Physical Therapy Employment Mistakes

My thanks to my son Matthew Steinberg and his firm Constangy, Brooks, Smith & Prophete LLP (Boston office) for contributing this article. Constangy specializes in workplace law with offices in Alabama, California, Colorado, Florida, Georgia, Massachusetts, Minnesota, Missouri, New Jersey, New York, North Carolina, South Carolina, Tennessee, Texas, and Virginia.
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We get asked all the time to help with recruiting PTs. Although that question may seem unrelated to our practice marketing services, it’s really not. That’s because good marketing creates capacity issues, which, in turn, lead to hiring and firing. In addition, implementing a PTRM system will change your staff’s routine. These changes are frequently met with resistance. For example, when implementing Internal Marketing Strategies, accountability for the patient follow-up process changes. If you’re not happy with how that’s going and need to make a staffing change, will you know the key “does” and “don’ts” for avoiding legal exposure?

Legal employment problems may sound like an unlikely occurrence, especially for small clinics, but according to recent liability insurance statistics from Hiscox, “US companies had at least a 10.5% chance of having an employment charge filed against them.” The rate is even higher in many states.

To help get you thinking about this important aspect of practice growth, here’s an article for PTs written for PTRM by a leading workplace law firm, Constangy, Brooks, Smith & Prophete LLP.

The Top 3 Employment Law Issues Facing Physical Therapy Clinics
(And How To Avoid Them) 

Physical therapists are on the front lines of healthcare.  Delivering a quality patient experience requires time, expertise, and, perhaps most importantly, retention of dedicated personnel.  Unfortunately, state and federal employment laws lay a number of legal traps for even the best-intentioned clinics.  Based on our experience representing a variety of healthcare institutions with labor and employment matters, we’ve identified three of the most common sources of employment law liability facing clinics today:

1. Employee Misclassification/Wage and Hour Compliance

Physical Therapy Employment Law - ImagePhysical therapy clinics contract with a variety of individuals and vendors: in-home physical therapists for patients who cannot travel; independent contractors on short and long-term contracts; temporary workers from staffing companies; and office/administrative staff.  Whether or not the clinic can deal with these individuals as independent contractors or must employ them directly as employees varies from state to state.  For example, in places like Illinois, New Jersey, and Massachusetts, any contractor is presumed to be the clinic’s employee unless the individual is (1) free from control and direction in the performance of services; (2) the service is performed outside the usual course of the clinic’s business; and (3) the individual is engaged in an independently established trade, occupation, or business.

In addition, clinics must ensure that they are properly classifying their employees as “exempt” or “non-exempt” under federal and state law; all non-exempt employees must be paid at least the minimum wage for all hours worked plus time and one-half for all hours worked over 40.  Deciding whether an employee is exempt (and can therefore be paid a fixed salary regardless of hours worked) depends on the salary level and specific tasks performed by the employee and can be especially thorny for office staff, such as administrators and office managers.  Just one false step in this area can result in significant liability, including being on the hook for a former employee’s attorneys’ fees and multiple (double or treble) damages.

2. Anti-Discrimination Laws

Physical Therapy Employment Rights - ImageMost physical therapy clinics, both big and small, are covered by either state or federal (or both) anti-discrimination laws.  The basic ground rules are straightforward enough: clinics are required to treat similarly-situated employees equally without regard to an employee’s “protected category,” such as race, gender, or national origin.  But the devil is in the details and, often, the execution of sound HR policies.  Are all employees being disciplined for similar infractions in a similar manner?  Have you consistently applied a written discipline policy?
Some of the thornier issues revolve around responding to workplace harassment complaints and requests for a medical accommodation or leave of absence.  All employers should have a clear and thorough anti-harassment policy which provides a mechanism for employees to report complaints.  In addition, all clinics should have a protocol in place for impartially and fairly investigating workplace harassment allegations.


 The same is true for medical accommodation and leave of absence requests.  There are a thicket of laws that govern this topic, including the Americans with Disabilities Act, state workers’ compensation statutes, and the Family and Medical Leave Act.  In addition, various states and municipalities have enacted their own sick leave and family leave laws, including New York, California, and Massachusetts.  Consulting with an advisor who has a thorough understanding of a clinic’s obligations to accommodate medical leaves of absence and employee disabilities is critical.

3. Whistleblower and Retaliation Protections

Whistleblower Law - ImageThe healthcare workplace has become increasingly regulated by state and federal anti-retaliation and whistleblower protection laws.  For example, PT clinics are prohibited from taking any adverse action against an employee who has lodged a complaint of unlawful discrimination.  Clinic employees are also protected against retaliation by the federal False Claims Act (“FCA”).  The FCA prohibits clinics from presenting false claims for reimbursement to a federal entity, like Health and Human Services (“HHS”), which administers Medicare and Medicaid.  Employees who suspect fraud in Medicaid or Medicare billing can file a private lawsuit on behalf of the government seeking civil penalties, treble damages, and actual damages.  In a successful FCA suit, the employee is entitled to a percentage of the government’s recovery.  Employers are prohibited from retaliating against employees who make a claim under the FCA.
 Just like regular check-ups with a primary care physician or regular exercise, all employers benefit from proactively assessing their compliance with state and federal employment law.  New laws have been going onto the books at a torrid pace in recent years at the state level, whose regulators can be less than forgiving even for inadvertent oversights or honest mistakes.
For more information, I encourage you to reach out to Constangy’s Boston Office: or 617-849-7889. You can also sign up for the Constangy newsletter here.

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