DVM Compensation Trends with an HR Professional

Leah Frizzle, CHRP joins us to chat about trends she's been seeing in the DVM compensation space as an HR Advisor within the Ward & Uptigrove Veterinary Advisory group. Hiring veterinarians remains a tricky endeavor, and Leah offers some interesting insights from an employer standpoint.

The Ward & Uptigrove Veterinary Advisory group comprises Business Advisory, Accounting, Tax Planning, Bookkeeping, Wealth Management and HR consulting services with over 300 veterinary clients across Ontario.

Make sure to like this episode and hit that follow button to be kept up to date on all our new episode releases. If this episode raised some questions for you, we would love to chat. Give us a call or send us an email any time - links are on our website here.

Transcript

00:00:06:23 - 00:00:29:06
Speaker 1
Hello and welcome to Integrating for Success a Ward and Uptigrove Podcast. My name is Amy Noonan and I will be your host. I am the marketing and communications generalist here at Ward and Uptigrove and I am so excited to bring you trending topics in the accounting wealth management and consulting spaces.

00:00:31:16 - 00:01:00:10
Speaker 1
Today we have Human Resources advisor Leah Frizzle with us. Leah is a member of the Ward and Uptigrove Human Resources Solutions Consulting Team and is also the h.r. Advisor for the Ward and Uptigrove Veterinary Group. She achieved her certified human resources professional designation in 2015 and has experience in both public and private sectors. In addition to providing a whole host of human resources support, Leah also instructs the Ward and Uptigrove Emerging Leaders Development Program.

00:01:00:15 - 00:01:03:16
Speaker 1
Welcome to the podcast, Leah. Thank you so much for joining us.

00:01:04:17 - 00:01:06:00
Speaker 2
Thanks, Amy. Happy to be here.

00:01:06:20 - 00:01:35:05
Speaker 1
So obviously you have so much experience in a whole host of industries, but today we're here to talk about what you're seeing in the veterinary industry. This is an industry that's facing some very unique challenges and many of which are very different from what they were even like 15 years ago. Back when I worked with the OVMA, compensation for associate DVMs was not particularly strong relative to the amount of debt that students were taking on.

00:01:35:22 - 00:01:44:22
Speaker 1
And it was hard to get a job. But things are very different now. So I was wondering if you could touch on some current compensation trends that you've been seeing in the market?

00:01:45:20 - 00:02:24:16
Speaker 2
Yeah, absolutely. As you alluded to, yes. Unfortunately for veterinary clients, the market for DVMs currently is very competitive. So if they can set themselves apart in some way through compensation, that's fantastic. They're much more likely to get somebody in the in the door. We can also discuss some other potential avenues to explore if, you know, they're not able to necessarily provide the compensation levels that, you know, we're seeing from some of the bigger ones and understanding that, you know, some of the smaller firms are not going to be able to compete with, you know, some of those larger firms, unfortunately, just, you know, from a financial perspective, but ensuring that, you know, you're not necessarily

00:02:24:24 - 00:02:49:05
Speaker 2
meaning to lead the pack, but you also don't want to be trailing the pack either. Right. There's a happy medium. So really what we're seeing overall is, you know, salary, obviously large salaries. Right. So last year we were seeing, you know, a range of about like $110,000 to about $206,000. So huge wide range. Right. So the average annual salary is about 135, give or take.

00:02:50:14 - 00:03:17:07
Speaker 2
So again, huge salaries, the ones obviously high. Those definitely came from probably one of the larger firms, understandably. That being said, a lot goes into this compensation and those are just base salary. So there's other things you can add into that. So what we're seeing is a trend towards some profit sharing. So, you know, if they're prescribing medications, food, other products, when those vets are present, they're also receiving some of the profits from those as well.

00:03:17:08 - 00:03:37:07
Speaker 2
So we're seeing those being added to a lot of employment contracts that previously wouldn't have been included. So there's, you know, the base salary, you know, profit sharing. We're also seeing a lot of signing bonuses come through. So signing bonuses, there's a lot to think about with signing bonuses as well. So the average signing bonus that we're seeing right now is about 70 $500.

00:03:37:24 - 00:03:56:16
Speaker 2
You know, with a low of about five in a high of ten. That being said, it's not necessarily you sign, you get it on your first paycheck. That type of thing. What we're seeing is some clinics are using these as, you know, retention bonuses. So they're saying, listen, you know, you can have a $10,000 signing bonus, but we're going to give you it in increments.

