Managing salary discussions

Estimated reading time: 5 minutes

The way dental clinics manage salary discussions can mean the difference between success and failure, but some key strategies can make the process easier for all. By Cameron Cooper 

Paying staff fair wages is crucial to the financial sustainability of a dental clinic, not to mention employee morale.

But many clinic owners and practice managers struggle with negotiating salaries, which can result in over-paying for talent or, more commonly, offering too little and missing out on outstanding recruits.

Julie Parker, co-founder Dental Business Mastery, believes both scenarios are common throughout dentistry. With dental auxiliary team members’ collective salaries typically costing about a quarter of a clinic’s turnover, she states it can lead to a mindset among practice leaders of “paying people as little as they can get away with”.

The upshot is those clinics won’t attract the best talent. “Those practices are then the ones that say there’s no good staff out there, that everyone’s unreliable,” Parker says. “But that’s what you get with a lower-level wage. If you start off with a higher wage, you’ll start seeing the superstars coming through.”

Dental clinics can follow Fair Work Commission salary guidelines, or the ADA’s suggested pay rates. While these sources provide a benchmark, they may use old data that sets the bar too low for the salary demands of high performers.

Acknowledging this risk, Parker recommends that when dental clinics advertise for auxiliary staff, they should provide a salary range, rather than a fixed hourly rate. Locking in a $35-an-hour rate, for instance, is likely to put off top talent who could otherwise deliver a great return on investment. “If you’ve got an absolute superstar looking for a job and they know they’re worth $40 an hour, that fine talent won’t even bother applying,” Parker says.

As principal dentist and director of the East Bentleigh Dental Group (EBDG) in Victoria from its inception in 1972 until its sale in 2025, Dr Harry Marget hit upon a successful formula for setting pay rates. The approach attracted excellent auxiliary and clinical talent while minimising turnover.

Dr Marget would ask potential recruits to tell him what they were worth and which skills they would bring to the practice. “I didn’t really negotiate,” he says. “I asked people to put themselves up on a pedestal and say, ‘Look, here I am, this is what I can do’.”

If they requested $40 an hour, Dr Marget would instead pay a promising recruit $41.50 and test them out. “And after about three or four months, I would say, ‘You’re better than $41.50, you’re worth $45 an hour.”

That method, in combination with regular salary reviews, contributed to low turnover rates and high morale at EBDG. “I never wanted anybody to feel as though they’d been offered a salary and that was the end of it,” Dr Marget says. “With some people I would have been happy to review their salary 50 times a year because they were worth it.”

Bhupesh Kaphle is a partner in BDO Australia’s business services team in Brisbane who specialises in working with dental and healthcare sector clients. He says mastering the art of negotiation can be difficult for dental clinic owners.

Those practices are then the ones that say there’s no good staff out there, that everyone’s unreliable. But that’s what you get with a lower-level wage. If you start off with a higher wage, you’ll start seeing the superstars coming through.

Julie Parker, co-founder, Dental Business Mastery

“By their nature they aren’t trained in HR and salary negotiations are such nuanced discussions,” he says.

Kaphle notes that some larger dental clinics may opt to use HR managers, or bring in external consultants, to negotiate salaries on behalf of the leadership team.

For the owners of smaller practices with fewer resources, Kaphle says salary negotiations can be an “isolating process”. He advises reaching out to peer networks and the ADA to get greater clarity on current going rates for reception, dental-assistant and specialist staff. It is also vital to have clear frameworks in place outlining specific staff roles and key performance indicators (KPIs) for those positions.

Sometimes, he warns, the owners of smaller dental clinics who lack negotiating experience go straight into salary discussions without explaining their value proposition to potential recruits, or the parameters behind salary reviews of existing employees. 

Dentists and other specialists are typically paid commissions in the range of 30 to 40 per cent of their production, including superannuation, depending on their level of expertise and the degree of patient demand.

To recruit and retain dentists, Dr Marget favours a combination of bonuses and the promise of ongoing training and learning opportunities so they can boost their skill sets and long-term career prospects. 

At EBDG, he would pledge to pass on for free his skills in orthodontics to a potential recruit who specialised in another dental discipline, while also offering an attractive percentage of the dentist’s monthly production. As the dentist hit milestones—for example, monthly production targets of $50,000, $80,000 or $160,000—he would keep upping their compensation. “That’s how I hired people and basically they were working on performance systems,” Dr Marget says.

Kaphle agrees that extending recruitment and salary discussions to coaching and mentoring opportunities is smart. “If you can show candidates the potential for learning opportunities, it can really resonate,” he adds. 

The other challenging component of wages management is salary reviews. To ensure fairness, Parker agrees that dental clinics must have clarity around performance expectations and KPIs. “Then if staff want to be paid more, they know exactly what they need to do.”

She recommends asking staff members up-front about their desired salary increases, and reviews should be held at least every six months. 

Kaphle adds being transparent about salaries in advance of a job offer can prove to be invaluable to set clear salary-negotiation plans and have remuneration discussions with staff before any discontent sets in. 

“If you can get it right at the start and build a framework for those discussions, it really puts you in a good position moving forward.”