Document:

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                                                                    Exhibit 10.4

                              EMPLOYMENT AGREEMENT

     THIS EMPLOYMENT AGREEMENT ("Agreement"), is made as of this 31st day of
March, 2003, by and between THE PROVIDENCE SERVICE CORPORATION, a Delaware
corporation, with its corporate headquarters located at 620 N. Craycroft,
Tucson, AZ, its successors and assigns (hereinafter collectively referred to as
"Company"), and Fletcher Jay McCusker, an individual residing at 401 N. Mountain
Side Place, Tucson, AZ 85745 ("Employee").

                                   BACKGROUND

     WHEREAS, Employee is currently employed by Company as Chief Executive
Officer, and serves as Chairman of Company's Board; and

     WHEREAS, Company intends to complete an Initial Public Offering ("IPO") of
stock in Company, and offer Employee the foregoing Agreement contingent upon
successful completion of the IPO;

     WHEREAS, should Company complete the IPO, Company desires to continue to
employ Employee, and Employee desires to continue to be employed by Company, all
upon the terms and conditions set forth in this Agreement.

     NOW, THEREFORE, in consideration of the facts, mutual promises, and
covenants contained herein and intending to be legally bound hereby, the parties
hereto agree as follows:

          1.  Employment. Subject to, and contingent upon, the successful
completion of the IPO, Company hereby employs Employee and Employee hereby
accepts employment by Company, for the period and upon the terms and conditions
set forth in this Agreement, subject to earlier termination pursuant to Section
6 below.

          2.  Office and Duties.

              (a)  During the term of this Agreement, Employee shall serve as
Chief Executive Officer of Company, and shall report directly to Company's Board
of Directors (the "Board") and/or an executive committee established by the
Board, and be subject to its and/or their supervision, control and direction.
Employee shall also serve on the Board as may be requested from time to time.

              (b)  In his capacity as Chief Executive Officer of Company,
Employee shall have such authority, perform such duties, discharge such
responsibilities and render such services as are customary to, and consistent
with his position, subject to the authority and direction of the Board, and
shall perform such additional duties and responsibilities as may be from time to
time assigned to him by the Board or committee established by the Board.

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              (c)  The Employee shall render his services diligently, faithfully
and to the best of his ability, and shall devote all of his working time,
energy, skill and best efforts to the performance of his duties hereunder, in a
manner that will further the business and interests of Company.

              (d)  During the term of this Agreement, Employee shall not be
engaged in any business activity which, in the reasonable judgment of the Board,
conflicts with Employee's duties hereunder, whether or not such activity is
pursued for pecuniary advantage.

          3.  Term. This Agreement shall be effective for a term commencing on
the date the IPO is successfully completed ("Effective Date") and ending on the
Third anniversary thereof (the "Expiration Date"), unless sooner terminated as
hereinafter provided or further extended by the mutual written agreement of
Company and Employee (the "Term").

          4.  Compensation.

              (a)  Base Salary. In consideration of the services rendered by
Employee to Company during the term hereof, Employee shall receive an annual
base salary of One Hundred Ninety Thousand and 00/100 Dollars ($190,000.00)
("Base Salary"), payable in equal periodic installments in accordance with
Company's regular payroll practices in effect from time to time. Employee's Base
Salary shall be reviewed annually by the Board and/or a committee of the Board
which has been delegated responsibility for employee compensation matters (such
committee to be referred to herein as the "Compensation Committee") in
accordance with the compensation policies and guidelines of Company, and may be
modified as a result of such review at the sole discretion of the Board and/or
the Compensation Committee.

              (b)  Bonus Plans/Incentive Compensation Programs. In addition to
Base Salary, during the Term, Employee shall be eligible to participate in any
bonus plans or incentive compensation programs, if any, as may be in effect from
time to time, at a level consistent with his position and with Company's then
current policies and practices ("Bonus").

              (c)  Benefits. During the Term, Employee also shall be entitled to
participate in all fringe benefits, if any, as may be in effect from time to
time which are generally available to Company's senior executive officers, and
such other fringe benefits as the Board and/or Compensation Committee shall deem
appropriate, subject to eligibility requirements thereof (collectively, the
"Benefits").

              (d)  Vacation. During the Term, Employee shall be entitled to the
number of paid vacation days in each calendar year as determined by Company from
time to time for its senior executive officers. Vacation days which are not used
during any calendar year may not be accrued or carried-over to the next year,
nor shall Employee be entitled to compensation for unused vacation days.

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              (e)  Business Expenses. During the Term, Company shall pay or
reimburse Employee for all reasonable expenses incurred or paid by Employee in
the performance of Employee's duties hereunder, upon timely presentation of
expense statements or vouchers and such other information as Company may
reasonably require and in accordance with the generally applicable policies and
practices of Company.

              (f)  Withholding. All payments made pursuant to this Agreement
shall be subject to such withholding taxes as may be required by any applicable
law.

          5.  Representations of Employee. Employee represents to Company that:
(a) there are no restrictions, agreements or understandings whatsoever to which
Employee is a party that would prevent, or make unlawful, his execution of this
Agreement and his employment hereunder; (b) his execution of this Agreement and
his employment hereunder shall not constitute a breach of any contract,
agreement or understanding, oral or written, to which he is a party, or by which
he is bound; and (c) he is of full capacity, free and able to execute this
Agreement and to enter into this Employment Agreement with Company.

          6.  Termination. This Agreement shall continue until the Expiration
Date, unless terminated earlier by Company or Employee as provided herein, or
further extended by the mutual written agreement of Company and Employee. Unless
otherwise extended by the mutual written agreement of Company and Employee, this
Agreement shall terminate automatically on the Expiration Date, without any
notice, severance pay, termination pay or any severance obligation whatsoever.
If, however, this Agreement is terminated prior to the Expiration Date by
Company or Employee, the provisions contained in Section 7, Payments Upon
Termination, shall apply.

              (a)  Termination by Company for Cause. Company shall have the
right to terminate this Agreement at any time for "Cause". For purposes of this
Agreement, the term "Cause" shall mean the following:

                   (i)    Employee commits fraud or theft against Company or
any of its subsidiaries, affiliates, joint ventures and related organizations,
including any not-for-profit affiliates or not-for-profit joint ventures
(collectively referred to as "Affiliates"), or is indicted, convicted of, or
pleads guilty or nolo contendere to, a felony; or

                   (ii)   In carrying out his duties hereunder, the Employee
engages in conduct that constitutes gross neglect or willful misconduct and that
results, in either case, in material economic harm to Company or its Affiliates;
or

                   (iii)  Employee materially breaches any provision of this
Agreement (including but not limited to the restrictive covenants contained in
Paragraph 8 below) or breaches any fiduciary duty or duty of loyalty owed to
Company or its Affiliates; or

                   (iv)   Employee engages in conduct tending to bring Company
or its Affiliates into public disgrace or disrepute; or

                   (v)    Employee repeatedly neglects or refuses to perform
duties or responsibilities as directed by Company or the Board, or violates any
express direction of any

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lawful rule or regulation established by Company or the Board which is
consistent with the scope of Employee's duties under this Agreement; or

                   (vi)   Employee commits any acts or omissions resulting in or
intended to result in direct personal gain to the Employee at the expense of
Company or its Affiliates; or

                   (vii)  Employee compromises trade secrets or other
confidential and proprietary information of Company or its Affiliates.