00:03:56:22 - 00:04:16:10
Speaker 2
So, you know, we'll give you, you know, 20 $500 here when you start. And that'll be on your first paycheck, though, with us three months from now. We'll give you another 2500. You're with us a year from now. We'll give you the rest of it. So that's something to think about. So because initially, I think they're they're typically used I mean, signing bonuses traditionally are used really as more of a recruitment strategy.

00:04:16:24 - 00:04:26:06
Speaker 2
But what we're seeing in the veterinary world is that there's a need, again, because it's so competitive to use them as retention strategies as well.

00:04:26:23 - 00:04:28:05
Speaker 1
Oh, that's so interesting.

00:04:28:23 - 00:04:40:16
Speaker 2
You essentially want to just pay somebody enough that, you know, you take money off the table, that it's not going to be you know, it's not going to be something that causes them to leave. You never want somebody to leave because they're not being paid enough.

00:04:41:10 - 00:04:51:18
Speaker 1
That's absolutely fair. Are there any other things that clinics are looking at, like paid time off or what is that looking like as well?

00:04:52:09 - 00:05:17:01
Speaker 2
Yeah, absolutely. So annual vacation, obviously, the Employment Standards Act does require a certain level of vacation entitlement or PTO. Obviously, veterinarians specifically are exempt from the ESA. That being said, a lot of clinics still ascribe to that because their other employees fall under the ESA about tax reception, that type of thing. That being said, we are seeing an uptick in vacation offerings.

00:05:17:06 - 00:05:37:02
Speaker 2
So in the veterinary field, usually for vets, we're seeing at least a minimum of three weeks. Typically that ranges. You know, I've seen anywhere from 3 to 7 weeks. Seven weeks is usually for you know, that's not necessarily for a new grad. That would be more so from somebody coming from another clinic. But the average is about 17 days a year of combined PTO.

00:05:37:02 - 00:05:45:15
Speaker 2
So that would be, you know, sick days, vacation, floater days, anything. Any other types of personal leave days. Those types of things that would be paid.

00:05:46:06 - 00:05:51:12
Speaker 1
So are continuing education days included in that number or is that something separate?

00:05:52:05 - 00:06:15:04
Speaker 2
That's something that we're seeing is separated. So we have kind of like the PTO balance or bucket, I guess, where, you know, the sick vacation, that type of thing, all those fall. And then we're also seeing offers of continuing education, both funds and time off. So, for example, what we're seeing is, you know, there's there's really a range and it really depends on clinic size and also the desires like future wise.

00:06:15:09 - 00:06:31:10
Speaker 2
So, you know, we've seen some clinics that are, you know, they're looking to hire their successor. So they're willing to put a little bit more money towards, you know, this person taking some leadership courses, some back end administration courses, those types of things. But what we're seeing written into the employment contracts is really an offer of a certain amount of money.

00:06:31:18 - 00:06:54:15
Speaker 2
In addition to typically days off, paid days off to attend, you know, conferences, courses, those types of things. So the range is really about, you know, $750 to about 20 $500 a year with an average of being of about 1600, obviously. And then with two paid days off to attend whatever the veterinarian and the owner choose to attend.

00:06:55:12 - 00:07:01:23
Speaker 1
So are there any other benefits that you're seeing practice owners offer when they're looking at recruiting veterinarians?

00:07:02:18 - 00:07:22:17
Speaker 2
Yeah, absolutely. So as part of that kind of overall comp package, we're also seeing some health care and pet care as well. So from a health care spending account perspective, you know, some of the bigger clinics are able to offer, you know, benefit packages. You know, again, if they have enough employees to justify the cost for a lot of the smaller practices, it just doesn't make sense from a cost perspective.

00:07:22:17 - 00:07:58:08
Speaker 2
So what we're seeing is a health care spending accounts, whether that is self-administered, meaning that, you know, the veterinary owner or the practice owner actually has a set, a number of funds and they provide the reimbursement directly to the employees or whether it's something that is, you know, administered by an external company. So, for example, Ward Grove offers a health care spending account program to administer, and we're seeing averages of about 1250 dollars a year just because, again, if if a veterinarian does not have external benefits through, you know, their spouse or through something else, you know, this is a little bit that's just a way to set themselves set the clinic apart from some

00:07:58:08 - 00:08:31:17
Speaker 2
of the other practices that potentially don't offer that. And we're also obviously seeing pet care spending accounts that's pretty typical in a veterinary clinic. That being said, it's not necessarily documented an employment contracts as often as I've seen it lately. And I think, again, this is just a desire to kind of set apart from the competition. So typically, like majority of clinics offer you know, free annual exams and vaccinations with other visits and supplies at a cost for animals that live within that household or or primarily owned by the veterinarian.

