ECN Forum Forums General Topics of the Trade Business Related Discussion The GC / Sub Relationship

One of the biggest developers in the area (country?) just went belly up, WCI Properties. Mailings went out to thousands of people around here. I bet there are a lot of people who will be left with unpaid bills. My wife got one but she doesn't think they owe her people anything. I told her to wait and see who will claim she isn't getting paid because they didn't get paid. The court got her name from somewhere.
I really feel bad for the little guys who think they were working for someone who would pay them. Now they are a couple hundred down on the pecking order in bankruptcy court.
The cruelest blow will be when the #1 guy sues everyone else to get them to quit their claim. That happened to a guy I know who had worked himself up to #146 or so in the Evinrude bankruptcy. Bank of America had him served with a show cause order.

How would you feel if your employees gave out their business cards to your customers for future work? completely urelated to the job your involved in.

Employees arent property they are free to do whatever they want with their free time, right? wrong, and it's not a matter of using your materials or tools that you would have objections to this issuse, it's a matter of princple.

I hear alot about dangling carrots, and thats unfortunate alot of subs have been hurt by GC's but a well oiled machine demands there be rules, even unspoken ones.

Watt work, I admire your devotion ... it's pretty late!

The comparison of employees to independent contractors strikes to the heart of the matter. Independent contractors are NOT employees. They carry their own licenses, bond, and insurance. That's why they're called 'independent' contractors.

So, the issue of an employee performing contracting raises all manner of legal issues, all by itself.

If the legal requirements are met, the employee IS absolutely free to do as he wishes when he's 'off the clock.' The employer has absolutely no say in said employees private time. This has been reflected in numerous legal rulings, where employers attempted to exercise control over such time ... even to the extent of directing religious, political, and family activities.

That sort of thing went out with the 13th amendment.

Now ... I suggest you take your "I get to limit the activities of another contractor to your local contractors' board, and see what they think. While you're at it, you might ask your attorney about 'restraint of trade' laws.

The 'understood conditions' you assert border on the illegal; they're certainly immoral.

That is an entirely different thing, your sub-contractors are not as you put it above, your employees, they are only contracted to you for a short period of time, otherwise you would be providing them with safety gear and the like.

This is what some General Contractors, no matter how young, don't seem to be able to fathom, if you annoy "your" subbies enough, you WILL run out of guys to do "Your work",
use this rule at your own peril.

GC's didn't get a bad name with subbies over-night.

We all have a bad name,(flaky,slow,always late,forgetful) sometimes unfounded, Like I said I've been working with the same bunch of guys for 15 years, I personally have only had this conversation about twice and the one time I can point out it was breaking a new sub in.

Most property managers we work with ask me if my electrician can take a look at something on a different floor, I always pay upfront and on time, whereas the building takes 30-45 days from recieving the bill, somewhere in the middle of the job if not after. My guys don't mind the 20% I make and the building knows that there is more accountability. (3 million in general liability insurance).

Now imagine if the building's project manager talked to everyone directly; the drywallers, electrician's, plumber's, painters where would I be? General's depend on their contractors just as much as the subs depend on the generals. I'm getting calls now from my subs because WE are out of work, thing's are dryed up and one developer told us two months ago; to take .60 cents on the dollar or I should get in line. All my subs are paid and it looks like I'm out $45,000 or Lawyers fees.

John, I don't suppose you have read many employee contracts. Most employees of any large corporation sign an agreement than can be several pages long telling them what they can't do on or off the clock.
This has even gone as far as banning smoking on your own time and other things that are far from personal freedom. Virtually any tech company makes you sign a "no compete" and intellectual property agreement. We gad a guy at IBM who got fired because he was selling boat propellers on the side ... on his own time. The contract was so air tight, he couldn't find a lawyer who would take his case for a taste.

Greg, as you noted, such restrictions are so unusual that they need to be specifically called out in advance. Likewise, such agreements are subject to a great deal of litigation ... and frequently not enforced by the courts.
Not that it has matters .... the outlawing of slavery did not prevent Texan employers from foisting 99 year 'contracts' on illiterate former slaves, and attempting to have them enforced.

None of that applies here, for two reasons: there is no such specific agreement, and none of the parties are employees.
In the example you cite, I suspect that IBM relied upon the idea of 'at will' employment. That is, essentially, what the GC is threatening to exercise: do things my way, or I won't let you play with my ball.

Otherwise, all cant aside, let's look at the practical barriers to enforcing the 'understanding' that the GC is asserting exists:
Assume the customer has an additional project. Is the first GC asserting that the customer must hire him again?

Assume a job has been bid by several GC's. Is our GC asserting that the sub cannot furnish bids for his part of the job to several GC's?

Assume a job arises that does not require a GC. Is the GC asserting that the sub is required to hire him anyway?

