Thoughts on construction law from Christopher G. Hill, Virginia construction lawyer, LEED AP, mediator, and member of the Virginia Legal Elite in Construction Law

How Do You Get to the Five Year Mark? Some Practical Advice

sls-logo-header1For this week’s Guest Post Friday here at Construction Law Musings, we would like to welcome back (again) Sean Lintow Sr. of SLS Construction & Building Solutions. Sean has over 20 years working directly in the trenches in the construction arena. Since moving to Illinois, the focus of his business has shifted to helping builders, trade professionals& even code officials not only understand and meet the latest energy codes but how to improve their methods to accomplish it better and more affordably.

Currently he is RESNET Rater, AEE CEA (Certified Energy Auditor), ENERGY STAR partner & verifier, EPA Indoor airPLUS verifier, Level 2 Infrared Thermographer, Volunteer Energy Rater for Habitat for Humanity, and Builders Challenge Partner & Verifier. You may also want to check out his great resources on The HTRC (Homeowners & Trades Resource Center).

I would like to thank Chris for inviting me back for my 6th musing on this great site. I would also like to give him a Belated Happy Birthday for reaching 5 years since going solo. Reaching five years is a big milestone for many businesses as most new ventures (I think it is 85% or maybe even 90%) fail during that time. Therefore, a big congrats to you Chris & here is to another five plus years.

For the most part the blame game for failure comes down to; wrong product offerings (market to saturated, not interested in, etc…), their ability to market, or poor business skills (not charging enough, realizing what they are spending, etc…) as the main point of failures. There is another group though that never seems to get much press and that is the ones that seemingly are blindsided by the dreaded “ignorance of the law” is no excuse… Not only does this effect many large companies but also many solo operations which is where I do want to focus today, especially on 4 “lesser” known issues.

Don’t wear too many hats:

For most sole proprietors with or without employees the biggest challenge is how much one must do / aka wearing so many hats. As many of my colleagues and myself point out on forums when people ask about starting their own company is talk to a lawyer – not only to review your contract but to make sure you have taken care or thought about other items (should I be an LLC or setup as a corporation.) One item that has rocked a few companies is the need to make sure that your customers are given a 3-day right of rescission for any contract not signed in your office. It can come back and bite you up to 5 years later.

OSHA can affect you:

For many years, OSHA has not been that much of a concern on residential projects, as they seemed content to stick with commercial unless something really bad happened. That has changed dramatically over the last few years and has just gotten more interesting as they have jumped into “confined spaces” which includes attics and crawl spaces.

Ahh but I have no employees so OSHA doesn’t affect me, right??? As pointed out in the piece linked above there are times that does not fly, like: you are using sub-contractors, you hire a temp, others are working on the site, you own the building, or the GC over the project requires everyone to follow OSHA’s guidelines. It would be wise to create a Safety Manual (especially as I am sure you hope to grow) so that if required per a contract (or OSHA stops by) you have it readily handy. Just remember if you have employees (or are using temps); your employees need to know not only that it exists but can grab it.

Employee or contractor?

For years, it seemed like most states were content to let the Feds handle some items like illegal immigrants or employee classification but that has dramatically changed. Chris wrote about how VIOSH was jumping into the mix and I even wrote how Illinois was changing the game (which includes mandatory reporting) in another piece. So how do you keep up – well besides talking to your lawyer I would recommend starting with this PDF from the NAHB, which covers all the states.

Why does that matter – well in many cases (speaking as a GC) you have to hire other companies and you want to make sure that it doesn’t come back to bite you, especially if the “contractors” might end up being classified as contractors. On the flip side, you also want to make sure to protect contractors you may work for by making sure they can prove you are an actual independent contractor.

Stay up on current code changes:

I know it shouldn’t surprise me, but I seemingly here it all the time – the code inspector said I am required to do a duct test & I haven’t ever had one before… So far, 38 states have a mandatory “state-wide” code, which generally includes language like “If a unit of local government does not regulate energy efficient building standards, any construction, renovation or addition to buildings or structures is still subject to the provisions contained in the Act.”

Try not to get surprised as it can be costly – one contractor I know spent almost $2,000 with the house essentially sitting finished, just to get the ductwork brought up to code (4% total leakage here.) That does not include how much time was taken up which could have easily have been avoided if dealt with up front. One trick I used for the “regular” codes was simply building to the newest codes even if a municipality hadn’t adopted them yet – it sure beet playing the oh, you’re on the 2003 or is that the 2006 code that also requires…

How do I do this?

Hopefully you have a good lawyer that can help keep you updated on many items and out of trouble. With that I also recommend finding a few industry specific magazines that focus on issues related specifically to your industry. I would also recommend joining your local NARI, NAHB or similar chapter/organization to also help keep you informed. I would also recommend finding a few good blogs to help keep you informed like this one – granted while a lot is written regarding Virginia law, many other states are similar or it just might spark that question, I wonder what the requirements are here…

As always, Sean and I welcome your comments below. Please subscribe to keep up with this and other Guest Post Fridays at Construction Law Musings.

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