00:08:32:07 - 00:08:51:15
Speaker 2
Obviously, a lot of those, they'd probably they could probably do that themselves. But being able to provide products and services at at cost as opposed to, you know, them having to go to PetSmart and pay the markup right through the clinic is much more desirable for a veterinarian looking at an employment contract. So that's what we're seeing kind of on average.

00:08:52:11 - 00:08:58:13
Speaker 1
Right. So you mentioned setting yourself apart. So how can practice owners set themselves apart these days?

00:08:59:07 - 00:09:18:24
Speaker 2
Yeah, absolutely. There's so there's quite a few things that a practitioner can do to, you know, really set themselves apart from the competition. One of the biggest ones being, you know, culture. So there's a great book called Drive by Daniel Pink, and it's all about motivation. And in it, he he spells out essentially that, you know, pay is a hygiene factor, which means that it's an extrinsic factor.

00:09:18:24 - 00:09:42:24
Speaker 2
It's not an intrinsic motivator, meaning that, you know, it is actually not it does not correspond with increased engagement. So, for example, if you know, you're paying somebody $105,000 a year, they're not significantly more engaged if you give them $120,000 a year. So they're not correlated. What he does suggest, though, is, again, you want to pay somebody enough that, you know, pay is not not a factor.

00:09:43:06 - 00:10:08:09
Speaker 2
So you don't want to be underpaying somebody. If you're overpaying somebody, that's fine. But you're not going to significantly increase their engagement and their enjoyment in the workplace by paying them more. So what that essentially means is, you know, if you are having problems with employees in your workplace, if you have poor performers that you've been letting them kind of percolate and destroy your culture, if you, you know, never not everyone's working as a team player.

00:10:08:09 - 00:10:13:17
Speaker 2
You don't have everyone on the same page. Throwing some money at it is not going to fix the issue. Hmm.

00:10:14:01 - 00:10:19:20
Speaker 1
That's such a good point. Sorry. I just. I feel like a lot of people will resonate with that.

00:10:20:13 - 00:10:38:10
Speaker 2
Absolutely. It seems that that is our that's our traditional response to, you know, oh, we see a problem. You know, that person doesn't seem like they're engaged or they seem unhappy. You know, they're just not being paid enough. Whereas the research shows that that's actually not the case. And giving them more money is not going to, you know, help them help retain them.

00:10:38:19 - 00:11:06:04
Speaker 2
Right. So it's not going to substantially increase their happiness at work. So culture is a big one. So, you know, if you have employees that, you know, again, are percolating in poor behavior or are there's struggle, people for you are there. You know, they're difficult employees for you. You really want to address those because bringing in a diva and asking them to work with these individuals that, you know, potentially are giving you already a hard time is not going to, you know, keep them motivated and engaged and you're at risk of losing them.

00:11:06:20 - 00:11:32:07
Speaker 2
Mm hmm. Some of the other things you can consider more like long term, too, is if you're looking for like a successor, for example, you know, engaging with some of the schools, the colleges and the majority of them have say all of them have co-op programs. You know, if you can get somebody in, you know, their first or second year, you're able to, you know, provide them an employment contract, for example, that provides a certain amount of money or support.

00:11:32:14 - 00:12:04:20
Speaker 2
Usually it's monetary. We usually see monetary in return for them returning every year to you and or staying with you past the end of, you know, the end of their last term. So we're seeing that a trend as a trend towards that as well, that we're seeing some students that are coming through and, you know, are working with clinics over a number of years, but are receiving, you know, some type of bonus or some type of retention throughout that period in order to ensure that they stay two or three years following the end of their graduation.

00:12:05:07 - 00:12:25:21
Speaker 2
So that's another way that, you know, you can really set yourself apart, as, you know, to build those connections early on, because unfortunately, it's such a competitive market right now that, you know, if you're posting a job despite, you know, putting in, you know, this is why we're great. This is why you should join us. At the end of the day, you know, it's not that job that isn't necessarily going to, you know, pull people in.

