Neel Kothari explores the problem of greed and corruption around retention fees, and why they may cause ‘significant animosity’ between principal and associate.
For those unaware, a retention fee is a sum of money withheld by the practice owner from a departing associate, usually for a specified period to cover costs for treatments identified as defective.
When properly administered, this can be of significant advantage to both the associate and practice owner for a multitude of reasons, not least because it provides a mechanism where remedial work can be swiftly completed for the patient, making a complaint or a legal claim less likely.
Nevertheless, it isn’t uncommon for retention fees to be the cause of significant animosity between principal and associate. This is largely because we as dentists can hardly agree on a treatment plan, let alone what constitutes ‘defective’ treatment. For some, this may be a failing implant, whereas for others it could just be about being able to get the tip of a dental explorer between a crown margin and a caries-free tooth surface on a low-risk patient.
Grey area
While some failures may be obvious, others are less clear, and in this grey area, from the associate’s perspective, not only do they stand to lose money, but they are also left out of the decision-making process and are left vulnerable to the whims of the practice owner, who they can only hope will be fair.
Where issues exist, one would hope matters could be resolved amicably. After all, we are all professionals, right? Well, unfortunately, there are some unscrupulous practice owners in our profession and, even though they are in the minority, it isn’t uncommon to come across cases where retention fees are used as a tool to bully associates, as well as in some cases being kept for the simple reason of greed.
A noteworthy consideration for dental associates is that practice owners are only able to withhold fees if they have the express contractual authority to do so. This means it requires the agreement of the associate to do so, ideally via a signed contract. Yet despite this, it isn’t uncommon to hear of situations where associates have had their fees unlawfully withheld.
For sure legal action is an option, but there are numerous obstacles preventing associates from getting what they are owed. Apart from trying to avoid souring business relationships, engaging legal action can be incredibly stressful with no guarantee of success. Even if they do win, many may have concerns over their reputation locally or, in the case of some, vindictive actions via a ‘blue on blue’ referral to the General Dental Council (GDC).
Greedy and corrupt
Alex Sharp, founder of Facebook group ‘Dental Disruptors’ and owner of Market Place Dentistry, is a passionate advocate for dental associates. He said: ‘I have heard many stories from associates over the years and I am continually amazed by the creative and unfair ways that retention fees are being abused. Associates feel they have no control, they don’t know where to turn for advice, they feel threatened, powerless and scared.
‘Unfortunately, this issue has been going on for a very long time and is grossly under reported. Thankfully we are becoming more comfortable talking about these issues, but the fear of reprisal from practice owners often acts as a barrier to seeking advice.
‘The most unethical behaviour I have seen is practices reporting their colleagues to the GDC for daring to fight for their legal rights to their money. We need to change the current system as it enables nefarious, greedy and corrupt behaviour which is literally ruining the lives of human beings and at times forcing them out of the industry.’
Are retention fees abused?
So, are retention fees being abused? Well, in most cases probably not, but nevertheless it strikes me that this is a far bigger issue than is reported. My unevidenced and anecdotal opinion is that for those reading this article, there is a very high chance that you or someone you know has been affected by retention fee issues.
For these reasons, I think it’s long overdue that we as a profession do more to prevent disputes surrounding retention fees. While ambitious, I would love to see some form of third-party decision making on how retention fees are allocated, which would of course only be necessary in the event of a dispute.
This could potentially resemble the tenancy deposit scheme used by landlords to protect their tenant’s deposits or alternatively via a contractual arbitration clause where both parties agree to a neutral third party making legally binding decisions.
While one would hope that both parties would treat each other fairly, hope alone won’t recover fees or stop repeat offenders seeing this as a source of additional income. In these situations, it seems wholly against the principles of natural justice to have one party solely responsible for holding fees and determining what money, if any, should be returned.
Until more is done to address this, I’m inclined to think that for some associates, retention fees will continue to be an issue for the foreseeable future.
Read more from Neel Kothari:
- Will 2025 be an economic disaster for the dental sector?
- The dangers of ‘bad science’ in dentistry
- What exactly can we say on social media?
- Was it right to force the COVID vaccine on healthcare workers?
- Are universities adequately preparing new dentists?
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