Dental and Medical Counsel Blog

What Every Veterinary Associate Contract Should Include

December 30, 2020
Veterinary Associate Contracts

If you have a veterinary practice and are hiring or contracting associates, it's to your benefit to use a well-written and comprehensive employment contract. This document serves to protect the interest of the practice and the associate. They can be negotiated in certain aspects but overall, they serve as a way to make sure both parties understand duties and obligations before entering into a legal working arrangement.

Veterinary associate contracts are similar to other associate contracts but they're written to address specific requirements in the veterinary industry, as well. It's also important to note that the laws of the state or area need to be adhered to in order to make most contracts legally binding.

You might be wondering if you need a contract. Some veterinary practices don't have one but there are a number of reasons that it's beneficial. 

  • If you sell the practice, it will be more attractive for future owners if there is a solid contract for associates. The business is more attractive to buyers when the staff will continue because their patient list will be more likely to remain with the practice through the transition. Buyers can easily see past revenue and build on that process.
  • The contract lays out terms so that there are no misunderstandings over duties, compensation, or benefits.
  • Verbal agreements are still binding but can be difficult to prove and, even in the best relationships, people can misunderstand or fail to remember things.
  • An associate contract is written fairly to protect both parties.

What Is Covered in a Veterinary Associate Contract?

A veterinary associate contract covers all of the aspects of the work arrangement, from onboarding through termination or practice buy-in. While a verbal agreement may be as legally valid, there are so many variables to the way that the practice operates and what might be expected from associates and owners, it's to everyone's benefit to have the terms written clearly to avoid miscommunication.

There can be terms and clauses that are negotiated in the contract and clauses may vary based on the needs of the participants. We'll discuss each of the following aspects of veterinary associate contracts in full detail further on in the article. This bulleted list serves as a quick overview that's easy to scan and understand at a glance.

Most contracts contain the following clauses:

  • Term. This is the time period that the contract is binding. Some contracts are written for a set time period or they may be perpetual.
  • Duties. This clause stipulates the requirements of the position.
  • Scheduling and Compensation. The contract should stipulate the schedule or number of hours the associate will work in a given time frame. It should also discuss any required emergency duty, as well as the pay rate and monetary benefits associated with the position.
  • Benefits. The contract should stipulate specific benefits which may include professional licensure, association fees, insurance, and tuition for continued education. Benefits may also include things like vehicle allowance for practices where associates are expected to travel frequently to treat patients.
  • Termination. Reasons and provisions for the termination will be clearly outlined. The contract should also indicate any set time frame for notice if either party decides to sever the professional relationship.
  • Buy-In Option. For associates who have been with the practice for a number of years, the buy-in clause might be added to address their ability to become an owner or partner in the practice.

Terms of the Contract

The terms of the contract discuss the length of time that the agreement is binding. The length of time can be created as an annual or perpetual contract. In an annual agreement, the contract is set to terminate after 12 months. After 12 months, the contract is either renewed or terminated. There may be a clause within the contract stipulating that either or both parties must give notice of their intent not to renew. One possible benefit in a contract with a specific length of time attached is to allow the associate and practice a time frame to decide if the working relationship can grow beneficially for both parties. The contract can also be edited to reflect new needs at the time it's renewed, and the length of the term can be altered for subsequent contracts.

A perpetual contract does not have an expiration. This type of contract will often stipulate a time frame for notice if either party decides to sever the agreement and may also offer a buy-in clause and other clauses to promote a long working relationship. 

The contract should also address the process if the practice sells to an outside buyer. Ideally, the contract would be assumable by the buyer. Making the contract assumable means that the new practice owner must accept the terms that have already been agreed to in order to purchase the practice. It protects the associate from any discrepancies in their responsibilities, payment, or schedule due to the preferences of the new owner.

Duties, Schedules, and Emergency Services

The contract will discuss the duties that the associate is responsible for during their tenure. It can be as specific as listing each item that the associate should complete or it may use a more general language. The number of hours is often addressed in general terms because it can fluctuate greatly, depending on the practice.

Many veterinary clinics have a need for emergency services and there may be some stipulation as to the number of days that the associate should be on call or available for emergency service. This section may address specific days that the associate will be on emergency duty or may simply address how emergency responsibilities will be divided among staff members.

The scheduling and duty sections may be purposely general because there needs to be some flexibility. This allows the practice to manage schedules in extraordinary circumstances, such as situations where one or more associate may be absent for a prolonged period.

Non-Compete and Non-Solicitation Clauses

Non-Compete clauses can be tricky because some states do not recognize them. It's always important to consult with a lawyer to make sure that your contract is legally binding and enforceable in your state. However, in many states, a non-compete clause can be used if it is reasonable. The law recognizes that a practice or business should not be able to impede the associate from working in their field for a prolonged period of time. However, the courts also recognize that there is a risk to the practice if the associate leaves to operate their own business or joins another practice within a set proximity. The business can be harmed because practice clients may follow the associate to their new location.

To make a non-compete clause binding, it should be written in a comprehensive but reasonable way. Often the clause gives a specific length of time to enforce the clause. It may stipulate that the associate cannot treat any clients that have been seen by the practice during that time frame. It may indicate that they cannot practice within a certain number of miles from the practice location. There can also be a provision to allow the associate to buy-out the noncompete agreement.

Compensation and Termination

These aspects are covered in most, if not every, associate contract. The termination section will discuss reasons that the associate may be terminated and the process for termination. 

Compensation can be discussed in general terms or very specifically. It may include salary, benefits, and any other monetary compensation that the practice is offering. Some practices will reimburse associates for advanced training. Other aspects of the compensation practice might include paid time off, vacation and sick leave, retirement funds, health and life insurance benefits, and any bonuses.

Do You Need Help in Creating a Solid Veterinary Associate Contract?

If you have a veterinary practice and are currently revising or creating an associate contract, Dental & Medical Counsel can help.

We specialize in helping veterinary practices understand and adhere to the legal requirements involved in their business. You need a seasoned legal expert to help you design the best contract to meet your practice needs and provide the best protection for all parties. Contact us today to schedule a complimentary consultation with attorney Ali Oromchian.

Need Help with Your Agreement? Contact Us Today for a Complimentary  Consultation!


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