00:12:26:04 - 00:12:40:14
Speaker 1
Right. Yes. It's so hard to connect with people just through a job ad. And I'm so glad you brought that up because, you know, of course, there's traditional job postings, but what other avenues should veterinarians and practice owners be exploring when they're looking to hire a DBA?

00:12:41:07 - 00:13:04:06
Speaker 2
Yeah, definitely. So, yeah, like I mentioned, obviously going to the schools, attending those career fairs, you know, making yourself available. There's also opportunities to you know, there's there's tons of foreign trained veterinarians as well. And that's a huge untapped labor pool. Yes, it is a little bit more expensive at the beginning. And long term, though, there's obviously lots of there's long term benefits to that.

00:13:04:16 - 00:13:23:09
Speaker 2
You know, you want to engage with, you know, local associations. So, you know, I know that there's there tends to be a reluctance, especially for some practitioners that are you know, you've been doing things a certain way. You know, whether it's veterinary, the veterinary world tends to be very traditional in the way that job searches are done, in the way the hiring is done.

00:13:23:22 - 00:13:42:12
Speaker 2
But you know, taking advantage of social media, for example, you know, a lot of young, you know, veterinarians are on Facebook. There are lots of Facebook groups, you know, for veterinarians, you know, connecting through those and like building some rapport and building some relationships, maybe it's not you're not going to hire, you know, the veterinarian that you're messaging on Facebook.

00:13:42:12 - 00:14:04:07
Speaker 2
Maybe they've got a friend or, you know, they or a coworker or someone else that's looking for another job that you can, you know, that would be happy to come and work for you again, building those connections. Also looking at your internal resources that you already have. Do you have again, this is more of a long term solution, but do you have a veterinary technician that's interested in attending and becoming a vet?

00:14:04:20 - 00:14:25:23
Speaker 2
Is there a possibility of you providing some support and some funding to help them get there? Right. And again, in return for obviously, you know, them signing a contract that says, you know, they're going to work for you for five years following the end of their graduation. Right. Again, it's really taking a look at, you know, what you what you've got internally that I've seen that work a couple times as well.

00:14:26:16 - 00:14:36:03
Speaker 2
You know, again, that's a that's a long a long term solution. If you're struggling for talent right now, that's not going to necessarily help you, but that would set you up for success in the future.

00:14:36:11 - 00:14:58:05
Speaker 1
Mm hmm. No. And that's so interesting, because I think, you know, looking forwards, you do have to be thinking, obviously, about the future and long term solutions, because the short term solutions, they might help right now, but it may not continue to work for you. So I think that's awesome. So we we attended the OVC Industry Day back in March.

00:14:58:05 - 00:15:19:04
Speaker 1
And the most common question that we got from students was that they had been offered a position as a contractor rather than an employee, and they were wondering what that meant for them. So this is obviously becoming more and more common practice. So what are the benefits from a practice owner point of view of hiring a veterinarian as a contractor rather than an employee?

00:15:19:23 - 00:15:37:09
Speaker 2
So I always from a practice owner perspective, I would always hear on the side of caution with with offering a position as a contractor role. Typically, we see a lot of contractor roles being requested by the employee, the incoming candidate.

00:15:37:11 - 00:15:39:07
Speaker 1
Oh, that's so interesting. Yeah.

00:15:39:07 - 00:15:59:21
Speaker 2
Versus the opposite. Which is it? Yeah, it's interesting. I'm not actually surprised that because I find that some of the bigger organizations and the bigger firms, they're more likely to say, hey, listen, you want to come work for us as a contractor, there's less risk. Right. At the end of the day, there's less risk. Right. So from a malpractise perspective, well, as a contractor, that contractor is basically owning their own business.

00:15:59:21 - 00:16:23:14
Speaker 2
So they have to register their business. They have to, you know, provide, you know, documentation. They have to provide insurance to cover themselves. So there's a lot less risk from a practice owner perspective because, again, you you've got this person that is basically their own operating, you know, their own veterinary clinic that operates. Right. You essentially just pay them typically an increased fee.

00:16:23:14 - 00:16:50:13
Speaker 2
It's it would usually be quite substantially more than what you be paying an internal and internal employee. But again, that's to cover off those additional costs that they would have associated with, you know, operating their own practice, essentially. There's obviously more flexibility from a student or like a candidate employee perspective wouldn't be an employee. Sari Contractor perspective, there's more flexibility because again, at the end of the day, they can say, well, listen, I'm going to be available these two days for you and I'm going to go work at another clinic for these days.

