WELCOME 2016…THIS WILL BE A BETTER YEAR!
Happy New year from all of us at JP Insurance Group! All of us at our network of companies are dedicated to providing information and services to help our contractors grow in 2016. Your success is our success! For that reason, we have put together some “Best Practices” and “Traps to Avoid” to help you to not fall into the fines, suspensions or unexpected additional premiums that can seriously hurt your company.
Best Practices:
• Carry $1,000,000 limit of general liability and business auto liability and require the same from your subcontractors.
• Hire a CPA even if only to check your financials and do your year-end taxes.
• Outsource your payroll administration, Workers’ Compensation, and Human Resources to the professionals. We recommend ADP, ADP can help you conserve your cash flow on Work Comp as well as keep you legal on employees, all while being payroll deducted! Click here to visit their site.
• Promote your business by creating a free website your customers can go to. We recommend WordPress and WIX . Both are user friendly and easy to set up.
• At the first sign of trouble with a customer or general contractor who isn’t wanting to pay you, or any other complaint, call us and we can refer a construction and business law attorney.
• If you are ever unsure whether a project is allowed to be undertaken under your current license, call the ROC and ask one of their helpful staff. Click here to visit their site.
Traps To Avoid:
• If the total job (materials & labor) is over $1,000 you must use a licensed, insured subcontractor OR your own W-2 employee. Otherwise the ROC will consider you to be aiding and abetting an unlicensed contractor. Penalty: cease & desist order and $200 to $2,500 fine.
• IF you hold the personnel folder for your employees, DO NOT keep the I-9 form in there with the application and other new hire information. If audited by Department of Labor – $500 fine/per employee.
• IF you are reporting your own FICA, FUTA, SUTA etc. quarterly, and they are received 5 days late – you will not even hear about it until 3 months later and you will have penalties & interest added to the late charge. To avoid these traps – outsource to ADP (Link)
• If your employee is injured at the job-site and you do not have him covered under a Workers’ Compensation policy, the Industrial Commission will make you pay for his medical treatment as well as fine you and can even close your operation until you get a Work Comp policy in place.
• If your employee is not covered by Statutory Benefits (Work Comp) he can sue you and/or sue the owner of the job-site where he was injured. The IRS and Work Comp statutes have a list of criteria that determine the status of “employee” VS “independent contractor” and they are not the same.
• If you sub work out and do not have your subcontractor sign your subcontract agreement and give you a certificate of insurance, naming you as Additional Insured on their policy – you may not have coverage under your policy for a claim caused by that subcontractor.
• If you sign a contract to do a job without understanding what the insurance requirements are, you may find that to comply with the contract will cost more money, that you did not put into your bid. Call us and we can help!
• Most of you have reduced your payroll and cost of subcontractors because, Last year was a bad year. As business picks up this year, be sure to call us to increase your exposures so you don’t get hit with a large additional premium at audit!
May each of you enjoy prosperity in this New Year!