Practicing in the new economic reality

Practicing in the new economic reality

If the recession is over, why are so many veterinarians still worried?
Jan 01, 2011
By staff

Well, it's all finished, and I am so relieved! The Great Recession is over! I know this because I saw a government official say so on TV.

Obviously, all those cynics working in the construction industry, education, real estate sales, technology and elsewhere aren't watching enough television, because they are my veterinary clients, and they all say that the economy hasn't been worse in their lifetimes. Maybe they just need more cable channels so they can get the word. Then again, having their full-time hours restored or jobs reinstated might help.

While the politicians spin each new economic number to make it sound as if it was, if not great, better than last year, better than expected, better than Yemen's, better than something, from the phone calls and e-mails I receive every day, I am getting a much different picture of the economy. At the same time, I am seeing a tremendous change in the nature and seriousness of disputes that develop in and around the veterinary practice arena.

This month, I would like to share my experience with the burgeoning economy. My frame of reference, of course, is the information and insight I glean from my clients. So here is what my law and consulting clients, all of whom are somehow involved in the animal health or related industry, are telling me (and I can tell you categorically that it isn't better than last year, and it isn't better than five, 10 or 15 years ago).

A big-city problem

The bulk of the new problems we are seeing, employment wise and cash-flow wise, seem to be originating in the parts of the country that had traditionally been considered the haven of the high-spending client. Veterinarians and their office managers are calling frequently from New York, Atlanta, Los Angeles, Las Vegas and many areas throughout Florida. They are experiencing legal problems that didn't exist when clients were free spending and had limitless job security (or at least thought they did).

Multi-doctor practices in large cities are faced with huge overhead, most of which is personnel costs. Clients are tightening their belts, and practice revenues are having a tough time keeping up with increasing fixed costs. It is putting a monkey wrench into plans previously embraced by several categories of staff members.


In many parts of the country, particularly metropolitan areas, associate veterinarian employment contracts, which were assumed to be perpetually available for renewal at the whim of the associate, are appearing to be much less secure. I am receiving calls from associates requesting to have their contracts reviewed so that they are certain as to the period their boss must keep them employed between a termination notice and the end of their employment agreement.

Also, owners of multi-doctor hospitals are contacting me to ask what their options are when an annual associate contract calls for a minimum base salary but the client base has dropped off to the point where it is costing the practice money just to keep the associate on staff. I'm hearing it all:

  • "Is there more than one way to interpret the word year?"
  • "Is there any wiggle room on the expression 'minimum base salary?'"

Last week I received a call from a practice owner who had hired more veterinarians than he could now afford. He wanted me to assure him that his employment agreement with his most recently hired associate was "just a letter of intent, right? It's not really a contract..." Yeah, okay.