Blog #35 - Graduate Employment Contracts for Private Practice

Majority of graduates we deal with at Physiomentor are completely overwhelmed and confused by employment contracts/ agreements for private practice. Many graduates are so keen to secure a position they fall into the trap of briefly reading a contract and sign on the dotted line without really considering the content. Employment contracts are a legally binding document of written communication between two parties, the employer (business owner) and the employee (graduate). An employer creates an employment contract to suit their private practice requirements and protect their business. If you agree to the terms by signing the document, then you are bound to the contract.

There will be no excuses later to say that you did not read the document carefully or understand the contents of the agreement. If you don't understand the contract, then it is best to seek advice to clarify and explain what you are signing.

Below is some situations that you may find in your Employment Contract/ Agreement that you should be aware of before signing.

Probation Period

This is a period that is designated by the employer to allow them to trial you in the business and still have the opportunity to cease employment within a minimal designated time frame (e.g. 1 weeks' notice) without consequence if they do not feel you are the correct fit for their practice.

You also have the opportunity to leave the practice in this period with minimal notice as designated and without consequence.

In most contracts, this period is 3 months, but recently we have seen many contracts with a 6 month period.

Termination of Employment

After your Probation Period ends, you are then bound by a new set of criteria to leave the position or have your employment terminated by your employer.

Once you are out of your Probation Period, you and your employer will have to give each other a longer time frame if you wish to cease employment. This can be anywhere from 4 - 6 weeks' notice in writing.

Read this section carefully, because you will be penalised in your final pay packet if you do not adhere to these requirements.

Restriction of Practice

Due to the increasing number of private practices popping up everywhere. Private Practice owners need to protect their business and will often input a restriction of practice clause into your contract.

This can be a restriction of practice by time, location or both.

Example:

Restriction Period For the purpose of clause A the relevant period is: a) Twelve (12) months; b) Nine (9) months; c) Six (6) months.

Region For the purpose of clause A, the relevant region is: a) Within a 50 kilometre radius of any XXX Physio work location; b) Within a 40 kilometre radius of any XXX Physio work location; c) Within a 30 kilometre radius of any XXX Physio work location; d) Within a 20 kilometre radius of any XXX Physio work location; e) Within a 10 kilometre radius of any XXX Physio work location.

Depending on where the practice is located, the radius could be significant to protect the employer's current customer base.

The main reason this clause is created is to stop employee's working in a private practice and then leaving to open a clinic next door or down the road the day after they leave.

Commission Model

This is a tricky topic. The most common commission rate for a graduate in private practice is 40%.

But be very careful to investigate the specifics of how commission is calculated. There are some very innovative ways of offering commission.

Commission is designed to motivate the employee and offer them a bonus for their hard work in the business. If you choose a job with a commission model, then be sure to clarify your base salary and do the maths to have an approximate idea of what you may be able to achieve as a graduate in private practice.

Example:

Consultation Fee: $80

30 min consultation time

40% commission

= $64 per hour

* Factor in time for PD, mentorship and different consultation fees e.g. Workcover, TAC, Third Party, NDIS etc.

A graduate does not have the non- clinical skills initially to build a full caseload, so to offer a financial incentive to do this will be unhelpful and potentially drive a graduate to provide 'non- patient focused treatment'. We hear from many disappointed graduates that are surviving on a very low base salary and are struggling to build a caseload. These graduates were impressed by the figures in their contracts but did not factor in that this was calculated on the best case scenario of being fully booked 38 hours a week.

An average base salary for a graduate in private practice is in the range of $50 000 - $60 000.

Professional Development Money

Be sure to clarify what Professional Development you will be offered internally within the practice in your first year as a graduate (e.g. in-services, mentoring) and any additional financial package to complete external PD courses.

Many employers will have guidelines about how this money should be spent and what your obligation for contribution is towards your PD. e.g. you pay for flights and accommodation and they pay for the course or they pay for everything

In some cases, there may be a clause that if you do not stay with the clinic for a certain period after completion of a PD course, you may be required to reimburse the cost of the course to your employer.

Best of luck on the job hunt and remember to read your contract. It is not your employers' fault when they must uphold and enforce the contract rules and obligations.