Why Every Business Needs Hired and Non-Owned Auto Coverage

Even if you have company cars or a fleet of vans, occasions may arise that require an employee to run an errand in their personal vehicle or one of your employees needs to rent a car while on a business trip visiting a client.

In these circumstances if you don’t have the proper coverage, you could be leaving your organization exposed to liability if an employee injures a third party in an accident. There are two types of insurance that are vital in these situations: Non-owned auto coverage and hired auto insurance.

These two policies offer very different types of coverage, and it is important to understand each to ensure you find the policy that is right for your operation:

  • Non-owned auto coverage This insurance protects your company if sued as a result of an auto accident that you or one of your employees has in a personal vehicle while on company business.
  • Hired auto coverage This provides your company with liability insurance for vehicles that you rent, hire or borrow on a short-term basis for business purposes.If you or an employee are in a car accident while driving one of these vehicles for work, hired auto insurance can help pay for your liability costs.

You should consider these two coverage options if your company ever rents cars or vans for business purposes (including travel to conferences, visiting clients, etc.) or if employees use their personal vehicles to run company errands.

These important coverages are usually added to a general liability policy or a commercial auto policy as an endorsement or a rider.

When there are no vehicles titled in the company name, this additional coverage will serve to meet the contract requirement for commercial auto coverage in most states.

How the coverages work

Both hired and non-owned auto insurance are a type of liability insurance, meaning they will only cover property damage and injuries to third parties, as well as any legal fees, settlements or court judgements relating to third party claims. Hired and non-owned auto insurance helps cover:

  • Physical damage to a third party’s vehicle,
  • Bodily injuries and medical expenses if a third party is hurt in an accident with you or one of your staff, and
  • Legal expenses if your business gets sued for negligence.

However, these polices won’t help with:

  • Property damage to your business’s hired or non-owned vehicle.
  • Medical bills if you or your employee get hurt in an accident while using rented or personal vehicles.
  • Liability coverage, property damage or bodily injury from an accident while you or your employee drive for personal reasons that are not related to your business.

Do you need coverage?

If your business rents or borrows vehicles to do work or if your employees use their personal vehicles on business, hired and non-owned auto coverage is crucial to manage your risk.

It can help pay for any property damage that you or your employees cause while on company business in rented or personal vehicles. It also covers vehicles used for your business if they cause bodily injury to another driver in a car accident.

BGES Group’s office, located in Larchmont, NY is a full service insurance agency offering, Property, Liability, Umbrella Liability, Business Auto, Bid & Performance Bonds, Inland Marine, Worker’s Compensation, Worker’s Compensation Premium Recovery, New York State Disability, Group Health, Life insurance, Personal lines and Identity Theft.

Special Contractor Insurance Programs (NY, NJ, CT) – We we have 60+ insurance companies to market your general liability, umbrella liability, business auto, workers compensation, bid & performance bonds and group health coverages. We help contractors set up proper risk transfer. If you’re a contractor we offer extensive information about insurance markets, coverages, risk transfer, subcontractor screening, ways to lower your insurance costs.

BGES Group are Worker’s Compensation Specialists for the States of New York, New Jersey and Connecticut – Issues we address: 1) Lowering pricing – we have specialty programs that can save you up to 40%; 2) Finding a new company; 3) Replacing policies that are being cancelled or non renewed; 4) Audit disputes; 5) Company creating fictitious payroll at audit time; 6) Lowering high experience modifications factors; 7) Misclassification of payrolls; 8) Lowering or eliminating renewal deposits;  9) Getting coverage when you’ve been without for a few months; 10) Covering multiple states under one policy; 11) Eliminating 10% service or policy fees; 12) Timely issuance of certificates; 13) Always being able to get someone on the phone or by email when you need to.

If you would like to speak with us call Gary Wallach at 914-806-5853 or click here to email or click here to visit our website.

Company: BGES Group, 216A Larchmont Acres West, Larchmont, NY 10538

e-mail: bgesgroup@gmail.com

website: http://www.bgesgroup.com

© – Copyright – 2022 – BGES Group

The Dangers of Staffing Agencies That Promise Lower Workers’ Comp Premiums

The Dangers of Staffing Agencies That Promise Lower Workers’ Comp Premiums

Many employers receive aggressive sales calls from employee leasing firms or their brokers telling them they can not only get rid of the administrative headache of handling payroll and compliance, but also reduce their workers’ comp costs.

These organizations known as professional employer organizations (PEOs) promise to assume various employer human resources responsibilities by becoming the employer on record for the client business’s workers.

Besides touting the benefit of having someone else handle your HR responsibilities, the big selling point that they push is that they can save you money on your workers’ compensation program.

PEOs do this by essentially becoming the employer of record, and handling everything from payroll and benefits administration, to paying payroll taxes and purchasing workers’ compensation coverage.

While many PEOs are legitimate, some underreport payroll and misclassify employees so that the workers’ comp premium is lower than what you pay. Some especially unscrupulous players have been jailed for not paying workers’ comp premiums and payroll taxes, leaving their clients in a bind.

In those cases, the employer is often left holding the bag for workers’ compensation claims they thought were covered, or for unpaid tax bills.

The danger of PEOs

When an employer outsources its workers’ compensation coverage responsibility to a PEO, it is entrusting that all insurance requirements will be fulfilled by that organization.

This means that the PEO will be responsible for classifying employees, communicating payroll to insurers, selecting appropriate coverage and paying premiums. This also presupposes that the PEO is familiar with your state’s workers’ compensation statutes and regulations.

Some employers shift this burden to the PEO without securing contractual evidence of the PEO’s rights and duties. What’s worse, these employers may rely on an ambiguous contract that fails to protect their interests.

These poorly written contracts can lead to fraud or misrepresentation by the PEO, which in turn can backfire on the employer.

Take the following examples:

  • A San Francisco jury found that two PEOs, Onvoi Business Solutions and Select Staffing, had run a scheme to defraud an insurance company and avoid paying $30 million in workers’ compensation premiums.The two PEOs were accused of piggybacking an arrangement where one PEO with a high X-Mod obtains coverage through another PEO with a lower X-Mod so that it can take advantage of better rates.
  • Six executives from three PEOs were given varying prison sentences and probation for swindling insurance companies and small businesses that had signed up for their services out of more than $100 million.The men ran a series of PEOs that piggybacked on each other, while collecting payroll and other taxes, as well as workers’ comp premiums from their small business clients.

