My first employment contract:
“Your compensation will consist of your total collections minus 1/4 of the total expenses of the practice. The resulting number will be divided by 2—$90,000 minimum.”
Our first NP contract:
“Your total compensation will consist of $60,000 per year plus 10% of your collections above that number.”
My last compensation formula;
Don’t ask.
If you can recite and understand your compensation formula while standing on one foot, then the opportunity merits further investigation.
If you can’t, walk away—you won’t be happy.
In fact, you should run.
It’s a cliche because it’s true.
I know I’m asking you to forgo lots of opportunities, but look around—look at the cynicism and disengagement, the burnout.
Complex compensation formulae are tools for manipulation and control.
It’s explicitly taught in business school.
If anyone tells you different, look for their bias.
You can tell pretty much everything you need to know about a potential employer by how they figure out what to pay you.
Make sure it’s simple.
Make sure it’s transparent.
And you’’ll the be happier for it.
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