Unique Issues In J-1 Visa Waiver Physician Contracts

J-1 visa waiver applicants often have contracts that are structured a bit differently because of the visa requirements associated with their positions, and we often negotiate them quite differently compared to others. This is just a starting primer, and there certainly could be additional unique issues for you, but here are some primary points to look out for.

Term and Termination

As you know, the J-1 visa requires physicians to return to their home country for 2 years upon completion of their training. This requirement is waived upon application to serve in an underserved area for 3 years. The visa requirements often require you and the employer to agree to a 3-year term and often require removal of any termination without cause clauses, which essentially locks you and the employer in for a 3-year commitment.

Some J-1 contracts include a termination without cause clause initially, but either pause enforcement during the initial 3-year term or potentially remove this clause as the immigration attorney gets involved and clarifies the requirements under the visa waiver application. We want to make sure that you have the option to terminate without cause right after the 3-year mark, as we see a lot of J-1 visa waiver applicants change jobs after that 3-year period has expired. You benefit from clarity on exactly how and when you can termination upon completion of the 3-year period. We want you to have that option!

Most termination without cause clauses require you or the employer to provide 90 to 180 days of advance notice before you can terminate. They also require you and the employer to continue employment, your work, and compensation in good faith for the duration of the notice period. I support this type of clause, and it typically should not raise concerns or negotiation priorities. Watch out for a mandatory notice period for you, but an optional one for the employer, as we believe this type of unbalanced termination without cause clause typically triggers a negotiation request.

We also look very closely at the termination “for cause” clauses in J-1 contracts, as they become much more impactful than in other physician contracts. Employers can’t typically terminate you without cause easily because of the visa requirements, and thus will sometimes try to beef up their rights under termination for cause. Most visa waiver programs appear to allow employers to terminate the employment “for cause”, but the definition of what is appropriate “for cause” termination seems to be a bit loose. On occasion, we’ve seen employers sneak in rather nonsensical terms in the termination for cause clause to combat this and provide them with some options to terminate the physician, regardless of the visa requirements. Here’s an example:

Termination For Cause: Employer may terminate Employee’s employment immediately upon any of the following occurrences:

*** 

12) Employer determines in their sole discretion that Employee’s employment is not profitable.

We have seen termination for cause clauses in J-1 contracts that allowed the employer to terminate for cause, effective immediately, if, under relatively vague terms, “the physician’s practice is no longer financially profitable.” These types of clauses should raise concern for you and are often a negotiation priority if they exist. The employer’s termination for cause rights should be limited to things that are truly justified, like losing your medical license, DEA license, hospital privileges, the right to bill Medicare or Medicaid, instances of malpractice that make you uninsurable, you show up to work drunk, or stop showing up, etc. These are typically appropriate, but we otherwise often consider negotiation. There’s usually a laundry list of termination for cause clause reasons, and we comb through these with a bit more particularity in J-1 contracts because this is the main or only way that employers can decide to terminate your relationship during your 3-year term.

We will also often get a bit more aggressive on termination for cause notice requirements. For example, if the employer wants to terminate you for failure to follow employer policies and procedures, most physician contracts will allow this event to occur with no notice to you or any right to a cure period. We sometimes negotiate for a 30 to 60-day notice requirement for ‘for cause’ reasons for termination that can be cured, like showing up late, not following policies and procedures, not timely submitting and closing out notes, and similar curable issues.

Noncompetes

Most J-1 visa waiver requirements prevent employers from placing noncompete clauses on you during the first 3 years of employment. However, what the employer does thereafter is a bit of an open question. Some employers will remove noncompetes in full, with no automatic starting of a noncompete upon conclusion of your 3-year term. Some J1 contracts will have a noncompete in the contract, but will pause enforcement for the duration of the three-year period. Here, your noncompete would automatically attach if you stay any period longer than three years.

Alternatively, some employers remove the noncompete in full from your contract during your visa waiver years, but then offer you a new contract after your 3-year term that has a noncompete. You often must sign this new contract to continue employment with them, and face termination if you do not.

It just depends on how the employer handles it, but we often want to make sure it is at least unenforceable during the term of your 3-year employment so that you don’t run into approval issues with your visa waiver requirements. Very few employers make this mistake, but we still see employers that are new to hiring J1s make this mistake, and it could jeopardize your visa application. It’s good due diligence to double-check.

Work Obligations

As discussed in the termination section, it’s very difficult for J-1 physicians to change employment during the initial 3 years. It becomes a difficult timeline question during a transition, and you run the risk of potentially not meeting the timeline requirements.

