Employed women ODs still lag behind their male counterparts in salary, according to Jobson Optical Research’s and Local Eye Site’s 2013 ECP Compensation Study. Male optometrists responding to this study reported significantly higher compensations than their female counterparts. Male optometrists who are employees reported an average compensation of $113,245 compared to $101,000 for females.
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The first take-home point that everyone should get from the Compensation Study referenced above is that owners/partners make approximately 30 percent more than employee doctors. That is definitely a benefit to being an owner/partner.
Now, to the other major point: Does discrimination between male and female compensation packages in your practice exist? You need to look carefully and make sure that it does not exist.
There should be equal pay for equal work. If there are two doctors in a practice–one male and one female–with equal experience, equal productivity, equal longevity and working an equal number of hours, then those two doctors should have exactly the same compensation. But can situations occur where male and female doctors have unequal compensation without discrimination occurring?
Let’s consider two situations, one for employee doctors, and one for owner/partner doctors.
SITUATION 1: There are two doctors–one male and one female. Both are employees. Here are their profiles:
EMPLOYEE DOCTORS
Male doctor
• No ownership of the practice
• Works 2,000 hours per year (40 hours/week for 50 weeks/year)
• Hourly rate is $56.62/hour
• Paid by the practice for a year’s work $113,245
Female doctor
• No ownership of the practice
• Works 1783.83 hours per year (35.68 hours/week for 50 weeks/year)
• Hourly rate is $56.62/hour
• Paid by the practice for a year’s work $101,000
Both the male and the female doctor were paid exactly the same dollar per hour rate. The doctor who worked more hours received a higher compensation without the presence of discrimination.
SITUATION 2: There are two doctors–one male and one female. Both are owners/partners. The female partner is buying into the practice each year. The goal is to end up as 50/50 partners, however, the buying partner has only purchased 41.5 percent of the stock so far. Her plan is to purchase the rest of the stock next year to get to the 50 percent goal. Here are their current profiles:
OWNER/PARTNER DOCTORS
Male doctor
• 58.5 percent ownership of the practice–selling to new partner
• Works 2,000 hours per year (40 hours/week for 50 weeks/year)
• Hourly rate is $50/hour
• Hourly compensation = $100,000
• Profit distribution = $45,947
• Total compensation = $145,947
Female doctor
• 41.5 percent ownership of the practice – buying from the established partner
• Works 2,000 hours per year (40 hours/week for 50 weeks/year)
• Hourly rate is $50/hour
• Hourly compensation = = $100,000
• Profit distribution = $32,605
• Total compensation = $132,605
Both the male and the female doctor were paid exactly the same dollar per hour rate. The doctor who owned more stock received a higher total compensation without the presence of discrimination.
To determine if discrimination is occurring, it is important to look deeper than just the total compensation. Consider, at the very least, the number of hours worked per week and the amount of practice stock owned.
Don’t miss the key point: Do not permit discrimination to occur in your practice.
What is your action plan for this week? Look at your compensation packages for all males and females in your practice and make sure there is no discrimination occurring in your practice.
