Effective Employee Contracts Are Essential To the Security of Your Practice

MDalert.com staff

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  • Effective contracts between employers and employees can significantly improve the success of a medical practice, and can help to avoid damaging litigation.
  • Good contracts with employees are a sort of legal insurance against potentially costly disagreements.
  • A solid contract will cover all reasonably foreseeable circumstances.

Strong, well-constructed contracts can spare a physician significant lost time and money in litigation. The money and time invested in working with a legal team to write quality employee contracts are sound insurance should the relationship with that employee sour.

Steps You Can Take To Protect Your Business in Employee Relations

  • Create a detailed employee handbook that contains all the company’s policies, including grounds for termination.
  • Include obvious grounds for termination, such as destruction of company property, illegal activity, abusive or inappropriate language, physical violence, and theft. While nearly everyone knows that these are grounds for termination, you can still end up in court if the policy handbook does not include every reasonably foreseeable grounds for termination.
  • Conduct training sessions to educate employees on the guidance contained within the handbook.
  • Make sure that policies are enforced fairly throughout the company.
  • Require mandatory mediation for disputes among employees or between an employee and the employer. A clause of this type would require that, should a dispute arise, both parties to the dispute must, by contract, participate in a mandatory mediation program.

If the employees are unable to resolve the dispute between themselves, or if the dispute is threatening someone’s employment, the mandatory mediation clause will compel the disputants to meet with a mediator – an attorney or other professional trained in dispute resolution – and attempt to resolve the dispute.

“Often, what I see in these situations, noted Dan Fredenberg, Esq., of the Fredenberg Beams law firm in Phoenix, “is that people just have something they want to get off their chest. They want their grievance to be heard by a neutral third party and, in the best case, by the person with whom they are having the dispute. If the mediator is able to help both disputants understand the other’s perspective, this is often enough to resolve the dispute and improve the relationship.”

An Example of an Unusual but Effective Contract Clause

Mr. Fredenberg offered the following example of a clause that can prevent enormous trouble and also help to foster a positive work environment. “Lately, I have been counselling my employer clients to include an anti-disparagement clause in employee contracts. These clauses provide the employer the ability to terminate the employment of employees who gossip negatively or generally disparage the employer or their fellow employees.

“An anti-disparagement clause can have a significantly positive effect on productivity and on general corporate attitude,” noted Mr. Fredenberg. “It is a very powerful tool within the context of a small or medium-sized business.”

“It only takes one or two people to have their employment terminated for an anti-gossip clause to start to set a culture of positivity. The benefits of a policy like that are immeasurable but they are immense,” he added

What if the Dispute Cannot Be Resolved?

Of course, not all disputes can be resolved. Some do in fact involve unethical or criminal activity. In these cases too, clear employment policies that are outlined both in strong contracts and in an employee handbook can be of significant assistance in arriving at a fair and equitable termination of employment of the fired employee.

Space does not allow us to cover even a small portion of the subject of effective, multifaceted contract employee contracts. However, you can see how important it is to work with an attorney who is highly qualified in contract law when you are devising human resource policies and hiring employees.

Dan Fredenberg, Esq., is a Partner at Fredenberg Beams in Phoenix, Arizona. You can reach him at (602) 421-4286, or dfredenberg@fblegalgroup.com.