Associate Contracts FINALLY Made Sense! From Holidays to Retention Fees – IC051

Protrusive Dental Podcast

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Associate contracts are actually a HUGE deal that we do not give enough attention to…

How long can your principal keep your retention for?

Is it really true you cannot work within a certain radius?

How principals and associates may be getting screwed over by the poor contract!

Finding the right principal/associate is very exciting, so much so that we sometimes forget how important it is to read through the small print of our contract.

This can prove very costly in the future in our industry where mistakes do happen, so it is extremely important to be aware of what we are signing up for.

https://youtu.be/lC_POxlmL_U

Watch IC051 on Youtube

Join us today with Neel Jaiswal and Sarah Buxton for a breakdown of how to negotiate the right contract for you, the power of being an Associate in this day and age, and the importance of Insurance. There’s a lot more in this episode so don’t miss out…’Court is in session!’

Need to Read it? Check out the Full Episode Transcript below!

Highlights of this Episode:
02:08 Sarah Buxton and Dr Neel Jaiswal
08:40 Associate Contracts
11:15 Who Checks the Contract?
13:50 Contract Bias towards Principals?
18:50 Getting Contracts Checked
21:28 Retention of Fees
30:48 Annual Leave
35:00 Exclusion Zones
43:04 Vicarious Liability
52:18 How to get in touch

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If you liked this episode, you will also like GF019 – Indemnity vs Insurance

Click below for full episode transcript:

Jaz's Introduction: If you're an associate, when you joined the practice, did you read and did you understand your contract? And if you're a principal, do you actually understand the contract that you're giving to your associate?

Jaz’s Introduction:
Look, something I make very clear in this episode is that I’m a man of trust. I’m not the biggest fan of forms and contracts.

I don’t really think any of us are, right? My biggest currency is trust. However, in this day and age, unfortunately Protruserati, trust is not enough. We need everything backed by writing and unfortunately a huge takeaway of this podcast will be that contracts are super super important to the letter. So it is my duty to make contracts tangible.

In this episode joined by Sarah Buxton and Dr. Neel Jaiswal. Sarah is representing the legal side and Neil’s representing the medical legal side. So together we’re going to make dental contracts tangible for you. Everything from what is a fair retention fee to withhold from an associate after they stop working to who should be paying to get a contract checked.

This one actually might surprise you actually. So who should be paying? Should your contracts be checked? The answer is yes, they should be, believe it or not. Who should be paying for it? What about the retention fee? What about vicarious liability? What if an associate messes up? And now the practice is responsible.

How do you cover that in a contract? What about the clause that you can’t work X number of miles away when you leave a practice? Is that actually enforceable? Is it actually worth the paper it’s written on? And so with all these themes, this I promise you will be the most to the point, concise and actionable piece of education on dental contracts you’ll ever listen to.

Hello, Protruserati, I’m Jaz Gulati, and welcome back to an Interference Cast, which is an arm of Protrusive Dental Podcast, where we discuss non clinical but important topics. This particular episode is eligible for one hour of CPD. You just have to answer some questions under the Protrusive Guidance Network, which is on the website.

You can like access on the laptop my entire network. It’s got all my educational content and the forum on there as well. That’s www. protrusive. app and the native iOS or Android app, which is Protrusive Guidance. The best way to do it is that you make the account on the web and then use that login on your native app. So if you love protrusive, you want the full experience, do check us out on there. But without further ado, let’s demystify these contracts.

Main Episode:
Sarah Buxton, welcome to the Protrusive Dental Podcast and our guests. Once again, Neel Jaiswal, Dr. Neel Jaiswal. Great to have you here, sir. Really, really super important.

Like this is kind of the topic that I’m so in love with clinical dentistry. And when we talk about contracts and stuff, like it is for me, it’s a snore fest. However, the difference today is that we’re going to cover the super important, the key things that actually we’re all talking about on all the dental forums.

Sarah, I think you get bombarded with these contract questions that we’re covering today. So I’m actually really excited to actually get some answers, get to the bottom, all these nitty gritty little details before we continue. Sarah, please introduce yourself. How did you get in to the dental space.

[Sarah]
Thank you. Well, I must be a bit like you because I get really excited about contract law. So we can be sad together, but yeah, thank you for having me. Yeah. I’m Sarah Buxton. I’m one of the directors and owners of Buxton Coates Solicitors. We are a niche firm that advises dental practice managers, associates, buyers, sellers, all aspects of buying and selling and running a dental practice.

And my specialism is employment and HR law. I didn’t wake up one morning and think, oh, it’d be really, really good to act within the dental industry. I fell into it by having one dental client and I thought, oh, it’s quite interesting, did a good job and then it grew from there and actually it is quite an interesting area of law for an employment solicitor, especially especially when it comes to self employed associates and workers and employee status.

So over 15 years experience. So I always say to our clients, look, you don’t have to explain to me what a UDA is. I understand, I know the acronyms. So yeah, always, always happy to have a chat with people. And yeah, I really do enjoy this topic that we’re going to speak about today.

[Jaz]
Good. I’m glad someone’s passionate about it, but we know we want answers. We definitely want answers. And that’s why we’re going to be picking your brains today. It’s a bit of a minefield. I feel there’s a lot going on, especially the last few years, then talking about the whole self employed and employed, and there’s a lot of confusion regarding that. So seeking some clarity, Neel, my friend, you are here as someone who’s representing the medical legal challenges that can sometimes come between.

So there’s been a nice interplay here between us. Sometimes we seek help from our indemnities, right? When it comes to these issues and is that in a rightly or wrongly and also we’ll talk about vicarious liability, right? This new, not new things been around for a while, but it’s a very much a hot topic as well.

And so I think that’s where you’re going to come into a lot. We’re looking to get a borrow your expertise and your experiences, but Neel, for anyone who has not listened to our previous episodes, we’ve done loads of medical, legal ones, including a really big one that got a lot of positivity. A lot of love was insurance versus indemnity.

