• Max Bazzucchini

Associate Agreements: 10 Key terms and updates to consider following the COVID-19 pandemic

We asked Sarah Hillebron, senior associate at Knights PLC, to give us an update on what are currently the key points to consider on the associate agreements. Here are ten key points she raised:

  1. Dental practice owners have found many ways to productively use their time during COVID-19 induced practice closures.  Some have caught up on CPD, some have researched new online diagnostic tools and many have developed new practice policies and procedures to address the changing circumstances.  One matter principals may also be reviewing is terms of engagement for their associates. The BDA model associate agreement - version 6 updated some provisions which had been entrenched in the standard agreement for some time.  We have set out some key points to remember from this update together with a few issues arising from the pandemic that should be considered when reviewing associate agreements.

  2. Practice hours and closures: The BDA model agreement no longer contains an obligation on associate to use the facilities during set hours.  It simply states whenthe facilities are available and leaves the associate to have discretion over when they work. If the practice facilities aren't available for a period of time exceeding an agreed number of days then the model agreement allows for associates to receive a credit from the principal for lost UDAs.  Going forwards,principals may seek to qualify this by stating that if the practice is closed due to government advice then the practice owner shall not be in breach of the associate agreement for failing to make the facilities available, to prevent any claim for lost UDAs. Conversely, associates will technically be in breach of their associate agreement for failing to fulfil UDA targets as a result of the pandemic. Therefore, going forwards, associates may seek similar wording confirmingthat they are not responsible for any such breach resulting from practice closures based on government advice. The parties may also want to consider including wording that confirms that, if the practice is closed following government advice and the Principal continues to pass NHS income onto their associate, then the associate will contribute towards any clawback claimed by the NHS for underperformance.

  3. Holiday, Parental Leave and Sickness: Many associate agreements contain specific provisions regarding holiday and paternal leave.  Such terms contradict the nature of self-employed status. It is recommenced that there is no specified entitlement (i.e. no number of days holiday per annum etc.) and no requirement for the associate to justify their absence.  The only obligation is for the associate to keep the principal informed of absences, provide appropriate advanced notice of planned time away and arrange locum care for absences exceeding an agreed length of time.      

  4. Insurance: There have been some recent legal developments in relation to vicarious liability.  In order to limit practice owner’s exposure,most associate agreements already contain an obligation on the associate to have appropriate professional indemnity cover in place and to provide a copy to the principal, on request.  The BDA model agreement also includes and obligation for the associate to maintain run-off cover after their agreement has terminated and an indemnity from the associate to cover any financial losses the principal may suffer as a result of not having such cover in place.  In addition,practice owners may want to consider the following:      a.    Requesting evidence of each associate’s professional indemnity cover on a regular basis (including a copy of the certificate of cover and receipt for the premium paid).      b.    Including a clause allowing immediate termination of the agreement if the associate does not provide suitable evidence of cover when requested to do so.      c.    Checking their own insurance carefully to see if it would protect them in the event of a claim for vicarious liability.

  5. Introduction of patients: In relation to NHS work, the model agreement states that the principal will endeavour to introduce sufficient patients to allow the associate to meet their UDA commitment.  Again, to address issues that have arisen as a result of the pandemic, Principals may wish to caveat this by excluding the obligation in circumstances where the practice is closed due to government advice.

  6. Locum Tenens: Further to point 3 above, the associate should have the discretion to appoint a locum to cover their own services at any time.  

  7. Hygienist Services: The updated modal agreement contains an option for the associate to pay the principal for the use of a hygienist or therapist.  If the associate receives the patient fee for the hygienists or therapists work then it should be included in the associate’s gross earnings, before any such charge is deducted.  A key reason for this structure is to avoid payments being viewed as financial incentives in return for referrals.

  8. NHS Target: For practices with an NHS contract, the associate pay statement (a template of which is usually set out at schedule 1 of the associate agreement) should contain the associate’s annual UDA requirement.  Whilst the associate will be in control of their own work (in terms of hours, periods of absence etc.) there usually does need to be some form of target to assist the principal in achieving their overall UDA target and sustain the business.

  9. Private fees: The private fee scale for the practice should be on the basis for calculating the licence fee due to the principal for private work however, the associate may charge patients any fee that they wish.  So, if the associate charges a lower fee then they shall bear the difference between the fee charged and the private fee scale set by the principal.    

  10. Confidentiality and data processing: Rather than simply requiring compliance with the practice’s policies, the latest BDA model associate agreement sets out specific requirements in order to ensure the General Data Protection Regulation (GDPR) is adhered to.

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