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Reassessing Notice Periods for Compensation Cuts and Termination in Radiology Contracts

February 12, 2024

Blog

Article

A prospective employer’s willingness or unwillingness to negotiate notice periods in a contact may signal the difference between a worthwhile opportunity and a one-way, dead-end job.

In a recent post on rad social media, someone brought up a clause in a prospective employer’s contract, which stated that should the practice’s volume drop or be expected to, the employer could cut compensation or fire with 60 days’ notice. The poster wanted to know if this was “okay.”

If you spend any time at all on social media, it won’t surprise you that responses ranged from the equivalent of “Hell, no!” to “It’s not unreasonable.” Some included more rationale than others.

From my perspective, if the group wants to be able to alter or terminate the deal with two months’ notice, how much notice do they expect from the employee if the shoe is on the other foot? Is this clause a one-way street?

Someone once taught me a useful term by referring to the notice period as an “Out.” For instance, my last job had a six-month Out. While it is a handy term, it can be confusing if you’re talking to someone who hasn’t heard it. I have taken to capitalizing it in order differentiate the noun from an otherwise commonly used preposition.

I have seen a lot of variability in Outs. Six months has been the longest Out I have endured. I understand the reasons why a hospital or rad group might feel the need for such a prolonged parting. The rationale may include the need to ensure coverage, recruiting, licensing, and credentialing new people, etc. However, I have also written in this blog about why I think it’s an incredibly bad idea to make the Out longer than both parties want it to be.

It would be a harmonious world if we all agreed on how long was reasonable, but that is not usually the case. When I finally decided that my last job was a dead end, I would very much have liked to switch to my new gig ASAP, and my new outfit certainly didn’t need six months to make things happen. My former employer, however, was not inclined to play ball.

A lot of the time when negotiating employment, whoever wants the longer Out wins. When I took on my former job, I didn’t like the six-month term, but other details were more important to me (and I hoped I would never want to leave), so I accepted it.

I can also imagine another world, perhaps one with a harsher job market, in which a prospective employer lists a 3-month Out. Happy to have found a gig but worried about finding another if this one goes south, the employee asks for a longer interval. The employer might increase the Out, or maybe take on the employee with the understanding that the three months will be increased to six if the employee performs well for a certain duration.

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Such mutual flexibility feels good to those who like a sense of control over their careers. A two-way street, where we can exchange ideas with our teammates/employers and reasonably expect that we will be heard if not accommodated, is desirable.

That is why I asked my question in that social media thread. It sounded like the prospective employer was dictating a one-way street. It could claim dropping volumes (or an unverifiable expectation of same) and cut the employee’s pay or even let him or her go. However, it didn’t sound like the employee had the same ability. The employee couldn’t, for instance, suddenly demand more money or abruptly leave if he or she felt circumstances warranted.

Sure enough, the poster confirmed that the contract otherwise had a six-month Out, in which either employer or employee could pull the trigger with equal consequences. The two-month clause was a one-way street, exclusively geared to the benefit of the employer.

Of course, contracts routinely have similar clauses, but these are usually for more extreme circumstances in which the employee commits a felony, loses licensure, or otherwise stops being able to do the job. It’s not feasible to just keep giving him or her a paycheck for several months while the clock counts down. However, even that is a two-way street. If the rad group suddenly imploded and couldn’t provide work or a paycheck, nobody would expect the rad to hold off finding a new livelihood.

People generally don’t like one-way street relationships. If I have a pal who is constantly bumming me for rides, drinks, etc. and never gives anything in return, I might seek less of his or her company. I have mentioned in previous blogs that, social animals as we are, humans are hard-wired for reciprocity. We appreciate it when others do things for us. We instinctively want to repay the favor, and we expect others to behave similarly. Two-way streets feel proper.

If we sense that we are dealing with someone (or a group, such as a radiology practice) that is more inclined to take without giving, or demand without hearing requests in response, we react negatively. We diminish contact or avoid it entirely. That includes not accepting contracts (or, if already in one, accumulating dissatisfactions that might ultimately result in termination). The more one-way streets we see in a relationship, the more likely we are to conclude that the whole thing is one big dead end.

I have gotten the impression that a lot of the contractual one-way streets that look like red flags to job-seeking rads haven’t been properly weighed by the rad group seeking a new teammate. These clauses might make perfect sense to their lawyers or bean counters, who might very reasonably tell rads in the group: “This one-way street clause protects you for reasons A, B, and C.”

When rads in the group hear that, however, or certainly when their prospective new hire points out that there are some unfriendly-sounding one-way streets in the deal, the group needs to seriously think about their motivations and strategy. Do they really want to start out this new relationship on a bad note or prevent the relationship entirely?

All too often, their mailed-in response is “Sorry, the lawyers make us say that. It’s in all the contracts. There is nothing we can do.” It comes across as a flimsy excuse and an intention that this (as well as other avenues in the relationship down the line) will never be a two-way street.