What are the differences? So if anyone has not listened to that, please, please, please do yourself a massive favor, save yourself thousands and listen to that episode, but Neel, just introduce yourself, my friend, for those who haven’t listened to that episode.

[Neel]
Well, thank you again, just for having me today. Always a pleasure. And nice to see Sarah again. Yeah. I’m a director of professional dental indemnity, and I’ve been doing that for about five years now. So it’s been a learning curve for me. I was like, you’re a dentist. We don’t really know about contracts. We don’t really know about GDC. We try to stay away from all these things.

And then I kind of, a bit like Sarah, fell into it and started to help people. And so PDI has been going for five years, but I’ve still got my clinical practice and my practice here in Hertfordshire. So I’m always happy to help. And I don’t know if you remember, Jaz, how this topic came up. I think it was like 11 o’clock at night and I texted Jaz, can you talk?

I know it’s late. I know you’ve got a young family. Same here. And I just had a call from a client. It’s a PDI client. And it was so unfair. I think her principal was basically keeping six months of gross for the renewal fee. And she was newly qualified, she was in tears. And I’ve heard it a couple of times before now, this thing where principals are taking the retention-

[Jaz]
Can I stop you there, Neel? By renewal fee, do you mean the retention fee?

[Neel]
Retention fee, sorry. I’ve just come from the gym, as I was saying to Sarah. So I’m a bit light headed.

[Jaz]
That’s fine. So retention fee, for those who are not familiar with it, this is where you’re leaving your place of work where you’re an associate, but then they keep some money aside so that in case there are any failures or the whole point of it is in case any failures, any remedial work that needs to be done, there’s a pot of money that they can use.

And after a certain amount of time, it’s going to be six months, 12 months, Sarah, I’ll ask you later. What’s a reasonable amount of time. We’ll talk about that. But then that should be ideally returned to the associate. Have I got that right? Any amendments to what I’ve just said?

[Neel]
Yeah, that was the case. And in this case, we’d see this unfair amount and older principal, younger dentist, happened to a few of her associate colleagues. And I’d also been it before, seen it before where they’ve gone to court over it. And then the principal reacts by sending notes off to the GDC. And it becomes a whole tit for tat.

And you have a lot of this blue on blue stuff, which is a total waste of time for the GDC and our money. So really for the viewers and listeners out there, it’s really important to understand the contracts, but you will find yourself in deep doo doo if you get that wrong. So it’s really important. I think it’s a must have in terms of, you know, pretty even at the graduate level that we should understand the contracts. So it’s great to have Sarah here.

[Jaz]
Well, let’s make it a mission for this, this time we have together right now of next 20 minutes, half an hour, 40 minutes, wherever it ends up being to really make sure that anyone who listens to this is going to feel really confident.

Okay. What is the purpose of the contract? What’s fair? What’s unfair? All those really important things, including we’ll talk about the retention fee as well. Look, I’ll be honest with you. My view on contracts has always been this. Okay. I’m old fashioned this sense, in the sense that a contract for me is something you sign, right?

But the day that you need to look at it, something has gone wrong. Like there has been a disagreement. Like for me, the time I have to pick up a contract is bad news and I’m probably leaving the place. So that’s how I see it. And I I’m very much a trusting soul. I’m very much my principal. I’m hoping he’s not listening to this, but I didn’t read.

Okay. I mean, okay. I’ll admit I didn’t read the contract fully though. The one that I signed the practice. Okay. I’m just being super real. And Sarah, I guarantee you most associates are in my position. They see it. Okay. It’s the BDA one, whatever they’ll sign it. And I, cause I trust the guys I work for.

However, all the issues I see on the Facebook groups, on the protrusive guidance community, the common answer is, well, depends on what’s in your contract. Have a look at your contracts. What does your contract say? So actually we need to give it more a gravitas, right? So the question naturally I want to ask you is the first question is, I think Neel’s already answered his perspective is how essential our contracts in this day and age.

[Sarah]
Yes. So essential. And I agree with you. I would say this to most of our clients that actually what the contract is, is a document that we want to refer to when something’s gone wrong, but ultimately we want to be able to have a good relationship between practice owner, associates, or self employed hygienist, therapist, whoever the relationship is, and hopefully we can get by by doing things by agreement.

However, when things do go wrong, or you want an answer to understand your obligation or their obligation, the first place where we will always go to is the contract. So it’s really essential if you’re ever in a dispute and the first thing the judge in any case will look at is let me see the contract, what’s in the contract? So it’s essential that you do understand those causes in there and in my experience, like you say, many associates do not get their contracts checked and understand it.

[Jaz]
I’m not proud of it. Listen, I’m not proud of it, but it’s an honest admission of my nature of just being very, I go by trust. I looked him in the eye, like, do I like this guy? Do I trust this guy or girl? And that’s why I go by it. But you’re right. That’s not good enough for this.

[Sarah]
Absolutely not, because it’s okay until something goes wrong and nobody trusts anybody anymore. And then you end up paying the legal fees for being too trustworthy. And that’s what we don’t want. We don’t want to be in disputes.

It’s stressful. It is time consuming. It is incredibly expensive being in a dispute. So if we can set out the obligations and understand the obligations in the first instance, that is something that will hopefully prevent a dispute from happening. And that’s why I would always recommend for contracts to be checked.

But I must say, it’s not just associates who don’t understand associate agreements or what’s contained in them. Quite often practice owners don’t as well, and they will have downloaded a contract, a template contract, try to fill it in themselves, given it to the associate, and they don’t understand the terms either. And so it’s both parties. So associates, if you don’t understand them, don’t feel bad because quite often practice owners don’t as well.

[Jaz]
In which case then my next question is, if you are joining a new position as an associate or you’re hiring someone as a principal to be an associate or a self employed associate or otherwise in your practice or hygienist or nurse, whoever, do you think the standard of play now, nowadays is that any contract should be checked and then like we allude to, but therefore my next question is, who checks it?

Should it be someone in your space? Should it be any solicitor? Should it be the BDA? Should it be your indemnity? Who can help us to check these? Because it sounds like we should be getting checked.

