Graduation is just around the corner, and you're starting to let yourself dream about what it would be like to own your own practice.
You probably already have a design in mind, a location (even if it's just the city and state), and maybe even what it would be called. You probably already know what tools you'll need, and what you'd like to specialize in. In fact, your shiny new business is starting to seem so real, you can practically taste the complimentary toothpaste you'll be giving out.
But then reality sets in. You know how to be a dentist…but how do you run or manage a business? Endless clinic hours and cramming for board exams probably didn't teach you what paperwork is required when you hire your first employee, as opposed to your fifteenth. It probably didn't mention the best way to negotiate a salary with a DA I versus a DA II. And it most definitely didn't tell you which employment laws you need to comply with so you won't get sued.
Thankfully, HR and practice management don't have to be learned the hard way, through years of painful, trial-and-error experience.
Here's the easier way. I've addressed four practice-
management fundamentals that will help you start your new journey on the right foot while still covering your backside. Rip this article out right now and save it!
Lesson No. 1: Employee policies come before employees.
Before your first employee ever steps through your door, you need to have a set of strong, comprehensive, and legally compliant employee policies in place.
Why are these policies so important? Think of your office policies, which would be bundled together in an employee handbook, as your how-to manual for your practice. It should tell your employees what you expect of them, what they can expect from you, and the rules of the practice. It's your go-to reference for dealing with employee issues fairly and consistently. And it is the best way to show your commitment to comply with the hundreds of local, state and federal employment laws that apply.
Equally important, a good employee handbook tends to discourage disgruntled employees and unscrupulous lawyers from bringing lawsuits. The case against an employer becomes much more difficult when there are updated, comprehensive and fair employee policies in place. The lawyers tend to sniff around a bit, and then move on to easier targets.
A properly written handbook should include all of the following: at-will language, an EEOC disclaimer, days and times the practice is open, your pay schedule, how to handle paycheck discrepancies, which holidays are observed, what to do if the employee is going to be late, what your disciplinary procedures look like, what happens in the event of a voluntary or involuntary termination, when final paychecks will be given, how much (if any) PTO is given and how it is accrued, what happens in the event of a family emergency or tragedy, how much maternity leave is allowed, how the practice handles CE events, and much, much more.
Unfortunately, that list only scratches the surface of everything you should include. A complete and fully comprehensive employee handbook that has all of the required policies and safe harbors included should be approximately 80 pages long. No, I'm not joking.
Your policies must also comply with the letter of the law.
In other words, they need to not only address the employment laws that apply, but use the proper language, too. If a policy's language is too vague or too narrow, or if it implies a meaning that the law did not intend, then that's as dangerous as outright breaking the law. As such, we always recommend you hire an expert to write your policies and your handbook, rather than trying it yourself or trusting the sources you find online. It's too easy to get something wrong inadvertently, and it can cost you tens of thousands of dollars (or more!) to defend yourself against a complaint. Just don't do it.
Lesson No. 2: Hiring well means hiring safely.
Once you have your employee policies and handbook firmly in place, the next step is setting yourself up for success when hiring. Despite how easy it looks on TV, hiring is more than just placing an ad, sitting through a couple of interviews, and picking an applicant whose qualifications look good.
First off, before you write your job ads, you'll want to make sure you have detailed job descriptions in place. A job description is a written summary of the job duties and physical requirements for each position in your office. When written properly, job descriptions not only help employees understand their role and responsibilities, they also serve a very important legal function in the event an employee needs a disability accommodation. This becomes very relevant when an employee is disabled due to illness or injury, and is no longer able to do the job you hired him or her to do.
Include that you're an equal opportunity employer in both your job ad and job description. And use careful language that won't deter applicants who might have a disability but can still perform the job.
Then there's your interview process. Stay away from interview questions that prompt the candidate into revealing protected information, even if you're trying to be friendly. For example: "Maya is a pretty name…is that Hispanic?" or "Do you have any children?" Even if you never use that information during your decision process, just the fact that you asked for it and received it can be enough to justify to a judge that a rejected applicant's discrimination case should proceed to court.
