I was about 5 years old when I signed my first contract. My father built his two daughters a magical playhouse in our suburban backyard, its three charming paned windows lighting the inside thanks to the warm Texas sun. The single room was decorated with beanbag chairs, a shelf for games and a small play kitchen where we churned out delightfully messy mud pies.
My sister is three years older and had a posse of friends. Therefore, playhouse time was not always blissfully shared. To make sure her bratty little sister didn’t crash the big-girl playhouse parties, she and her BFFs drew up a contract for me to sign. The details are obscure today since I tore the paper to bits in a tantrum of realization that I’d been duped.
The point is, I signed something I didn’t understand and frankly couldn’t read. I was only 5, and my sister wrote the contract in cursive.
A contract is a promise meant to provide clarity and determine mutual understanding. Therefore, each party should understand what it says precisely and how it affects them.
As business-to-business service providers, relief veterinarians should provide each job site with a work agreement outlining the terms of the arrangement. With corporate groups owning more hospitals, relief veterinarians are often presented with contracts that need signing. Please note that whether you call the exchange of information an agreement, deal, commitment or understanding, courts will interpret it as a contract if the two parties agree to abide by the document’s terms and apply their signatures.
Whether you’re creating a contract on behalf of your relief business or reviewing one presented to you, I advise you to engage an attorney to protect your interests.
Let’s break down some of the essential elements of a contract and the key provisions important to relief veterinarians. Keep in mind that the language doesn’t have to be complicated legal jargon to be enforceable.
Preamble
It identifies the purpose of and the parties to the agreement. It starts with a title (“Independent Contractor Agreement,” for example) and the name and address of the practice for which you’ll work. The preamble also shows your name or, if you established a business entity such as a limited liability company (LLC) or professional corporation (PC), the company name and address.
Recitals
This section provides a general overview and explains why each party enters the agreement.
Representations and Warranties
The parties assert that certain information is true. For example, the practice would “represent” that it’s authorized to operate a veterinary care facility in a particular state. As a veterinarian, you would “represent” that you are licensed in good standing in the same state. You also might represent that a previous agreement with a current or former employer doesn’t prohibit you from working at the location.
Relationship of the Parties
This section defines the rights or lack of rights as they relate to the relationship between the parties. In a relief veterinarian agreement, the section identifies whether the parties have an employer-employee or independent contractor relationship and which rights are associated with each.
Term
This section establishes how long the agreement will be in effect. As a relief veterinarian, you can agree to a set number of shifts over a few weeks or months, that you will provide services over a limited period, or that you have an open-ended term that ends when you or the hospital terminate the agreement. This section might contain language about an automatic renewal if a notice to terminate isn’t given by a specific date.
Termination
The termination clause sets forth how either party can end the agreement when the “term” has not expired. This part usually has two subsections: “termination for cause” and “termination without cause/notice termination.”
Merger
This clause seeks to ensure that evidence outside of the agreement’s “four corners” won’t be admissible in court in the event of a dispute. If the document has a merger clause, you must ensure that every term and condition discussed with the hospital is present.
Assignment/Successors and Assigns
This provision restricts or prohibits the parties from assigning the rights, duties or obligations under the agreement. (In some cases, the provision allows them to.) It comes into play in the veterinary world when a hospital is sold. If the term is for an extended period and you have concerns about working for a corporate owner, you might want to push back on the inclusion of an assignment provision.
Amendment and Waiver
The amendment provision governs how the contract may be amended, typically only with the parties’ written consent. The waiver provision seeks to limit the ability of a party to claim that the actions or inactions of the other side waived an obligation or breach.
Severability
A severability clause prevents the entire contract from being deemed unenforceable simply because a particular provision is deemed unenforceable.
Force Majeure
This part protects the parties from being deemed in breach in the event of something beyond their control, such as an act of God, terrorism or pandemic.
Governing Law and Venue
This clause sets forth the laws under which the contract shall be governed and in which jurisdiction causes of action will be adjudicated. You might see instances in which a matter will be heard in one state, but the laws of another state apply. The reason for such language is that litigation might be more convenient for a hospital in one place but more friendly in another.
Compensation
Any agreement should set forth the amount to be paid for services rendered, whether hourly, half day or full day. You can request additional compensation for working outside regular hours, on holidays or weekends, or being called in within 24 to 48 hours of a shift. Consider addressing payments for last-minute cancellations by the hospital.
Timing and Manner of Payment
The agreement should identify when and how you’ll be paid. You might negotiate payment within “X” number of days of a shift or agree to invoice the hospital once or twice a month.
Scope of Work/Services
The services provided by veterinary practices and relief veterinarians can vary greatly. When entering an engagement, particularly with a new hospital, you should set forth which animal species you are comfortable seeing and the scope of your services.
Schedule
If the engagement is of a limited duration, you should identify the specific work dates and times. In other instances, you might pinpoint the days or shifts you generally will or will not be available. This part is crucial because it creates an understanding of availability expectations. Additionally, you might want to include how the employer may schedule shifts and how far in advance.
Exclusivity
In the context of full-time employment, this clause usually says the relief veterinarian will provide professional services to only the hospital during the term of the contract. I recommend that the agreement state that the engagement isn’t exclusive and that the relief veterinarian may work at another hospital.
Insurance
Generally, relief veterinarians should carry professional liability insurance. However, if the relationship is that of an independent contractor, the hospital might request that you also have workers’ compensation insurance and agree that the employer isn’t responsible for your medical, disability or life insurance. If you are an independent contractor with an LLC or PC, ask an insurance broker and attorney about which coverages are mandatory or recommended in your state.
Indemnification
This term means one or both parties agree to compensate the other for losses that might occur because of specific actions. In a relief veterinarian setting, you likely will see an indemnification clause that seeks to have you “defend and indemnify the hospital for any and all claims arising from any action or omission taken by you in connection with this agreement.” The clause means you’re responsible for legal costs the hospital incurs in a claim that you harmed an animal or physically or verbally assaulted or harassed an employee.
For your protection, request that the clause say the hospital will defend and indemnify you against claims brought against you arising from the actions or omissions of the hospital’s employees and agents. For example, a technician working a shift with you drops an animal, breaking its leg. The pet owner might bring a claim against the hospital and all the doctors working at that time. You were not responsible for training or managing the technician, so you should not have to incur the costs of defending the claim.
Arbitration
This clause provides that disputes arising under the contract are settled through arbitration rather than litigation. The requirement is legal in most states, but not all. Relief veterinarians might negotiate that the hospital is responsible for arbitration and arbitrator fees.
Restrictive Covenants
These clauses involve noncompetition, nonsolicitation, confidentiality and nondisparagement. Generally, noncompetition and nonsolicitation agreements aren’t binding on independent contractors. A relief veterinarian should never agree to a noncompetition clause.
Confidentiality and nondisparagement clauses are usually enforceable. As for nondisparagement, the clause should be mutual, meaning the practice and its owner and employees can’t make disparaging comments about you, and vice versa.
What did I learn from my childhood contract debacle? Never sign something you don’t understand or can’t read. And when it has something to do with playhouse rights and your sister, consider a pinky promise instead. I don’t think the courts recognize those.
POINTING THE FINGER
The pinky promise or pinky swear has existed in North American culture at least since the 1860s. Although the pinky promise is an adorable children’s game, its origins seem more sinister, with most sources attributing it to the Japanese mafia (Yakuza). It stems from a Japanese practice called Yubikiri, meaning “finger cut off,” where if you break a promise, you must cut off your pinky as punishment.
CREDIT
The National Veterinary Law Group at Mandelbaum Barrett contributed to this article.