          "Cause" shall not include a bona fide disagreement over a corporate
policy, so long as Employee does not willfully violate on a continuing basis
specific written directions from the Board, which directions are consistent with
the provisions of this Agreement. Action or inaction by Employee shall not be
considered "willful" unless done or omitted by him intentionally and without his
reasonable belief that his action or inaction was in the best interests of
Company or its Affiliates, and shall not include failure to act by reason of
total or partial incapacity due to physical or mental illness.

              (b)  Termination by Company upon the Death or Disability of
Employee. Company shall have the right to terminate this Agreement at any time
upon the death or Disability of Employee. The term, "Disability", as used
herein, means any physical or mental illness, disability or incapacity which
prevents Employee from performing the essential functions of his job, with or
without reasonable accommodations, hereunder for a period of not less than one
hundred fifty (150) consecutive days or for an aggregate of one hundred eighty
(180) days during any period of twelve (12) consecutive months. During any
period of Disability, Employee agrees to submit to reasonable medical
examinations upon the reasonable request, and at the expense, of Company.

              (c)  Termination By Company Without Cause. Company shall have the
right to terminate this Agreement at any time without "Cause" and/or without the
occurrence of Employee's death or Disability upon thirty (30) days written
notice to Employee.

              (d)  Termination By Employee For Good Reason. Employee shall have
the right to terminate his employment at any time during the Term of this
Agreement for "Good Reason" upon sixty (60) days prior written notice to
Company's Board. For purposes of this Agreement, "Good Reason" shall mean any of
the following:

                   (i)    the assignment to Employee by Company of any duties
inconsistent with Employee's status with Company or a substantial alteration in
the nature or status of Employee's responsibilities from those in effect on the
Effective Date hereof, or a reduction in Employee's titles or offices as in
effect on the Effective Date hereof, except in connection with the termination
of his employment for Cause or Disability or as a result of Employee's death, or
by Employee other than for Good Reason;

                   (ii)   a reduction by Company in Employee's Base Salary as in
effect on the Effective Date or as the same may be increased from time to time
during the term of this Agreement;

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                   (iii)  the relocation of Employee to a Company office located
more than one hundred and fifty (150) miles from Tucson, Arizona;

                   (iv)   any material breach by Company of a material term or
provision contained in this Agreement, which breach is not cured within thirty
(30) days following the receipt by the Board of written notice of such breach;
or

                   (v)    a majority of the Board consists of individuals other
than "Incumbent Directors," which term means the members of such Board on the
Effective Date; provided that any individual becoming a director subsequent to
such date whose election or nomination for election was supported (other than in
connection with any actual or threatened proxy contest) by two-thirds of the
directors who then comprised the Incumbent Directors shall be considered to be
an Incumbent Director.

              (e)  Termination by Employee for Other than Good Reason. If
Employee shall desire to terminate his employment hereunder for other than Good
Reason, he shall first give Company not less than ninety (90) days prior written
notice of termination. Upon a termination of Employee's employment with Company
under this Section 6(e), the effective date of termination shall be the date set
forth in employee's resignation notice (assuming such date is in compliance with
the notice provisions of this Section 6(e)) or an earlier date after Company's
receipt of such notice as determined by Company, in its sole discretion, but not
earlier than the date on which Company learned of Employee's decision to
terminate his employment for other than Good Reason.

              (f)  Notice of Termination. Any termination, except for death,
pursuant to this Section 6 shall be communicated by a Notice of Termination. For
purposes of this Agreement, a "Notice of Termination" shall mean a written
notice which shall indicate those specific termination provisions in this
Agreement relied upon and which sets forth in reasonable detail the facts and
circumstances claimed to provide a basis for termination of the Employee's
employment under the provisions so indicated. The Notice of Termination shall
also set forth Employee's employment is terminated and be delivered in
accordance with the terms of this Agreement.

          Notwithstanding anything to the contrary set forth herein, the
provisions of Sections 8 and 9 shall survive the termination of Employee's
employment hereunder for any reason, and shall remain in full force and effect
thereafter.

          7.  Payments Upon Termination.

              (a)  Termination for Cause. In the event Employee's employment
hereunder is terminated for Cause, all of Employee's rights to his Base Salary,
Benefits and Bonus, if any, shall immediately terminate as of the date of such
termination, except that Employee shall be entitled to any earned and unpaid
portion of his Base Salary and accrued Benefits up to the date of termination,
less all deductions or offsets for amounts owed by Employee to Company. Company
shall have no further obligations to Employee under the Agreement.

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              (b)  Termination Due to Death or Disability. In the event
Employee's employment hereunder is terminated due to his death or Disability,
all of Employee's rights to his Base Salary, Benefits and Bonus, if any, shall
immediately terminate as of the date of such termination, except that Employee
(or, in the event that Employee's employment hereunder is terminated due to
Employee's death, Employee's heirs, personal representative or estate) shall be
entitled to any earned and unpaid portion of his Base Salary and accrued
Benefits up to the date of termination less all deductions or offsets for
amounts owed by Employee to Company. Company shall have no further obligations
to Employee under the Agreement.

              (c)  Termination By Company Without Cause or By Employee For Good
Reason. If Company terminates Employee's employment other than for Cause or the
occurrence of Employee's death or Disability, or if Employee terminates his
employment for Good Reason, all of Employee's rights to his Base Salary (so long
as Employee is not in breach of this Agreement) shall continue as severance
payments until, and terminate upon, the twelve (12) month anniversary of the
date of such termination (the "Severance Period"), provided that Employee
executes, and does not revoke, a General Release of all claims relating to his
employment and termination from employment in a form provided by Company.
Employee understands that should he fail or refuse to execute the General
Release provided by Company, or revoke such General Release, he shall not be
entitled to any severance payments under this section. Employee's Base Salary
referred to in this paragraph shall be payable during the Severance Period in
equal periodic installments in accordance with Company's regular payroll
practices then in effect, but shall cease immediately if Employee is in breach
of this Agreement. Company shall have no further obligations to Employee under
the Agreement.

              (d)  Termination By Employee For Other Than Good Reason. In the
event Employee terminates his employment for other than Good Reason, all of
Employee's rights to his Base Salary, Benefits and Bonus, if any, shall
immediately terminate as of the date of termination, except that Employee shall
be entitled to any earned and unpaid portion of his Base Salary and accrued
Benefits up to the date of termination. Company shall have no further
obligations to Employee under the Agreement.

              (e)  Recognition. Employee recognizes and accepts that Company
shall not, in any case, be responsible for any additional amount, severance pay,
termination pay, severance obligation or other damages whatsoever arising from
the termination of Employee's employment, above and beyond those specifically
provided for herein.

          8.  Restrictive Covenants.

              (a)  Non-Competition. During the Term, and for a period of
twenty-four (24) months thereafter, Employee will not, in any capacity
(including, but not limited to, owner, partner, member shareholder, consultant,
advisor, financier, agent, employee, officer, director, manager or otherwise),
directly or indirectly, for his own account or for the benefit of any natural
person, corporation, partnership, trust, estate, joint venture, sole
proprietorship, association, cooperative or other entity ("Person"), establish,
engage in, work for, or be connected with, except as an employee of Company, any
business in competition with the Business of Company (as defined in Section 8(i)
below), if such business competes with the

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Business of Company in any State, county, or municipality where Company or its
Affiliates conduct business, are preparing to conduct business or have conducted
business during the Term.

