Articles

Every contractor understands the advantage of getting work done with subs rather than employees. Employees come with headaches like payroll taxes (F.I.C.A., F.U.T.A., S.U.I), employee insurance, fringe benefits and overtime. Collectively, those add about one-third to labor cost. With subcontractors, you simply write a check payable to the sub. No withholding tax. No fringe benefits. […]

Many contractors prefer time and material (cost-plus) contracts. And for good reason. With T&M;, you’re sure to recover expenses and earn a profit. There’s no dispute about the cost of changes. Work can start before design is complete. The job gets done just the way the owner wants – and at the owner’s expense. What […]

The law in most states puts residential contractors at a disadvantage. Omit a required notice or disclosure and your contract is probably unenforceable (at best) and could earn you a fine (or worse). That’s called consumer protection law. No use complaining. It’s not going away. To help protect consumers, several states require that contracts be […]

Every residential contractor knows about an owner’s 3-day right to cancel, sometimes called the Reg Z notice. Any time you do work on the principal residence of an owner (whether new construction, improvement or repair) you have to: Give each owner two copies of the notice. Show on each form the date the right to […]

Most state legislatures make their changes to the law effective on either January 1 or July 1 of each year. Here’s a state-by-state summary of major changes to construction contract law taking effect on July 1, 2012: California – Forty pages of lien laws will change. Civil Code § 8000 to § 9566 will replace […]

My March2009 blog suggested that Pennsylvania’s Home Improvement Consumer Protection Act (HICPA) didn’t have to be a deal breaker for residential contractors in PA. The law (effective July 1, 2009) was written to tip the playing field in favor of owners when negotiating for home improvement work. But the legislature in Harrisburg didn’t think of […]

You know about headaches that come with any project – risk of loss, regulation, code compliance, employees, warranty claims, liens, and – always – the need for more capital. If you’re looking for a better way to make a living in construction, consider a contractor I know. He doesn’t have these problems – and still […]

All states set standards for construction contracts. The notices and disclosures required by state law vary with the size of the job, type of work, materials used, who signs the agreement and even where the contract is signed. To see what’s required where you do business, go to Construction-Contract.net and click on your state. Some […]

I’ve been asked, “Can I get my contracts E-signed — send my contract to a client as an email attachment, get an electronic signature and then have the E-signed contract emailed back to me?” The short answer is “Yes.” And it makes good sense. If you draft contracts with your computer, it’s easy to get […]

Construction disputes usually start with a surprise – something nobody considered. A good contract anticipates the most likely surprises. But no contract is perfect. Occasionally you’re going to have a dispute. If you write the contract, you decide how disputes will be settled – either in court or by arbitration. If your contract requires arbitration, […]