Different travel nursing companies have different travel nursing contracts. The differences lie largely with the various contract clauses that companies choose to use. As mentioned previously, you want to ensure that the contract includes a certain set of information for tax purposes. This includes the start date, end date, taxable pay rate, non taxable stipend rates, and the address of the hospital.
In addition, you should make sure that every compensation variable you’re expecting is stated in the contract. You should also make sure that all the pertinent work related arrangements are present such as the unit, and shift to be worked. Finally, you should make sure that every special agreement you’ve made with the hospital regarding your working conditions, requested time off, and scheduling is included in the contract.
There are several contract clauses that merit special attention. Let’s address them individually.
Travel Nursing Contracts: Missed Hours Penalties and Charge-Backs
We’ve touched on missed hours penalties previously. Remember that a penalty is a mechanism for the company to recoup costs when the full contracted hours are not worked. A penalty clause may stipulate that the travel nurse will be penalized a certain dollar amount for every hour not worked in a given pay period. For example, the clause may state that the travel nurse’s pay check will be deducted $20 for every missed contract hour in a two week period.
Essentially, the amount of the penalty will be based on the value of all the compensation variables except the hourly rate. Therefore, the penalty may or may not include the value of the lodging stipend, the M&IE stipend, the travel stipend, company provided housing, company provided medical benefits, and any other variable that costs the company money. While this action may violate wage recharacterization rules, it is used none the less in some form or another by almost every company. Don’t let it scare you off. Essentially, if you don’t work, you don’t get paid just like any other job. However, this is where the guaranteed hours come in to play.
Travel Nursing Contracts: Guaranteed Hours
Because travel nurses can get penalized for missing hours, they’ll want to make sure that the guaranteed hours policy is clearly stated in the contract. If you’re a true travel nurse incurring duplicate expenses, then you didn’t travel away from your home to simply duplicate your expenses. The guaranteed hours policy ensures that you don’t get stuck paying for duplicate expenses due to shift cancellations.
Travel Nursing Contracts: Non-Compete Clauses and Exclusivity Clauses
Almost every company will have non-compete or exclusivity clauses in their contracts. Some people treat non-compete and exclusivity to mean the same thing. I’m not a lawyer, but from what I can tell by reading about this topic, it appears as though lawyers don’t know whether they’re the same thing or not. Therefore, I’m going to point out 2 key aspects that I believe travel nurses should be aware of regardless of what the clause is called.
First, some clauses intend to prevent you from working at the contracted hospital in any capacity for some specified period of time after your contract is completed, typically 1 year. This means you can’t work there through another company and you can’t take a job with the hospital directly. However, when it comes to taking a job directly with the hospital, there may be a buyout clause in the contract between the hospital and the company that allows the hospital to pay the company a fee if the hospital wishes to hire you on.
Second, some clauses intend to prevent you from working only with another company at the contracted hospital for some specified period of time after your contract is completed, typically 1 year. This means that you would not be able to work at the hospital through another company. However, you could become directly employed with the hospital without penalty. A buyout clause may still exist in the contract between the company and hospital and it would still come in to effect if you were to take a job directly with the hospital. However, that’s between the hospital and the company.
Companies utilize these clauses to protect against loss. The company has invested significant time and resources in to finding and credentialing the travel nurse and they want to ensure that their investment is protected. It’s important to point out that the laws governing these clauses vary by state. These clauses are nearly impossible to enforce in California. In other states, they’re nearly impossible to get out from under. If you’re highly concerned about these clauses, then I recommend doing some research on the specific state in question and perhaps seeking legal advice if that suits you.
Travel Nursing Contract Cancellation Penalties
Most contracts will have some form of penalty for early cancellation by the traveler. The value of the penalty is typically designed to mitigate the losses the company will incur if the travel nurse cancels the contract early. These expenses can include but are not limited to various compensation variables like company provided housing or travel expenses as well as the cancellation fee that is charged to the company by the hospital which can run anywhere from 1 to 2 weeks worth of billing. The cancellation penalties charged by companies typically represent a small percentage of the total cost the company stands to incur.
It’s important to point out that many contracts seek to collect this penalty by docking the travel nurse’s paycheck. This may be against state employment regulations depending on the state you’re in. It’s very difficult to dock an employee’s paycheck in many states. Therefore, if your paycheck is docked, you can check with the state’s labor board to see if this action is legal.
If it’s not legal, then you can file a claim with the labor board and attempt to have the funds returned. The company may be charged penalties on top of having to return your funds, so the simple act of filing the claim or even threatening to file the claim may get the company to return the funds. The company would then be forced to go after you through proper legal channels which may be too costly to justify action.
Perhaps the most important general concept to understand about the contract you sign as a travel nurse is that it’s a contract between you and the company, not a contract between you and the hospital. Meanwhile, the confirmation is the contract between the agency and hospital as it pertains to you. You see, the company already has a master contract with the hospital. The master contract establishes the business relationship between the company and the hospital which includes the working expectations for the company’s contracted workers. The confirmation is intended to establish the parameters of each assignment and any special considerations.
This is an important distinction for travel nurses to understand for two reasons. First, it highlights the importance of establishing with your recruiter any special agreements you’ve made, or desire to make, with the hospital prior to the company accepting the offer. If these items are not included in the confirmation, then they may not be honored by the hospital. Furthermore, attempting to add such items after the confirmation has been sent can be difficult.
Second, this distinction highlights the importance of addressing issues with your recruiter when you feel that they violate your contract. I’ve read many reputable travel nursing blogs that seem to advocate addressing “contract violations” with the hospital directly. This is fine and you’re welcome to do as you please. However, there’s a good possibility that the unit manager and/or supervisor you’re working with have no idea what has been agreed to. It’s very likely that they’ve not seen the confirmation. It’s also possible that the confirmation was sent without the agreements included. This would be unfortunate, but it does happen. In any case, the best approach is to take these issues up with your recruiter to ensure that they are resolved without damaging your relationship with the hospital.
As always, we’d love to hear about your experiences or questions on this topic in the comments section!