              (b)  Non-Solicitation/Non-Piracy. During the Term, and for a
period of twenty-four (24) months thereafter, Employee will not, directly or
indirectly, for his own account or for the benefit of any Person or entity:

                   (i) solicit, service, contact, or aid in the solicitation or
servicing of any Person or entity which is or was a customer, prospective
customer, client, prospective client, contractor, subcontractor or supplier of
Company or its Affiliates within three (3) years prior to Employee's termination
("Company Customers/Clients"), for the purpose of (a) selling services or goods
in competition with the Business of Company; (b) inducing Company
Customers/Clients to cancel, transfer or cease doing business in whole or in
part with Company or its Affiliates or (c) inducing Company Customers/Clients to
do business with any Person or business entity in competition with the Business
of Company.

                   (ii) solicit, aid in solicitation of, induce, contact for the
purpose of, encourage or in any way cause any employee of Company or its
Affiliates to leave the employ of Company or its Affiliates, or interfere with
such employee's relationship with Company or its Affiliates.

              (c)  Non-Disclosure. Other than in furtherance of the Business of
Company, in the ordinary course in his capacity as an employee hereunder,
Employee will not, at any time, except with the express prior written consent of
the Board, directly or indirectly, disclose, communicate or divulge to any
Person or entity, or use for the benefit of any Person or entity, any secret,
confidential or proprietary knowledge or information with respect to the conduct
or details of the Business of Company including, but not limited to, customer
and client lists, customer and client accounts and information, prospective
client, customer, contractor and subcontractor lists and information, services,
techniques, methods of operation, pricing, costs, sales, sales strategies and
methods, marketing, marketing strategies and methods, products, product
development, research, know-how, policies, financial information, financial
condition, business strategies and plans and other information of Company or its
Affiliates which is not generally available to the public and which has been
developed or acquired by Company or its Affiliates with considerable effort and
expense. Upon the expiration or termination of Employee's employment under this
Agreement, Employee shall immediately deliver to Company all memoranda, books,
papers, letters, and other data (whether in written form or computer stored),
and all copies of same, which were made by Employee or otherwise came into his
possession or under his control at any time prior to the expiration or
termination of his employment under this Agreement, and which in any way relate
to the Business of Company as conducted or as planned to be conducted by Company
or its Affiliates on the date of the expiration or termination.

              (d)  Intellectual Property. Employee will promptly communicate to
Company, in writing when requested, all software, designs, techniques, concepts,
methods and ideas, other technical information, marketing strategies and other
ideas and creations pertaining to the Business of Company which are conceived or
developed by Employee alone or with others, at any time (during or after
business hours) while Employee is employed by Company or

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its Affiliates. Employee acknowledges that all of those ideas and creations are
inventions and works for hire, and will be Company's exclusive property.
Employee will sign any documents which Company deems necessary to confirm its
ownership of those ideas and creations, and Employee will cooperate with Company
in order to allow Company to take full advantage of those ideas and creations.

              (e)  Non-Disparagement. Employee will not, at any time, publish or
communicate disparaging or derogatory statements or opinions about Company or
its Affiliates, including but not limited to, disparaging or derogatory
statements or opinions about Company's or its Affiliates' management, products
or services, to any third party. It shall not be a breach of this section for
Employee to testify truthfully in any judicial or administrative proceeding or
to make statements or allegations in legal filings that are based on Employee's
reasonable belief and are not made in bad faith.

              (f)  Enforcement. Employee acknowledges that the covenants and
agreements of this Section 8 ("Covenants") herein are of a special and unique
character, which give them peculiar value, the loss of which cannot be
reasonably or adequately compensated for in an action at law. Employee further
acknowledges that any breach or threat of breach by him of any of the Covenants
will result in irreparable injury to Company for which money damages could not
be adequate to compensate Company. Therefore, in the event of any such breach or
threatened breach, Company shall be entitled, in addition to all other rights
and remedies which Company may have at law or in equity, to have an injunction
issued by any competent court enjoining and restraining Employee and/or all
other Persons involved therein from committing a breach or continuing such
breach. The remedies granted to Company in this Agreement are cumulative and are
in addition to remedies otherwise available to Company at law or in equity. The
Covenants contained in this Section 8 are independent of any other provision of
this Agreement, and the existence of any claim or cause of action which Employee
or any such other Person may have against Company shall not constitute a defense
or bar to the enforcement of any of the Covenants. If Company is obliged to
resort to litigation to enforce any of the Covenants which has a fixed term,
then such term shall be extended for a period of time equal to the period during
which a material breach of such Covenant was occurring, beginning on the date of
a final court order (without further right of appeal) holding that such a
material breach occurred, or, if later, the last day of the original fixed term
of such Covenant.

              (g)  Acknowledgements. Employee expressly acknowledges that the
Covenants are a material part of the consideration bargained for by Company,
and, without the agreement of Employee to be bound by the Covenants, Company
would not have agreed to enter into this Agreement. Employee further
acknowledges and agrees that the Business of Company and its services are highly
competitive, and that the Covenants contained in this Section 8 are reasonable
and necessary to protect Company's legitimate business interests. In addition,
Employee acknowledges that in the event his employment with Company terminates,
he will still be able to earn a livelihood without violating this Agreement, and
that the Covenants contained in this Section 8 are material conditions to my
employment and continued employment with Company.

              (h)  Scope. If any portion of any Covenant or its application is
construed to be invalid, illegal or unenforceable, then the remaining portions
and their

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application shall not be affected thereby, and shall be enforceable without
regard thereto. If any of the Covenants is determined to be unenforceable
because of its scope, duration, geographical area or similar factor, then the
court or other trier of fact making such determination shall modify, reduce or
limit such scope, duration, area or other factor, and enforce such Covenant to
the extent it believes is lawful and appropriate.

              (i) Business of Company. The term "Business of Company", as used
herein, shall mean the provision by Company or its Affiliates of social
services, including but not limited to, counseling, client monitoring and
mentoring, substance abuse treatment and counseling, school support services,
case management and foster care services to children, adults and families in
community based settings such as a client's home, school or workplace. The term
shall also mean the provision by Company or its Affiliates of intake, assessment
and referral, case management and network management services to governmental
agencies and provider networks, and any other business in which Company or its
Affiliates were actually engaged or planning to be engaged during the Term.

              (j) Indemnification. Employee shall indemnify, defend and hold
harmless Company in respect of all liabilities, charges, damages, losses,
expenses, fees, and costs of any nature (including reasonable attorney's fees
and costs of litigation) that result from a failure by Employee to fully perform
or comply with any Covenant contained in this Section 8.

          9.  Miscellaneous.

              (a)  Indulgences, Etc. Neither the failure, nor any delay, on the
part of either party to exercise any right, remedy, power or privilege under
this Agreement shall operate as a waiver thereof, nor shall any single or
partial exercise of any right, remedy, power or privilege preclude any other or
further exercise of the same, or of any other right, remedy, power or privilege,
nor shall any waiver of any right, remedy, power or privilege with respect to
any occurrence be construed as a waiver of such right, remedy, power or
privilege with respect to any other occurrence. No waiver shall be effective
unless it is in writing and is signed by the party asserted to have granted such
waiver.