Overview. As such, we approach J-1 physician contracts as if you practically cannot leave for 3 years. We often want to add many more specific details to the work obligations section because of this limitation. Most physician contracts leave work obligations in the sole discretion of the employer, namely: call, call schedule, clinical template, workdays, coverage for nights, weekends, and holidays, interaction and supervision with nurse practitioners and physician assistants, work locations, academic responsibilities, etc. We often want to nail these down a little bit more firmly in J-1 contracts, as your ability to leave if the employer treats you unfairly is greatly diminished.

Work Location. Additionally, work location is often important for your visa application, so we sometimes push harder for guardrails around where you’re required to work. We have seen instances in the firm where a smaller private practice that serves multiple locations wrongly ignores these requirements, putting the physician in a rough spot. They are violating the visa requirements, but your ability to speak up puts you in a bit of jeopardy with the employer. It’s helpful to consider advocating for clearer boundaries during employment.

Hourly Requirements. Most J1 visa applications require the employee to work 40 hours per week, and this is often stated clearly in the contract for ease of approval. Some employers use this 40-hour requirement to push you to provide 40 clinical patient-facing hours. However, I don’t interpret anything in the visa applications that requires every single hour of your work for employers to be patient-facing. For example, many primary care contracts require 32 to 36 patient-facing hours, with 4 to 8 dedicated administrative hours. Some employers want to remove that carved out and protected administration time under what may be unfounded fears of the visa application being denied.

Here’s the challenge. Many immigration lawyers will advise you and the employer that including admin time could cause a problem with the visa application (they are not wrong), and we obviously don’t want that. As such, you might be in a situation where the contract needs to say one thing, but the employer is promising something else. This is frankly just a hard issue, and it might be something you need to take a leap of faith on. Someone should fix the visa rules on this to make it make more sense in the context of physician contracts, but it’s a grey area that you should be aware of.

Call and Call Schedule. Most physician contracts allow call and call coverage to be in the sole discretion of the employer. This is a bit problematic for you, as many employers that seek J-1 physicians to fill often dire service needs might also feel there’s an opportunity to unilaterally expand your call requirements without any additional compensation. I like to consider prioritizing a call cap or, at a minimum, a contractual promise that call shall be evenly distributed among the physicians in the practice group. We take this on a case-by-case basis, however, and you should understand what happens if the employer’s needs expand under your contract.

Work Days and Schedule. Regarding working days and work hours, many primary care physicians and other specialists prefer 4-day work weeks with a full day off during the week. These are not always defined in the contract, but I often encourage J-1 contracts to include a statement that guarantees and clarifies this if it’s important to them and was promised during the interview process. This is particularly true if the job that you want is attractive because they have promised a 4-day work week or some other specific scheduling clarification. Seriously consider pushing for that clarification to be included in your contract so there is a lower probability that they will attempt to unilaterally change this in the future. I’m unaware of a PTO cap for J1 contracts, as long as it’s reasonable. This could be an area to negotiate.

Compensation and MGMA Data

Basics. Our experience with J-1 contracts is that some employers use your visa application status to try to pay you less than what is appropriate in the market. Physician compensation is generally dictated by practice setting, geographic region, and volume expectations within the specialty. We do not believe you should be paid a discount under these metrics because of your visa status. For example, the compensation norms for a very busy hospital-employed or private practice might be higher with additional compensation, while an academic position or a pre-business-ownership opportunity might pay less.

Get a Compensation Consult! It’s very important for J-1 visa waiver applicants to consider doing a deeper dive and appropriate due diligence on compensation norms and make sure that their compensation package matches macro-level compensation data applicable to their position. We have access to this data and we use it in our compensation evaluations, along with our extensive experience in almost every specialty, practice setting, and geographic region. We encourage you to consider the same, either through your training program if they have access, or through a compensation consult service we or others may provide. This is included in all our contract negotiation packages, and we have a compensation consult service that can address this issue. You would benefit from doing this as due diligence preparation before you start interviewing.

Volume and $/Volume Rates. Lastly, base salary is often not the main driver of total compensation. A high base salary does not automatically make a deal attractive, and most compensation plans are primarily driven by volume that’s paid at a $/volume rate. You should know the Compensation Per Work RVU rates offered by your employer, and how much volume is required to meet or exceed your base salary expectations. For example, we commonly see two jobs that offer the same base salary, let’s say $300,000, but one might pay $60/wRVU and thus require 5,000 work RVUs to reach the bonus structure, while another may pay $50/wRVU and thus require 6,000 work RVUs to reach the bonus structure. Negotiating on these rates and locking them into your contract for the 3-year term is often an attractive negotiation strategy, but of course, your situation could differ from the norms.