    Rather than use the money the defendants were paid by the small businesses to submit payroll taxes and provide workers’ compensation insurance, they spent it on vacations, girlfriends, gambling trips to Las Vegas, a private jet, real estate (including a 551-acre horse-training ranch) and other personal expenses.

Both of these failures affected thousands of businesses, and many were forced to purchase new workers’ compensation policies since the PEOs had failed to remit premiums to insurers.

In addition, they were forced to pay the IRS for the failed remittances of payroll taxes, even though the employers had paid the PEO for the taxes.

The takeaway

While there are many legitimate PEOs operating across the country, employers still have to take a leap of faith and assume that the PEO will pay the bills on their behalf. If it doesn’t, the burden falls back on the employer.

And there is a big difference between a PEO failing and an insurance company failing. If the PEO fails, you could be on the hook for any workers’ comp claims that were incurred or premium that wasn’t paid. If your insurer goes belly up, the policy will be guaranteed through its expiration and all claims will be paid by a state-run insurance guaranty fund.

If you have questions about PEOs, feel free to call us. We can answer any queries you may have about them.

BGES Group’s office, located in Larchmont, NY is a full service insurance agency offering, Property, Liability, Umbrella Liability, Business Auto, Bid & Performance Bonds, Inland Marine, Worker’s Compensation, Worker’s Compensation Premium Recovery, New York State Disability, Group Health, Life insurance, Personal lines and Identity Theft.

Special Contractor Insurance Programs (NY, NJ, CT) – We we have 60+ insurance companies to market your general liability, umbrella liability, business auto, workers compensation, bid & performance bonds and group health coverages. We help contractors set up proper risk transfer. If you’re a contractor we offer extensive information about insurance markets, coverages, risk transfer, subcontractor screening, ways to lower your insurance costs.

BGES Group are Worker’s Compensation Specialists for the States of New York, New Jersey and Connecticut – Issues we address: 1) Lowering pricing – we have specialty programs that can save you up to 40%; 2) Finding a new company; 3) Replacing policies that are being cancelled or non renewed; 4) Audit disputes; 5) Company creating fictitious payroll at audit time; 6) Lowering high experience modifications factors; 7) Misclassification of payrolls; 8) Lowering or eliminating renewal deposits;  9) Getting coverage when you’ve been without for a few months; 10) Covering multiple states under one policy; 11) Eliminating 10% service or policy fees; 12) Timely issuance of certificates; 13) Always being able to get someone on the phone or by email when you need to.

If you would like to speak with us call Gary Wallach at 914-806-5853 or click here to email or click here to visit our website.

Company: BGES Group, 216A Larchmont Acres West, Larchmont, NY 10538

e-mail: bgesgroup@gmail.com

website: http://www.bgesgroup.com

© – Copyright – 2022 – BGES Group

How to Protect Yourself Against Claims of Sub-Contractors

How to Protect Yourself Against Claims of Sub-Contractors

Generally, employers must set up workers compensation coverage and other required coverages – depending on the jurisdiction – for anyone working as a statutory employee. That is, employers are directly responsible for all workplace injury claims of anyone reporting to management and drawing an hourly wage or salary, from which taxes are deducted.

Construction managers, therefore, must obtain workers compensation coverage for their own staff. They do not, however, set it up for subcontractors, nor the employees of subcontractors.

In a recent Indiana court case, though, an injured worker decided to test the limits of the traditional arrangement. According to reporting by ConstructionRisk.com, the worker was working at a stadium construction site as an employee of a subcontracted firm, Baker Concrete Construction, Inc. She was injured by a falling block of wood, which struck her in the face and hand. Although she had no employment contract with the general contractor overseeing the contract, Hunt Construction Group.

The plaintiff’s theory was that Hunt had an overall responsibility to ensure the safety of the workplace.

However, Hunt did not have any kind of contractual relationship with Baker Concrete Construction. Hunt’s only contractual relationship was with the site owner.

An Indiana appeals court sided with Hunt. There was nothing in Hunt’s contract that granted them the responsibility for overall worksite safety, much less anything in their contract that granted them the authority to intervene in other subcontractors’ operations, not affiliated with Hunt, to ensure workplace safety. Yes, Hunt periodically conducted workplace safety audits for the protection of their own employees and subcontractors. But the courts held that that did not imply that they had a responsibility for other workers wholly unrelated to their operation just because they were on the site – at least, not to such an extent that it rose to the level that Hunt bore financial liability for the injury.

According to the judgment, the courts looked specifically at the contract that Hunt had with the site’s owners. There was nothing in their contract that made them the overall safety director of the site, nor anything other than geographical location that connected them to the injured worker.

The court also noted that both the injured worker and the employee that dropped the piece of wood that injured her were both Baker employees, not Hunt employees. The appeals court unanimously ruled that Hunt did not have a duty to provide the injured worker with a safe workplace. Maybe somebody else did – and a majority of the panel ruled that the worker could possibly seek remedy from Baker, under workers compensation laws. But not for Hunt.

Be Careful With Sweeping Responsibilities for Safety

If you are the construction manager of a worksite, look closely at the contract. Are you signing on as the overall safety director for the worksite? Is there anything in the contract appointing your company as the overall workplace safety czar? If there is, and you accept that responsibility, you are also assuming an elevated level of risk. If Hunt had allowed itself to be formally appointed the site safety director, the Indiana appeals court ruling suggests that would have been sufficient to open a window wide enough to allow the injured employee to go after Hunt – even though she was injured by another Baker employee.

If you do take on the responsibility, you may also need to increase your umbrella liability coverage – and retain a number of discretionary rights over the workplace that you otherwise wouldn’t, such as the right to have unsafe workers from other companies removed from the workplace.

Overall, don’t take on safety responsibilities unless the contract gives you the discretion and authority to carry them out.

The terms of the contract should reflect the need for safety staffing and expertise, and should pay for the man-hours needed to conduct safety and compliance inspections all over the work site. If you need to significantly modify the work flow, or even have a vendor pack up and leave the work site rather than create an unsafe environment, you should be held harmless by the terms of the contract for executing your workplace safety duties.