              (b)  Controlling Law; Consent to Arbitration; Service of Process.

                   (i)   This Agreement and all questions relating to its
validity, interpretation, performance and enforcement (including, without
limitation, provisions concerning limitations of actions), shall be governed by
and construed in accordance with the laws of the State of Arizona
(notwithstanding any conflict-of-laws doctrines of such state or other
jurisdiction to the contrary), and without the aid of any canon, custom or rule
of law requiring construction against the draftsman.

                   (ii)  Except to the extent provided for in Section 8 above
(relating to injunctive relief and other equitable remedies), Company and
Employee agree that any claim, dispute or controversy arising under or in
connection with this Agreement, or otherwise in connection with Employee's
employment by Company or termination of his employment (including, without
limitation, any such claim, dispute or controversy arising under any federal,
state or local statute, regulation or ordinance or any of Company's employee
benefit

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plans, policies or programs) shall be resolved solely and exclusively by
binding, confidential, arbitration. The arbitration shall be held in Tucson,
Arizona (or at such other location as shall be mutually agreed by the parties).
The arbitration shall be conducted in accordance with the National Rules for the
Resolution of Employment Disputes (the "Rules") of the American Arbitration
Association ("the AAA") in effect at the time of the arbitration, except that
the arbitrator shall be selected by alternatively striking from a list of five
arbitrators supplied by the AAA. All fees and expenses of the arbitration,
including a transcript if either requests, shall be borne equally by the
parties, however, all costs for the services of the arbitrator shall be borne
solely by Company. Each party is responsible for the fees and expenses of its
own attorneys, experts, witnesses, and preparation and presentation of proofs
and post-hearing briefs (unless the party prevails on a claim for which
attorney's fees are recoverable under law). In rendering a decision, the
arbitrator shall apply all legal principles and standards that would govern if
the dispute were being heard in court. This includes the availability of all
remedies that the parties could obtain in court. In addition, all statutes of
limitation and defenses that would be applicable in court, will apply to the
arbitration proceeding. The decision of the arbitrator shall be set forth in
writing, and be binding and conclusive on all parties. Any action to enforce or
vacate the arbitrator's award shall be governed by the Federal Arbitration Act,
if applicable, and otherwise by applicable state law. If either Company or
Employee improperly pursues any claim, dispute or controversy against the other
in a proceeding other than the arbitration provided for herein, the responding
party shall be entitled to dismissal or injunctive relief regarding such action
and recovery of all costs, losses and attorney's fees related to such action.

                   (iii) Each of the parties hereto hereby consents to process
being served in any suit, action or proceeding of any nature, by the mailing of
a copy thereof by registered or certified first-class mail, postage prepaid,
return receipt requested, to them at their respective addresses set forth in
Section 9(c) hereof. Each of parties hereto hereby irrevocably waives, to the
fullest extent permitted by applicable law, all claims of error by reason of any
such service pursuant to the terms hereof (but does not waive any right to
assert lack of subject matter jurisdiction) and agrees that such service (A)
shall be deemed in every respect effective service of process in any such suit,
action or proceeding and (B) shall, to the fullest extent permitted by
applicable law, be taken and held to be valid personal service.

                   (iv)  Nothing in this Section 9(b) shall affect the right of
any party hereto to serve process in any manner permitted by law or affect the
right of any party to bring proceedings against any other party in the courts of
any jurisdiction or jurisdictions.

              (c)  Notices. All notices, requests, demands and other
communications required or permitted under this Agreement shall be in writing
and shall be deemed to have been duly given, made and received only when
delivered (personally, by courier service such as Federal Express, or by other
messenger) or when deposited in the United States mails, registered or certified
mail, postage prepaid, return receipt requested, addressed as set forth below:

                   (i)   If to Employee:

                         Fletcher Jay McCusker
                         401 N. Mountain Side Place
                         Tucson, AZ  85745

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                   (ii)  If to Company:

                         The Providence Service Corporation
                         620 N. Craycroft
                         Tucson, AZ  85711
                         Attention: Board of Directors

     In addition, notice by mail shall be by air mail if posted outside of the
continental United States.

     Any party may alter the addresses to which communications or copies are to
be sent by giving notice of such change of address in conformity with the
provisions of this Section for the giving of notice.

              (d)  Assignment of Agreement. The rights and obligations of both
parties under this Agreement shall inure to the benefit of and shall be binding
upon their heirs, successors and assigns. Company may assign or otherwise
transfer its rights under this Agreement, including but not limited to all
Covenants contained in Section 8 above, to any successor or affiliated business
or corporation whether by sale of stock, merger, consolidation, sale of assets
or otherwise. This Agreement may not, however, be assigned by Employee to a
third party, nor may Employee delegate his duties under this Agreement.

              (e)  Execution in Counterparts. This Agreement may be executed in
any number of counterparts, including by facsimile, each of which shall be
deemed to be an original as against any party whose signature appears thereon,
and all of which shall together constitute one and the same instrument. This
Agreement shall become binding when one or more counterparts hereof,
individually or taken together, shall bear the signatures of all of the parties
reflected hereon as the signatories.

              (f)  Provisions Separable. The provisions of this Agreement are
independent of and separable from each other, and no provision shall be affected
or rendered invalid or unenforceable by virtue of the fact that for any reason
any other or others of them may be invalid or unenforceable in whole or in part.

              (g)  Entire Agreement. This Agreement contains the entire
understanding among the parties hereto with respect to the subject matter
hereof, and supersedes all prior and contemporaneous agreements and
understandings between the parties, inducements or conditions, express or
implied, oral or written, except as herein contained. The express terms hereof
control and supersede any course of performance and/or usage of the trade
inconsistent with any of the terms hereof. This Agreement may not be modified or
amended other than by an agreement in writing.

              (h)  Section Headings. The Section headings in this Agreement are
for convenience only; they form no part of this Agreement and shall not affect
its interpretation.

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              (i)  Gender, Etc. Words used herein, regardless of the number and
gender specifically used, shall be deemed and construed to include any other
number, singular or plural, and any other gender, masculine, feminine or neuter,
as the context indicates is appropriate.

              (j)  Number of Days. In computing the number of days for purposes
of this Agreement, all days shall be counted, including Saturdays, Sundays and
holidays; provided, however, that if the final day of any time period falls on a
Saturday, Sunday or holiday on which entities which are provincially regulated
are or may elect to be closed, then the final day shall be deemed to be the next
day which is not a Saturday, Sunday or such holiday.

              (k)  Costs, Expenses in the Event of Breach. In the event that
either Employee or Company breaches this Agreement, the non-breaching party
shall be entitled to reimbursement for all costs and expenses associated with
enforcing such non-breaching party's rights and remedies under this Agreement,
including but not limited to legal fees and costs of litigation.

            [The remainder of this page is intentionally left blank]

                                       12

<PAGE>

     IN WITNESS WHEREOF, the parties have executed and delivered this Agreement,
intending to be legally bound hereby, as of the date first above written.