[Sarah]
Well, for me, it’s the day job and there will be solicitors out there. I would say, make sure that they understand the dental profession because it is unique. And I’m sure we’re going to come on to why associate agreements are so unique. And I think that’s really important. Whoever checks them, they not only need to have the knowledge. But you also need to have a good working relationship with them. I think that’s really important. It’s an important document.

You need to be open with them about what you’re wanting from the relationship with your practice owner. And they need to support you with the negotiation, the compromises, explaining what’s to be included, what’s normal, what’s reasonable, so there’s a lot to it. But I think one of the important things is when you’re looking for somebody to provide you with advice, trust is the key. So just make sure that you trust the individual who you’re taking the advice from.

[Jaz]
You know, maybe I’m simple minded, but I would just love like, let’s say the contract’s eight pages. I would love a half page summary of key points, right? That should, I think that should be made like a standard thing that it should be.

Cause we recently made a will and like, there’s like a plain English, like summary kind of thing. I think all contracts should have this including associate principal ones, but I have never seen that before myself. Is that something that you see?

[Sarah]
I mean, the difficulty with it is, is that each and every associate agreement is different. So quite often in the dental industry, we talk about templates and, oh, it’s this template, or I’ve downloaded this, but you’d be surprised how many people will play around with those templates include clauses within the template, so they no longer become standard. And I say that because I don’t believe they are.

And for a practice owner, you will not have the same associate agreement as the competitor down the street, because the relationship you have with that associate will be different. So I think, yes, there will always be key terms that we can speak about and come on to so that people understand those key terms, like Neel said, the retention clause, but generally speaking, how that retention clause works will differ from practice to practice.

[Jaz]
I have a million questions, but the most pertinent one now then is, in your opinion, having seen thousands of contracts, and usually by the fact that it’s the practice and the principal that issues the contract, like, it wouldn’t be like the associate coming, here’s my contract for me to work for you.

It’s the principle giving it, right? So therefore, do you, in your opinion, are contracts bias and favour towards the principal both financially, both in terms of terms, and therefore the owners and the associate to be like, hang on a second, let’s just step back here and just amend this. Would you agree with that?

[Sarah]
To some extent. I mean, when we’re drafting contracts and especially in this day and age, because when we’re speaking about it, it’s not easy to engage good associates at the moment. So if you want to get an associate in your practice, it’s important that the terms are attractive. And if you are putting unfair terms-

[Jaz]
What does that mean? Sorry.

[Sarah]
In terms of not sneaking things in. Having a license fee that’s acceptable. Having a retention clause that’s acceptable. Because if the associate does take advice or reads the agreement and understands it, if they’re not happy with an unfair term, they’ll probably just go, I’ll see you later because there’ll be another practice down the street that actually will engage them on some fair and reasonable terms.

So we don’t see that often that practice owners are going out to be unfair or sneak a term in to make it unjust for the associate, but there will be financial considerations and there are some practices out there who will maybe that they’re doing the right thing by including clauses that are heavily in their favor, and they hope that the associate never goes and gets it checked.

And Neel already gave the example, didn’t he, of the retention fee, which was six months gross fees. And obviously that is somebody taking advantage of probably the associate’s good nature or naivety, that they are not going to get the contract checked or actually read the contract and understand it.

[Jaz]
Very good point. Now, before I talk about retention fees, yeah, Neel, I was gonna say anything you want to add to that?

[Neel]
Just a cheeky question, Sarah. If the contract is, if you employ a solicitor and a principal, there’ll be a principal bias. I know you were saying we should try and make it fair, and I understand that. It’s also, it’s in the associate’s benefit to have a contract that favors them. Should the contract cost be split down the middle and the associate work, and the lawyer works for both parties, or is that something you can do?

[Sarah]
No, so lawyers are not able to do that because lawyers act in the best interests of their client and they cannot get themselves into a conflict and for example If you have a practice owner saying I want this clause in and you have the associates saying I don’t that will be a conflict. So we wouldn’t be able to act so we would only act in one of those party’s best interests and we’re heavily regulated just like you, just like the dental industry and that comes from our regulator.

And so yes, lawyers do act for one party or the other. Now, what I would say about the cost of that, the practice owner usually bears the cost because it’s for the benefit of their business and they provide, as Jaz has already said the agreement. They’re the starting point from the agreement.

There were some instances where the associate may bear the cost of having an associate agreement drafted. And that is usually when the associate decides that they are going to run their business through a limited company. So it usually only happens in private practice because of issues to do with the NHS and superannuation and whether you can take part in it.

So it’s usually only private associates where this will happen. And the only reason why the associate will want to run their business through a limited company is for tax reasons, for the tax advantages. So it’s wholly for the associates benefit to do that. And sometimes the practice owner and the associate will come to an arrangement where they’ll say, okay, we’ll do this. We’ll pay your limited company. We’ll engage you as a limited company, but you bear the legal costs. And that’s often happens, but we will still only act for one party. We can’t act for both.

[Neel]
It also comes back to a previous conversation about our associates employed or self employed. And that’s a whole different rabbit hole.

[Jaz]
Yeah. I mean, we could easily fill a whole episode on that. So let’s be careful where that goes, but based on what you said, Sarah, it sounds like when you have the contract, you may be also, as well as seeking legal advice from someone like yourself, you also need like a relationship counsellor to go through your contract and make sure that both parties are satisfied in a way.

That’s one thing that came to my mind there. So this concept of the principal paying, I’m all for it as an associate. Listen, yeah, I’m all for it. But having that conversation, hang on a minute. Like surely, Neel, I don’t know about you, mate, but surely it’s associates who are paying. Like if an associate gets a contract, I don’t know any associates who are ballsy.

And I was like, hey, your contract, listen, I want you to pay Sarah to make sure that this is all above board. Right. So I just thought the associate just takes it as a hit and gets it checked and then comes back, like just maybe gets it checked on the slide, not even the slide, but like just gets it checked for their own own benefit. So how do you even have that conversation with the principal that hang on a minute before I even think about signing this, I want you to pay for me to get this check.

