What is the difference between an offer letter and an employment agreement for a veterinary associate? Many times, if a vet is either coming out of training, they’re switching jobs, the organization that they’re looking at may say, well, we want you to sign this offer letter before we present you with an employment agreement. That’s standard. Now, a couple of things to think about, one, do you or should you negotiate prior to signing the offer letter? The answer is yes. I mean, an offer letter contains basic terms. So, compensation bonus structure, the length of the agreement, probably some basic information about a non-compete and benefits. It will not be detailed. It’s usually one to two pages at the most that just kind of goes over basic terms. If they offer you a hundred thousand dollars and you want 120, you should say that in advance and get that amended into the offer letter. Now, an offer letter is not binding.
It could potentially say in the offer letter that it is binding. In that case, then I guess, yes, it could be, but I can’t recall a time where an offer letter ever had any language that states it’s binding. If you sign an offer letter, agree to terms, and then they present you with an employment agreement, it doesn’t mean you can’t renegotiate the terms you’ve already come to an agreement on. Why? Well, if you just see the basic terms of an agreement, it may look great at the time. And then when you get into the language of the contract and the specific details, it could change things. For instance, let’s say the offer letter stated there is a non-compete, but it had no details about how long it lasts or the geographic restriction. Then in the contract, it states you can’t work as a vet for two years within 50 miles of your clinic, which would then force you to move if you wanted to get a new job. Well, it might have looked great at the time, but once you see there’s some insane non-compete, it completely changes whether the agreed-upon salary is worth it. Maybe they might say, well, it was worth it for a hundred thousand with a normal non-compete but with this very restrictive non-compete, I want 140, or I’m not going to sign. So, don’t feel like you’re locked into the terms that you’ve agreed upon if the contract has changed, or at least once you see the details, it changes the way you think about it.
Now, how to approach the employer in that situation? It’s delicate. You do need to go back to them and just say, these are the reasons why I was okay accepting this salary before, but now I’m not. I think most savvy business people are going to understand. They might be ticked off or act like, well, we’re not changing anything and that’s fine. But then it’s your decision whether to sign the employment agreement or not. So, providing them details and reasons why you were okay with the initial terms but now you’re not after reading the language of the contract is important to kind of reduce the amount of, I guess, potential bad blood between the new employer and yourself. Once you sign the employment agreement, those terms are set. Other blogs of interest include:
There’s no wiggling out of the terms reached once you sign the employment agreement, so you need to make certain prior to signing the employment agreement everything that you are concerned about is in the document, it’s been negotiated. Any employer states to you, oh, we’ll work out the details after you sign or I’ll work out the details after you start, that is a bad idea. It’s a big red flag as far as an employer goes as well. Any good professional employer is not going to take that tact. They’re going to say, we want to have all the details. We want all the cards on the table, everyone knows their roles, everyone knows what they can, can’t do, what’s required. Starting there and working out the details is a bad idea. As far as an employment agreement goes, I’ll just break down in the most basic way the things that most vets need to think about, one, the length of the term, and how to terminate the contract.
You want to have a reasonable without cause termination, you want to make certain that they’re paying for your license, DEA if needed, malpractice, some kind of ancillary benefits, the non-compete needs to be reasonable, there shouldn’t be any kind of penalties or liquidated damages if you terminate the agreement, the compensation structure needs to be clear, it needs to state when bonuses are paid out, when the salary is paid out, and how it’s calculated. I find that in vet contracts, they generally list specific things that the vet will be paid for. You want to make certain that what is in that list is everything that you plan on doing, and that they’re not excluding things that normal vets would be paid for.
So, the main difference between an offer letter and an employment agreement is the offer letter is just kind of an entree that you may agree to terms, 99% of the time not binding and you can still renegotiate terms once you’ve seen the language of the employment agreement. Negotiate the terms before signing the employment agreement because once you sign it and it’s in fact binding, you need to follow the terms of that.
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