Case Study - Nurse Contract - Botox Injector Nurse
Many nurses, after doing the hard yards in hospital, often look for a career change. Some nurses consider using their considerable nursing skills in the cosmetic industry.
Here at the Contract Company we were recently asked to review two nurse contracts for nurses that we're going to provide services to a ‘cosmetic’ company. In essence our clients were going to be trained to perform minor treatments (such as but not limited to injecting Botox) and our clients were then going to work for this cosmetic company for a period of time. A career change to becoming a cosmetic nurse. Good work... I could use their services myself! 🙂
The Contract Issues
All contracts have what is known as an inherent drafting bias. This means that the contracts are drafted to favour the party that created the contracts. It is fair to say that the contracts we reviewed had this ‘drafting bias’. Actually that’s like saying Beethoven composed ‘a bit of’ music. Are you getting the picture?
Anyway, our clients had two main issues with the contract that they had each been asked to sign:
- how the commission was able to be calculated; and
- the imposition of an early termination fee.
It is not uncommon in contractor type agreements for the contractor to be paid on a commission basis. It is worth noting that where the commission is calculated on the difference between the wholesale and retail price of products, you should be fully aware of what the wholesale price of the products are (before you sign the contract) so that you are able to work out how much commission you think you will be able to make.
On that basis, make sure you obtain the product price list before you sign the contract.
Also, you should carefully examine the contract to determine if the other side has the ability to increase or decrease, at will, the wholesale price of the products or increase or decrease the retail price. As I am sure you will understand, any change in the wholesale price of the products, and any change in the retail price of the products could have a direct impact on the commission amount receivable by you.
The next issue that needed to be looked at was the potential payment of a substantial termination fee where either client wanted out of the contract before the contract has expired. The contracts were for an initial term of 2 years.
It is not uncommon in commercial contracts for one party to recover their reasonable out of pocket expenses and/or legitimate business losses that they have incurred under a contract, where these losses are directly attributable to the other party terminating the contract.
So in other words if my actions in ending the contract early cause you loss then it is not unreasonable for you to be compensated for that loss, because had I not terminated the contract early then you would not have incurred those expenses/losses.
Termination Fee was Completely Disproportionate
However, having reviewed thousands of contracts the termination fee that was to be imposed on our clients in these contracts seemed disproportionate to any loss that the relevant cosmetic company could suffer due to the early termination by our clients. Waaaay out of proportion. Think 1 person turns up to knife fight with a knife, the other brings a bazooka.
The lesson for you here is that you should very carefully consider entering into any contract where a substantial termination fee is payable, especially where the loss that could be suffered by the other side because you terminate the contract early, would appear on its face to be negligible.
Don't be pushed around or forced into signing any contract before talking to the Contract Company. Call us on 1800 355 455 today to get your contract sorted!