[Sarah]
Well, I think associates are in a strong position at the moment. Because of the market, I come back to the point that actually practices are struggling to engage good associates. And actually the legal fees to get a contract check is, I don’t mean this in the way it’s going to sound, but it’s peanuts to get somebody in, in terms of that right person. And actually it’s in the practice owner’s benefit that they have sought advice and understand the agreement because again, what we’re trying to do is stop a dispute from happening.

And actually for some of the causes to stand up in court, it’s better if both parties have taken legal advice, such as restrictions. So there’s one of the causes where if you’ve taken legal advice, they’re more likely to be enforceable. And when I talk about restrictions, I mean, restrictions that happen post termination in terms of where you can work, non poaching of staff, non poaching of patients, non dealing, so those type of causes.

So, again, I think associates are in a strong position to negotiate. And to ask practice owners the things which ordinarily they wouldn’t have done, and I appreciate that that’s quite difficult. Especially if you’re fairly new to the profession and you’ve just got your first associateship and you are respectful to the practice owner, that it may seem really hard, but actually, it’s becoming more and more of a thing. Associates are doing it because they’re in a stronger position.

[Jaz]
I’m just trying to get my head. I mean, again, being simple minded here, but I think this is going to help people because people are having the similar questions. Like, let’s say I’ve got this contract. I’ve been offered a job, got this contract.

Hey, Jaz, here’s your contract. Have a look at it. And then I look at the contract. I have no idea what it says, right? Because it doesn’t make sense to me because this is me when it comes to contracts. And so I’m going to say to the principal, okay, I would like to get this contract check on my behalf or the associate’s behalf, right? I’m sure you’ve done your due diligence ready. Please, could you pay this fee, which is Sarah’s fee, so that we can get it checked? Is that how it should go?

[Sarah]
Like that. Yeah. And it’s happening more. And because the practice owner wants to get this associate in, quite often they’ll say, yeah, actually. We’ll pay that for you go and get it checked because they want to engage with that associate and get them on board.

[Jaz]
That could be almost like a litmus test, right? To see, okay, is this principal, is this practice worth their salt? Right? Like if they’re going to say yes to that, then that’s already giving you vibes that actually this is the kind of practice you want to be in someone who’s actually doing things right.

And so this could be like for the in demand associate, a good practice. Great. Well, the next question then is retention. Let’s talk about retention because Neel mentioned that scenario. I’ve seen all sorts of contracts, the retention part. I’m trying to remember my old contracts and stuff. Some have gone on for 12 months, I think. But so what do you think is reasonable retention? And then also tell us some stories about some wacky ones.

[Sarah]
Okay. Yeah. So, I think this is one of the causes that people don’t pay enough attention to about how the retention works. So firstly, we’ve got the amount, which will vary from practice to practice. It can be a fixed amount that they retain, or it can be an average over, usually I would say the last three months. And that’s usually, but again, it can vary from practice to practice, but then what’s important is the next clause because people will look at the amount and think, Oh yeah, it’s okay. But actually it’s more than that.

It’s how we use that amount as the practice owner or how you allow the practice owner to use that. Because what you’re saying is that’s my money. You hold it on trust. And then if there’s any failed treatment, and they come back, I allow you to dip into that pot to sort out the failed treatment. And sometimes there’s a limit on the amount, so they might say, for example, I don’t want to hear about anything if it’s 250 and below, just do it.

Sometimes the clauses will say, actually, don’t touch that money, let me come in. Let me come back and check the patient and then we can have a discussion about what’s going to happen because I might be able to fix it or I might make a decision about whether to refund or what’s going to happen. And so those clauses are really important.

Then the next stage is when you get that back. And I think it depends on the type of dentistry that you do. So general dentistry, you should be seeing your patient within 12 months. Okay. So you would hope that you receive that payment at the end of the 12 month period. Then what’s happened to that money in the meantime?

So just to give you an example about why it’s important to get contracts checked and how they can vary and change. When I first started drafting associate agreements and advising on them, actually we were saying practice owner, you can hold that amount for 12 months. But I want interest on the amount.

Now, because interest rates have been so poor, that clause has fallen by the wayside. We never see that. It’s just a fixed amount that the practice owner looks after for 12 months, probably some interest on it, but you never get the interest of that amount. Now, because interest rates are high again, or high ish, that’s creeping back in.

So I’m seeing agreements where associates are saying, if you’re holding my money for 12 months. I definitely want interest paid on that amount. And that’s the kind of thing that people miss, but actually it could be quite a substantial amount if the retention is quite high. So it’s worth thinking about.

[Jaz]
Yeah. Very good. Yes. Yes.

[Neel]
You touched on something that was really important, actually. And again, I’ve had quite a few calls where the associates left the practice and the practice now saying, oh, they weren’t happy with their bonding or their business line got finished or whatever. And these associates aren’t allowed back in.

Now it might have been they’ve fallen out or they can’t accommodate them or sometimes it could be the principal not wanting them to see, not even wanting them to show them a photo of what’s happening to manipulate it to theirs. So I think actually, if you are looking for an associate contract, I think it’s quite a really nice thing to say, a mutual benefit, I will look at, come back and look at the patient. And so I think that at least have the option to do so because they’re getting shut out the door and then that’s leading to further conflicts.

[Sarah]
Yeah, absolutely. And I’m having access to their dental records. The practice owner, once you’ve left, is under no obligation to provide you with access unless it’s in the associate agreement. And again, you want to see that to see what actually is this failed treatment. We do come quite often across practices that will hold onto the money. Say they’ve used that money and because the associates are not probably confrontational or scared or don’t understand it, they ask for it. They ask for the retention back.

They get ignored and the associate just lets it go. And that happens quite often. And quite often it’s because either they can’t afford the legal fees. Or they don’t know where to turn to to try and obtain that retention and the practice anything. Well, I’ll see what they do. I’ll risk it. I’ll see if I can hold on to this for as long as possible.