The terms of the contract should also front you enough money to pay for an adequate level of liability insurance coverage.

If the client balks at the extra expense, then so should you. Don’t take on responsibility or liability for this burden unless you are adequately compensated for the additional man-hours and risk.

Don’t go “Above and Beyond”

Second, if there is no contractual obligation to assume responsibility as the worksite safety director, do not step beyond the terms of the contract to do so. According to another Indiana ruling, Plan-Tec vs. Wiggins, the courts held that a construction manager owes a legal “duty of care” – a necessary element to recover for negligence for jobsite employee safety in two circumstances:  “when such a duty is imposed upon the construction manager by a contract to which it is a party, or when the construction manager assumes such a duty, either gratuitously or voluntarily. [citations in original removed for clarity].”

In that case, the courts found that since the construction manager held regular safety briefings and meetings, issued safety directions to other contractors, and took initiative to have its own safety directors inspect scaffolding owned and erected by other contractors, the company took on itself the “duty of care” required for a claim of negligence – and was therefore on the hook for an employee’s injury when the scaffold fell.

In this case, doing the right thing caused a lot of problems for the construction manager.

Of course, it’s not a terrible thing to have a responsible organization actively policing the worksite for safety issues. Just make sure that if it’s your firm, that the terms of the contract resource that responsibility appropriately, and that you maintain adequate insurance coverage to compensate you for the risk.

BGES Group’s office, located in Larchmont, NY is a full service insurance agency offering, Property, Liability, Umbrella Liability, Business Auto, Bid & Performance Bonds, Inland Marine, Worker’s Compensation, Worker’s Compensation Premium Recovery, New York State Disability, Group Health, Life insurance, Personal lines and Identity Theft.

Special Contractor Insurance Programs (NY, NJ, CT) – We we have 60+ insurance companies to market your general liability, umbrella liability, business auto, workers compensation, bid & performance bonds and group health coverages. We help contractors set up proper risk transfer. If you’re a contractor we offer extensive information about insurance markets, coverages, risk transfer, subcontractor screening, ways to lower your insurance costs.

BGES Group are Worker’s Compensation Specialists for the States of New York, New Jersey and Connecticut – Issues we address: 1) Lowering pricing – we have specialty programs that can save you up to 40%; 2) Finding a new company; 3) Replacing policies that are being cancelled or non renewed; 4) Audit disputes; 5) Company creating fictitious payroll at audit time; 6) Lowering high experience modifications factors; 7) Misclassification of payrolls; 8) Lowering or eliminating renewal deposits;  9) Getting coverage when you’ve been without for a few months; 10) Covering multiple states under one policy; 11) Eliminating 10% service or policy fees; 12) Timely issuance of certificates; 13) Always being able to get someone on the phone or by email when you need to.

If you would like to speak with us call Gary Wallach at 914-806-5853 or click here to email or click here to visit our website.

Company: BGES Group, 216A Larchmont Acres West, Larchmont, NY 10538

e-mail: bgesgroup@gmail.com

website: http://www.bgesgroup.com

© – Copyright – 2022 – BGES Group

Misclassification of Employees is Payroll Fraud. Here’s How To Stay Out of Trouble

Misclassification of Employees is Payroll Fraud. Here’s How To Stay Out of Trouble

The Internal Revenue Service and Department of Labor have been going after employers who misclassify employees as independent subcontractors – and the construction industry is squarely in their crosshairs.

In late 2011, the DOL and IRS entered into a formal agreement of cooperation in sharing information and data in order to enforce employment laws. If you have been improperly failing to withhold income taxes and contribute the employer portion of the Social Security and Medicare taxes, and failing to pay unemployment insurance premiums and workers compensation premiums for people functioning as employees, and one of them complains to the Department of Labor, you can expect the IRS to get wind of it, too.

Additionally, if you are using an unlicensed contractor, and closely directing their work, the Department of Labor and IRS will consider this individual to be an employee, not a contractor. If that person is injured while functioning as an employee, the employer is liable… and you had better have workers compensation insurance in place.

The distinction is especially critical in the construction industry, because of the innately hazardous nature of the workplace. Independent contractors are generally expected to provide their own insurance. Employees are not, but are covered under their employers’ plan. Failure to comply with employee classification laws risks employees falling through the cracks – and severe consequences for employers.

A Pervasive Form of Fraud

The deliberate misclassification of employees as independent contractors is an epidemic form of payroll fraud in the construction industry – and law enforcement at both the federal and state level nationwide are focusing resources on eradicating it.

Some studies indicate that as many as one worker in twenty is misclassified as a contractor when he should be considered an employee – and that companies that do misclassify workers as independent contractors do so routinely. Among employers that have been caught conducting this kind of fraud, they do so for an average of 40 percent of their workers.

This creates a substantial pricing advantage for dishonest contractors – and makes it that much more difficult for legitimate construction contractors to compete on a level playing field.

The practice also severely undercuts the industry as a whole, according to some observers and market participants. Marek Brothers Construction CEO Stan Marek maintains that as long as dishonest contractors circumvent wage and hour laws, there is no viable career path for young people who might otherwise consider going into the construction industry. “We will never attract young men and women into the construction industry until there is a career path,” he told a panel of Texas legislators and regulators. “There’s a tremendous need for skilled workers. A lot of kids don’t want to go to college. But if the construction industry is dominated by businesses that exploit workers, Texas kids aren’t going to sign up… It is a cancer that is eating the industry. It is killing us.”

 Penalties for Payroll Fraud

It’s not just federal officials cracking down on employee misclassification and payroll fraud – state governments are also going after employers practicing this form of fraud, and a number of states have actually increased penalties in recent years.

Companies caught committing payroll fraud are typically charged back taxes and interest by both the IRS and state revenue officials. Companies are also fined up to hundreds of dollars per day per worker not covered by workers compensation insurance. Construction firms have also been hit with on-the-spot ‘stop work’ orders when state inspectors discover workers on site who aren’t covered by workers compensation. This can lead to cost overruns, time delays and uncomfortable conversations with customers and prime contractors upstream.

