Have you ever noticed how effortless it is for children to negotiate for their wants and needs? It is as if they come into this world with a magic gift of knowing how to get what they want—and better yet, nibble for even more.
As a mother of three small children, I watch in awe as my kids masterfully maneuver these situations and take note of their skills in an effort to learn from them. So I ask myself—why is it that, as we get older, we lose that comfort level with being direct about our needs and wants and negotiating for the same?
As a physician recruiter with more than 15 years of experience negotiating physician employment agreements, there is a palpable change in a candidate’s voice, behavior and even body language when we move from the pleasantries of exploring a particular opportunity to the negotiation phase of the recruitment process.
Why is this? I believe it has much to do with a candidate’s worry about crossing some invisible boundary in the discussion, appearing too greedy, or having a general discomfort with advocating for their needs. Since the fall is the time of year when many senior residents begin to consider job opportunities, it is an optimal time to put forth some tips on negotiating with an employer.
• Come prepared for the discussion.
This is fairly obvious, as you cannot expect modifications from an employer if you don’t know what is already in the agreement. You must review the document and become familiar with the obligations of both parties. Employers and their representatives will be well-versed in the language of the employment agreement, and you don’t want to be left behind as they move from paragraph to paragraph. That said, if there is something that requires clarity, be sure to speak up and ask for an explanation in layman terms.
• Enlist an attorney to review the agreement.
As it may be your first time reviewing an employment agreement, I encourage you to select an attorney who is both in the region where you plan to practice and is well-versed in physician agreements. You will be bound by the provisions of the agreement, so it is important that the document be one you can live with for the duration of the term of employment.
• The figures related to compensation may be negotiable, but more often than not, the methodology for payment is non-negotiable.
Compensation structures have simplified over the years, but there can often be multiple components that make up a total compensation plan, including salary, incentives, bonuses for quality and good citizenship, partnership, etc. Employers devote extensive time and resources to developing the best model for a practice and are typically not inclined to make radical modifications related to their methodology. As a general observation, employers tend to be more inclined within reason to readjust dollar amounts for base salaries, sign-on bonuses or retention bonuses before ever delving into changes in the compensation plan.
• It is perfectly acceptable to request data related to historical incentive/bonus payments.
If the employer is offering an incentive or bonus component, you should feel comfortable requesting not only the specific formula used for calculation, but also historical data related to how much has been paid on average to individuals in the group over a period of time (such as the past three or six months). The employer can do this while still protecting the identities of the individual physicians. If an employer is reluctant to do so, you should consider this a red flag.
• Benefit programs offered by employers are usually standard and universal for the group.
Health, dental, vision and retirement plans are typically non-negotiable. CME allowances and paid time off may be more negotiable, but many employers are reluctant to do so in order to avoid inequities within the group. There is also a greater level of complexity for the employer to administer a plan that differs among group members.
• Be wary of an employer that DOES give you everything.
I have always felt comfortable saying “no” to a physician’s request as it relates to the fairness of the group. If an employer is willing to do almost everything you ask in terms of compensation, then you can be assured others that precede or follow you will have the same experience, and this will create greater inequities between team members. In my experience, this is a recipe for disaster.
• How you are treated through the negotiation process is often an indication of how you will be treated once you are on board.
Did the employer carve out the appropriate amount of time to address your issues? Does the employer seem to understand your point of view without being condescending? When you are negotiating an agreement, keep in mind that the strength of the relationship and level of trust with an employer is arguably more important than what is written in a document. That said, if a concession has been made, make sure to get the changes in writing either within the agreement or via an amendment.
• Make sure you are comparing apples to apples.
Be wary of comparing compensation to areas outside of the direct marketplace of the career opportunity. According to a recent MGMA survey, the mean annual compensation between some regions across the country varied by as much as $44,000. If you are exploring a job in Denver, mentioning a much more competitive offer you received in Miami is somewhat irrelevant. Rather, gather specific data related to what other groups are paying in the same location. Be sure to compare this with the shifts required, expected patient workload and call requirements. You may find it valuable to break down a compensation plan so that there is a common denominator (i.e. a hourly or shift figure).
• Don’t be afraid to tell the recruiter which items are deal breakers.
Seasoned recruiters are skilled at classifying each negotiation point based upon the inflection in the candidate’s voice because there is typically emotion (or lack thereof) tied to the issue. If you know from the beginning what will keep you from taking the job, I would encourage you to be open about this with the recruiter rather than having them guess. This will help focus the employer on the items that mean the most to you and in turn may improve your chances of negotiating a concession. Choose your battles wisely, and try to keep your list of deal breakers to a reasonable number. If you find you have numerous concerns or you believe the agreement is too onerous, then you may want to reconsider if the position (and the employer) is ultimately the right fit.
• It is perfectly acceptable to request modifications related to non-compete/ non-solicitation clauses.
(But be aware most employers don’t budge on this item.) Depending on the specialty and arrangement, an employer may willingly alter the restrictive covenants to entice a physician to join. However, employers of a larger physician group are less likely to make any modifications with the knowledge that by doing so they set a precedent for current and future group members. This is much like a snowball rolling downhill, and most employers are willing to lose one physician due to a concern with the non-compete versus opening up the door for others to negotiate concessions in existing or future agreements.
• There is a fine line between being assertive and aggressive.
Since the negotiation exchange is typically between you and a representative of the employer, how you conduct yourself through the negotiation process can set a stage for how you will be perceived within the group. There is never a need for either party to be argumentative or disrespectful. Make your points known, but give the employer ample time to address the concerns and follow up with an agreeable solution.
• Know with whom you are speaking.
Try not to make the mistake of bringing up compensation or contract concerns with the wrong party. Typically you will address these items with the individual who has forwarded you the employment agreement, which is normally a representative of the employer. As you go through the interview process, it is advisable to avoid discussions related to compensation unless the person has been overtly involved in the contract or compensation discussions. If you require greater clarity as to whom you need to direct your questions, be sure to discuss with the employer.
• The bell curve of contract negotiations: Start light, tackle the hardest points in the middle, end with some light discussions.
This tip is merely a suggestion to facilitate a contract negotiation discussion. When you begin with a relatively benign concern, you can tend to get a flavor for how the employer responds to your request. If an employer is reluctant to budge on even the most benign requests, it is a signal that you may need to be more assertive with the most important issues, the deal breakers. This also allows both parties to “warm up” for the heavier issues.
Signing an employment contract is not only an important financial decision, but it can also affect your personal comfort, family, professional compatibility and career enjoyment.For this reason you should feel confident in your ability to advocate for your needs without fear of alienating the employer.
Negotiating your employment agreement with your practice of choice is much like salsa dancing. As one steps back, the other needs to do so as well to remain in step (and vice versa). Be prepared to take no for an answer, but also be prepared to walk away if your needs are not addressed. When done well, the negotiation process can leave both parties satisfied and ultimately excited about the future association.
I conclude this article on a Sunday afternoon as my 5-year-old relentlessly requests that I take her to the pool in 110-degree heat. Ludicrous, eh? Well I am ashamed to say I’m not only headed to get some towels, but I have opted to bring popsicles for poolside refreshment. We could all learn from those to whom negotiation comes so naturally.
Anne Fowler (firstname.lastname@example.org) is director of Outreach and Recruitment Services at Sound Physicians (soundphysicians.com), a leading hospitalist practice focused on being the organization of choice for clinicians and the provider of choice for partner hospitals and post-acute facilities.