[Jaz]
It’s a real, real shame that that happens in our profession, I think. One thing I would want actually is, looking back, thinking about contracts now, is one thing I’d like to see in a contract for retention therefore is if you are going to be claiming that I want a nice spreadsheet of someone’s name, what the issue is, I want clinical photographs and radiographs to support that.

It just seems like a reasonable thing to do rather than just going by blind faith, right? And so that’s an important thing to consider. So maybe that’s the kind of chat to have with someone you’re working with, when looking at the contract. The other thing, the other question I have financially is, and this is a genuine question, I have no idea is, let’s say we have a gross amount that you, earn every month, and then you get a percentage of that, right?

So when there’s remedial work being done, the patient is not paying again. It’s like done as remedial work, right? Usually, right? And therefore, should the associate be charged the gross amount of that treatment? Against their net pay and these kind of details should also be in the contract as well, because that would be quite, quite unfair. So is that the kind of stuff that you would actually go into that kind of detail, right?

[Sarah]
It’s really important. And it’s the kind of thing that’s looked over as in there’s not enough attention paid to it, but quite often there are clauses in there whereby the practice owner will have a contractual right to take a hundred percent of the fee, so you have got to be really careful.

It’s not always, by the way, the practice owner and trying to get one over on the associate, quite often as I said at the outset, it’s because they don’t understand either. At how it works and they think they’re putting the right causes in there.

[Jaz]
So it’s the template that’s been passed around. That’s to blame that someone made it and then they just use it in good faith, but actually they’re not realizing that actually it’s not quite fair.

[Sarah]
Quite often when the associate raises the issue, we go, oh yeah, that’s what I mean. It’s like, well, that’s not what’s in the contract. So let’s get it in the contract correctly. So yeah, definitely. It’s the detail that we need to look at. And I think quite often. Especially associates will open their associate agreement and think, oh, right. What’s the license fee? Great. I’m getting paid 50%. What’s the retention? Oh, it’s a fixed fee of a couple of grand. That doesn’t seem too bad.

How many weeks do I get off a year? And those will be the three things that they look at and forget about the rest. And yet these documents are substantial. They can run into 10, 20 pages depending on the practice and the associate agreement. So really important to look at the detail.

[Jaz]
Thanks so much. Anything more on retention before I move on to the next?

[Neel]
If you’re an employing or in your practice, an orthodontist, three months of their last remuneration is not really going to cover redoing two or three ortho cases. Have you, do they tend to have two year clauses and a larger amount or?

[Sarah]
Yeah, there tends to be a staggered payment back plan. So, if they’re withholding the monies for a significant period of time, they’ll hand some over and then it’s a staggered payment plan, I would say. That tends to be the way we’d offer.

[Neel]
And with so many people doing Invisalign now, I’ve seen it where associates are leaving, there’s still nine months left of Invisalign that someone’s got to pick up. So the world’s a little bit different to pre COVID with a lot of the new short term author or limited author. So I think, again, the older contracts aren’t reflecting that.

[Sarah]
Yeah, absolutely. And this is one of the things that I would always say, whether you’re an associate or a practice owner, is that contracts should be reviewed annually at least because the law changes so quickly and, but not only the law, but like you say, socially we change, things differ.

We live in an age now where there’s a lot of social media and I’m actually, I get lost with what’s the newest source of social media. I’ve got to say Instagram, Facebook, TikTok, all those. And how many of them are actually covered off in an associate agreement? How many of them are covered off in terms of what happens with your Instagram account?

Who does that belong to? What are you doing with my patient’s pictures afterwards? And it’s the ones that are moving with the times and actually the ones that include those causes within their agreements that then are preventing the dispute later on about when somebody thinks, oh, hang on a minute. They’re using my name on their Instagram account, but there’s nothing in the contract. So even that, we’ve moved on. Times have changed. We need to include it in the contract.

[Jaz]
Very relevant. Very good point there. Excellent. Next topic is something very close to my heart. Annual leave, right? This is really something that grinds my gears, right? And you hear this from all the associates, but I also understand the principal side of it, right? So I moan to principals, my friends who are principals. I’m a self employed associate. I should be able to take off time whenever I want, as long as I give fair notice. If I want to take 40 days off a year, I’ll take it.

If I want to take 20. I’ll take it. But actually in most contracts, we see actually there’s a contractual limit. So, if a HMRC get a whiff of this, surely they’d be saying, hang on a minute, how can you dictate the time off? But on the principal side of it, look, there’s a contract to be fulfilled. If your associates taking, going to Mexico every week, then it’s not going to happen. So I totally can understand both sides of it. Sarah, what do you make of this annual leave element in terms of the HMRC and also in terms of what is fair?

[Sarah]
Okay. So if we start with the point about a worker status, employee or self employed. If you are genuinely self employed, like you say, you should be able to take as much time off as you like. That is just one indicator. I always speak about indicators and what we try and have is as many self employed indicators as possible in a self employed agreement. And we’ll have some employee ones, but we want to try and have as many as possible, which is now employed because we want to ensure that that’s their status for tax purposes.

So, yes, if you’re genuinely self employed, you should be able to take as much holiday as you wish. I do have clients who do not dictate how much holiday their associates take. They will say, as long as you hit your KPI’s, your key performance indicators, whether that’s an NHS target, or a private target, whatever it may be.

I don’t care how much holiday you take. I have to know when you’re taking that holiday, because I have to arrange the practice. And do bear in mind, that if you take holiday after a certain number of days, you have to put a locum in place as well, to fulfill those terms.

[Jaz]
Okay.

[Sarah]
So yes, if you want belt and braces approach, you will not dictate holiday within a contract. Having said that-

[Jaz]
Most contracts do, right?

[Sarah]
Because the commercial reality of running a business is that we need to know when you’re around and need to put patience in. What I would say on this point is that you can make it work. If not to have a clause in. Regulating holiday, but you have to be super organized for it to work.