Base Salary Guarantee for 3 Years. While we know that your contracts are typically very sticky for 3 years, your base minimum guaranteed salary does not always extend for the entire 3-year timeline. For example, it’s not uncommon to see a minimum guaranteed salary for only 18 months, and then the physician is placed on a purely productivity-based compensation model for the remainder of their employment. This raises additional concerns for J-1s because you have a very diminished ability to leave an employer that does not have enough volume in their practice to meet or exceed your initial base salary under a productivity-based compensation model. As such, we often prioritize clarifying and negotiating for a minimum guaranteed salary that’s appropriate for the entire 3-year term, so you don’t have to worry about reduced compensation without the ability to leave. Not all practices have sufficient volume for you to outearn your base salary under a productivity model, so a defensive negotiation strategy to limit their ability to pay you less is often very prudent. We have seen this be a problem, which is compounded by the challenges you face in leaving that employer when compensation drops.

Permanent Residency Application

We often find value in asking the employer to start and pay for the permanent residency application within the first 6 months of employment. This is particularly helpful for physicians from countries that have longer-than-normal wait times, and I understand India and Pakistan fall into this category. While this contractual promise might not always be perfectly concrete, asking for your permanent residency application to be started well in advance of the end of your 3-year term can be helpful and can give you a strong negotiation point if the employer starts to drag their feet on applying for permanent residency status for you. This is particularly important if you want to prioritize seeking permanent residency status through employment rather than through marriage or otherwise. While we can’t contractually guarantee that they will be successful or move expeditiously, this at least creates a starting point and can be helpful.

We have received relatively little pushback on this clause on average, and many employers are willing to do this for you. An employer that objects might lead to a bit of a red flag here, and it could be the deciding factor for you when considering more than one option, so proceed cautiously.

Immigration Attorney

Most J1 visa waiver applications will be performed by a lawyer selected by the employer, and it is typically a joint representation. This means the lawyer’s responsibility is to you and the employer working in concert to achieve your visa waiver.  Most employers will agree in the contract to fund all the expenses associated with this application, but we will occasionally find employers that seek to limit their legal spending to a specified amount (say, $10,000) or require you to fund half of the costs. We often recommend that our clients negotiate to have the employer fund all legal and administrative fees associated with their waiver application. Most employers also clarify that they are not responsible for additional fees and costs associated with immigration needs for immediate family, and we typically do not negotiate for this. However, we have used this as justification to ask for a higher signing bonus to help offset these costs. Make sure you understand and clarify whether you are responsible for any costs.

Lastly, you can ask the employer to use the lawyer that you choose. Either way, it can be a really prudent idea to have someone on your side. We regularly refer clients to Sid Chary, JD, at Charylaw.com for this, and I highly recommend considering a consult with his firm or another lawyer experienced specifically in physician immigration as you move through this process!

Selecting Employers

Consider approaching your job selection process with employer experience in J1s in mind. Many large employers have done this many times for many years and are well-versed. Try to use your interview process to evaluate how many times they have done this in the past and evaluate the experiences from the J1s currently in the practice. Unfortunately, we have seen the most problems in small private practices that are bringing on their first J1. When J1 physicians in a contract have already called us with legal troubles, they have primarily been in small private practices that may have taken advantage of the situation. Please don’t take this as meaning that every small practice is out to get you, but it is a relatively consistent theme in the practice. If all else is relatively equal, we often recommend J1 physicians lean toward the larger employer with ample experience and other happy J1 physicians already in the practice.

Start Early!

The deadlines for applying for visa waiver applications are relatively tight. I highly recommend that any physician seeking a J-1 visa waiver start the interview process at least by the spring of the year prior to the end of their training, say 16-18 months in advance of the end of their training. Many deadlines in the visa waiver process occur in the fall before you conclude your training, and are quicker than everyone else. You often have less flexibility to receive a visa waiver if you’re trying to execute an employment agreement with only a few months before the end of your training.

Also, the visa waiver application process is not perfectly guaranteed. If you start early, this gives you additional options to transition to a new employer if things don’t work out. We like you having contingency plans for you, and you have more options if you start early!

Conclusion

Physicians applying for a J-1 visa waiver face multiple obstacles that are unique to them, and we recommend advanced planning and thoughtful legal advice. We recommend you cast a broad net during your interview process and ideally have a couple of viable options with at least 12+ months ahead of the conclusion of your training to spare, so that we can vet your options properly.

Being informed on the contract norms for J-1 visa waiver applicants is a must, and while we’ve tried to be detailed in this blog, it might not touch on every issue that you encounter. We recommend that all physicians proceed through this process with a lawyer who knows what they are doing in physician contracts and has J-1 experience, but this is more pronounced for J-1 visa waiver applicants. Get a physician contract lawyer who understands your specific needs and has represented physicians in your position multiple times. We have this experience in the firm and would be happy to assist.