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Legal Matters >
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New Year’s Resolutions
You’ve promised to lose weight, get in shape, and review
your finances, but professional resolutions are perhaps more urgent and more rewarding.
By bruce d armon
With the holiday season largely behind us, we are bombarded with advertisements to join the local health club to shed
those extra pounds we gained during the past month and to get ready for summer.
We are encouraged to make a series of new year’s resolutions—e.g., to be a better friend or spouse or to save a few extra dollars. Some of us
may actually be able to achieve some of these goals, but for most of us, the
challenge will be to remember these resolutions by the time the first flowers
of spring bloom.
Most new year’s resolutions focus on personal rather than professional, goals. The irony is
that if we fulfill various professional objectives, we may find that our
personal life is much more satisfied and enriched. With that in mind, set forth
below are a series of questions and issues that you should address when
outlining your professional goals and objectives in 2008.
Last year of training
If you will finish your training this year, you should be knee-deep in your job
hunt. Hopefully, you have been on many first (and second and third) interviews
with prospective employers and have sufficiently narrowed your opportunities.
As we get into spring, the supply-and-demand curve will start to tilt against
you if you have not finalized your post-training employment. Now is the time to
switch your employment search to a higher priority.
If you have already accepted a job and signed your employment contract (make
sure you have a contract—it protects your rights and responsibilities as well as those of your employer),
take a pat on the back for thinking ahead and skip to the next section.
If you will finish training in 2009, the time to start planning your job search
is now. Get organized and you’ll stay ahead of the game.
• Have you identified your job priorities and deal-breakers? Your job priorities are the mandatory things you would like in your job for you
to accept the opportunity. As the term suggests, the deal-breakers are the
things that cannot be a condition of your employment and, given the choice
between two jobs, you will take the job that does not include the deal
breaker(s).
The job priorities and deal-breakers are not the same for everyone, and are not
necessarily the converse of one another. It is very important, however, that
you have taken the time to write down these issues and use them as a guide
throughout your interview process. Make sure these issues are addressed to your
satisfaction before you execute the employment agreement. If they are not
resolved now, your leverage will likely be significantly less once you are in
the employment setting.
• Have you carefully reviewed your employment agreement? I find that many residents and fellows believe there is a standard physician
employment agreement. There is no such thing. Every employer has its own
priorities and proclivities for the items that are included in an agreement.
It is incumbent upon you to understand every paragraph, sentence, and word in
your employment agreement. If you do not, find someone who can help you
understand it. An experienced health-care attorney can be invaluable to you at
this stage of your career and serve as a skilled professional adviser as you
take on new opportunities and face challenges throughout your career. You don’t want to sacrifice years of hard training by signing a flawed employment
agreement that does not adequately protect you.
• Have you helped a colleague? You can only work one full-time job at any time. Once you have decided on your
prospective employer and signed your agreement, pass along other opportunities
to your colleagues. The job-hunting process is not a zero-sum game. You can
ensure you and your colleagues are all winners by sharing information with one
another and making sure that everyone in your circle has identified and
accepted a suitable opportunity.
At some point in your career, you will likely need the help or perspective of
one of your colleagues from your training years. Every person you help to
identify a job opportunity will be somewhat indebted to you. Given human
nature, that same person will more than likely go out of her way to assist you
when you are looking for a new job or need assistance with a referral.
Contract issues in 2008
If you have already completed training and are in the work force, there will be
challenges and opportunities that could present themselves and for which you
must be ready.
• You expect to become a “partner” in 2008. How do you get ready? Depending on the corporate form of your employer, there is different
terminology. If your employer is a professional association or corporation, you
will likely become a shareholder in the entity. If your employer is a limited
liability corporation, you will become a member in the entity.
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Hopefully, your employment agreement provides a date certain when you will be
notified whether or not you get this opportunity. By that date, your employer
should give you written notice of the decision and the financial cost for you.
This notice should include the calculation of the buy-in amount and provide the
relevant financial documents for your review. In addition, you should be
provided with a series of other documents that, when executed, memorialize your
role as a partner and describe your and the employer’s respective rights and responsibilities. Note that these documents will likely
include a new employment agreement.
Depending on the cost to become a partner, you may need to explore financing
options. If it is not viable for you to finance the costs of the transaction
from your personal savings, the employer may be willing to do a salary offset
or reduction for you to achieve the necessary buy-in. Otherwise, you will need
to work with a bank. Banks will need to do thorough due diligence on you and
your finances so be sure you have provided ample notice so the transaction can
be completed in a timely manner.
• Time to renegotiate your employment agreement? Start to think about issues that you would like addressed or modified in your
new employment agreement several months in advance of the current agreement’s expiration date.
Do you desire a higher base salary? Would you like the bonus tiers changed? Are
there different or additional benefits you would like? Do you want to build in
a timeline to becoming a partner in the practice and include quantifiable
goals? Prioritize these issues and act accordingly so you will look back upon
2008 fondly.
• You want to leave your job as soon as the right opportunity presents. How can you leave your current job? There is no such thing as indentured servitude. However, your employment
agreement may have specific terms regarding termination. How much notice must
you or your employer give to terminate the agreement “without cause?” Are there penalties if you leave sooner? The penalties could be forfeiture of a
signing bonus or moving expenses.
If you leave your job before the end of the contract year, will you be
responsible for the “excess” vacation days you may have taken or continuing medical education funds spent?
If your employment agreement provides a base salary and bonus, do you get a pro
rata bonus for the time you spent with the employer during the partial contract
year. Are you or your employer responsible for your professional liability tail
insurance costs? The financial consequences of switching from one job to the
next can be significant and should not be taken lightly.
• Have you adequately protected
yourself and your family? No one likes to think about death, particularly so soon after the holidays, but
proper estate planning is an essential element of everyone’s financial planning. Having a will, power of attorney, and advance health-care
directive in place will actually be a blessing for your family and loved ones.
Be aware of the changes in the tax laws and how they may affect your planning.
If you already have estate planning in place, now might be a good time to
review those documents and ensure they still reflect your current thinking and
priorities.
Long and short-term disability may also be worthy of your consideration.
Depending on your health history, disability insurance can be a very affordable
expenditure. Take a look at your employment agreement and refresh yourself on
your salary and benefits protections if you become disabled, and at what point
you will have to solely rely on your disability coverage. No one plans to get
disabled, and you do not want your and your family’s circumstances to be adversely affected when proper planning could have
mitigated the situation.
Your 2007 tax return will be due shortly. A well trained accountant can
effectively minimize your tax burden and help you plan in advance for your 2008
tax obligations. Understand how the federal and/or state laws may have changed
and what, if anything, you should do over the course of 2008. It is much easier
to change your habits now rather than at the end of the calendar year when
there may not be enough time to take advantage of the changes in the law.
Next Steps
According to www.goalsguy.com, the tradition of New Year’s Resolutions dates to 153 B.C. The mythical king of early Rome, Janus (for whom
January is named), had two faces and could simultaneously look back on past
events and forward to the future.
No one can accurately predict what 2008 holds for you. Do not, however, let the
days, weeks, and months go by without proactively protecting your professional
and personal interests and looking out for the best short and long-term
opportunities. Identify your professional goals and objectives and act
accordingly. END
Bruce D. Armon, Esquire is a partner in the health-care group of Saul Ewing LLP
and is a frequent speaker to physician audiences on corporate, regulatory, and
compliance topics. He can be reached at barmon@saul.com.
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