And this is why most contracts will say you can have this amount of time off, but you have to let us know within so many days. Going back to the HMRC point about status, it’s one indicator. Which doesn’t satisfy self employed status. We don’t look at individual indicators. We look at numerous ones. So the commercial risk is we’ll control holiday, but we’ll have lots of other self employed indicators in there.

What’s fair and reasonable? I’m going to say it depends on the practice, depends on the type of dentistry, and I would say-

[Jaz]
Associates everywhere now, inching closer to the speaker.

[Sarah]
All I would say is just watch out, because sometimes the time off clause or the time away from the practice isn’t always full holiday entitlement. It can include time off for CPD, training, things along those lines. So just be careful. Have again, it’s the detail of the cause that you need to look at when looking at holiday. But I see some practices that will have six weeks, eight weeks, 12 weeks. It depends. And don’t forget again, when we look at bargaining power, associates are in a strong position.

Again, so just because the contract has come to you and it says six weeks, if you would like a little bit more, go to this practice owner and say, six weeks doesn’t work for me. Can we push that to eight? and see what they say.

[Jaz]
Great. Lovely. Fantastic. The next one, which I think the medical legal element come in more into play here, Neel, is the whole thing about when you leave, you cannot work within the X miles radius within the clinic.

So from what I’ve read on the University of Facebook, is that is something that’s actually garbage and it’s not really enforceable. So you can ignore that is the kind of word on the street. So is there something that we can essentially ignore because it’s not enforceable or is this something that’s to be really highly respected? And then we’ll take it from there.

[Neel]
Well, from my point of view, it probably isn’t an indemnity question, but I think it’s one of those things, again, the whole point of all these things is the GDC gets involved at some point. I’ll tell you how, Sarah is saying unfair, or the associate doesn’t want to, or the retention fee hasn’t been paid.

The practice then wants to retaliate. Somewhere in the line, GDC gets involved. And again, the same with these exclusions there. Someone’s not that happy about something, the associate will say, they don’t wash their instruments, so they don’t change their needles, or the practice will say, oh, they don’t write their notes. So the whole point of the indemnity thing is we see it because these systems before, these contracts before, and the relationship isn’t like you have, you know, a trustworthy relationship. And unfortunately, not everyone is trustworthy, we like to think we are.

[Jaz]
So really the bigger picture here is if we focus hard on the initial bit of the contract to make sure that it’s worded in a way that’s tasteful for both parties, therefore it will help reduce claims overall because you’re starting on the right foot, right?

I don’t want to hear about these things. I don’t want to hear about some GDC thing and this and this and it’s over nothing. And it’s putting everyone’s fees up, for example, it’s putting our GDC fees up because they’re wasting time. And the poor people at the GDC waiting to be heard. Waiting two years because of these disputes which Sarah could have nipped in the bud.

[Sarah]
Yeah.

Interjection:
Hey guys, it’s Jaz interfering here with an important message. I just want to say thanks to Dr. Neel Jaiswal who represents Professional Dental Indemnity. It’s who I’ve got my insurance policy with and you may remember episode GF019 we talked about Indemnity Versus Insurance to actually understand what is the difference between those two things and why I went for an insurance product.

As well as Neel being one of the good guys in dentistry and always someone to support you with medical legal matters, i. e. looking at your existing arrangement, looking, picking out the flaws that actually have you considered this or have you considered that? And one of the things that Neel was able to introduce to our community, Neel is actually part of the Protrusive Dental community.

You can DM him on Protrusive Guidance and he’s super, super helpful. So if you’re getting to that time where you feel like you’re paying way too much, like every year your indemnity is increasing, and it’s about time you switch to an insurance product, assuming that’s correct for you, which is why you should probably reach out to Neel if it’s time to renew.

And you can visit protrusive.co.uk/insurance as part of your quote, you get a little discount about a hundred pound discount, which is nice, but the discount you’ll get compared to some of the other products out there for a very high quality insurance product that will cover you medically legally is well worth considering save me thousands. So I just want to pass that on to you. That’s protrusive.co.uk/insurance. And of course, reach out to Neel on protrusive guidance. Let’s join the episode again.

[Jaz]
Sarah, X miles away from the clinic, you can’t work, within X amount of time, whatever, what do you make of all this?

[Sarah]
Yeah, so, it’s been like this for years. Oh, they’re not worth the paper they’re written on, just ignore them, nobody does anything about it. Apart from, I make a living out of doing things about it. And I’m sure lots of other lawyers do as well. So I would say get them checked so important that you do get these causes check from a practice owner’s perspective It’s the only way that they can protect the goodwill of their dental practice, especially private dentistry because as a patient you like to know who’s putting their fingers in your mouth and you’ll go back to the same dentist you’d like to know who your dentist is.

We can brand and have practices where we’re trying to attract them to the practice but ultimately you still like to go back to your dental associate to look after you. So the only way a dental practice can protect its goodwill is by incorporating these restrictions and they have numerous names.

Restrictions, restrictive covenants, barring out clauses, binding out clauses. And what they do is they say, look, you’ve been in contact with my patient base. And what I don’t want you to do is take those patients when you leave. And sometimes they also say that in respect to the staff. And when we say take the patients, it’s contacting the patients, dealing with them, or I don’t want you to set up within a certain radius and be my competitor so that all the patients go.

And dental practices have a legitimate business interest to protect by putting these restrictions in. So what they do is they satisfy the first test for restrictive covenants to be enforceable. The next two tests whether you’re restricted for a reasonable period of time and whether you’re restricted within a reasonable radius.

[Jaz]
So, what is a reasonable, yeah, in your experience, reasonable terms?

[Sarah]
So, time is a bit easier because, again, it depends on the practice. So, general dentistry, 12 months, I would say, would be enforceable. For general dentistry, trying to stop somebody for 24 months. 36 it’s going to fail because you’re not being reasonable because within that 12 month period you should have seen the patient again.