As a final caution, make sure you're not using an outdated form that asks for criminal history information during the application process. Due to rapidly changing laws, you can often only ask for this information later when you've made a decision and it's clearly relevant to the job. You'll also want to check what your state's rules are about background checks.
Lesson No. 3: Being an at-will employer will help protect you, but it isn't a magic shield.
Employment in 49 out of 50 states is "at-will" for both the employer and employee. (Montana is a bit weird.) What this means is that either of you has the right to terminate the employment relationship at any time, with or without any notice, and for any (non-illegal) reason or for no reason at all.
What many employers fail to realize is how easy it is to damage your own at-will employer status by inadvertently saying anything, whether orally or in writing, that makes your employees believe their employment is guaranteed for a specific time period.
This is especially dangerous in offer/hiring letters and employment contracts. Your employee handbook must also include a professionally written "at-will disclaimer," in which you make your continual at-will status clear.
Likewise, you cannot terminate for any illegal reason. Keep in mind the protected classes: age, gender, race, religion, color, national origin, and disability. And if the employee also recently participated in a protected activity (e.g., complaining about discrimination), any discipline or firing within six months would likely be considered retaliation.
Most doctors (new and old) think that if they don't provide a reason when they fire, then nothing can be used against them. But that's not true. If you don't give a reason, guess who tends to come up with one? That's right—the employee, and his or her attorney. The reason usually falls under one of the protected classes above.
To play it safe, even if you have maintained your at-will employer status, it's best to keep careful, highly detailed records and to provide any employee you fire with a written letter as to why they've been let go.
Lesson No. 4: Classify your employees correctly.
This last lesson is one of the hardest to get right, even for veteran doctors, and is considered to be "one of the most serious problems facing affected workers, employers and the entire economy" by the Wage and Hour Division of the U.S. Department of Labor.
Each new employee must be classified correctly as exempt or non-exempt. Exemption refers to whether or not an employee is exempt from the laws surrounding overtime pay. Non-exempt employees must be paid at time-and-a-half their regular rate of pay for all hours more than 40 that they work in a work week, whereas exempt employees are paid on a salaried basis and do not receive overtime pay.
However, paying an employee a salary does not automatically make him or her exempt!
Strict federal rules apply to which employees may be classified as "exempt." Exemption criteria include the employee's salary level, types of duties performed, and the percentage of time he or she spends on such duties. A position such as office manager might be exempt or non-exempt, depending on salary and percentage of time the employee is actively engaged in managing employees. Your dental assistants, on the other hand, will be non-exempt. And your hygienists are not only considered non-exempt (unless they have a four-year degree and meet other criteria), but also cannot be considered independent contractors. Trying to call them anything else is like asking for an expensive Department of Labor (DOL) audit.
Also, as of June 2015, the DOL has proposed changes that are likely to raise the overtime salary threshold for exempt employees from $23,700 to as much as $50,440. This law has not gone into effect yet, but is likely to be made active within a year. To ensure you're covered for when this law does go through, you'll need to analyze all of your positions to make sure each and every new hire is properly classified. Employers will need to comply very quickly once the new rule goes into effect. This is difficult on your own, but easier (and much less scary) when you have help from
HR professionals.
Ready, Set, HR!
I've only scratched the surface of what you need to know when it comes to building and managing a team and a practice. But this is a strong start, and it will help you steer clear of endangering your profits before you've made any.
There are also related, although significantly different, knowledge and steps that will apply if you're taking over an existing practice. In that case, you're not only trying to prevent your own mistakes, but evaluating and correcting what's been done before you took over.
If I can leave you with any other piece of advice, it's to recognize what you don't know and when to get help. Not only does it make everything much, much easier on you, it's also the safest way to ensure that you and your new business stay firmly on the path to success.
Paul Edwards is the CEO of CEDR HR Solutions, which provides custom employee handbooks and unlimited HR support to dental offices of all sizes across the United States. He has more than 25 years of experience as a manager and owner, and specializes in helping dentists successfully navigate employee issues. He can be reached at pauledwards@cedrsolutions.com or (866) 414-6056.
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