The Hidden Pitfalls in Dental Associate Contracts (And How to Avoid Them):
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Dentists
Compensation
Contracts
Landing your first associate position is a huge milestone in your dental career. You’ve spent years in school, passed your boards, and now you’re finally stepping into the professional world. But before you sign on the dotted line, there’s something you need to know, your contract could be hiding details that cost you thousands of dollars and limit your career options without you even realizing it.
Many individuals rush to sign their first contract, excited to start earning and practicing. But a bad contract can trap you in an unfair deal, one that slashes your pay, restricts where you can work next, and sticks you with unexpected expenses. These aren’t just minor inconveniences; they can add up to tens of thousands of dollars in lost income or career roadblocks that are hard to undo.
If you want to protect your financial future and career flexibility, it’s crucial to know what to look for, what to question, and what to negotiate before signing.
The Compensation Trap: Why Your Paycheck Might Be Smaller Than You Expect
Compensation is the first thing most dentists focus on when reviewing a contract, but it’s also where many associates get blindsided. You might see an offer that says “35% of production” or “30% of collections,” but what does that mean for your paycheck?
Let’s say you produce $80,000 for one month and your contract promises 35% of production. You might expect to take home $28,000 before taxes. But if the practice accepts insurance, a big chunk of that production gets written off due to PPO adjustments and negotiated rates. If 30% of your production gets slashed by insurance adjustments, your actual collections could be closer to $56,000, which means your paycheck suddenly drops to $19,600 instead of $28,000. That’s a $100,000+ difference over a year.
The same issue arises if your contract is based on collections. You might perform the work, but if the practice has slow billing, insurance denials, or patients who don’t pay on time, your paycheck gets delayed or reduced.
How to Protect Yourself:
- Ask whether your percentage is based on gross production, adjusted production, or net collections.
- Negotiate a minimum base salary so you have financial stability.
- Clarify who’s responsible for unpaid patient bills. If a patient doesn’t pay, does that come out of your earnings?
If a contract isn’t clear on these details, assume the worst, or better yet, ask for clarification in writing.
The Non-Compete Clause: Could You Be Forced to Move?
One of the biggest surprises for many dentists is realizing that a non-compete clause could force them to relocate after leaving a job.
Non-competes are common in associate contracts and are meant to protect the practice’s patient base, but some are so restrictive they can box you out of your entire city or state. A fair non-compete typically lasts 1-2 years and applies to a 5–10-mile radius in urban areas or 15-25 miles in rural areas.
But some contracts go too far, banning you from working anywhere within an entire metro area, county, or even state. This could mean that if you leave, your only option is to move or completely switch how you practice, like transitioning to tele dentistry.
Some contracts also have non-solicitation clauses, which means you can’t notify your patients if you leave. Even if you build great patient relationships, you might not be able to tell them where you’re going.
And while the Federal Trade Commission proposed a nationwide ban on non-competes back in 2023, as of 2025, no federal rule has been enacted. That means non-competes are still legal and enforceable in many states, unless your state has passed its own ban or limits. States like California and North Dakota, for example, do not enforce non-compete agreements in employment contracts
Before signing, ask yourself:
- If I leave, can I still work in this area, or will I be forced to relocate?
- Is geographic restriction reasonable for the type of community I’m in?
- Is there a buyout option that allows me to pay a fee to exit the non-compete early?
If the restrictions seem too aggressive, negotiate before signing. Non-competes can be adjusted, and some states like California and North Dakota ban them altogether for employment contracts.
Hidden Costs: Are You Paying More Than You Think?
Some of the most overlooked contract clauses are the ones that quietly shift costs onto the associate and can eat into your earnings quickly.
For example, lab fees are often buried in contracts, and if you’re responsible for 35% of lab costs, that could be thousands of dollars per month coming out of your paycheck. Malpractice insurance is another big one some practices cover it, while others make associates pay for it. If you’re responsible for tail coverage when you leave, that could mean a $2,000–$5,000 bill you weren’t expecting.
Before signing, find out:
- Who pays for lab fees? If it’s you, is there a cap on how much can be deducted?
- Who covers malpractice insurance? If you leave, do you have to pay for tail coverage?
- Are CE costs reimbursed? Some contracts offer a stipend for continuing education, while others leave it entirely up to the associate.
The Partnership Promise: Is It Real or Just a Selling Point?
Many dental practices dangle the idea of future ownership to make an associate position seem more attractive. But unless the partnership path is clearly outlined in writing, there’s no guarantee it will ever happen.
Some associates work 5+ years expecting a partnership opportunity, only to realize the owner never planned to sell equity. Others find out that the buy-in price is inflated beyond what’s reasonable, making it impossible to afford.
If a practice is offering a partnership track, ask for specifics:
- When will discussions about partnership begin?
- How will the buy-in price be calculated?
- Does partnership mean actual ownership, or just profit-sharing?
Without these details, the promise of ownership is just a vague idea, not a real opportunity.
Read the Fine Print Before You Sign
Your associate contract is more than just a job offer, it shapes your income, career mobility, and future opportunities. While salary is important, the real financial impact often lies in fine print. Hidden costs, restrictive non-compete clauses, and vague partnership promises can cost you thousands or limit your career options if you’re not careful.
Before signing, clarify how you’ll be paid, who covers expenses, and what happens if you leave. If anything seems unclear, ask questions, negotiate, and, if necessary, consult a dental contract attorney. Adjusting a contract now is far easier than dealing with regrets later. Your first contract isn’t just about taking a job, it’s about setting yourself up for a successful, financially secure career. Make sure it works for you.