For continued harmony you need an agreement of the relationship – in other words a contract.
Many of the situations that I have to deal with in my role as a business troubleshooter have arisen through a lack of communication and subsequent misunderstanding between two parties. I used to be surprised, but am no longer, to find that even in practices whose business systems are well organised and superficially tick all the legal boxes, no clear contracts exist between professionals.
I’m not referring to the arrangements between employer and employees where there is a clear legal obligation to provide a contract within the first few weeks with a job description and terms and conditions of employment. Rather I’m talking about the relationship between partners/principals and associates where, all too often, there is a “handshake” deal based on a presumed understanding between professionals. Problems often arise down the line when what was “understood” by one party differs from the other.
Dentistry isn’t unique; I watched a friend’s legal firm implode because the seven partners had no formal agreement. The lesson here is: if you’re going to get into a business arrangement with someone make sure you know what is expected of you and how you can get away when (it’s never if, always when) you want to. Similarly, you need to clearly understand the consequences for the business if the partnership ends due to someone else’s departure.
As an associate you may wonder why a contract is necessary. Surely both parties are honourable professional people and to impose paperwork on the relationship shows a lack of trust? If that argument is put forward to you I suggest you start looking for another job. A contract ensures that there is clarity in your dealings, that both sides know what they have agreed to do for the other and what they can expect from each other.
The absence of a contract leads to confusion, uncertainty and misunderstanding which may lead to resentment, a failure of trust and an association that doesn’t function at its best and ultimately may fail.
So what should be in your contract as a new associate? Many lawyers use the current BDA standard contract because it is considered the “industry norm”. Ensure that the version you are offered is up-to-date which grants you a licence to practise dentistry.
Money, time and people
There must be clarity about what you will be paid as an associate: is it a fixed fee or a set or variable percentage (sliding scale)? If you are offered a set amount then you could have problems proving your self-employed status. What deductions will be made and how much are they? When can you expect to be paid? Any monetary targets should be clearly defined and stated in your contract. What is the provision for retention of fees if you relocate? Be clear about responsibilities for bad debts and, if you are working in the NHS in England or Wales, for clawback.
A contract should also state your expected working hours/days, how much holiday and study leave is considered acceptable and what happens should you be unable to work? Do you have the freedom to work at another practice? Will you have the services of a trained dental nurse? If you refer patients to the therapist or hygienist what are the financial arrangements?
There is increasing talk that the HMRC may soon begin examining the self-employed status of dental associates. You must ensure that you can be classified as self-employed and can prove it if challenged. For this you will need to engage with an accountant experienced in dealing with dental associates who can provide written confirmation of your status. Only an accountant can back you on this.
Exactly what does “full clinical freedom” mean? Where does that leave you if you want to develop new skills or concentrate on existing ones? What are the skill make-up and interests of the other practitioners?
Change is the very nature of things. There should be a review of your associate’s contract at your annual appraisal. Be prepared to argue your case for any improvement in your remuneration by showing your productivity and profitability. You must keep good records of income and new patients who specified that they want to see you, also of numbers of patients returning post-treatment and failures to attend/complete treatment.
If you feel that things are not going the way that you had been led to expect, try to achieve clarity and discuss anything with which you are not comfortable. Finally if you want to move on, ensure that any barring-out clause is “reasonable”.
For a successful associate/principal relationship, make sure you get off on the right foot with a clear contract that meets both parties’ needs.
Alun K Rees BDS is The Dental Business Coach. An experienced dental practice owner who now works as a coach, consultant, troubleshooter, analyst, speaker, writer and broadcaster – www.dentalbusinesscoach.co.uk
This page was correct at the time of publication. Any guidance is intended as general guidance for members only. If you are a member and need specific advice relating to your own circumstances, please contact one of our advisers.