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RMTAOLOGO

by: Don Dillon, RMT

Contracts are more than a legal construct.  Contracts are a covenant between two parties who signal they wish to work together.  A binding agreement, contracts are written to define the roles and responsibilities of each party involved, who controls the resources, and how the parties enter and exit the agreement should they wish to wrap up the relationship. 

Contracts provide essential documentation and confirmation of the terms each party has agreed to.  They provide an important reference should misunderstandings threaten the working relationship.  Practitioners entering a working arrangement without a clearly articulated, legally reviewed contract set themselves up for complicated and unpleasant circumstances when the parties wish to eventually part ways.  Practitioners can face frustrated working conditions, premature termination, denied access to records and equipment, legal and regulatory consequences.

 Acclimitization to isolated solo practice or shared space, with often fairly informal agreements not reviewed by accounting/finance or legal experts, working exclusive to the established administrative practices of health care institutions, sometimes weak business acumen, ignorance of legislative differences between employee/employer and contractor/business operator relationships…these can all contribute to an incoherent, oppressive and specious groundwork that contaminates massage therapist agreements.  For additional perspective, reference Massage Therapy Today, Spring 2010, Why So Many Massage Therapy Agreements Go Sour.[i]

It's About the Relationship

When practitioners step out of sole practices and work in larger operations, there can be benefits to all involved.  Business operators can illuminate a path to successful, sustainable practice for the entry-level practitioner, transfer knowledge and technique “hacks” to the novice, and can design a productive space to grow, learn and adapt. The practitioner in turn can assist in serving the operator’s practice community, grow the business via solid reputation and goodwill, and contribute to expansion of real estate and services offered.  The novice can potentially partner in the business eventually, or become successor when the operator is ready to retire. 

Forward looking business operators will provide opportunities for practitioners to develop professionally, be rewarded for exceptional work, and be considered in a succession plan.  As the operator, consider creating overt rewards and clear incentives for excellent practitioners to thrive, while constructing exit plans to weed out unproductive practitioners. 

If you have no formal experience in negotiation skills, I recommend a crash course by reading Getting to Yes:  Negotiating Agreement Without Giving In by R. Fisher, W. Ury and B. Patton before entering into discussions of working together.[ii]  May we always hold in our focus that, regardless of the legal-ease or length of the contract, agreements are held together by trust and mutual regard. 

Accountability and Responsibility

The contract should clearly outline the role of each party in the working relationship.  All contracts should abide by employment laws and guidelines, such as Canada Revenue Agency’s “Employee or Self-Employed”  document.  This document will assist you in measuring if your intended terms lean one way or the other. (Note: I’ve observed practitioners and operators may attempt to hybrid these variables, which leads to confusion and ultimately misinterpretation for tax reporting purposes.  Consequences include penalties and the payment of back taxes). 

The  variables to consider as outlined in this document: 1) degree of control or independence 2) who owns/services tools and equipment 3) the ability to subcontract or hire assistants 4) Who shoulders the financial risk of the business? 5) Responsibility for investment and business management and 6) Who can realize a profit or loss from the business? [iii]

Registered Massage Therapists (RMT) regularly work as "freelancers" (contractors) to help manage excess workload of a larger practices, and are paid commission (percentage) per service.  In return, the business operator provides the space, equipment and all supplies, manages operations, reserves ownership of the business assets and pays acquisition costs (marketing/promotion) to draw in business.  The freelancer may work for multiple businesses.  This situation is ideal for practitioners looking for part-time or limited time (locum) work, but doesn’t contribute to long-term relationships - there’s no loyalty expected by either party, and the practitioner is not guaranteed future work or opportunity to advance.

RMTs may alternatively be “renters” (self-employed), leasing a physical space and remaining autonomous from the landlord’s business.  Renters pay flat rent, handle their own administration and billings, promote their practice, can bring on associates/assistants, provide their own supplies and service their own equipment.  Complications arise if the commercial space is not stand-alone, and the larger business confuses and conflates multiple competing identities and branding messages in the same foyer.  There’s no cohesion or integrated care, so friction with other practitioners in the commercial space may ensue.  Your contract should consider and address any potential conflicts up front.

In our profession, employee/employer relationships are less common. I suspect business operators fear the tax/pension complexity, and freelancers may prefer potentially higher take home pay (serving their own tax obligations at tax time).  And yet, there are advantages.  Employed practitioners can expect long-term employment and resultant security, clear job description and expectations, all tools/supplies provided, training/professional development, collegial interaction, potentially health & dental benefits, and even profit-sharing.  Employers can require skill-building for their employees - ensuring higher competence and a broader service offering, reduce turnover while increasing worker security and satisfaction, mandate uniforms/hygiene, cleaning/disinfection processes, equipment and facility maintenance.  Employers can also hone successors for the business or cultivate partners for expansion.  Partners can offer diverse perspectives and expertise, adding value to the business.

