The number of medico-legal landmines associated with running a practice is huge. Our cup runneth over. And most physicians are at least aware of these debacles.

What most practices are blissfully unaware of: brouhahas caused by employees.

A number of years ago I listened to an engaging talk by the head of Ritz Carlton. He was emphasizing the point that human capital was a business’s greatest asset. He explained there are three types of employees.

(a) Those who are enthusiastic, motivated, and over-deliver.

(b) Average. They meet expectations. However, if you ever doubt whether your clocks are functioning, these employees are excellent surrogate measures as to when it is precisely 9AM and 5PM.  

(c) The actively disengaged. These are individuals working to sabotage your business. They deliver negative value.

Obviously, you should aim towards recruiting and retaining the best. You should aim to avoiding the actively disengaged.

Further, a separate study in a business journal explained you are far better off avoiding toxic employees than seeking out a superstar. The chaos that is created by toxic employees outweighs the benefit a superstar brings to the table.

Toxic workers. These are talented and productive people who engage in behavior that is harmful to an organization…. skilled employees who ended up doing real damage — employees who had been fired for egregious company policy violations, such as sexual harassment, workplace violence, or fraud — and [the authors] found that avoiding such people can save companies even more money than finding and retaining superstars.

In their study:

They compared the cost of a toxic worker with the value of a superstar, which they define as a worker who is so productive that a firm would have to hire additional people or pay current employees more just to achieve the same output. They calculated that avoiding a toxic employee can save a company more than twice as much as bringing on a star performer – specifically, avoiding a toxic worker was worth about $12,500 in turnover costs, but even the top 1% of superstar employees only added about $5,300 to the bottom line.

Now that you’ve hired, what should you pay attention to.


I’ll illustrate with just one example.

One practice recently called and said they provide discounted surgery on its employees as a perk of employment. They lamented some employees have taken advantage of such benevolence. They’d have the procedure done, then quit. I’m guessing post-op visits were awkward.

The practice asked whether they could create an agreement which would “claw back” the discount on the surgical fee if the employee/patient look for greener pastures. The answer is maybe, but, it’s probably not worth it. Here’s why? The perk may be treated as compensation. Once the employee has a vested benefit, it’s difficult to unwind. And, such disputes, frequently over seemingly trivial amounts of money, morph into complaints filed with the state Employment Security Commission; complaints filed with EEOC; and lawsuits. It’s probably much simpler to turn the surgical fee discount into an earned benefit over time. A perk limited solely to those with longevity with the practice. Then, the best employees – those who have served the longest – receive the benefit.

When employees leave, they must be paid for all the time they worked. If they have accrued vacation benefits; paid time off; or equivalent compensation, they must be paid. Document this accounting and pay the correct amount. If there is a good faith dispute, address it when the accounting is calculated. Even a modest error can be misconstrued as bad faith.

Employment litigation is one of the most frequent types of civil lawsuits in federal court.

So, recruit wisely. Take your time to avoid entry of a Trojan horse. And take your time to address accounting if and when employees leave.

What do you think? Use the comments box below to share your thoughts.