                                                 THE PROVIDENCE SERVICE
                                                 CORPORATION

                                                 By:   /s/  Michael Deitch
                                                    ----------------------------
                                                     Name:  Michael Deitch
                                                     Title: Secretary/Treasurer

                                                 FLETCHER JAY McCUSKER

                                                     /s/  Fletcher Jay McCusker
                                                    ----------------------------

        [Signature Page to Employment Agreement of Fletcher Jay McCusker]

                                       13<PAGE>

                                                                    Exhibit 10.5
                              EMPLOYMENT AGREEMENT
                              --------------------

     THIS EMPLOYMENT AGREEMENT ("Agreement"), is made as of this 31st day of
March, 2003, by and between THE PROVIDENCE SERVICE CORPORATION, a Delaware
corporation, with its corporate headquarters located at 620 N. Craycroft,
Tucson, AZ, its successors and assigns (hereinafter collectively referred to as
"Company"), and WILLIAM BOYD DOVER, an individual residing at 5727 North Paseo
Ventoso, Tucson, AZ 85745 ("Employee").

                                   BACKGROUND

     WHEREAS, Employee is currently employed by Company as President and Chief
Operating Officer; and;

     WHEREAS, Company intends to complete an Initial Public Offering ("IPO") of
stock in Company, and offer Employee the foregoing Agreement contingent upon
successful completion of the IPO;

     WHEREAS, should Company complete the IPO, Company desires to continue to
employ Employee, and Employee desires to continue to be employed by Company, all
upon the terms and conditions set forth in this Agreement.

     NOW, THEREFORE, in consideration of the facts, mutual promises, and
covenants contained herein and intending to be legally bound hereby, the parties
hereto agree as follows:

          1.  Employment. Subject to, and contingent upon, the successful
completion of the IPO, Company hereby employs Employee and Employee hereby
accepts employment by Company, for the period and upon the terms and conditions
set forth in this Agreement, subject to earlier termination pursuant to Section
6 below.

          2.  Office and Duties.

              (a)  During the term of this Agreement, Employee shall serve as
President and Chief Operating Officer of Company, and shall report to the Chief
Executive Officer of Company and be subject to his supervision, control and
direction.

              (b)  In his capacity as President and Chief Operating Officer of
Company, Employee shall have such authority, perform such duties, discharge such
responsibilities and render such services as are customary to, and consistent
with his position, subject to the authority and direction of the Chief Executive
Officer, and shall perform such additional duties and responsibilities as may be
from time to time assigned to him by the Chief Executive Officer.

              (c)  The Employee shall render his services diligently, faithfully
and to the best of his ability, and shall devote all of his working time,
energy, skill and best efforts to the performance of his duties hereunder, in a
manner that will further the business and interests of Company.

<PAGE>

              (d)  During the term of this Agreement, Employee shall not be
engaged in any business activity which, in the reasonable judgment of the Board,
conflicts with Employee's duties hereunder, whether or not such activity is
pursued for pecuniary advantage.

          3.  Term. This Agreement shall be effective for a term commencing on
the date the IPO is successfully completed and ending on the Third anniversary
thereof (the "Expiration Date"), unless sooner terminated as hereinafter
provided or further extended by the mutual written agreement of Company and
Employee (the "Term").

          4.  Compensation.

              (a)  Base Salary. In consideration of the services rendered by
Employee to Company during the Term hereof, Employee shall receive an annual
base salary of One Hundred Sixty-Five Thousand and 00/100 Dollars ($165,000.00)
("Base Salary"), payable in equal periodic installments in accordance with
Company's regular payroll practices in effect from time to time. Employee's Base
Salary shall be reviewed annually by Company's Board of Directors ("Board")
and/or a committee of the Board which has been delegated responsibility for
employee compensation matters (such committee to be referred to herein as the
"Compensation Committee") in accordance with the compensation policies and
guidelines of Company, and may be modified as a result of such review at the
sole discretion of the Board and/or the Compensation Committee.

              (b)  Bonus Plans/Incentive Compensation Programs. In addition to
Base Salary, during the Term, Employee shall be eligible to participate in any
bonus plans or incentive compensation programs, if any, as may be in effect from
time to time, at a level consistent with his position and with Company's then
current policies and practices ("Bonus").

              (c)  Benefits. During the Term, Employee also shall be entitled to
participate in all fringe benefits, if any, as may be in effect from time to
time which are generally available to Company's senior executive officers, and
such other fringe benefits as the Board and/or Compensation Committee shall deem
appropriate, subject to eligibility requirements thereof (collectively, the
"Benefits").

              (d)  Vacation. During the Term, Employee shall be entitled to the
number of paid vacation days in each calendar year as determined by Company from
time to time for its senior executive officers. Vacation days which are not used
during any calendar year may not be accrued or carried-over to the next year,
nor shall Employee be entitled to compensation for unused vacation days.

              (e)  Business Expenses. During the Term, Company shall pay or
reimburse Employee for all reasonable expenses incurred or paid by Employee in
the performance of Employee's duties hereunder, upon timely presentation of
expense statements or vouchers and such other information as Company may
reasonably require and in accordance with the generally applicable policies and
practices of Company.

              (f)  Withholding. All payments made pursuant to this Agreement
shall be subject to such withholding taxes as may be required by any applicable
law.

                                       2

<PAGE>

          5.  Representations of Employee. Employee represents to Company that:
(a) there are no restrictions, agreements or understandings whatsoever to which
Employee is a party that would prevent, or make unlawful, his execution of this
Agreement and his employment hereunder; (b) his execution of this Agreement and
his employment hereunder shall not constitute a breach of any contract,
agreement or understanding, oral or written, to which he is a party, or by which
he is bound; and (c) he is of full capacity, free and able to execute this
Agreement and to enter into this Employment Agreement with Company.

          6.  Termination. This Agreement shall continue until the Expiration
Date, unless terminated earlier by Company or Employee as provided herein, or
further extended by the mutual written agreement of Company and Employee. Unless
otherwise extended by the mutual written agreement of Company and Employee, this
Agreement shall terminate automatically on the Expiration Date, without any
notice, severance pay, termination pay or any severance obligation whatsoever.
If, however, this Agreement is terminated prior to the Expiration Date by
Company or Employee, the provisions contained in Section 7, Payments Upon
Termination, shall apply.

              (a)  Termination by Company for Cause. Company shall have the
right to terminate this Agreement at any time for "Cause". For purposes of this
Agreement, the term "Cause" shall mean the following:

                   (i)   Employee commits fraud or theft against Company or any
of its subsidiaries, affiliates, joint ventures and related organizations,
including any not-for-profit affiliates or not-for-profit joint ventures
(collectively referred to as "Affiliates"), or is indicted, convicted of, or
pleads guilty or nolo contendere to, a felony; or

                   (ii)  In carrying out his duties hereunder, the Employee
engages in conduct that constitutes gross neglect or willful misconduct and that
results, in either case, in material economic harm to Company or its Affiliates;
or

                   (iii) Employee materially breaches any provision of this
Agreement (including but not limited to the restrictive covenants contained in
Paragraph 8 below) or breaches any fiduciary duty or duty of loyalty owed to
Company or its Affiliates; or

                   (iv)  Employee engages in conduct tending to bring Company or
its Affiliates into public disgrace or disrepute; or

                   (v)   Employee repeatedly neglects or refuses to perform
duties or responsibilities as directed by Company or the Board, or violates any
express direction of any lawful rule or regulation established by Company or the
Board which is consistent with the scope of Employee's duties under this
Agreement; or

                   (vi)  Employee commits any acts or omissions resulting in or
intended to result in direct personal gain to the Employee at the expense of
Company or its Affiliates; or

                                       3

<PAGE>

                   (vii) Employee compromises trade secrets or other
confidential and proprietary information of Company or its Affiliates.

