Times have changed drastically, now an employee can “walk off” with much more without anyone noticing.  Thumb drives can be great to transfer needed information, but can also be tools for employees copying their contacts plus several gigabytes worth of confidential information.  Right now, I have an 8 gigabyte flash drive sitting in my desk which anymore is considered small.

Hopefully, a person has enough honesty and integrity not to steal the confidential information, but it will still occasionally happen.  Unfortunately, the targeted data such as historical cost is information estimators need to perform their normal job responsibilities.

Even though technology is supposed to make everyone’s jobs easier, it can also create additional headaches.

Lying does nothing but demoralizes the employees and will not encourage them to increase their productivity.  In general, people want to do a good job and take pride in the work they do.  Telling them how the job is progressing is another way of saying they are doing a good job which can actually make them work harder.  A person will be more productive with a positive attitude compared to being frustrated and negative.

If trust is an issue with the craft, then there are much bigger problems to deal with especially on remodel projects.  The client’s image of the contractor is based on the crews they see all day and every day, not the project manager or anyone else that may visit the site every few days or weeks.  So how can a contractor trust the craft to represent the company but not trust the craft enough to be honest to them?

Unfortunately, not every project is a winner, but after the trust is established between the craft and management, telling the craft the project is behind will carry much more weight.  It’s really no different than the old story of the boy crying wolf.

If a person is going to milk the job, they will milk the job no matter what.  If a contractor can’t trust an employee, then maybe they need to reconsider that employee’s employment.

Even if the thefts results in an insurance claim, there is still a deductible for the claim.  If your company views losses due to theft as an overhead cost, this will raise your overhead cost during the bidding process.  No matter how you look at it, thieves have a direct impact on the cost of a project.

There are several different types of thieves from the obvious person that sneaking onto the site and helping themselves to the employee or other trade on the project “borrowing” tools or material.  Another form of stealing is an employee padding their time cards.

One way or another an estimator has to increase their bid to compensate for the loss whether it’s decreasing the productivity rate (compensate for time card padding) or increasing line items in the estimate such as small tools allowance, overhead, or material costs.   In order to help keep these additional costs down, everyone at your company needs to take an active role in loss prevention.

The correct approach to signing a legally binding contract is to not only read the document but more importantly, comprehend it.  It’s very easy to breeze over some fancy legal jargon which at first glance seems completely harmless.  But a single word or phrase can make the contract extremely unfair for you or your company and could end up costing your company severely in the long run.

I was just recently reading a confidentiality agreement and came across a word that I did not fully understand.  After doing a bit of research, that one word allowed a third party to bring a lawsuit against our company (this term was not agreed to).

So, what do you do if you don’t understand something?  I would suggest doing a little research by either talking to your coworkers/superiors and/or researching the term on the internet (use common sense and caution when using the internet as a resource).  A better alternative if you can is having an attorney review the document and explain to you the meaning and possible ramifications of the contract.  No matter what, you should always understand the terms and conditions of the contract prior to signing the document.

I worked with a construction salesman several years ago that would stop in at a potential client once every few months trying to get a foot in the door.  After about two years, the potential client had an issue that needed an immediate repair.  Our competition that had a lock on the work told them it would be several days before they could send someone so they decided to give us a try.  We sent a service tech the same day.  That quick response time led the way to us being able to do so many construction projects that I lost count.  The best part was that the client’s main concern was quality and time, not price.  The company we took the business away from lost out on millions of dollars’ worth of very profitable work.

The following link provides more information about the requirements and how it affects your business:

https://www.nlrb.gov/news/board-issues-final-rule-require-posting-nlra-rights

Information on how to download the poster and how to receive free copies can be found at the link below:

https://www.nlrb.gov/poster

What is your opinion on the matter?

A little background on the project; it was a four month project with an average of about ten field guys and was not located near much of anything.  After a couple of weeks, the project manager realized the guys would all run to the gas station for a pop for both the morning and afternoon breaks.  This quick run resulted in a 30 minute break twice daily instead of two 15 minute breaks.  By doing the math, 5 hours a day was spent on the pop run over what was supposed to be taken.  The project manager came up with an idea to supply the guys with the pop.  The foreman would load up the coolers on his way to work with pop and ice for all the guys to drink on the breaks which cost about $10/day but we gained 5 hours of productivity.

Another result of this nice gesture was the efficiency of our craft seemed to improve.  They were happy about the small perk and actually started to work harder.  The benefits gained in increased productivity more than compensated for the relative low cost of the drinks.  Sometimes even giving out some sincere compliments can improve the attitudes and morale of the workers hence increasing their productivity.  It’s definitely a “win-win” situation.

I recently learned about a union contractor that was able to negotiate a deal with the union to cut the hourly rate of the craft by 20% on a large project.  This means with overtime figured in the craft will need to work roughly 47 hours to receive a 40 hour paycheck.  I was actually told about this deal by one of the union craft members!  Not only was he willing to accept the deal, he was excited about the opportunity to have a steady paycheck with the potential of overtime pay (at the 20% reduced rate of course).

 It’s amazing how times have changed and how contractors have had to adjust their way of thinking in order to survive.  I believe this type of situation will become more prevalent until the economy turns around.   Unfortunately, the workers in the field have to take a pay cut while the cost of living continues to increase.  But on the other hand, a pay cut is still better than waiting for the unemployment check to arrive.

The insurance company of the neighbor tracked down a potential contractor and he made a site visit to see the extent of the repairs required.  Up to this point, everything seemed great and the contractor seemed very knowledgeable about what needed to be done.  But then the first red flag was raised when the contractor delivered the proposal to my parents.  The proposal had the contractor’s name and company name (which wasn’t legible) and a cell phone number.  What it lacked was a physical address for the company which my folks thought was odd. 

The next red flag occurred when the contractor was requiring almost 60% down payment to “pay for” materials.  The contractor knew this was an insurance claim because the insurance company was the one who contacted him so the chances of being stiffed for the work are slim.  And since this was an insurance claim, my folks contacted the insurance company – who said they would be willing to pay this down payment or even meet the contractor at the lumber yard and pay for all the materials purchased if needed.  I think the insurance company was just trying to get this claim settled because they were spending too much time compared to the size of the claim!

My folks called the contractor to let him know what the insurance company had said and his reply was shocking.  He stated that he would not accept a check from the insurance company!  Instead, it had to be a personal check from my folks.  At this flag, my folks wisely decided it was time to turn and run.  Something fishy is going on when he would insist on a personal check (which could bounce) instead of a guaranteed check from an insurance company.  In my opinion they are either trying to cheat taxes or more probable – they were going to take the money and run.

The icing on the cake though is the contractor has now been calling saying that he needs them to sign the proposal and give him the check right away (which luckily my parents hadn’t done either) in order to get the project done before winter.  I see news stories in which contractors scam people way to often, but I have never known someone personally that is has happened to.

It’s important when dealing with any type of transaction to follow your gut instincts and realize that sometimes the best course of action is to simply walk away. 

I first read an article from the Wall Street Journal about this new program.

Also, if you want more information, here is the IRS press release.

I would definitely contact my accountant prior to filling out the forms for this project.  I would be interested in what the fine print says but this could be an attractable alternative to being audited and having to pay fines and penalties.

I know there are a significant number of construction contractors in the US that classify their employees as contract workers.  I believe the IRS is going to start pushing much harder on this subject and will enforce the fines and penalties as a means of increasing revenue.  What do you think?