Is a Job in Your Office a Career?
One of the consequences of the changes in our society wrought by women's desire or need to work has been the institutionalizing of changes in the work force. Combined with the further social independence of women, which has resulted in a large increase in the number of single females with and without children, the net effect of these social and economic changes has been that the definition of family itself has changed. The norm in our society is now that work is looked upon by women as a career.
We have seen the same phenomenon in orthodontics, and the trend is likely to accelerate for the foreseeable future. When one contemplates the changed relationship of women and work, it seems clear that more and more women are going to have to think about providing for their retirement when they no longer are able to or desire to work.
Orthodontists have not universally accepted the responsibility of providing for the retirement of their employees. Many orthodontists have even avoided installing a retirement plan that might have been advantageous to themselves and their retirement aspirations because of the requirement of including employees. Yet it is in virtually every orthodontist's self-interest to have a retirement plan, and the fact that employees are included ought to be looked upon as a plus and not a minus.
First, with regard to the orthodontist, there are very few retirement programs that can equal the potential of a qualified pension plan--defined-benefit or profit-sharing--even with the current limitations on the amount that can be set aside each year. The reason lies in the ability to keep investing in the plan without paying income tax on the contribution until the money is withdrawn. It is the ultimate pyramid scheme. If it is used wisely and if the administrators of the plan do not over-reach for yields, it is possible to accumulate a sizable nest egg.
It could be argued that the consistent setting aside of retirement funds could be flawed because we cannot predict what the income tax rate might be when we are ready to retire and withdraw money from the plan. If income tax rates should be extremely high at the time of retirement, it might call into question the sacrifice of making annual contributions to a retirement plan. Still, there are a great many more serious consequences in this world that we cannot predict, and it is fruitless to permit such speculation to cause us to refuse a plan with such outstanding potential at minimal risk. It was also pointed out in this column some months ago that, with more people living longer, orthodontists have a greater likelihood than ever before of retiring.
The rationale for providing for employees' retirement is in fostering the concept of a job in an orthodontic practice as a career. When auxiliaries were permitted by law to perform very few tasks in an orthodontic practice, their performance on the job was less critical and their perceived value to the practice was generally low. With the expansion of the tasks orthodontic assistants are permitted to perform, and with the increasing emphasis on the role of staff members in public relations and marketing, employees have assumed a much greater importance to the success of the practice. Not only are they entitled to share appropriately in the rewards, but it is in the orthodontist's self-interest to hire and retain high-performance, career-oriented employees.
Orthodontists who refuse to entertain the idea of a retirement plan for employees should first consider why they have that attitude. If, as I have often heard, it is because they do not believe their employees are worth it, they should consider what effect these little-valued employees are having on the practice and what might be done to improve employee quality. If employees have been thoroughly trained in both technical and patient-relations skills and still do not perform as valuable members of the practice team, serious efforts should be made to find replacements who will. The smaller the staff, the more important this concept may be.
An orthodontist who is satisfied with the performance of employees, but has simply guessed that it could not be economically valid to institute a retirement plan that included staff members, should consult with an actuary and find out exactly what the alternatives are and what the actual cost/benefit picture is.
There may be nothing that will provide that last spot of glue that bonds orthodontic office personnel together as a career-oriented team like adding the security of a retirement plan. It says to employees, "I am pleased that you are a career member of my team, and I am concerned about your welfare." The advantages of a practice with career-oriented employees are well documented in the Management & Marketing column by Dr. Ronald Mackley in this issue of JCO.