Terminated! The Risky Clause Hidden in Physician Contracts

Ashley Saucier, MD, hadn’t even finished charting after her shift in March 2023, when she had to rush to a meeting called by her supervisor. When she got there, a team of executives handed her a piece of paper telling her she had been “terminated without cause, effective immediately.”

“In that moment in the conference room, your life flashes before your eyes,” said the Louisiana-based pediatric emergency room physician. “You have all of these feelings all at once: I just spent 10 years of my life giving everything to this job, not spending time with my family, having to be on blood pressure and anxiety medicine, not sleeping and always having to have my phone on.”

As the hospital’s pediatric emergency medical director, Saucier said she had received positive feedback in peer reviews and had overseen the expansion of her department, the launch of a children’s hospital, and its Level II pediatric trauma certification.

But she had also been vocal about patient-safety issues, including concerns she and her staff had surrounding a new business partnership.

“That definitely built up over time, the perception that I was too vocal,” she said. She assumes this contributed to the company’s decision to fire her.

Saucier, 47 years, said she vaguely remembered a clause in the contract she’d signed a decade earlier that had a clause about “termination without cause.”

“You sign the big contract in the beginning when you start, but after that you only sign a one-page document going forward,” she said. “So you’re not seeing that clause over and over again.”

A “termination without cause” clause in a contract allows either the employer or the employee to end their contract at any time, without having to give a reason for the decision. Without a reason for a firing, doctors are often left to speculate about what’s behind it, while also faced with the prospect of finding a new employer, maintaining financial solvency, and dealing with a personal sense of failure.

Understanding the Risk

It’s unclear how often “termination without cause” affects doctors. Saucier said that after sharing her story publicly, she heard anecdotal stories from physicians all over the country who had had similar experiences.

Still, Jackie Crain, an associate contract review specialist at Contract Diagnostics said that she has not seen employers making frequent use of the provision, although it’s common in contracts.

Scott Weavil, an attorney with Weavil Law, a San Francisco law firm that specializes in physician contract review, said that more often physicians recognize that they face a potentially imminent termination and resign before it occurs.

“Where we do see more risk is in smaller private practices, where the economics are tighter and personality conflicts are at the fore vs larger practices,” he said. “This also applies to both practices owned by financial investors and others that are re-evaluating their workforce, such as by replacing physicians with mid-level providers.”

Weavil added that many hospitals are looking to increase or retain their physician workforces, although some are replacing primary care physicians with advanced practice providers.

The Union Factor

Cris Carillo, DO, 33 years, a family medicine physician in California, said he also had a vague recollection of such a clause in his contract.

“I knew that I was an at-will employee,” he said. “But it never really entered my mind that I could be terminated and how much that could upend your life.”

Like Saucier, Carillo had been outspoken about patient safety concerns. At the time of his termination, he was also serving as a lead organizer in a unionizing drive, urging fellow doctors to join the Union of American Physicians and Dentists (UAPD).

Carillo had had near-perfect performance reviews prior to his firing, which happened abruptly. He was called into a meeting with human resources and clinic managers, who handed him a termination letter and immediately escorted him out of the building.

Tim Jenkins, a senior representative with the UAPD, said that terminations without cause are more common when physicians are in the midst of unionizing. Jenkins said Carillo’s employer thought that they could “cut the head of the snake off” and “teach everyone a lesson about what happens when you speak up.”

In Carillo’s case, his coworkers went on a brief strike to protest his termination. He was reinstated after about 90 days as a result of a settlement of an unfair practice charge filed by the union. Despite the experience, Carillo wanted to return to his job because he believes in the clinic’s mission and feels connected to the community.

Jenkins said that the union has filed charges against three different employers in the last few years where there have been terminations during the process of starting a union.

“Our goals include protecting physicians from unfair terminations as well as negotiating a collective bargaining agreement that is clear and comprehensive,” Jenkins said. “All of our contracts are reviewed and voted on before adoption, so it is a transparent and democratic process.”

According to the Union Membership and Coverage Database, fewer than 8% of physicians belong to a union. So if your contract says that you can be terminated without cause, you have little recourse unless you suspect you’ve been fired as retaliation or for discriminatory purposes.

Still, there are things that you can do to minimize your risk:

Before You Sign:

Have a legal expert look at your contract. Crain likens a physician signing a contract without legal review to a lay person trying to interpret their own diagnostic tests.

“Yes, I can Google it and get hints and ranges, but is that as good as talking to the doctor about it?” she asked.

In addition to making sure you understand the contract, a legal expert can also help you negotiate for terms that are fair to both parties. Ideally, “termination without cause” clauses should:

• Be mutual — meaning that you can also leave for any reason
• Include a notice period — 90 days is typical
• Not require noncompete adherence or incentive repayment upon termination
• Include severance pay and/or extended benefits

On the Job:

Don’t ignore red flags.While he was not expecting to be fired, Carillo said that in retrospect, there were signs.

“In the months leading up to [it], I saw the trajectory where I was feeling more like I was under a microscope,” he said.

Many employers use the strategy of “quiet firing,” meaning they try to pressure an employee into quitting before resorting to termination. If you’re suddenly excluded from meetings, given less responsibility, or being denied raises, your boss may be trying to send you a message that your current position is not a good fit.

“Be aware of the prevailing sentiment,” Weavil said. “If things are not going well, start pursuing back-up options. Consider doing the same thing in the event of potential upheaval, like a corporate change-of-control transaction, or a reconsideration of the staffing model.” 

Make sure you keep your network up to date. Keeping in touch with other physicians in your fields has many benefits, including making it easier to quickly land on your feet at a new role, if necessary.

After her termination, Saucier called a friend who was director of a pediatric emergency department in a nearby city to tell her she was no longer employed. Within a week, she’d met with staff in her friend’s department and had a letter of intent for a new position a few weeks after that.

It’s also important to build up a rainy-day fund in a conservative, liquid place, such as a high-yield savings account.

If It Happens to You

Often, there are forces beyond your control that culminate in your firing. As difficult as it is, your best approach is to move on. Saucier said, now that 2 years have passed, she views the day she was fired as the “best/worst day of my life.”

“For a long time, probably 2 or 3 years, prior to my termination I really wanted to leave,” she said. “I didn’t feel that it was going in a direction that intersected with how I live my life and practice medicine, but I had spent years building up this team and would never have left them. And so the decision was made for me.” 

It can be hard not to take a termination personally, especially if — like many — you’re the type of physician who places a lot of your self-worth in your professional success. But try not to dwell.

Weavil added that while legal protections exist for good-faith disclosures, physicians terminated without cause likely have less to worry about in terms of their future career prospects than those fired for a competency issue. Many employers are cautious about disclosure and may provide only minimal information as a reference, unless compelled by law or accreditation requirements.

“Realize that physicians switch jobs all the time in the current landscape, so future employers aren’t likely to view the separation negatively,” Weavil said.