In egregious cases, people have been sentenced to prison time.  For example:

On September 6, 2012, in Richmond, Va., Mark S. Holpe, of Midlothian, Va., was sentenced to 18 months in prison and fined $40,000 for evading the payment of employment taxes on unreported cash wages he paid employees of Nature’s Way Landscaping, Inc. Holpe pleaded guilty to evading the assessment of $326,196 of employment taxes. Holpe worked for Nature’s Way, a business that did residential and commercial landscaping in the Richmond metro area. He was originally the president, but became the treasurer in 2007 when he sold a portion of the business. In entering his plea, Holpe acknowledged that the company had two groups of employees during tax years 2006 through 2009. Holpe admitted that he paid one group of approximately 30 employees $2,132,000 in cash wages during that period, without withholding social security taxes.

Staying out of Trouble

It is true that there is substantial gray area in defining who is an employee vs. who is an independent contractor. The IRS has published a 20-point series of tests to help determine how a worker should be properly categorized. In the construction industry, a lot of it comes back to who is holding the license: If you hire an unlicensed contractor, and you are directing their work and telling them what to do on a daily basis, and they are operating under your license, this is clearly an employee.

If that worker is injured, the employer is liable, and if workers compensation insurance is not in place, the medical costs could potentially push an employer into bankruptcy – even before back taxes, penalties and possible criminal prosecution is taken into account.

By way of further examples, your independent contractor may legally be an employee if any of the following factors apply:

  1. You provide tools, training and/or materials for the job.
  2. You are closely directing what time the worker or workers must show up on the job.
  3. You are ‘counseling’ workers in writing about tardiness or other disciplinary issues.
  4. You are dictating methods. Contractors don’t tell subcontractors how a job is to be done – they just define the scope of work and leave it to the subcontractor how best to complete it. If you tell someone how to do a job, rather than just describing the end state, chances are you could be turning them into a legal employee.
  5. You expect any kind of exclusivity.
  6. Do you require any kind of company-provided training?
  7. Do you pay transportation expenses or provide transportation for these workers?
  8. Do you reserve the right to terminate the worker at will?

The complete IRS 20-factor test can be viewed here.

Note that not all 20 factors need apply for the IRS, Department of Labor or state officials to determine that an employment relationship exists. Officials can and have determined that an employment relationship exists even when just a few of the 20 factors apply.

Meanwhile, if there is any doubt or gray area, it’s important to address it immediately – and maintain legally required workers compensation, medical and other coverage until you are certain you are engaged in a bona fide contractor-to-contractor relationship, rather than an employer/employee relationship.

BGES Group’s office, located in Larchmont, NY is a full service insurance agency offering, Property, Liability, Umbrella Liability, Business Auto, Bid & Performance Bonds, Inland Marine, Worker’s Compensation, Worker’s Compensation Premium Recovery, New York State Disability, Group Health, Life insurance, Personal lines and Identity Theft.

Special Contractor Insurance Programs (NY, NJ, CT) – We we have 60+ insurance companies to market your general liability, umbrella liability, business auto, workers compensation, bid & performance bonds and group health coverages. We help contractors set up proper risk transfer. If you’re a contractor we offer extensive information about insurance markets, coverages, risk transfer, subcontractor screening, ways to lower your insurance costs.

BGES Group are Worker’s Compensation Specialists for the States of New York, New Jersey and Connecticut – Issues we address: 1) Lowering pricing – we have specialty programs that can save you up to 40%; 2) Finding a new company; 3) Replacing policies that are being cancelled or non renewed; 4) Audit disputes; 5) Company creating fictitious payroll at audit time; 6) Lowering high experience modifications factors; 7) Misclassification of payrolls; 8) Lowering or eliminating renewal deposits;  9) Getting coverage when you’ve been without for a few months; 10) Covering multiple states under one policy; 11) Eliminating 10% service or policy fees; 12) Timely issuance of certificates; 13) Always being able to get someone on the phone or by email when you need to.

If you would like to speak with us call Gary Wallach at 914-806-5853 or click here to email or click here to visit our website.

Company: BGES Group, 216A Larchmont Acres West, Larchmont, NY 10538

e-mail: bgesgroup@gmail.com

website: http://www.bgesgroup.com

© – Copyright – 2022 – BGES Group

The Elements of a Good Construction Contract

It would be nice if everything could be done with a gentlemen’s agreement. But it’s important to get things down on paper in a written contract. That’s especially vital for high-dollar, complex items like construction projects – which require big investments up front, large commitments of capital and labor.

Furthermore, we all hope that all our projects are built to completion without any unforeseen obstacles, delays, hitches or confusion. But we all know that they don’t, and complications can arise that are beyond the ability of any party to a construction contract to foresee.

Here are some of the tenets of sound construction planning and contracting – and the essential elements of a sound construction contract that can withstand adversity and protect the interests of both sides.

Specificity. This is essential even before the contract is entered into, because no bid can be more accurate than the description and scope of work to be done. The contracting entity should ensure that whoever is drawing up the work requirement or request for proposal is qualified to do so. Conversely, contractors should be alert to the possibility that the authors of a ‘request for proposal’ (RFP) or work order may not fully understand what is involved. A successful contract is built from the very first engagement – which could be months before the actual contract is drawn up and signed.

Ideally, the RFP or its functional equivalent should include the following information:

  • Property information, including location, approaches, and available storage/staging space. In today’s environment, with Google Earth, it’s often easy to include an areal photo of the work site.
  • Architectural and engineering specifications, if they have already been drawn up. If not, contractors should plan on some back and forth as these requirements are identified.
  • Environmental remediation or environmental impact mitigation requirements.
  • Deadline for completion at a minimum. Milestones for partial completion if possible, though this is frequently a collaborative process. The deadline for completion is frequently set, however.
  • Any additional constraints. For example, contractors on federal projects must pay workers according to the Davis Bacon Act, which frequently means that prevailing wages paid to workers will be higher for federal projects. States frequently have similar laws that govern state projects.

Pricing and Allocation

Contracts should address what expenses are reimbursable to the contractor and what kinds of costs are to be included in the contractors’ fees.

Payments

Any construction contract should spell out exactly when payment is due to the contractor. This frequently means a series of milestone payments to the contractor. The less frequent the milestone payments, and the later the payments are made, the greater the risk to the contractor.