So that’s the idea behind it. If you’re a specialist you might get a little bit longer. If you’re doing ortho treatment over a period of time again a little bit longer but in my experience 12 months seems to be reasonable. Radius it depends on the practice and where you are in the country. And where the people visit you because they travel to see you.

So if your practice is based in Cumbria and the nearest competitor is 10 miles away, 10 miles. If you’re in a built up area, your nearest competitor’s five miles, five miles. Wimpole Street. It’s a bit difficult to see what’s reasonable and that’s basically-

[Jaz]
500 yards.

[Sarah]
Exactly. And that’s basically how it works. And then again, then we come back to why these contracts need to be drafted to be specific to the individuals and what works for the individuals because it will differ. Just picking up on the point that Neel said, I do agree that what happens when two people get into a dispute is that they do try and armor themselves in lots of different ways and being regulated one of the things that dentists seem to default to is I will report you to the GDC if you don’t let me, blah, blah, blah, that tends to be how it goes.

I think what is quite good, I would say, is that the GDC do tend to understand when it’s coming out of a different type of dispute. In terms of, this is a contractual dispute and you’ve said this because you’re in the middle of a dispute, basically, they do tend to read between the lines, they look into it, don’t get me wrong, but we do seem to have that element there because one of the questions is, why didn’t you raise this six months ago? But yeah, it does tend to get thrown about a bit the GDC when people are in disputes, which is a shame that the body’s being used in that way.

[Jaz]
Totally, total shame. But I think we can conclude from this question is actually is, it is a reasonable thing to have in a contract as part of a practice viewpoint. And it’s just worth checking that the terms within it are reasonable to your individual clinic in the area that you work in. So fine, I feel better about seeing that in contracts now. The last thing we have to cover then, because there’s so many, there’s millions of things we cover, but in terms of maximizing our time here or maximizing the impact from our time is vicarious liability, right? So Neel, can you, can you explain what vicarious liability is?

[Neel]
Well, again, me just being a dentist, I’ve had to look at it quite clearly and try and understand it myself. And perhaps a little bit in layman’s terms as well, which I like it. So there’s two parts to it. There’s this non deligible duty of care, which our friend Simon Thackeray is always very good at talking about these things.

And again, I’m not sure we understand it, but for me as a lay person, I would say if a patient comes into practice and you’re my associate, and he sees you, but you come into my practice, does the practice have a responsibility to the patient? So the non deligible duty of care is something where the patient has, the practice has a responsibility to the patient, regardless of who is seen.

And I think as a practice, we’d probably agree on that as a principle, because we feel there are patients, even though you’re seeing them. We’re talking about not poaching patients. So I think probably we have a non deligible duty of care. So there is this thing is, you’ve come to Neel Dentistry.

Whoever you’ve seen in there, they’ll knock at our door when they have an issue. So we have a duty of care for them. Now, the vicarious liability part of that is, are we responsible for what’s happened to them? So if they had some negligence from the associate or who didn’t do perforated or did something right or wrong, does the practice have any onus in that? Now they might argue you didn’t give any instruments.

[Jaz]
Individual human error of the associate is that now, can you now point a finger at the practice, basically, right?

[Neel]
Exactly. And the famous lawyers who like to go after dentists and advertise tend to go after the practice because the associates can move around, they can go abroad, they can be off the list, and they know the practice has an address, has assets is an easier target.

So therefore we have to protect ourselves and I’ve got vicarious liability as a practice because it might not be to pay out a claim. Although I’ve seen that happen. I’ve seen something else I’ll tell you a sec, but it might be to defend the claim that actually we don’t have a vicarious liability issue here. We have a deligible duty, but we don’t have the VL. So that’s why you might need some money. or an insurance to have that set up to practice.

[Jaz]
So you mentioned you had vicarious liability as a practice, do you mean you had vicarious liability insurance as a practice?

[Neel]
Insurance as a practice. So we have it as a practice, and if you’re partners, you should have it. What I have seen is some principals have it as part of their indemnity. So there are a certain insurers out there will give you a week. We give you the L, but they put it on your policy. The problem with that, I feel is let’s say you went on maternity. Someone comes along, does some negligence, goes away abroad.

You’ve never seen the patient. Now the vicarious liability that is now here on the practice comes out of your own indemnity. So your indemnity, which might be three grand now goes up to 15 grand because you’ve taken a hit personally. So I think it’s better. And again, you’d have to get proper advice to have the entity.

If you on your own, or if you’re going to sell it to a partner or sell it to somebody, the business has the VL policy and don’t have it attached. We’ve seen a lot of people with a certain insurer have got attached to their individual policy. So I would keep them separate. So ensure the practice for the BL because you need insurance, not to say that you will pay out, but you have to defend it at least and you want to defend that VL.

But you do have the duty of care, which is why it’s in the best interest for the patient, which is what’s most important, is that the associate and the patient and the practice will all work together. I’ve also seen it in some corporates where a complaint comes into the front desk and the receptionist goes, oh, that dentist’s name is this.

It’s his GDC number. There’s an email. He’s treated you deal with it and that’s dropping the associates in the lurch and I’ve seen that at big corporates and again that doesn’t help anyone. So I think with all this, coming full circle is associates and principals, we’re tending to try and be opposites. We actually will be much better if we work together, whether it’s disputes, whether it’s contracts, whether it’s dealing with things, we’ve got to try and get the love back a little bit, Jaz.

[Jaz]
Absolutely. And so Sarah, they’ve been all very fascinating, scary as well. So how is this element of a vicarious liability managed in the standard contracts that you see and you help with and how much of the contract does this part take up?

[Sarah]
Yes, so, vicarious liability is a term which as an employment solicitor we’ve used for years because as a practice owner you have always been vicariously liable for the actions of your employees. So, to give the example, one employee discriminates against another employee. You might think, well, it’s between them two.

I haven’t done anything wrong, but actually it’s in the course of employment. You’re vicariously liable for their actions. So they will sue you as the employer. And that it, this has been the case forever, for as long as I can remember. I think why it’s really come into the dental industry is because we’ve had numerous cases whereby it was decided, as Neel has set out, that actually now the practice owner can be liable for the clinical treatment of the associates.

