Compensation Negotiations

I had an email from a colleague recently asking about compensation expectations of a prospective part-time therapist. The back-story is that the therapist was coming from a large Midwestern city and moving into a smaller community in the southeast. The employer was taken back by the compensation expectations of the therapist.

In such situations there is no substitute for fact finding to sort through the fog of conflicting expectations. Here are some of the considerations that needed to be discussed...

1. Cost of Living – turned out there was more than a 20% difference between the two communities that needed to be considered.
2. APTA conducts periodic compensation surveys that are posted on its website. Such data provided relevent benchmarking opportunities for comparison.
3. The number and flexibility of hours worked at the two locations could have been a factor.
4. There were important questions to discuss about the relative level of supervision and responsibility required between the two positions in question.
5. There was the possibility that special skills may not have been required in the new position.
6. There were matters concerning whether there was any premium time (evenings and weekends), adverse conditions (hard to staff location), or exclusive services (e.g. high-end club) involved with the previous position.
7. There were potential commuting and parking reimbursement amounts included in the previous salary.
8. There was the possibility that the prospective therapist may have been paid additional salary in lieu receiving employer paid benefits.
9. It wasn't clear initially if the hourly rate the therapist quoted was paid as an employee or an independent contractor… if it was the latter the therapist would be responsible for all payroll taxes - that would add another 7.65% to the therapist's obligations while saving the employer an equal amount.
10. And finally there was the consideration of third party reimbursement between the two communities - how might that affect a Practices capacity to compensate?

Recruitment discussions invariably result in the discussion of compensation expectations of the two parties. More often than not there is a gap between what is offered and expected. Too often a potential deal breaks down or negotiations heat up because the facts are not on the table. The result is comparing the proverbial apples to oranges. Before discussing the specifics of compensation amounts it is always a good idea to explore contextual questions in order to put both parties on the same page. There is no substitute for good due-diligence.

Bob Wiersma
Performance Builders

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