Spell out at what stages of construction a payment is due to the builder – and the specific procedures for triggering that payment. Ideas include:

  • Initial deposit and payment to get work started, hire laborers, lease equipment, and pay a project manager or team to start laying out the whole project.
  • Groundbreaking
  • Completion of foundation, to include ground-level and basement plumbing and sewage fixtures
  • Receipt of a key materials invoice

The contract should also specify how payment is to be made. Credit card payments are expensive. Contractors should bid appropriately. Where possible, use ACH or wire transfers with lower costs, or checks that can also be processed for little or no cost.

Responsibilities

Contracts should identify the contract manager on both sides, by name and duty position. If there should be personnel turnover, including duty position can help clear up confusion in larger organizations, though ideally any personnel changes should be addressed in writing, to avoid questions about who is authorized to approve payments and change orders.

Deliverables

Don’t neglect the securing of permits and licenses as a deliverable. Everybody misses them, but they aren’t free, and are a showstopper if you miss this step.

Change order procedures

There is always a significant chance that contracts for construction projects have to be altered mid-stream to account for changes on the ground. Material availability, labor disputes, weather, changes in regulations or zoning, unexpected complications on the job site, and human error combine to lead contracting entities, contractors and subcontractors to alter the contract. Contracts should be clear about setting forth the project and terms while still allowing for flexibility in addressing real-world issues that come up.

Also, material, labor and permit costs can fluctuate. A thorough contract will take this into account, and provide a mechanism for pricing to increase to compensate for this.

Where contracts are less flexible, contractors will have to charge more, to compensate for the risk.

Termination

Even among well-intentioned, competent contractors, there is occasionally a mismatch that arises between the project and the core competencies of the contractor. Contracts should specify how and under what circumstances a contract can be terminated, and if a new construction company is to take over the project, what kind of ‘handover’ a contracting company can expect.

BGES Group’s office, located in Larchmont, NY is a full service insurance agency offering, Property, Liability, Umbrella Liability, Business Auto, Bid & Performance Bonds, Inland Marine, Worker’s Compensation, Worker’s Compensation Premium Recovery, New York State Disability, Group Health, Life insurance, Personal lines and Identity Theft.

Special Contractor Insurance Programs (NY, NJ, CT) – We we have 60+ insurance companies to market your general liability, umbrella liability, business auto, workers compensation, bid & performance bonds and group health coverages. We help contractors set up proper risk transfer. If you’re a contractor we offer extensive information about insurance markets, coverages, risk transfer, subcontractor screening, ways to lower your insurance costs.

BGES Group are Worker’s Compensation Specialists for the States of New York, New Jersey and Connecticut – Issues we address: 1) Lowering pricing – we have specialty programs that can save you up to 40%; 2) Finding a new company; 3) Replacing policies that are being cancelled or non renewed; 4) Audit disputes; 5) Company creating fictitious payroll at audit time; 6) Lowering high experience modifications factors; 7) Misclassification of payrolls; 8) Lowering or eliminating renewal deposits;  9) Getting coverage when you’ve been without for a few months; 10) Covering multiple states under one policy; 11) Eliminating 10% service or policy fees; 12) Timely issuance of certificates; 13) Always being able to get someone on the phone or by email when you need to.

If you would like to speak with us call Gary Wallach at 914-806-5853 or click here to email or click here to visit our website.

Company: BGES Group, 216A Larchmont Acres West, Larchmont, NY 10538

e-mail: bgesgroup@gmail.com

website: http://www.bgesgroup.com

© – Copyright – 2022 – BGES Group

Does your Insurance Cover the Promises you Made in that Construction Contract?

Does your Insurance Cover the Promises you Made in that Construction Contract

Most contracts for construction work include provisions called “indemnification” or “hold harmless” agreements. These agreements require one party to the contract to compensate (indemnify) the other party for certain costs. The costs include damages the owner or general contractor (GC) must pay because of injury to others or damage to others’ property that result from the contractor or subcontractor’s work. The agreement may also cover other costs, such as attorneys’ fees.

In short, the owner or GC is saying to the contractor or sub, “If we get sued over something related to the work you do for us, you’re going to pay for it.”

When a contractor must fulfill this part of the contract, substantial amounts of money are involved. Fortunately, insurance might cover the expense.

The terms in the contractor’s general liability insurance policy can be confusing at first glance. The standard commercial general liability coverage form actually states that the insurance does not apply to bodily injury or property damage for which the insured organization must pay damages because it assumed that obligation in a contract or agreement. However, the form goes on to say that the insurance does apply to liability for damages 1) the insured contractor would have if there was no contract, or 2) the contractor assumes in what the form defines as an “insured contract.”

The form’s specific definition of “insured contract” includes several specific types of agreements. It also includes other agreements where the insured organization assumes the liability of another organization to pay damages for injury or damage to a third party caused by negligence. The insurance will pay for damages covered by these contracts only if the two parties execute the hold harmless agreement before the accident causing the loss occurs. Here are a few examples of how this coverage might apply:

GC and subcontractor sign a contract for the sub to dig the foundation for a new building. The contract includes a hold harmless agreement that benefits the GC. Two weeks after they sign the  contract, an employee of another sub on the site falls into the hole the sub dug. The injured worker sues both the sub and the GC. The accident happened after the contract was signed, and the agreement fits the definition of an insured contract. Therefore, the sub’s liability insurance will cover damages both the sub and the GC owe for this accident.

Suppose, though, that the GC hires the sub in a hurry. Because the project is behind schedule, the GC tells the new sub to start work before any contracts are signed. Remember, the insurance does not apply if the contract is not executed before the loss. If someone were to fall in the hole and sue, the sub’s insurance would not cover this loss. Also, the insurance would not cover a loss if the contract was with a railroad for certain work near its tracks.

Coverage for liability assumed in contracts is very important for construction projects. These agreements are very common. Contractors who do not have this coverage are unable to comply with contract terms. Some policies may change the definition of “insured contract,” so it is important that  contractors verify with their insurance agents that the coverage is in place. This is an area that is too important for contractors to leave to chance.

BGES Group’s office, located in Larchmont, NY is a full service insurance agency offering, Property, Liability, Umbrella Liability, Business Auto, Bid & Performance Bonds, Inland Marine, Worker’s Compensation, Worker’s Compensation Premium Recovery, New York State Disability, Group Health, Life insurance, Personal lines and Identity Theft.