00:16:50:21 - 00:17:09:19
Speaker 2
You know, they're not necessarily held to the same expectations as an internal employee, right. From a like from an employee perspective, you know, the employer sets the sets, the work hours. They're the ones that set the schedule. They're the ones that approve your vacation, those types of things. Well, if you're a contractor, will all of that all of that is within your own wheelhouse.

00:17:10:05 - 00:17:30:09
Speaker 2
Right. So you are the one that dictates that information. Again, from a practitioner perspective, the biggest advantage is there's less risk. So there's a lot there's a lot less risk for both from, you know, a malpractise perspective, but also from, you know, if things aren't necessarily working out. So if you have you know, if you have an employee that's not working out well, you know, to terminate them, there's a certain process you need to follow, right?

00:17:30:09 - 00:17:55:06
Speaker 2
You can't just up and terminate someone and go, you know, walk away. And I'm not paying you anything. I'm not you know, there are requirements, legal requirements, whereas a contractor or there's there are different requirements as far as, you know, terminating that contract. Typically, they're stipulated in that contract with the with the contractor. But again, from a I'm an employee or a practice manager perspective, there's, you know, inherent risk in hiring and taking on an employee as opposed to a contractor.

00:17:55:09 - 00:18:15:12
Speaker 2
As far as from a cost perspective, it can be beneficial because again, as we as we've previously discussed, you know, as part of the full compensation package, you know, there's tons of things that are included, right? There's the base salary, profit sharing, signing bonuses, you know, paid time off, all those types of things that combine to a a total amount of compensation.

00:18:15:12 - 00:18:37:24
Speaker 2
Right. Which typically is not the base salary. So, you know, if you combine all of that, all of those numbers together, you're probably looking at, you know, for $150,000, you know, employee their base salary, you're probably paying them with benefits and everything else like that, you know, well over $200,000 once all is said and done right. So from a cost perspective, you know, again, as a contractor, well, you're not paying them for their vacation.

00:18:38:13 - 00:19:00:00
Speaker 2
Right. So you're typically not providing them with, you know, continuing education credits or paid time off for that, you know, no health care spending account, no signing bonus, those types of things. So the more cost perspective, there can be benefits as well. That said, obviously you are paying an inflated hourly rate because the contractor themselves, they have the business and they're being paid from that business.

00:19:01:01 - 00:19:24:21
Speaker 1
That's yeah. So interesting. It certainly makes sense to me if you're hiring an experienced DVM that, you know, this is a route you might explore. But it's so interesting that students are experiencing this because from my understanding, there's a lot of mentorship that needs to go on even after graduation. So it'll be interesting to see where those decisions take the industry, I guess.

00:19:25:14 - 00:19:49:17
Speaker 2
Yeah, absolutely. Yeah, definitely. It's definitely evolving. It's definitely an industry that is quickly evolving. And it's really important for for, you know, practice owners to make sure that, you know, they're a part of that that transition and not, you know, falling behind and lagging behind because unfortunately, that's what we're finding that, you know, we do have clients call us that say, you know, we've been looking for somebody for a year and like, you know, we're really struggling here.

00:19:49:24 - 00:20:06:07
Speaker 2
We're going, okay, like let's start back at the beginning. But, you know, knowing that this is going to probably, you know, unfortunately, this this not moving forward in the past year is going to cost you, you know, time, resources, those types of things, because it really is a really competitive and evolving market.

00:20:06:19 - 00:20:28:07
Speaker 1
Yeah, I mean, it it is wild to me how much it's changed. And it's so interesting to follow what I think we've taken up enough of your time. Leo, I so appreciate you joining us today for what is our first episode. So I hope everybody enjoys it and hopefully they can take away some nuggets of information.

00:20:28:20 - 00:20:33:03
Speaker 2
All right. Thanks so much for your time today, Amy. I really appreciate it.

00:20:38:18 - 00:21:00:18
Speaker 1
And that's a wrap on our first episode. I hope you enjoyed it and would love to hear your feedback. If you're a veterinary practice owner looking for help navigating the wild world of DVM recruitment, or maybe you need some guidance and other people related areas of your business, I highly suggest you reach out to our knowledgeable and experienced Human Resources Solutions team.

00:21:01:11 - 00:21:11:21
Speaker 1
Their contact details will be in the show notes. Thank you again so much for joining us on the Integrating for Success podcast chat. Next time.