Regardless of which type of working agreement you enter, make sure your contract clearly and succinctly outlines your understanding and expectations of the relationship.  RMTs should wisely consult a lawyer to fully comprehend their legal implications of signing the contract.

Conditions

A number of legal conditions are suggested for your contract:

Confidentiality

RMTs will be exposed to intellectual capital within a business that, in the hands of a competitor, could be harmful to the business.  This includes financial information, business strategy, patient and supplier information. The business will typically require a non-disclosure agreement from the practitioner to protect these assets.  RMTs are also expected to comply with other regulations related to confidentiality, such as the Personal Health Information Protection Act (PHIPA).

Adherence to Business Policies

The agreement should contain a provision that the associate, whether employee or contractor, will abide by the policies of the practice.  Often included is the provision that policies are subject to change, so the policy manual can be revised without having to rewrite the contract.  This can be an especially important clause in cases of termination.

Probationary Period

Even though a potential employee may demonstrate an excellent interview, you don’t really know their personality or if they are a culture-fit until they’ve been working in your establishment.  I recommend a clearly defined 3-month employee probationary period that allows for the dissolution of the agreement as good practice.  “Providing for the probationary period in the initial contract of employment clarifies expectations and builds in an opportunity for the employer to correct behaviour or terminate the relationship at an early stage.”[iv]

Termination of the Agreement

Clarify when an agreement can be terminated immediately - obvious reasons include theft, breach of trust, and gross incompetence.  For other cases, two-week notice is typical.  The employer or business operator may wish to expand the definition of their agreement to outline performance indicators, such as consequences exercised if service totals or patient retention rates fall short of a specific target.  The regulator has additional considerations for employers of RMTs.[v]

Non-Competition and Non-Solicitation

Business operators pay acquisition costs to attract and obtain patients, and quite rightly wish to protect their investments from poaching by malevolent practitioners intent on harming the original business in their avarice.

The courts view non-competition clauses – prohibiting an employee from working in another business in direct competition with the primary business (while either employed in the business or after employment ceases) – as negatively impacting the employee’s right to earn a living, and thus, illegal in Ontario under the Employment Standards Act.[vi]

To protect her business, the operator can instead incorporate a non-solicitation clause, restricting the practitioner from contacting existing customers of the business for a specific period of time.   Consult your lawyer to determine how this clause can work for your situation.

Records Storage and Security

RMTs may be confused by a seemingly contradictory message – a regulatory obligation to inform when a practitioner is leaving a practice versus a legal prohibition of solicitation.  To clarify, it’s not promoting the practitioner’s next location that is in contention, but related to the security of records, and record retention. .  “Clients (patients) must be made aware of how their health records will be stored, and who to contact with requests for access and/or copies. When changing practice locations, RMTs do not have to give clients their new contact information unless they are taking the only copy of clients’ health records with them when they leave.”[vii] 

I recommend a best practice of drafting a standard letter early in the business relationship to be circulated to all affected patients on the RMT’s eventual departure.  The letter 1) confirms how and where health records will be secured and 2) informs the patient the RMT can be contacted through the CMTO's public register should they wish.  This places the agency and choice of who provides their care directly in the patient’s hands (without overt solicitation by the RMT which may incite legal action) and assures the patient of the security of their records.

Contract Duration

It’s recommended to set a review date for a contract to ensure it remains practical and relevant for both parties.  One year renewals are customary.  There may be instances where employment may occur for only a limited time, such as a locum for a therapist on maternity leave.  Make sure to schedule a review of the contract by both parties well in advance of the end date.

A contract is much more than a piece of paper.  It’s a covenant, a clarification of roles and responsibilities, of regulatory and legal requirements, and a guiding document when continuing, modifying or ending a working relationship no longer desired by signatories involved.

Don Dillon, RMT is a practitioner, speaker and practice coach.  Find him at DonDillon-RMT.com

[i] Massage Therapy Today, Spring (March) 2010, pages 20-22

[ii] https://www.goodreads.com/book/show/313605.Getting_to_Yes

[iii] https://www.canada.ca/en/revenue-agency/services/forms-publications/publications/rc4110.html

[iv] Standryk, L. https://lbwlawyers.com/written-employment-contract/, under ii) probationary period

[v] https://www.cmto.com/concerns-complaints/file-a-mandatory-report/

[vi] https://www.ontario.ca/document/your-guide-employment-standards-act-0/non-compete-agreements

[vii] https://www.cmto.com/all-touchpoints/rmts-thinking-of-leaving-your-practice-here-are-answers-to-frequent-questions/

Tags: contracts, record keeping, agreements