Failing to properly complete Form I-9 can be costly
In recent years, the U.S. Immigration and Customs Enforcement (ICE) agency has focused its attention on construction companies and other businesses that rely heavily on foreign workers. And the agency isn’t just targeting companies that employ workers who are in the country illegally. It’s also penalizing businesses that fail to satisfy their employee verification paperwork requirements. Harsh Penalties Every employer is required to inspect certain documents and to complete and maintain a Form I-9 — [...]
6 Tips for More Effective Change Orders
In the construction industry, change orders are a fact of life. The trick is making them a profitable one! Managing change orders wisely can make the difference between a successful job and a losing one. Here are six tips to better managing the process: 1. Read the Contract. This may sound obvious, but contractors often assume things about approval procedures that aren’t reflected in the legal language. For instance, the markup percentage for change orders [...]
Waivers of Subrogation: Are you Really Protected?
It’s common for a construction contract to contain a “waiver of subrogation” provision under “insurance requirements.” Unfortunately, these provisions are widely misunderstood. Although they’re designed to shield owners, contractors and subcontractors against lawsuits by insurers covering project-related claims, the protection offered may not be as extensive as you might think. Understanding the Concept Subrogation is a legal concept under which an insurance company that covers a loss gains the right to “step into the shoes” [...]
Cross-Training Can Help Mitigate the Contractor Labor Shortage
It’s an unfortunate fact of life that shows no signs of diminishing soon. The construction industry continues to struggle with a shortage of skilled labor. Many contractors find themselves sorely limited in the size and number of projects they can take on because they simply don’t have the workforce to deploy. One way to mitigate the problem is to make better use of the workers you already have on staff. Undertaking a carefully planned and [...]
4 Accounting Alternatives that May Reduce Financial Reporting Costs
Consider a Different Route Many privately held construction companies prepare audited financial statements that comply with Generally Accepted Accounting Principles (GAAP) as established by the Financial Accounting Standards Board (FASB). They do so, at least in part, to satisfy the requirements of lenders, sureties and other business partners. Many of GAAP’s requirements benefit private businesses and their financial statement users. But, for some contractors, the limited value doesn’t justify the additional cost and complexity. Recognizing [...]
A Contractor Controlled Insurance Program May Suit Growing Companies
Most business owners aren’t content with running a small company. They want to see that operation grow and grow to become a major player — if not the dominant player — in their markets. This certainly holds true for construction companies. Most general contractors aren’t satisfied jumping from small job to small job. They want to take on bigger and bigger projects and reap the rewards that come along with them. Naturally, the obstacles are [...]
Attract and Retain Talent with Equity-Based Compensation
Construction is a competitive industry. And contractors aren’t just competing for projects; they’re also competing for a dwindling supply of new management talent and other skilled workers. To combat this problem, consider these equity-based compensation incentives that can help you attract, retain and motivate quality employees. A Powerful Tool Among the most powerful tools for engaging employees and aligning their interests with those of your business is equity-based compensation. Sharing ownership — by granting stock [...]
Failing to Properly Complete Form I-9 for Foreign Workers Can Be Costly
In recent years, the U.S. Immigration and Customs Enforcement (ICE) agency has focused its attention on construction companies and other businesses that rely heavily on foreign workers. And the agency isn’t just targeting companies that employ workers who are in the country illegally. It’s also penalizing businesses that fail to satisfy their employee verification paperwork requirements. Harsh Penalties Every employer is required to inspect certain documents and to complete and maintain a Form I-9 — [...]
Should You Reconsider Your Entity Choice?
The Tax Cuts and Jobs Act (TCJA) slashed federal corporate income taxes from a top rate of 35% to a flat rate of 21%. As a result, many construction company owners organized as pass-through entities — such as S corporations, limited liability companies (LLCs) and partnerships — are rethinking their business structures. An owner’s share of pass-through income continues to be taxed at individual income tax rates as high as 37% (down from 39.6%), so [...]
Lock Down Financial Assets with the Right Controls
You’ve got a fence around the jobsite. Your heavy equipment is turned off and the keys stored securely. Your materials are tied down and, where possible, kept out of sight. But what about your financial assets? Are you protecting those as carefully as your physical assets? Many contractors worry so much about petty theft or misuse of equipment that they overlook the home office or job trailer where so much important information is held and [...]