          "Cause" shall not include a bona fide disagreement over a corporate
policy, so long as Employee does not willfully violate on a continuing basis
specific written directions from Company or its Board, which directions are
consistent with the provisions of this Agreement. Action or inaction by Employee
shall not be considered "willful" unless done or omitted by him intentionally
and without his reasonable belief that his action or inaction was in the best
interests of Company or its Affiliates, and shall not include failure to act by
reason of total or partial incapacity due to physical or mental illness.

              (b)  Termination by Company upon the Death or Disability of
Employee. Company shall have the right to terminate this Agreement at any time
upon the death or Disability of Employee. The term, "Disability", as used
herein, means any physical or mental illness, disability or incapacity which
prevents Employee from performing the essential functions of his job, with or
without reasonable accommodations, hereunder for a period of not less than one
hundred fifty (150) consecutive days or for an aggregate of one hundred eighty
(180) days during any period of twelve (12) consecutive months. During any
period of Disability, Employee agrees to submit to reasonable medical
examinations upon the reasonable request, and at the expense, of Company.

              (c)  Termination By Company Without Cause. Company shall have the
right to terminate this Agreement at any time without "Cause" and/or without the
occurrence of Employee's death or Disability upon thirty (30) days written
notice to Employee.

              (d)  Termination By Employee For Good Reason. Employee shall have
the right to terminate his employment at any time during the Term of this
Agreement for "Good Reason". For purposes of this Agreement, "Good Reason" shall
mean a material breach by Company of a material term or provision contained in
this Agreement, which breach is not cured within thirty (30) days following the
receipt by Company and its Board of written notice of such breach.

              (e)  Termination by Employee for Other than Good Reason. If
Employee shall desire to terminate his employment hereunder for other than Good
Reason, he shall first give Company not less than thirty (30) days prior written
notice of termination. Upon a termination of Employee's employment with Company
under this Section 6(e), the effective date of termination shall be the date set
forth in employee's resignation notice (assuming such date is in compliance with
the notice provisions of this Section 6(e)) or an earlier date after Company's
receipt of such notice as determined by Company, in its sole discretion, but not
earlier than the date on which Company learned of Employee's decision to
terminate his employment for other than Good Reason.

              (f)  Notice of Termination. Any termination, except for death,
pursuant to this Section 6 shall be communicated by a Notice of Termination. For
purposes of this Agreement, a "Notice of Termination" shall mean a written
notice which shall indicate those specific termination provisions in this
Agreement relied upon and which sets forth in reasonable detail the facts and
circumstances claimed to provide a basis for termination of the Employee's

                                       4

<PAGE>

employment under the provisions so indicated. The Notice of Termination shall
also set forth Employee's employment is terminated and be delivered in
accordance with the terms of this Agreement.

          Notwithstanding anything to the contrary set forth herein, the
provisions of Sections 8 and 9 shall survive the termination of Employee's
employment hereunder for any reason, and shall remain in full force and effect
thereafter.

          7.  Payments Upon Termination.

              (a)  Termination for Cause. In the event Employee's employment
hereunder is terminated for Cause, all of Employee's rights to his Base Salary,
Benefits and Bonus, if any, shall immediately terminate as of the date of such
termination, except that Employee shall be entitled to any earned and unpaid
portion of his Base Salary and accrued Benefits up to the date of termination,
less all deductions or offsets for amounts owed by Employee to Company. Company
shall have no further obligations to Employee under the Agreement.

              (b)  Termination Due to Death or Disability. In the event
Employee's employment hereunder is terminated due to his death or Disability,
all of Employee's rights to his Base Salary, Benefits and Bonus, if any, shall
immediately terminate as of the date of such termination, except that Employee
(or, in the event that Employee's employment hereunder is terminated due to
Employee's death, Employee's heirs, personal representative or estate) shall be
entitled to any earned and unpaid portion of his Base Salary and accrued
Benefits up to the date of termination less all deductions or offsets for
amounts owed by Employee to Company. Company shall have no further obligations
to Employee under the Agreement.

              (c)  Termination By Company Without Cause or By Employee For Good
Reason. If Company terminates Employee's employment other than for Cause or the
occurrence of Employee's death or Disability, or if Employee terminates his
employment for Good Reason, all of Employee's rights to his Base Salary (so long
as Employee is not in breach of this Agreement) shall continue as severance
payments until, and terminate upon the twelve (12) month anniversary of the date
of such termination (the "Severance Period"), provided that Employee executes,
and does not revoke, a General Release of all claims relating to his employment
and termination from employment in a form provided by Company. Employee
understands that should he fail or refuse to execute the General Release
provided by Company, or revoke such General Release, he shall not be entitled to
any severance payments under this section. Employee's Base Salary referred to in
this paragraph shall be payable during the Severance Period in equal periodic
installments in accordance with Company's regular payroll practices then in
effect, but shall cease immediately if Employee is in breach of this Agreement.
Company shall have no further obligations to Employee under the Agreement.

              (d)  Termination By Employee For Other Than Good Reason. In the
event Employee terminates his employment for other than Good Reason, all of
Employee's rights to his Base Salary, Benefits and Bonus, if any, shall
immediately terminate as of the date of termination, except that Employee shall
be entitled to any earned and unpaid portion of his

                                       5

<PAGE>

Base Salary and accrued Benefits up to the date of termination. Company shall
have no further obligations to Employee under the Agreement.

              (e)  Recognition. Employee recognizes and accepts that Company
shall not, in any case, be responsible for any additional amount, severance pay,
termination pay, severance obligation or other damages whatsoever arising from
the termination of Employee's employment, above and beyond those specifically
provided for herein.

          8.  Restrictive Covenants.

              (a)  Non-Competition. During the Term, and for a period of
Eighteen (18) months thereafter, Employee will not, in any capacity (including,
but not limited to, owner, partner, member shareholder, consultant, advisor,
financier, agent, employee, officer, director, manager or otherwise), directly
or indirectly, for his own account or for the benefit of any natural person,
corporation, partnership, trust, estate, joint venture, sole proprietorship,
association, cooperative or other entity ("Person"), establish, engage in, work
for, or be connected with, except as an employee of Company, any business in
competition with the Business of Company (as defined in Section 8(i) below), if
such business competes with the Business of Company in any State, county, or
municipality where Company or its Affiliates conduct business, are preparing to
conduct business or have conducted business during the Term.

