Salaried Staff

Most clinic staff are salaried. Salaries may be based on an hourly wage, a monthly or annual salary, a base salary plus a percentage of billings or collections, or other formulas. If you intend to pay dentists and dental hygienists with a base salary plus bonuses based on productivity, make sure the productivity levels that trigger bonuses are attainable and reasonable. Clinics are responsible for all employee federal, state, and local tax withholding, workers’ compensation insurance, and any other expenses required by law or regulation.

Contractors

Clinic staff may also be contractors. Hiring contractors involves drawing up a legally binding contract between an independent contractor and the clinic. The contract specifies the hours the contractor will work, the rate of pay (usually per hour or per day), and any other relevant information. Contractors do not receive benefits and are responsible for paying all federal, state, local, and payroll taxes. For this reason, clinics must expect to pay a higher hourly or daily rate for a contractor than for a salaried staff member. Internal Revenue Service (IRS) criteria distinguishing between a salaried staff member and contractor can be found on the IRS Web site.

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