Tuesday, July 28, 2009

Managing Risk in Construction

The following blog post, although brief, highlights how important it is to plan for possible problems that can occur in the construction business and how to prevent them:

Dare I say, but it is so true! "An ounce of prevention is worth a pound of cure."

I understand business is tight right now. I know the last thing a business owner wants to do is spend money. However, the time to get your business in shape is now, when you are not busy. Make a list of your top twenty referral sources and see how they are doing. Review your insurance policies and make sure they are up to date and provide you with adequate coverage (even we lawyers hate doing that).

When was the last time you updated your contract? Is it still in compliance with your state's laws? What if someone gets hurt on your job? If you have a homestead act in your state, you should file a homestead to protect your family's home.

Are your incorporation filings up to date? In some states a plaintiff could "pierce the corporate veil" if you do not follow corporate formalities and hold you individually liable.

Do you hold all of the necessary licenses and registrations for your area of construction? Massachusetts had a new edition of the building code go into effect, and there are now areas that require additional licensing (roofing and siding for example).

Do you have an employee handbook and work policies? Are you paying independent contractors who would now be considered employees under MA law?

In addition, now is the time to learn more about developments in green construction, energy and aging in place.

Money and time spent now for risk prevention will more than pay off if a dispute arises or an accident occurs. Pay me less, but pay me now.