              (b)  Non-Solicitation/Non-Piracy. During the Term, and for a
period of twenty-four (24) months thereafter, Employee will not, directly or
indirectly, for his own account or for the benefit of any Person or entity:

                   (i)   solicit, service, contact, or aid in the solicitation
or servicing of any Person or entity which is or was a customer, prospective
customer, client, prospective client, contractor, subcontractor or supplier of
Company or its Affiliates within three (3) years prior to Employee's termination
("Company Customers/Clients"), for the purpose of (a) selling services or goods
in competition with the Business of Company; (b) inducing Company
Customers/Clients to cancel, transfer or cease doing business in whole or in
part with Company or its Affiliates or (c) inducing Company Customers/Clients to
do business with any Person or business entity in competition with the Business
of Company.

                   (ii)  solicit, aid in solicitation of, induce, contact for
the purpose of, encourage or in any way cause any employee of Company or its
Affiliates to leave the employ of Company or its Affiliates, or interfere with
such employee's relationship with Company or its Affiliates.

              (c) Non-Disclosure. Other than in furtherance of the Business of
Company, in the ordinary course in his capacity as an employee hereunder,
Employee will not, at any time after the date hereof, except with the express
prior written consent of the Board, directly or indirectly, disclose,
communicate or divulge to any Person or entity, or use for the benefit of any
Person or entity, any secret, confidential or proprietary knowledge or
information with respect to the conduct or details of the Business of Company
including, but not limited to, customer and client lists, customer and client
accounts and information, prospective client, customer, contractor and
subcontractor lists and information, services, techniques, methods of

                                       6

<PAGE>

operation, pricing, costs, sales, sales strategies and methods, marketing,
marketing strategies and methods, products, product development, research,
know-how, policies, financial information, financial condition, business
strategies and plans and other information of Company or its Affiliates which is
not generally available to the public and which has been developed or acquired
by Company or its Affiliates with considerable effort and expense. Upon the
expiration or termination of Employee's employment under this Agreement,
Employee shall immediately deliver to Company all memoranda, books, papers,
letters, and other data (whether in written form or computer stored), and all
copies of same, which were made by Employee or otherwise came into his
possession or under his control at any time prior to the expiration or
termination of his employment under this Agreement, and which in any way relate
to the Business of Company as conducted or as planned to be conducted by Company
or its Affiliates on the date of the expiration or termination.

              (d)  Intellectual Property. Employee will promptly communicate to
Company, in writing when requested, all software, designs, techniques, concepts,
methods and ideas, other technical information, marketing strategies and other
ideas and creations pertaining to the Business of Company which are conceived or
developed by Employee alone or with others, at any time (during or after
business hours) while Employee is employed by Company or its Affiliates.
Employee acknowledges that all of those ideas and creations are inventions and
works for hire, and will be Company's exclusive property. Employee will sign any
documents which Company deems necessary to confirm its ownership of those ideas
and creations, and Employee will cooperate with Company in order to allow
Company to take full advantage of those ideas and creations.

              (e)  Non-Disparagement. Employee will not, at any time, publish or
communicate disparaging or derogatory statements or opinions about Company or
its Affiliates, including but not limited to, disparaging or derogatory
statements or opinions about Company's or its Affiliates' management, products
or services, to any third party. It shall not be a breach of this section for
Employee to testify truthfully in any judicial or administrative proceeding or
to make statements or allegations in legal filings that are based on Employee's
reasonable belief and are not made in bad faith.

              (f)  Enforcement. Employee acknowledges that the covenants and
agreements of this Section 8 ("Covenants") herein are of a special and unique
character, which give them peculiar value, the loss of which cannot be
reasonably or adequately compensated for in an action at law. Employee further
acknowledges that any breach or threat of breach by him of any of the Covenants
will result in irreparable injury to Company for which money damages could not
be adequate to compensate Company. Therefore, in the event of any such breach or
threatened breach, Company shall be entitled, in addition to all other rights
and remedies which Company may have at law or in equity, to have an injunction
issued by any competent court enjoining and restraining Employee and/or all
other Persons involved therein from committing a breach or continuing such
breach. The remedies granted to Company in this Agreement are cumulative and are
in addition to remedies otherwise available to Company at law or in equity. The
Covenants contained in this Section 8 are independent of any other provision of
this Agreement, and the existence of any claim or cause of action which Employee
or any such other Person may have against Company shall not constitute a defense
or bar to the enforcement of any of the Covenants. If Company is obliged to
resort to litigation to enforce any of the Covenants

                                       7

<PAGE>

which has a fixed term, then such term shall be extended for a period of time
equal to the period during which a material breach of such Covenant was
occurring, beginning on the date of a final court order (without further right
of appeal) holding that such a material breach occurred, or, if later, the last
day of the original fixed term of such Covenant.

              (g)  Acknowledgements. Employee expressly acknowledges that the
Covenants are a material part of the consideration bargained for by Company,
and, without the agreement of Employee to be bound by the Covenants, Company
would not have agreed to enter into this Agreement. Employee further
acknowledges and agrees that the Business of Company and its services are highly
competitive, and that the Covenants contained in this Section 8 are reasonable
and necessary to protect Company's legitimate business interests. In addition,
Employee acknowledges that in the event his employment with Company terminates,
he will still be able to earn a livelihood without violating this Agreement, and
that the Covenants contained in this Section 8 are material conditions to my
employment and continued employment with Company.

              (h)  Scope. If any portion of any Covenant or its application is
construed to be invalid, illegal or unenforceable, then the remaining portions
and their application shall not be affected thereby, and shall be enforceable
without regard thereto. If any of the Covenants is determined to be
unenforceable because of its scope, duration, geographical area or similar
factor, then the court or other trier of fact making such determination shall
modify, reduce or limit such scope, duration, area or other factor, and enforce
such Covenant to the extent it believes is lawful and appropriate.

              (i)  Business of Company. The term, "Business of Company", as used
herein, shall mean the provision by Company or its Affiliates of social
services, including but not limited to, counseling, client monitoring and
mentoring, substance abuse treatment and counseling, school support services,
case management and foster care services to children, adults and families in
community based settings such as a client's home, school or workplace. The term
shall also mean the provision by Company or its Affiliates of intake, assessment
and referral, case management and network management services to governmental
agencies and provider networks, and any other business in which Company or its
Affiliates were actually engaged or planning to be engaged during the Term.

              (j)  Indemnification. Employee shall indemnify, defend and hold
harmless Company in respect of all liabilities, charges, damages, losses,
expenses, fees, and costs of any nature (including reasonable attorney's fees
and costs of litigation) that result from a failure by Employee to fully perform
or comply with any Covenants contained in this Section 8.

          9.  Miscellaneous.

              (a)  Indulgences, Etc. Neither the failure, nor any delay, on the
part of either party to exercise any right, remedy, power or privilege under
this Agreement shall operate as a waiver thereof, nor shall any single or
partial exercise of any right, remedy, power or privilege preclude any other or
further exercise of the same, or of any other right, remedy, power or privilege,
nor shall any waiver of any right, remedy, power or privilege with respect to
any occurrence be construed as a waiver of such right, remedy, power or
privilege with respect to any

                                       8

<PAGE>

other occurrence. No waiver shall be effective unless it is in writing and is
signed by the party asserted to have granted such waiver.

              (b)  Controlling Law; Consent to Arbitration; Service of Process.

