DON’T Sign on the Dotted Line: NP Employment Contract Considerations

I have been on the signing end of a few poorly worded nurse practitioner employment contracts in my day. In my less experienced, younger days I was especially quick to accept a job without even attempting to negotiate less favorable contractual clauses. The main reason for my negligence? I didn’t know what to look for in reviewing a nurse practitioner employment agreement.

There are a few key things nurse practitioners need to watch for when it comes to signing an employment agreement. Ideally, you should have an attorney look over your contact before you sign on the dotted line. If a formal review isn’t an option for you, keep the following in mind.

Pay Attention to Noncompete Clauses

Noncompete clauses prevent the nurse practitioner from competing with the employer should he/she leave the practice. A noncompete clause specifies that the NP will not practice within a specified geographic period for a certain period of time after leaving the practice. Be wary of these clauses. They could theoretically make the situation such that you have to call Two Men and a Truck and leave the city should you decide to switch jobs. Make sure any noncompete agreement is something you can live with.

Is There a No Moonlighting Agreement?

Even as an experienced nurse practitioner, I didn’t become aware of no moonlighting clauses until recently. This sneaky language in an employment agreement prevents you, the nurse practitioner, from holding a job outside of the one for which you are signing the employment agreement. In other words, if you wanted to take on a PRN gig to earn some extra cash outside of normal work hours you would be contractually prevented from doing so. I have even heard of physician contracts where MD’s are permitted to moonlight but must pay a percentage of earnings from outside employment to the current employer.

If you work PRN or think you might want to do so in the future, ask to have the no moonlighting clause removed from your employment agreement.

Ask for Malpractice Tail Coverage

There are two main types of medical malpractice insurance– “claims made” and “occurrence”. In a claims-made policy, you are only covered for claims filed during the time you are employed if they occurred while you were practicing at the same clinic or hospital under the same policy. Claims against you arising from a prior place of employment or from when you were covered by another malpractice policy are not covered.  This means “tail” coverage is required to cover claims arising from prior employment or which occurred under another malpractice policy.

Don’t sign a contract where you are responsible for purchasing your own tail coverage. This can cost you tens of thousands of dollars and being uninsured when it comes to prior actions is too big of a risk. Most employers include tail coverage in their contract.

What Happens if You Quit?

Even though you are just beginning a job with a new employer in signing a contract, think through how the job will end. Look closely at how much notice you are required to give if you decide to leave your employer. Some employers may ask for six months notice making it difficult for you to find a new job or relocate in the future.

Often, employment agreements contain a “without cause” termination provision. Make sure this is a mutual provision enabling both you and the employer to end the agreement without cause.

Compensation and Bonus Structures Must Be Clearly Outlined

It’s common that nurse practitioners are paid either partially or completely based on productivity– the more you bill, the more you are paid. Productivity formulas can be complex and confusing. Many employers use vague contract language to outline bonus structures or compensation models. Take the time to understand the formulas your employer will use to determine your pay. If you are offered periodic bonuses, make sure the bonus structure is clearly explained in the contract (or in a separate document referenced specifically in the contract).

Delineate Day to Day Responsibilities

Many nurse practitioners neglect to consider time spent on non-clinical duties in their contracts. Working in a medical practice can mean much more than seeing patients. Patient call backs, being on call, and other time spent on administrative tasks adds up. Some employers may even ask you to participate in marketing efforts or other activities outside of normal clinic hours. Make sure these additional responsibilities are outlined clearly in your contract. This allows you to point back to your contract should your employer ask more of you in the future without offering additional compensation.

If your clinic or hospital has multiple locations or outlying clinics, make sure your contract specifies in which location you will work if this is important to you. It is common that employers shuffle providers around which may result in you working further from home or in a location you aren’t comfortable with.

Watch Out for Fluffy Language

Employment contracts are notorious for fluffy language that doesn’t seem to mean much at all. But, these clauses are there for a reason. Don’t fall victim to the “it’s just the standard language” line. Everything is included in your contract for a reason. Understand the reasoning behind vague language and its potential implications. Don’t agree to it unless you are comfortable with what it could mean for your job.

A Handshake Means Nothing

Verbal agreements sealed with a handshake may be well intentioned, but unless an agreement is put into writing it doesn’t hold any legal ground. We all want to believe our employers have our best interests in mind, and most of them do, but if the terms of your employment aren’t clearly stated in a written document, you will have nothing to point to in the future should the relationship sour.

Is there anything else you wish you would have looked for in your nurse practitioner employment agreement?

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