Special Contractor Insurance Programs (NY, NJ, CT) – We we have 60+ insurance companies to market your general liability, umbrella liability, business auto, workers compensation, bid & performance bonds and group health coverages. We help contractors set up proper risk transfer. If you’re a contractor we offer extensive information about insurance markets, coverages, risk transfer, subcontractor screening, ways to lower your insurance costs.

BGES Group are Worker’s Compensation Specialists for the States of New York, New Jersey and Connecticut – Issues we address: 1) Lowering pricing – we have specialty programs that can save you up to 40%; 2) Finding a new company; 3) Replacing policies that are being cancelled or non renewed; 4) Audit disputes; 5) Company creating fictitious payroll at audit time; 6) Lowering high experience modifications factors; 7) Misclassification of payrolls; 8) Lowering or eliminating renewal deposits;  9) Getting coverage when you’ve been without for a few months; 10) Covering multiple states under one policy; 11) Eliminating 10% service or policy fees; 12) Timely issuance of certificates; 13) Always being able to get someone on the phone or by email when you need to.

If you would like to speak with us call Gary Wallach at 914-806-5853 or click here to email or click here to visit our website.

Company: BGES Group, 216A Larchmont Acres West, Larchmont, NY 10538

e-mail: bgesgroup@gmail.com

website: http://www.bgesgroup.com

© – Copyright – 2022 – BGES Group

How to Avoid Being Ripped off by a Contractor

Many Americans decide to remodel or build additions to their homes in the summer as the weather is more accommodating to that kind of work.

But when summer starts, scammers also come out of the woodwork and it’s not uncommon for homeowners to be ripped off by an unscrupulous contractor.

The most common scam is to ask for money up front and then abscond, never to be seen again. Also, many shoddy contractors will underperform, providing poor workmanship at an exorbitant cost and try to illicit more money from you in the process.

If you are planning a remodel, you should look out for these common scams.

Up-front payments
A typical job will require about 10% of the cost up front, just as a good faith payment that you are scheduling the contractor’s time.

But the scammer will ask for 30-50% of the project price up front, saying that he has to order materials and/or rent machinery to get the job started. Then the scammer will disappear and not be seen from again, or they will start the project with shoddy workmanship.

Or the contractor is not financially stable and may plan to skimp on the work later.

Reneging on terms
When a homeowner and a contractor discuss a project, it’s common for the contractor to suggest decorative details that will make the work stand out. But what often happens is that those details never make it into the final contract and … surprise! … they don’t make it into the final project either.

When you see that the contractor isn’t adding those details in, you confront them and they tell you they didn’t include those features in the price. They’ll then try to elicit more money for that extra work.

Being told no permit is necessary
In most jurisdictions you have to get a work permit for any large construction project. Building officials want to know about all projects so that they can check on safety practices.

Sometimes unlicensed contractors may try to avoid pulling permits by saying they’re not necessary for this particular type of job. This would be typical for an interior project.

If they want to avoid pulling permits for an outside project, they may tell you it’s the homeowner’s responsibility. But it’s not. A permit must be obtained by the party doing the work.

So what can you do to avoid being ripped off? Angie’s List and HouseLogic.com, a site run by the National Association of Realtors, has the following advice to avoid getting ripped off:

Do your homework – Solicit at least three bids for your project and check Angie’s List, industry associations and previous clients’ references before hiring. Visit the contractor’s completed projects during the bid review process, particularly when it’s a big job.
You should also talk to friends who have had done work recently to get recommendations.

Check status and references – Check your state contractor’s board to see if a contractor is required to have a state or local trade license to do your job, and then verify his or her status with the appropriate licensing agency.
Ask for proof of liability and workers’ compensation insurance and bonding (if applicable). Ask for and check references for past jobs, and also suppliers they often use.

Negotiate a detailed contract – It should specify the various responsibilities of both the contractor and the homeowner, start and completion dates, terms that tie payments to job progress and completion, details of the work that’s being performed, itemized materials and any warranty information, and whether subcontractors will be used.
Also require that the contractor is responsible for obtaining all of the required building permits.

Ask for a detailed outline of costs – Never prepay more than $1,000 or 10% of the job total, whichever is less. That’s the legal maximum in some states, and enough to establish that you’re a serious customer so the contractor can work you into his schedule – the only valid purpose of an advance payment.

BGES Group’s office, located in Larchmont, NY is a full service insurance agency offering, Property, Liability, Umbrella Liability, Business Auto, Bid & Performance Bonds, Inland Marine, Worker’s Compensation, Worker’s Compensation Premium Recovery, New York State Disability, Group Health, Life insurance, Personal lines and Identity Theft.

Special Contractor Insurance Programs (NY, NJ, CT) – We we have 60+ insurance companies to market your general liability, umbrella liability, business auto, workers compensation, bid & performance bonds and group health coverages. We help contractors set up proper risk transfer. If you’re a contractor we offer extensive information about insurance markets, coverages, risk transfer, subcontractor screening, ways to lower your insurance costs.

BGES Group are Worker’s Compensation Specialists for the States of New York, New Jersey and Connecticut – Issues we address: 1) Lowering pricing – we have specialty programs that can save you up to 40%; 2) Finding a new company; 3) Replacing policies that are being cancelled or non renewed; 4) Audit disputes; 5) Company creating fictitious payroll at audit time; 6) Lowering high experience modifications factors; 7) Misclassification of payrolls; 8) Lowering or eliminating renewal deposits;  9) Getting coverage when you’ve been without for a few months; 10) Covering multiple states under one policy; 11) Eliminating 10% service or policy fees; 12) Timely issuance of certificates; 13) Always being able to get someone on the phone or by email when you need to.

If you would like to speak with us call Gary Wallach at 914-806-5853 or click here to email or click here to visit our website.

Company: BGES Group, 216A Larchmont Acres West, Larchmont, NY 10538

e-mail: bgesgroup@gmail.com

website: http://www.bgesgroup.com

© – Copyright – 2022 – BGES Group

Protect Yourself against Liability Exposure from Contractors’ Employees

Protect Yourself against Liability Exposure from Contractors’ Employees

As a business owner, you could be held liable for the actions of other peoples’ employees.

U.S. employment law has long recognized that workers may have an employment relationship with multiple entities at the same time. That means your company could get stung with OSHA fines, Title VII discrimination claims and other actions that arise from the actions of an employee that you thought was a subcontractor.

