Many physicians ask if there is any reason why they can’t just give two weeks’ notice (or so) and leave a bad situation, even though their employment agreement requires significantly longer notice for without cause termination of the physician employment contract. The question is usually phrased as, “What can they do to me?”

Often, there is no penalty provided in the agreement for leaving early. Accordingly, the physician sometimes believes that the employer won’t be able to do anything if they ignore the required notice.

Unfortunately, there can be serious consequences to leaving without giving the required notice.

Money damages for breaching the employment agreement

Although the employment agreement may not specify the employer’s rights if the physician quits without giving the required notice, common law protects the employer in this situation. When the physician breaches the agreement (which is the effect of not giving the notice provided in the agreement), the employer may recover damages it suffers as a result of this breach.

The damages to the employer could be substantial. For example, if the employer must hire a locum tenens to cover the departing physician’s patients, the expense of hiring that locum tenens (reduced by what the physician would have been paid) could be claimed as damages. Even though the physicians who provide locum tenens services are not paid extraordinarily well, the companies which arrange for locum tenens services are paid very well—so the cost incurred could be several times the salary of the physician for the notice period.

Credentialing and patient notification

Claiming money damages is not all that an aggrieved employer can do to the departing physician. Unless that physician remains in the same location and maintains privileges at the same facilities, the former employer will almost certainly be contacted as part of credentialing at new facilities. Anything less than a stellar endorsement can be a red flag in the credentialing process at the new facilities.

Since the employment agreement at any new employer will probably condition the offer on credentialing, putting future credentialing in jeopardy should not be done lightly. A physician who prematurely leaves his or her current employer may have an existing offer from a potential new employer revoked if credentials are denied.

In addition, the current employer will likely notify the physician’s patients of his or her departure. It would be preferable to have a positive or neutral (or at least not negative) notification sent to the physician’s patients.

The Golden Rule (attorney version)

The employer may owe the physician money for things like unused vacation, accrued bonuses, or other benefits under the current agreement. The odds of collecting that money are not spectacular if the agreement that gave the physician the right to those benefits has been breached by the physician. The employer could also refuse to pay for tail coverage even if the agreement provides that the employer will pay for that coverage.

Attorneys quote what we call the “Golden Rule,” which is probably different from the one you learned. For lawyers, the Golden Rule generally states, “He who has the gold rules.” In this case, the employer is holding money that it owes to the physician. It will be up to the physician to obtain that money from the employer. Litigation is expensive, and the physician’s chances of success are not great if the physician has breached the agreement that provides the basis for the lawsuit.

Advice for physicians who are considering leaving without giving the notice required

I generally recommend that the physician continue to work for the entire notice period. Even if the employer has been awful, it’s almost always preferable to take the high road and depart on the best terms possible. As noted above, leaving early could:

• Subject the physician to a lawsuit to recover money the employer spent to temporarily replace the physician.
• Result in lukewarm recommendations in credentialing requests.
• Trigger a negative notification to the departing physician’s patients.
• Cause a refusal to pay money that is owed.
• Allow the employer to refuse to buy tail coverage even if the employment agreement requires it.

Physicians should not let the absence of a specific provision concerning leaving early give them a false sense of security. The monetary cost of not giving the notice required can be huge, and the effect on the physician’s reputation can be substantial.

Dennis Hursh is a veteran attorney with over 40 years of experience in health law. He is founder, Physician Agreements Health Law, which offers a fixed fee review of physician employment agreements to protect physicians in one of the biggest transactions of their careers. He can also be reached on Facebook and LinkedIn.