How do you Terminate a Dental Associate Contract Without Cause?

How can a dental associate terminate an employment contract without cause?  Let’s first talk about the basics of terminating a contract. There are four general ways of terminating an employment contract. One, the initial term simply expires and there’s no renewal. In the contract, it’s usually going to state how long the contract lasts, the term of it. Usually, it’s somewhere between one to three years. However, I’d say more and more contracts will have no fixed term, meaning, they’ll just go on forever unless terminated by a party through one of the three ways that we’re about to talk about. So, look at how long it lasts and then whether it automatically renews, if it does, it’s for one-year terms usually, and then we just continue until terminated.

That’s the first way a contract can be terminated. Second, with mutual agreement. If both parties just say, hey, it’s not working out. We don’t need you to give us any notice. Let’s just wash your hands of it and move on. That’s fine. So, either party can terminate by mutual agreement. The third way is with cause termination. If one party is in breach of contract, they would then have to provide written notice to the other party. Then that party would then have a certain amount of time to fix the breach. They will do that during what’s called a cure period. A cure period simply allows one of the parties that’s accused of being in breach of contracts, of fixing whatever the problem is. Usually, it’s 15 to 30 days.

Let’s just take a dental associate who has productivity-based compensation where they’re paid a bonus monthly and the employer just isn’t paying the monthly bonus, even though it’s been earned well. The dental associate could give them written notice that says, hey, you’re in breach of contract. You’re supposed to pay me my bonuses every month and you’re not. If you don’t fix this within 15 days, I can terminate the agreement immediately for cause. For cause termination is the third way. Now, the purpose of this blog is, how does the dental associate terminate the contract without cause? So, this is the most common way of terminating a contract. In any dental associate agreement, you absolutely need to make certain there’s without cause termination and I’ll say why. Normally, it would be somewhere between 60 to 90 days. And that just means either party can terminate the agreement at any time with a certain amount of notice to the other. As I said before, somewhere between 60 to 90 days is kind of industry standard. In that scenario, let’s say, a dental associate got a better job offer and wanted to move on, they give a letter to the practice that just states, I am using the without cause termination section in the agreement to terminate it. I will work the 60 days as required. Other blogs of interest include:

And then at the end of that, I’ll terminate the agreement, the agreement terminates and both of you can move on. If you have a dental associate contract that does not have without cause termination, it is an enormous red flag. And why? Well, if you can’t get out of a contract at any point, you’re stuck for as long as the term. So, if it is a three-year contract and there’s no without cause termination, you must stay for the three years, no matter what. Now, why would you want to leave? Well, let’s say, they said the volume would be this amount and it’s not, and you’re paid on pure productivity and you’re getting paid a quarter of what you expected, or maybe the hours are bad, or the call is bad or there’s lack of staffing, which makes you completely inefficient or maybe the practice owner is just a jerk, and you don’t enjoy working with him.

There could be dozens of reasons why you’d want to leave an employer, but if you can’t terminate the contract at any point, you are stuck. Why would an employer not have without cause termination in their agreement? Well, the first thing is they’ve had an enormous turnover. People keep leaving. And so, they’re trying to make certain that someone can’t leave before a period. That’s kind of the first thing that I look at when I see no without cause termination. Now, it’s rare it wouldn’t have without cause termination. But if it’s not in there, it’s usually because the employer is probably a bad manager, you’re a bad businessperson, whoever or whatever. And they just can’t keep people on staff. And therefore, they’re trying to secure them for a period. So, no matter what, you want to have without cause termination, somewhere between 60 to 90 days. Now, why that amount of time? Well, in any kind of healthcare professionals, there needs to be continuity of care. It needs to be considered.

So, there need to be arrangements to have either hire a new dentist to take over or refer the patients out to someone else. That’s normally why there just needs to be a little bit of lead time to ensure continuity of care. Kind of paramount to the termination. Well, that’s about it for without cause termination.