[Jaz]
Of the self-employed associates.

[Sarah]
Yeah, which was never the case before. And the reason why it was decided in those cases is because what the key here is that those relationships between the practice owner and the associate, it’s been identified that relationship is akin to an employment relationship.

So they looked at these indicators that we spoke about. And I think, as you said, Jaz, if we went into self employed indicators, we really could speak about it for hours. Well, I could speak about it for hours. But if we’re going back to, are they genuinely self employed? How many indicators do they have?

So that’s the first thing we would always look at and also make sure in the agreement to try and ensure that the relationship is not one that looks like an employment contract, so that’s the first thing. Secondly, yes, there are clauses within the associate agreements now about vicarious liability. Like, for example, if I become liable for your treatment and it’s you that’s made the mistake, but actually I’m the one that’s sued and I have to rely on my vicarious liability insurance to deal with this, you’ll indemnify me. So you pay me back, you’ll owe me the cost of that because I didn’t do it and you’re self employed. So there’s little clauses like that, that you need to leave it.

[Jaz]
And that’s fair, right? Is that kosher?

[Sarah]
Yeah, it’s kosher. Yeah, don’t have any issues with it if both parties agree to it. So, yeah, you do have to be careful and make sure that you understand those clauses and what you’re entering into.

But yeah, that those are clauses that we’re seeing where the practice owner is now trying to protect themselves from these claims being made. Because of course the practice owner will not, well, I say will not, but shouldn’t or doesn’t tend to have much to do with the clinical treatment that the associates providing.

They won’t mentor them day in, day out to this, the extent that maybe they would want to be or should be. Firstly, because they’re self employed, that’s the main reason for it. But also they are meant to be self employed clinicians. And we don’t, we don’t have the time to be mentoring associates to that extent.

So yeah, there are causes being included in the agreements. And again, we come back to make sure you understand them. And usually with the agreement. We would always say, make sure you have the right insurance in place that sits alongside it. And so there were always two elements, whether you’re the practice owner or whether you’re the associate, you need the contract, right? But then you also need the right insurance. That’s really important.

[Jaz]
I think the key message here is get every element of your contract check. I totally have a heightened awareness and importance of the contract for sure. Neel, is there a story, this final thing, is there a story you want to share before we wrap up?

[Neel]
It was just that a principal went on maternity, the associate fled the practice after some theft, et cetera, and 200 grand payout from the principal. So all these things have huge implications, right? And we always believe in justice, but the right and wrong on the end of the day, you’d never know what’s going to happen. So don’t go and trust, trust is a great thing, but just back that trust up with some proper due diligence.

[Jaz]
So in this day and age, although the contract very much still is, in my opinion, something you pick up when this disagreement happens or when you’re entering this hazy territory, you better make sure it’s a good contract, right? It’s good.

[Neel]
It’s too late by then.

[Sarah]
I know. Dentists completely understand. Prevention is better than the cure, so take that with your contracts as well.

[Jaz]
Fantastic. Neel, Sarah, thank you so much for your time. I really appreciate it. Sarah, but for those hundreds of associates now be reaching out to you to just get, can you just go answer my contract? How can they reach out to you?

[Sarah]
Yeah, of course. Thank you so much. If you can Google or go to our website, it’s www.BuxtonCoates.Com. There’s information about how you can get hold of us and they’re all our telephone numbers. There’s a contact. You can email us, but also on our website, there’s more information about this.

We do blog quite often to try and make sure that dentists and practice owners know what’s relevant in the industry and what they should be looking out for. So there might be some information there, but we’re always happy to help people. So thank you so much.

[Jaz]
Well, I appreciate you giving up time to discuss this really important topic. I think this has been the most tangible piece of content around contracts that I’ve ever been in discussion. I’ve ever been involved in more than any lecture I’ve ever been to more than any webinar I’ve ever seen. So thank you so much for answering those questions. So wonderfully, Neel, my friend, I hope you’re nodding there. You agree. How can we reach out to you, my friend?

[Neel]
Always happy to. You can find me on the protrusive app, which is obviously this really new platform that Jaz has. And-

[Jaz]
Totally DM Neel on there.

[Neel]
Yeah. You can just DM me there. Or I think there’s a, you get a special deal if you mentioned Jaz’s good name. So, yeah, Neel @ProfessionalDentalIndemnity. WhatsApp or Facebook or Messenger or TikTok. I’ll be, I’ll find you.

Jaz’s Outro:
Amazing. Thanks so much. I’ll put both your links and whatnot in the show notes. Thanks so much for a fantastic episode.

Well there we have it guys. Thank you so much for listening all the way to the end. I will put Sarah Buxton’s details in the show notes and also how you can reach out to Neel as well, of course, reminding you that if you do a renewal for your indemnity or insurance product, do check out PDI and the good guys at All Med Pros. The way to capitalize on that is. prortusive.co.uk/insurance.

Make sure you get a quote from these guys before you commit to renewing with whoever you’re with at the moment. This episode is eligible for CPD. You can get one hour CPD because let’s face it, this was very educational, right? You were listening and you learned something. So why not get a verifiable CPD Certificate and you can do this for this episode and the hundreds of other Protrusive episodes on our network Protrusive Guidance.

Just answer the questions and our CPD Queen Mari will send you out a certificate every week and also every quarter and every year she’ll remind you of all the CPD that you’ve completed with Protrusive. I just want to thank my team, Erika, Krissel, Mari, Nav, Gian, Emma, Rakesh and Sophie, the list is getting longer and longer week by week, for helping to keep me afloat, right? So there’s so many things to do in Protrusive, so that’s why I’m so thankful to having the team to keep our community thriving. And thank you once again for listening and watching all the way to the end.

If you’re on YouTube, please hit that like button, subscribe button, share it with someone. And if you’re listening on Spotify and Apple, again, you guys are the OGs. Thank you so much. I’ll catch you same time, same place next week. Bye for now.