Can You Switch Locums Companies If Another Company Offers You a Better Rate for the Same Job?
It’s a common scenario on our online physician communities and in locums life in general. You’re considering a locums position (or are actually already working at a locums assignment), and you learn that another locum tenens company is offering better rates for the same job. You want to switch companies, but you’re not sure that you can. Common sense tells you that you should be able to switch to working with another company, but somehow it’s not that simple. Navigating this situation carefully will dictate not just how well you’re compensated, but also what your future relationship with the locums company is as well as what legal issues you may run into. Below, we’ll cover what you need to know about switching locums companies for the same position when one is paying a higher amount than the other.
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Is it possible to switch locum tenens companies if one is offering a higher rate than the others for the same locums assignment?
In most locums situations, you are a 1099 contractor, which means you’re not an employee. This may make it seem like you’re a free agent and should just be able to switch, but the practical reality is that it’s much more complicated than that. You can’t always switch the locums company you’re working with when it comes to the same locums assignment. You may be the talent, but when you work with locums companies, you’re using them as your agent, and there are also protections in place for their time and energy so that you can’t jump ship or back out of assignments just because somebody else offers you more money. While you should 100% advocate for yourself, how you do so is important.
The key questions are 1) where you are in the process, and 2) what your contract with the locums company states.
For context, if you’re new to loucms and don’t understand how locums companies make their money, you have to understand that the locums company is incentivized to get you to take a lower rate so that they can make more money. Learn more about how a locums company makes money.
Make sure you’re comparing apples to apples to decide if the offer with the second locums company is actually better
Remember that there’s a lot that goes into compensation for locums besides just the hourly rate. It’s also about the overtime or call pay, the travel and accommodation the locums company provides, the malpractice insurance, and all the other parts of your locums agreement. Sometimes you sacrifice a little in rate because the other aspects of working with a locum tenens company are better. Make sure you actually want to make the switch once you take the whole picture into account.
Your approach will depend on where you are in the process
Scenario 1: You haven’t been presented to the hospital or practice by the locums company yet
This is generally the easiest situation, because you’re usually under no obligation to continue working with them. The hospital or hiring company doesn’t know you have a relationship with the locums company, so they’re not obligated to only work with you through them either. As a general rule of thumb, you can’t be presented to the same hospital or hiring entity by two locums companies.
In this scenario, you’ve talked to Agency A (the lower paying agency) about a locums opening at a hospital. You haven’t yet authorized them or allowed them to present your CV to the hospital when you discover that another agency, Agency B, is offering a higher rate or better terms. In this situation, there is generally no reason that you can’t just tell Agency A you’re not interested and move on with Agency B, or try and use the knowledge you have about Agency B to negotiate with Agency A.
The situation where you may have an issue is if you’ve signed something with Agency A already in terms of an overarching agreement about your relationship. In this case, you need to check your agreement for exclusivity provisions, representation agreements, non-circumvention language, any restrictions on working with other agencies, or other terms that would create fees or legal issues. Hopefully, you haven’t signed anything like this, but if you’re just getting started with locums, it’s a mistake many physicians make.
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Scenario 2: The first agency has already presented you to the hospital for this locums gig, or you’ve already been offered the job by the hospital or hiring company
Things get more complicated (and potentially stop) here. Even if you don’t have a contract for the gig yet, in the eyes of the hospital and their relationship with the locums company, you are likely now ‘owned’ by locums company A. In other words, you’re no longer a free agent, and every interaction you have with that hospital system has to go through your agent, locums company A.
While this isn’t always the situation, in most cases the hospital and the locums companies have their own agreements about these scenarios. Agency B may therefore be unable, or unwilling (for the sake of their reputation and their relationship with other players in the space) to present you to the hospital, and/or the hospital may not be willing to consider you through another agency.
How to strategically navigate this:
If you’re in a grey area where you’re not sure, clarify the arrangement. You can ask locums company A when you were submitted and if you were submitted exclusively, if the hospital has acknowledged receipt, and if the agency has a “candidate ownership” or submission period and if so, how long that protection lasts.
If you’re playing the long game, you may just opt not to work with that locums company - or use the ability to walk away as leverage to get them to also consider giving you the higher rate.
If you have a great relationship with locums company A, they may want to play the long game as well. If they’re not willing to give you the higher rate, ask them if they’ll release you from the arrangement for this assignment, knowing that you’ll work with them on other assignments.