Here’s why:

In Secretary of Labor vs. Summit Contractors, the 8th Circuit ruled that companies that exercise overall control of a job site can be held liable for workplace infractions – even when the individual or individuals directly responsible for the infraction were employees of another firm, and no employees of the controlling employer were directly involved.

Furthermore, even if your company doesn’t exercise direct supervisory control of subcontractors, courts have held that a de facto employment situation exists if the controlling employer simply reserves the right to exercise control.

Protecting yourself

Here are some ways to safeguard yourself from joint employer liability:

  • Ensure that all subcontractors have employee liability insurance and general liability insurance of their own.
  • Check out the vendor or subcontractor’s track record with safety and OSHA-related claims.
  • Research the subcontractor’s bonding history.
  • Ensure your employer’s liability insurance covers claims that may arise from contractors and vendors working on your property, or on worksites your company controls.
  • Negotiate for an indemnification clause in any vendor contracts or subcontracting arrangements.
  • Don’t rely on verbal assurances: Put the subcontractor’s responsibility for complying with OSHA standards and labor laws, rules and regulations in writing, as part of the contract.
  • Hold regular safety meetings with representatives from the subcontractor’s firm, and document them.
  • Don’t sign a contract with a manpower or employee leasing firm unless you have looked through it for exposure to liability from their employees.
  • Ensure the vendor or subcontractor is providing job site supervision. At a minimum, ensure their management is checking on the site regularly. If all supervision is left to you, federal regulators may deem these workers to be your employees.
  • Don’t discipline the subcontractor’s workers directly. Work through the subcontracting entity wherever possible. If your supervisors attempt to discipline their employees, or direct their work too closely, courts may find that a de facto employment relationship exists with your firm as well as with the subcontractor. This exposes you to liabilities that these employees may cause.
  • Train your middle managers and foremen that they should not attempt to take on the role of supervisor to subcontractors’ employees and onsite vendors.
  • Don’t lend heavy equipment, power tools or vehicles to subcontractors on the job site, unless you also send a designated operator. Contractors are expected to have and maintain their own equipment. Also, when you send your own operator with a forklift, for example, you can help ensure that the subcontractor doesn’t expose you to liability because of an accident caused by an unqualified operator.

For more information, or to schedule an insurance and risk exposure review, call us today.

BGES Group’s office, located in Larchmont, NY is a full service insurance agency offering, Property, Liability, Umbrella Liability, Business Auto, Bid & Performance Bonds, Inland Marine, Worker’s Compensation, Worker’s Compensation Premium Recovery, New York State Disability, Group Health, Life insurance, Personal lines and Identity Theft.

Special Contractor Insurance Programs (NY, NJ, CT) – We we have 60+ insurance companies to market your general liability, umbrella liability, business auto, workers compensation, bid & performance bonds and group health coverages. We help contractors set up proper risk transfer. If you’re a contractor we offer extensive information about insurance markets, coverages, risk transfer, subcontractor screening, ways to lower your insurance costs.

BGES Group are Worker’s Compensation Specialists for the States of New York, New Jersey and Connecticut – Issues we address: 1) Lowering pricing – we have specialty programs that can save you up to 40%; 2) Finding a new company; 3) Replacing policies that are being cancelled or non renewed; 4) Audit disputes; 5) Company creating fictitious payroll at audit time; 6) Lowering high experience modifications factors; 7) Misclassification of payrolls; 8) Lowering or eliminating renewal deposits;  9) Getting coverage when you’ve been without for a few months; 10) Covering multiple states under one policy; 11) Eliminating 10% service or policy fees; 12) Timely issuance of certificates; 13) Always being able to get someone on the phone or by email when you need to.

If you would like to speak with us call Gary Wallach at 914-806-5853 or click here to email or click here to visit our website.

Company: BGES Group, 216A Larchmont Acres West, Larchmont, NY 10538

e-mail: bgesgroup@gmail.com

website: http://www.bgesgroup.com

© – Copyright – 2022 – BGES Group

Protecting Your Firm as an Additional Insured

IN THE course of doing business, you may sometimes find yourself entering into contracts requiring that your firm be named as an additional insured on another party’s insurance policies.

This is often done to make sure that your own insurance is not depleted by defense and indemnification costs for losses for which you may be legally liable as a result of the business relationship you have with the other party, but that are not due to your own firm’s direct negligence.

Definition: An individual or entity that is not automatically included as an insured under the policy of another, but for whom the named insured’s policy provides a certain degree of protection.

When to Be an Additional Insured

There are many times when you may want your firm included as an additional insured on another’s policy. Here are just a few examples:

  • If you are a building owner, you want to be an additional insured on the property and general liability insurance of your tenants in case one of them damages your building or in case a visitor to the property is injured.
  • If you are the owner or a contractor on a construction project, you want to be an additional insured on the general liability insurance of your contractors and subcontractors in case there is an injury to one of their employees.
  • If you are a distributor or a retailer, you may want to be an additional insured on the insurance programs of the manufacturers of the products that you sell.
  • If a contractor comes onto your property to perform work of any type, including erecting displays or maintenance or structural work, you will want to be named as an additional insured on their policy in case the display falls on someone, or someone is injured due to the work they are performing. You don’t want to be held responsible for any dangers or injuries created by their work.

If you are to become an additional insured on another company’s policy, confirm that the other party has indeed named your company as such with their insurance company.

You should ask for a copy of the policy that explicitly lists your company as an additional insured. You want to see a copy of the policy and the certificate of insurance, although the latter is not sufficient proof that your company has been added.

Additional insured status is effectively conferred through an additional insured endorsement to the other party’s original insurance policy.

An endorsement serves as an amendment to the terms of the policy that is incorporated into the relevant insurance policy. These amendments can take the form of an endorsement that specifically names a particular additional insured, or a general endorsement that identifies some class of parties as additional insureds.

If there is a dispute about your company’s status as an additional insured, you will want to have in hand not only the other party’s certificate of insurance, but also a copy of the policy itself and the endorsement that makes your company an additional insured.

