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Ike's Newsletter June 21, 2024

Important Discussion about PLAs
Although space is limited, it's imperative for our members to consider projects involving PLAs in their future work. With some construction sectors slowing down, you need to be prepared to bid on public jobs with PLAs. We're holding a confidential discussion on the ins and outs of such jobs. The team at Grunely will lead this discussion, but the most important questions will come from you. You can ask questions yourself or submit them anonymously ahead of time. Click here to learn more and to register.

What are Independent Contractors?
If you are using, or plan to use independent contractors, you should review this article from CLA, the accounting firm. They recommend you evaluate current independent contractors against the new rule to determine classification. ASAMW wants to make sure its members are protected from prosecution and fines, but you have to make your own decision about what is best for your company. There has been a 57 percent surge in the use of independent workers in the US according to MBO Partners. I am sure a lot of that increase is in construction. We learned this week that two companies that are part of ASAMW and three labor providers are being sued by this same office, the DC Office of the Attorney General for wage violations. Click here to read OAG’s press release. 

Are Your Subs Using Legitimate Workers?
To clarify the issue of the use of subcontractors in projects in DC, we received the following explanation from an attorney for DC’s Office of the Attorney General:

The question of construction worker classification is governed by D.C.’s Workplace Fraud Act. That Act applies what is known as the ABC test. The ABC test usually means that construction workers are required to be W-2 employees.  While construction companies may of course subcontract work, workers of the subcontractor should ordinarily be W-2 employees of the subcontractor (or of the sub-subcontractor, etc.). Penalties for misclassification include penalties of $1000-5000 per misclassified worker, and $500 in statutory damages for misclassification that goes to the worker. There is joint and several liability for upstream contractors.

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Ike's Newsletter June 7, 2024

Prevent Contract Errors
This article from JD Supra lists some valuable tips for preparing for a big project, but could be used in all projects. They recommend:

  • Know the entire contract – the boilerplate is not the complete contract.
  • Be sure of other documents that make up the contract – drawings, specifications, etc. 
  • “Which claims are included?” – court, arbitration, etc. Check to see what you have to cover.

Charging Fines for Safety Violations?
OHSA has multiple sections that address employee discipline, which can be confusing to some. Ned Fitter, Safety Director at Telligent Masonry said, “You can discipline an employee for a safety infraction if you have a disciplinary policy in place, along with clearly stated policies and procedures that the employee has been trained on. If you receive an OSHA citation and then discipline an employee for it, this action is considered retaliation. I would not use the word citation when disciplining employees for safety infractions. I have seen larger general contractors fine subcontractors for clearly defined safety violations such as fall protection, excavation, or electrical issues.”

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Ike's Newsletter May 24, 2024

“If You Paint it You Bought it”

Have you heard that phrase in job site meetings? Think about it…this puts the painter in the position of having to make sure your work is done properly before he/she begins. This is often discussed when we meet with our GC Partners to explain our expectations. 

Similar issues facing finishing trades, as well as general scheduling challenges, will be discussed at the upcoming ASAMW event on October 1, 2024, Building Success Together: A Summit for General Contractors & Subcontractors, at the Bethesda North Marriott. NOTE: THIS IS A DATE CHANGE. What are your thoughts?  We expect to see all the GC Partners as well as members who wish to discuss strategies to accomplish fairness. Click here for more information and to register. 

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Ike's Newsletter May 10, 2024

Up Front Payment for YOUR Projects? 

Tutor Perini is getting upfront payments for billion-dollar projects.  Is this a trend that could flow down to subcontractors?  This Construction Dive article quotes CEO Ron Tutor saying, “We demand and get mobilization payments…8% to 10% upfront…the day we set foot on the job.”  “We tell them, we don’t finance our work, they do.” 

Protect your Company When an Employee Leaves

A recent FTC ruling that would ban non-compete clauses has not taken effect and there are numerous lawsuits fighting it.  If this becomes effective in August, you will have to determine how to address your employees who decide to go into business for themselves.  How will you protect your company?  This article by Lerch Early and this one, by Smith Currie, offer more explanation.  

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Ike's Newsletter April 26, 2024

Change Order Payment

Washington state now requires contractors on both public and private construction projects to issue change orders within 30 days of completing additional work, with interest penalties and potential attorney fees for delays. This speeds up payment for subcontractors and suppliers, who are now included in the law's protections.  Here is an article that explains this new law in greater detail. 

Work Picture

  • Data Center – if you are willing to travel to the Richmond area, DPR is starting a $240 million project to be completed in 2025.  The developer is Chirisa, a Dublin-based company. Here is more information from Construction Dive.
  • Mixed-Use in Bowie – The Baltimore Sun reports there is a $1.3 Billion job called the South Lake Marketplace in Bowie, anchored by a Giant. One must be a subscriber to read the article here.

Prepare for Industry Event to Address Scheduling and Finishing Trades

The ASAMW Board has been discussing the major issues facing them so that we can bring the most valuable discussions in front of our construction partners that will positively impact your projects. They agree that scheduling is an issue that perplexes even the best companies. What we can do to improve scheduling for all the parties will be discussed on Sept. 24th at the Bethesda North Marriott. Additionally, Finishing Contractors are particularly impacted by scheduling changes at the end of the project for which they do not get compensated.  What can we do?  Let’s get together to discuss strategies to accomplish fairness. Click here for more information and to register. 

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Ike's Newsletter April 12, 2024

What is an Independent Contractor?

If you think you have someone on your projects who is an independent contractor, then you could be liable for back pay and penalties. The article provided by ASAMW member CBM gives some good guidance on what to look for and protect yourself from any surprises.

It is highly likely that those you are calling independent contractors are immigrants. Comprehensive Immigration reform is not in the cards anytime soon, so employers will have to find a way to deal with the predominance of immigrant workers in construction. One study reports one in five people who are part of the essential workforce are immigrants. It is higher than that in construction in the DMV. Your board is wrestling with this issue. Your ideas are welcome.

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