The financial commentaries in recent times have signalled a gloomy outlook on a global basis. While the need for veterinary
services will assist the profession in insulating itself much better than some other sectors, if recessionary times grow longer
it may be necessary for practice owners and hospital managers to implement some strategies to reduce overhead costs. Prior
to introducing some economic changes though one should be aware of the legal consequences associated with some of these plans.
Lowering Staff Costs
One of the most significant expenses in the clinic are those related to personnel; as such, if you can reduce some of those
costs through a reduction in staff hours, lowering of wages or terminating some employees, those savings will result in more
sustainability. Recognize though that any arbitrary change in the fundamental terms of the employment relationship by the
employer could result in claims for constructive dismissal. A significant reduction is pay rates or the number of hours scheduled
for work could permit the employee to resign from employment and seek legal redress for wrongful dismissal on the principle
that the employer actually breached the employment contract by introducing unacceptable changes. In jurisdictions where the
employment "at will" doctrine applied, then the termination of the employment of staff members may be initiated at any time.
One of the simplest means of planning for some unfortunate economic times is to ensure that employees have written employment
contracts setting out the specific length of notice to which they would be entitled.
Lease Arrangements
Another significant expense facing many practice owners relates to the costs of leasing premises. In difficult times it is
important for tenants to stay in close contact with their landlords if shortfalls in revenues are on the horizon. Generally
speaking, most landlords would happily enter into amended rental arrangements rather than pursue lease remedies and having
an empty space with no existing tenancy.