Scenario 3: You’ve already signed a contract for the gig, or you’ve already started working there, through Locums Company A
At this point, it’s very likely that you’re locked into working through this company when you’re working at this particular assignment. You’ll have to read the contract carefully, but it’s likely that it will have a certain time period where you can only work with this particular entity through Locums Company A. You’ll want to look at the termination provisions, notice requirements, cancellation conditions, exclusivity, non-circumvention, and non-solicitation clauses, and any other damages or assignment specific terms.
You’ll also want to see whether the agreement covers only the particular set of dates you’ve agreed upon, or if it applies for all future interactions with the hospital for a certain period of time. It is possible that you could do another assignment in the future at the same place through a different company, but you’ll have to check the terms. Otherwise, you’ll have to use the power to walk away from accepting future gigs to see if you can renegotiate terms or get agency A to release you from the terms in hopes of continuing your relationship with them for other gigs.
Scenario 4: You’re working at the assignment, and the place tells you that they’d rather work with you through another company
This is a unique situation that does happen sometimes. The hospital may like you and want to continue working with you, but for some reason it may be advantageous for them to contract with you through another agency. This may be because the other agency is a preferred vendor or offers them better rates or terms.
What’s important for you to know is that while they may have the ability to switch vendors for this placement, you may not. You’re going to want to independently sort this out with the two locums companies and ensure that the original company won’t have a claim against you through your agreement.
Scenario 5: You found the gig by yourself but then the hospital says you’ve already been presented to them by a locums company
This happens more than you think. Maybe you naively gave a locums company the permission to present you before without approving the specific gigs they presented you to, and they already presented you to a hospital and “own” your relationship with the hospital. Maybe you worked there in the past through an agency that now owns the relationship or was transferred the relationship because the locums company joined a larger umbrella or merged with another locums company.
Documentation matters. You’ll want to review what transfers and under what scenarios.You’ll also want to make sure that you had given permission for them to present you to the hospital.
Checklist: What to do if you find out another locums company is offering a better rate than the one you originally agreed to
While this may sound complicated, you’ll get used to navigating this situation once you’re entrenched in locums life, especially if you’re working with multiple companies. Here’s how to approach it:
Step 1: Don't panic or immediately cancel anything. It’s quite possible that locums company A will renegotiate the terms or release you in hopes of maintaining a good relationship for future assignments.
Step 2: Find out exactly what the other agency is offering, and make sure you’re comparing apples to apples. Look at not just the hourly or daily rate, but also the call rate, overtime or callback rates, reimbursement or allowances for travel and housing, and which company offers better malpractice and licensing and credentialing support. The whole picture matters when deciding what the better agreement is.
Step 3: Determine whether you've already been submitted.
Step 4: Review every agreement you've signed.
Step 5: Talk to both companies. Ask Agency B whether they can actually place you at that facility given your relationship with Agency A.Explain the situation to Agency A and ask Agency A whether they will match or improve the rate.
Step 6: If necessary, negotiate a release (and make sure you get any agreement to release you in writing).
The importance being savvy about the negotiation process, and giving the first agency a chance to compete
If you’re going to be doing locums regularly, your relationships with companies matter, and you want to ensure that you maintain good working relationships not just for this assignment, but for all assignments going forward. Don’t engage in a disrespectful or contrarian manner - all agreements are negotiations, and you should treat them in a way to maximize success. Realize that the locums company is always going to want you to take a lower rate, because they make more that way, but that you also may need them, so you have to walk a fine line between advocating for yourself and setting up an adversarial relationship where they don’t want to work with you again because they feel you’re always going to be threatening to leave if somebody offers you a dollar more.
In general, it’s a good idea to give the first agency a chance to compete. You may be surprised about how reasonable they are.
What not to do:
Don’t let two agencies submit you to the same hospital
Don’t assume that just because you didn’t sign anything you’re completely unrestricted - clarify before you create a mess
Don’t the hospital to circumvent the first agency - this erodes trust with multiple parties; your character and commitment matters
Don’t quit an active assignment - do what you said you’d do
Don’t give agencies the permission to present you without your explicit okay for a particular assignment
Don’t agree to anything over text or email before you’re ready to commit - they may constitute agreements
Don’t assume that the highest hourly rate is the best deal. Compare apples to apples.
Conclusion
It’s very common that different rates will be presented for the same assignment, because each locums company sets their margins according to their internal policies. Your job is to be savvy about how you navigate things, maintain good relationships with all players, and advocate for yourself without closing off doors or creating legal liabilities. If you don’t negotiate, you won’t get a better situation, so you absolutely should try to challenge your company to give you a better rate; just make sure you understand what you can and cannot do - not just legally but also professionally.
Additional resources for locums physicians
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