Assume the customer - or anyone, for that matter- has obtained the sub's number from the truck, the phone book, another referral, etc. Is the GC asserting that the sub is barred from accepting such work?

Suppose the GC needs another sub for some task. Is the heating guy supposed to stop taking service calls because he did a job with the GC? Or the plumber? Would the GC be upset if the roofer returns after a storm to make repairs five years from now?

I'll be that, should there be an accident on site, that the GC suddenly becomes an expert on the topic of 'independent contractors.' He's not about to let that loss affect HIS insurance premiums! Or pay the sub's unemployment insurance. Etc.

The GC can't have it both ways. Either he has employees, or he hires a contractor. What happens apart from that specific job is of no concern to the GC. He surely would object if the sub insisted that the GC only use him .... or only bid on jobs with the sub's approval.

Ironically, for the GC, the electrical contractor is in a much stronger position; in some ways, it is the EC who's in charge - not the GC. Unlike nearly every other contractor, the EC pulls his own permit, and signs off on the plans. He goes, the permit is void.

Contract law is based upon the 'legal fiction' of the parties being equal. Maybe it's best to make that fiction a reality, and leave all the other baggage aside. Call it the 'four corners' doctrine: if it's not in the 'four corners' of the contract paper, it's simply not part of the agreement.

This is the exact reason why I don't do work for GC's . This guy actually believes the Sub contractors are his employees. He believes this because there are way too many Electrical contractors out there that let GC's pull this nonsense.

Let me tell you something Watt man or whatever your name is, The Subcontractors that bid and win the jobs where you are the GC are Contractors. They Contract a job and then fufill the contract, they have no other obligation to anybody especially the GC who is nothing more than a middle man.

When you start paying your own workmans comp for electricians, Liability insurance, license fees etc. and get licensed in your state then you can hire all the Electrical "Employees" you want.

Until then go hammer some 2x4's together and try to take a bath every couple of days, which for some strange reason most GC's and they're retarded employees are unable to do.

Rich, I appreciate your passion. My own posts on this topic have had a fair amount of 'feeling' behind them as well.

Watt Work didn't start this thread - I did. He just brought it back to life.

As far as attitudes go, he just affirmed what another poster, in another forum, asserted. It was from this other forum that I copied, and pasted, the paragraphs that started the thread.

Oddly enough, the attitude isn't limited to GC's alone. For years I have worked together with a plumbing contractor, and it has been a relationship that has benefited us both.
Yet, his guys bungled a job - it happens to us all - and the customer called in another plumber .... who, in turn, called me. Now Plumber #1 is all upset that I was there helping Plumber #2.

This revealed two separate issues:
First of all, you have to be able to trust your fellows. Plumber #1 was afraid that, somehow, I was undermining our relationship. There were the usual suspicions of going behind his back, dealing direct with the customer, making the other guy look good at his expense, etc.
The second issue, of course, was: WHO is the customer?

You over-think this stuff, you'll drive yourself crazy. As for my passing out cards to the final customers ... it's their property, and they have every right to know who I am, who sent me, and why I am there. To expect otherwise is simply improper.

Now ... to carry this a bit further .... what if this customer wants his lights worked on? Going through his desk, he sees my card, and gives me a call. I think we can all agree that the lighting has nothing to do with the water heater that first brought me there. Why on earth would I call either of these plumbers, to 'clear' my going to work on the lights?
Yet, that is what the GC's are asserting.

One more point ....
EC's are often in a position to act in the place of a GC. I've often had to bring in other trades, and see that they get scheduled, paid, etc. Sometimes I've even brought in a GC.
Oddly enough, GC's can serve a useful purpose.
Likewise, it has always been my assumption that every journeyman, of any trade, is a skilled professional ... and I try to treat them as such.
Therefore, let's not get into personal attacks or name calling, please.

The situation can get really goofy when a GC has his cast of 'pet' subs, and - for whatever reason - you get the job, rather than 'his' guy. I've even had (a very few) of these other subs try to disrupt my work, just to try to make 'their' guy shine.
Such behavior is both unprofessional and futile.

Whoa! slavery?! obligations?!, Pets?!? you guys need to relax... I'm talking about a team effort not manditory rules. my subs are free to do whatever with whoever whenever! I don't need to tell them not to go around me, they RATHER work with me than for the H.O/P.M.

I represent a good 30-60% of their business, and if i'm cut out of the loop with a owner, fine, so now I'M OBLIGATED to give that person more work?! No, if he or she feels that I'm holing them back, there's the door! no hard feelings.

You guys have obviously been screwed over before, but it's not the way I do business. and I'm not talking about onesy twosies jobs I'm talking about the same crews on every job!

Take food of my table and I'm not OBLIGATED to put food on yours!!