Q:

Dr. M

Being a recent graduate I am currently seeking employment as an 
asociate. deal I recently had an interview with a doctor. The doctor 
proposed to pay me $18,000 a year or 25% assuming I bill more then the 
$18,000. Playing with numbers I figured if I bills for $10,000 a month, I 
would come out making about $30,000 a year. Assuming I am able to bill for 
that much.  That is the big question... I am concern with how much I will be 
billing for in his practice. I will be taking over his practice, and his 
patients while he concentrates on his new practice that he just opened.
So what I am asking is how does the $18,000 a yr or 25% deal sound to 
you. Assuming it is a reasonable deal what type of questions should I ask to 
get a general idea of how much he is billing. I am concern with the fact 
that I may be stuck making only $18,000 a yr, and not make a reasonable 
amount for my qualifications.
I looked at your cyberconsulting site on basic associate deals but, when 
this deal was thrown at me I was kinda curious to get your assesment of it 
and if it is a fair and resonable deal.


A:

Thanks for the e-mail and sorry for the delay in replying. 

$18,000 a year is about $350 a week which after taxes will be about $275 .. 
the question is can you survive on this .. pay your student loan .. pay for food 
rent and a life? In fact .. from what you wrote .. the salary may even be less if 
the billing is less. As an associate the advantage is always with the owner DC. 
Supply and demand is the key and there are more students graduating .. 
depending where you wish to open .. than positions available. Therefore it is 
prudent to think twice before being taken advantage of or spending a year or 
more being non productive.

Okay .. with all this said .. what is the base level of your survival? How much 
would you need to pay the bills and maintain a conservative lifestyle. 
Remember .. you want to benefit from others without the headache of opening 
your own office and getting further in debt to purchase equipment and having 
a monthly overhead .. therefore you must also sacrifice .. but hopefully 
without too much pain.

Therefore .. if you can determine your base need level .. you can then feel 
somewhat comfortable to extend beyond this base with bonuses upon office 
expansion and start this relationship with some breathing room. The fact that 
you'll have an active office and the ability to promote .. you can hopefully 
utilize the % bonus and do better than the $18-30,000 you mentioned.

I think for a new graduate $350 a week is too small. $500 a week would be in 
order as a base. This is a little more than $24,000 a year. 

If the DC wishes to stick to his guns than I feel a compromise is in order. 
Possibly have a start up salary of $500 a week and after 3 months bring it 
down $50-75 to be made up and hopefully exceed based on the % mentioned. 
It takes time to establish yourself and you are working as an employee not a 
slave .. employees should be compensated. I pay my CA over $500 a week as 
well as her health insurance.

You should also see the owners point. You are new and have not proven 
yourself. He/she may have had other associates that have dragged the practice 
down and in this case he/she wishes to leave you wish an established practice 
.. you just have to expand it. But .. relationships should always begin with 
trust and respect. If you feel uncomfortable and restrained by the 
compensation .. I'd walk away from it. Try to work this out .. understand 
his/her position and allow them to understand yours. Determine a timeline 
when you both can terminate the contract if certain and reasonable criterias are 
not met and go from there. This can be a great opportunity or just another 
mess I hear about.

Lots of Luck .. but whatever you do .. determine what you plan to do .. learn 
and save then move on

Have a Great Day

Dr. M