                   (i)   This Agreement and all questions relating to its
validity, interpretation, performance and enforcement (including, without
limitation, provisions concerning limitations of actions), shall be governed by
and construed in accordance with the laws of the State of Arizona
(notwithstanding any conflict-of-laws doctrines of such state or other
jurisdiction to the contrary), and without the aid of any canon, custom or rule
of law requiring construction against the draftsman.

                   (ii)  Except to the extent provided for in Section 8 above
(relating to injunctive relief and other equitable remedies), Company and
Employee agree that any claim, dispute or controversy arising under or in
connection with this Agreement, or otherwise in connection with Employee's
employment by Company or termination of his employment (including, without
limitation, any such claim, dispute or controversy arising under any federal,
state or local statute, regulation or ordinance or any of Company's employee
benefit plans, policies or programs) shall be resolved solely and exclusively by
binding, confidential, arbitration. The arbitration shall be held in Tucson,
Arizona (or at such other location as shall be mutually agreed by the parties).
The arbitration shall be conducted in accordance with the National Rules for the
Resolution of Employment Disputes (the "Rules") of the American Arbitration
Association ("the AAA") in effect at the time of the arbitration, except that
the arbitrator shall be selected by alternatively striking from a list of five
arbitrators supplied by the AAA. All fees and expenses of the arbitration,
including a transcript if either requests, shall be borne equally by the
parties, however, all costs for the services of the arbitrator shall be borne
solely by Company. Each party is responsible for the fees and expenses of its
own attorneys, experts, witnesses, and preparation and presentation of proofs
and post-hearing briefs (unless the party prevails on a claim for which
attorney's fees are recoverable under law). In rendering a decision, the
arbitrator shall apply all legal principles and standards that would govern if
the dispute were being heard in Court. This includes the availability of all
remedies that the parties could obtain in Court. In addition, all statutes of
limitation and defenses that would be applicable in Court, will apply to the
arbitration proceeding. The decision of the arbitrator shall be set forth in
writing, and be binding and conclusive on all parties. Any action to enforce or
vacate the arbitrator's award shall be governed by the Federal Arbitration Act,
if applicable, and otherwise by applicable state law. If either Company or
Employee improperly pursues any claim, dispute or controversy against the other
in a proceeding other than the arbitration provided for herein, the responding
party shall be entitled to dismissal or injunctive relief regarding such action
and recovery of all costs, losses and attorney's fees related to such action.

                   (iii) Each of the parties hereto hereby consents to process
being served in any suit, action or proceeding of any nature, by the mailing of
a copy thereof by registered or certified first-class mail, postage prepaid,
return receipt requested, to them at their respective addresses set forth in
Section 9(c) hereof. Each of parties hereto hereby irrevocably waives, to the
fullest extent permitted by applicable law, all claims of error by reason of any
such service pursuant to the terms hereof (but does not waive any right to
assert lack of subject matter jurisdiction) and agrees that such service (A)
shall be deemed in every respect effective service

                                       9

<PAGE>

of process in any such suit, action or proceeding and (B) shall, to the fullest
extent permitted by applicable law, be taken and held to be valid personal
service.

                   (iv)  Nothing in this Section 9(b) shall affect the right of
any party hereto to serve process in any manner permitted by law or affect the
right of any party to bring proceedings against any other party in the courts of
any jurisdiction or jurisdictions.

              (c)  Notices. All notices, requests, demands and other
communications required or permitted under this Agreement shall be in writing
and shall be deemed to have been duly given, made and received only when
delivered (personally, by courier service such as Federal Express, or by other
messenger) or when deposited in the United States mails, registered or certified
mail, postage prepaid, return receipt requested, addressed as set forth below:

                   (i)   If to Employee:

                         William Boyd Dover
                         5727 North Paseo Ventoso,
                         Tucson, AZ  85745

                   (ii)  If to Company:

                         The Providence Service Corporation
                         620 N. Craycroft
                         Tucson, AZ  85711
                         Attention: Board of Directors

     In addition, notice by mail shall be by air mail if posted outside of the
continental United States.

     Any party may alter the addresses to which communications or copies are to
be sent by giving notice of such change of address in conformity with the
provisions of this Section for the giving of notice.

              (d)  Assignment of Agreement. The rights and obligations of both
parties under this Agreement shall inure to the benefit of and shall be binding
upon their heirs, successors and assigns. Company may assign or otherwise
transfer its rights under this Agreement, including but not limited to all
Covenants contained in Section 8 above, to any successor or affiliated business
or corporation whether by sale of stock, merger, consolidation, sale of assets
or otherwise. This Agreement may not, however, be assigned by Employee to a
third party, nor may Employee delegate his duties under this Agreement.

              (e)  Execution in Counterparts. This Agreement may be executed in
any number of counterparts, including by facsimile, each of which shall be
deemed to be an original as against any party whose signature appears thereon,
and all of which shall together constitute one and the same instrument. This
Agreement shall become binding when one or more counterparts hereof,
individually or taken together, shall bear the signatures of all of the parties
reflected hereon as the signatories.

                                       10

<PAGE>

              (f)  Provisions Separable. The provisions of this Agreement are
independent of and separable from each other, and no provision shall be affected
or rendered invalid or unenforceable by virtue of the fact that for any reason
any other or others of them may be invalid or unenforceable in whole or in part.

              (g)  Entire Agreement. This Agreement contains the entire
understanding among the parties hereto with respect to the subject matter
hereof, and supersedes all prior and contemporaneous agreements and
understandings between the parties, inducements or conditions, express or
implied, oral or written, except as herein contained. The express terms hereof
control and supersede any course of performance and/or usage of the trade
inconsistent with any of the terms hereof. This Agreement may not be modified or
amended other than by an agreement in writing.

              (h)  Section Headings. The Section headings in this Agreement are
for convenience only; they form no part of this Agreement and shall not affect
its interpretation.

              (i)  Gender, Etc. Words used herein, regardless of the number and
gender specifically used, shall be deemed and construed to include any other
number, singular or plural, and any other gender, masculine, feminine or neuter,
as the context indicates is appropriate.

              (j)  Number of Days. In computing the number of days for purposes
of this Agreement, all days shall be counted, including Saturdays, Sundays and
holidays; provided, however, that if the final day of any time period falls on a
Saturday, Sunday or holiday on which entities which are provincially regulated
are or may elect to be closed, then the final day shall be deemed to be the next
day which is not a Saturday, Sunday or such holiday.

              (k)  Costs, Expenses in the Event of Breach. In the event that
either Employee or Company breaches this Agreement, the non-breaching party
shall be entitled to reimbursement for all costs and expenses associated with
enforcing such non-breaching party's rights and remedies under this Agreement,
including but not limited to legal fees and costs of litigation.

            [The remainder of this page is intentionally left blank]

                                       11

<PAGE>

          IN WITNESS WHEREOF, the parties have executed and delivered this
Agreement, intending to be legally bound hereby, as of the date first above
written.

                                              THE PROVIDENCE SERVICE
                                              CORPORATION

                                              By: /s/  Fletcher Jay McCusker
                                                 ----------------------------
                                              Name:  Fletcher Jay McCusker
                                              Title: Chief Executive Officer

                                              WILLIAM BOYD DOVER

                                                   /s/  William Boyd Dover
                                                 ----------------------------

         [Signature Page to Employment Agreement of William Boyd Dover]

                                       12

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