There are a few best practices that you can implement to help make certain your firm’s status as an additional insured has been properly secured:

  • At a minimum, always insist on receiving a copy of the relevant additional insured endorsement, as this is the instrument that establishes additional insured status;
  • An additional insured endorsement does not, however, state an insurance policy’s terms and conditions. In order to avoid being surprised by unexpected policy terms (such as strict notice requirement or unfavorable notice of cancellation provisions), you should ask for and receive a copy of the entire insurance policy under which you are an additional insured, and be sure to read it;
  • Retain additional insured endorsements and the relevant insurance policies for as long as there is any potential that claims triggering those policies might be made.

BGES Group’s office, located in Larchmont, NY is a full service insurance agency offering, Property, Liability, Umbrella Liability, Business Auto, Bid & Performance Bonds, Inland Marine, Worker’s Compensation, Worker’s Compensation Premium Recovery, New York State Disability, Group Health, Life insurance, Personal lines and Identity Theft.

Special Contractor Insurance Programs (NY, NJ, CT) – We we have 60+ insurance companies to market your general liability, umbrella liability, business auto, workers compensation, bid & performance bonds and group health coverages. We help contractors set up proper risk transfer. If you’re a contractor we offer extensive information about insurance markets, coverages, risk transfer, subcontractor screening, ways to lower your insurance costs.

BGES Group are Worker’s Compensation Specialists for the States of New York, New Jersey and Connecticut – Issues we address: 1) Lowering pricing – we have specialty programs that can save you up to 40%; 2) Finding a new company; 3) Replacing policies that are being cancelled or non renewed; 4) Audit disputes; 5) Company creating fictitious payroll at audit time; 6) Lowering high experience modifications factors; 7) Misclassification of payrolls; 8) Lowering or eliminating renewal deposits;  9) Getting coverage when you’ve been without for a few months; 10) Covering multiple states under one policy; 11) Eliminating 10% service or policy fees; 12) Timely issuance of certificates; 13) Always being able to get someone on the phone or by email when you need to.

If you would like to speak with us call Gary Wallach at 914-806-5853 or click here to email or click here to visit our website.

Company: BGES Group, 216A Larchmont Acres West, Larchmont, NY 10538

e-mail: bgesgroup@gmail.com

website: http://www.bgesgroup.com

© – Copyright – 2022 – BGES Group

Five Tips for Employing Teen Workers

As summer nears many businesses are ramping up hiring of teen workers, with many companies this year taking them on as they deal with the labor shortage as the country emerges from the COVID-19 pandemic. Others employ teens year-round.

Taking on a teen worker comes with added responsibility in terms of compliance with state and federal laws, as well as workplace safety. Each year, 70 teenagers die while working in the U.S., while about 100,000 are injured seriously enough to require emergency room treatment.

Keep in mind there’s a lot that employers can do to prevent injuries to their teen workers, and the measures you take to keep them safe will help protect all your employees. The following are some tips you can follow if you employee teenagers:

  1. Workplace safety вЂ” Know the law and OSHA workplace safety and health regulations, which are designed to protect all employees, including teens, from injuries. Ensure that all jobs and work areas are free of hazards. The law requires you to provide a safe and healthy workplace. Involve every worker in your Injury and Illness Prevention Program.
  2. Train teens to put safety first вЂ” Give clear instructions for each task, show them what safety precautions to take and point out possible hazards. Prepare teens for emergencies, accidents, fires and violent situations. Show them escape routes and explain where to go if they need medical treatment.
  3. Increased supervision вЂ” Teenage workers not yet accustomed to working typically require close supervision, and they may also require more instruction and repetition to learn a task than their adult counterparts.
    Instill good working habits in teen employees by encouraging them to ask questions and always request assistance when necessary. Be patient, even when you find yourself answering the same question more than once.
  4. Check your compliance вЂ” Make sure teenagers are not assigned work schedules that violate the law, or are given prohibited tasks like operating heavy equipment or using power tools. Also ensure they have their work permits if aged under 18.
    The Department of Labor has strict rules about 14- and 15-year-olds, particularly in terms of hours they are permitted to work. Although there are no specific federal laws restricting the working hours of minors age 16 and 17, you must comply with all state laws that do, as well as any state laws that further restrict the working hours of minors age 14 and 15.
  5. Know the law вЂ” Make sure also that your supervisors who give teens their job assignments know the law. Encourage supervisors to set a good example, as they are in the best position to influence teen attitudes and work habits.

The takeaway

Your teen employees are the next generation of workers in the U.S. The teenagers you hire develop personal skills that make them more likely to go on to further their education and succeed in life. As you hire these young people, know that you do make a difference.

Educating them about professional standards, workplace health and safety, rights on the job, and how to communicate effectively will shape the workplaces of the future, as well as keep your business running smoothly.

BGES Group’s office, located in Larchmont, NY is a full service insurance agency offering, Property, Liability, Umbrella Liability, Business Auto, Bid & Performance Bonds, Inland Marine, Worker’s Compensation, Worker’s Compensation Premium Recovery, New York State Disability, Group Health, Life insurance, Personal lines and Identity Theft.

Special Contractor Insurance Programs (NY, NJ, CT) – We we have 60+ insurance companies to market your general liability, umbrella liability, business auto, workers compensation, bid & performance bonds and group health coverages. We help contractors set up proper risk transfer. If you’re a contractor we offer extensive information about insurance markets, coverages, risk transfer, subcontractor screening, ways to lower your insurance costs.

BGES Group are Worker’s Compensation Specialists for the States of New York, New Jersey and Connecticut – Issues we address: 1) Lowering pricing – we have specialty programs that can save you up to 40%; 2) Finding a new company; 3) Replacing policies that are being cancelled or non renewed; 4) Audit disputes; 5) Company creating fictitious payroll at audit time; 6) Lowering high experience modifications factors; 7) Misclassification of payrolls; 8) Lowering or eliminating renewal deposits;  9) Getting coverage when you’ve been without for a few months; 10) Covering multiple states under one policy; 11) Eliminating 10% service or policy fees; 12) Timely issuance of certificates; 13) Always being able to get someone on the phone or by email when you need to.

If you would like to speak with us call Gary Wallach at 914-806-5853 or click here to email or click here to visit our website.

Company: BGES Group, 216A Larchmont Acres West, Larchmont, NY 10538

e-mail: bgesgroup@gmail.com

website: http://www.bgesgroup.com

© – Copyright – 2022 – BGES Group