Just wondering how some of you deal with contractors that you sub for deal with not getting paid.I have talked to a couple of lawyers and they say i can sue and win but when your dealing with theses type of contractors they know that it doesnt meen i'll get paid...any advice would be helpful.
I live in ohio if that helps.

JohnD24:

You ask a tough question....the method that I used is as follows:

Our Association (NJECA) has a collection agency, and if necessary a lawyer that 'assist' the electrical contractor members. The agency works on a commision, of what they collect, and need be the attorney works for a percentage of what he collects also. (NO out of pocket costs)

The best solution is to steer clear of the deadbeats. Other EC's (your competitors) MAY spread the word of the deadbeats, if you talk to them.

Luckily, I have a very good customer base now, and don't have these problems anymore. The bad apples were weeded out, I took my lumps, got what I could. Recently got a check from a bad debt from 8 yrs ago. Had a lein on the guys house, he wanted to re-finance, the lein showed up in the title search, I got $$$, and yes, the agency got there cut....they did all the legwork, paperwork, etc.

Be careful & good luck

John

i had inquired to a number of collection agencies , many of whom had letter writting campaigns focusing on customer retention.


i couldn't quite figure out the rationale of sucking up to someone that was screwing me so i passed them on

until one young man (who came to my office)informed me that his agency was not to be used unless i wanted to 'go for the throat'

after some background checks (BBB, state AG, and the locl cop shop for any known body count) i signed on...


btw~
note on the mech liens, you loose if the dwelling goes up for tax sale folks!

(unless your the winning bid, yet even then they can exercise right of redemption)

~S~

We can lein and sue but that does not force them to pay us what were owed.We have no rights,even if we have a written contract.
I guess all we can do is look for the aces in the deck and do some weeding....I think we can also use inspections as a meens of getting paid...like final inspection when paid in full......its a shame that it has to be that way...thanks guys

..John, I got stiffed 1-1/2 yrs ago for $6000.00 and although I pursued the S.O.B., he sure enough went belly up on me and declared bankruptcy..I should've seen the warning signs..he started shafting the home owners first, then us, the tradesmen...We're thinking he's just gonna high-tail it back to Poland, and live like a Czar, with the money he stole from everyone...I was naive,..that was my fault,..he took advantage of a good soul, and he'll get his in the end...I've learned alot from this, and now it's no more Mr. Nice Electrician,...Money up front,...or...so long..from now on...
..It's a terrible thing when someone ruins something for everybody else...
AR

i like it!, maybe i'll alter my biz card Attic Rat...

~S~

I could never figure out why so many well established electricians paid for such expensive ads in the yellow pages, then a friend/elec.contractor told me why. He said it was better business to deal with the end user, the customer, directly. He had many financial difficulties working as a sub for contractors, late payments or being practically held hostage for your money and having to do some unpaid extras to get full payment. It's best only to work for GC's you know. Sometimes you have to ask yourself why a GC, whom you never met before, wants to give you the new guy thousands of dollars worth of work. He most likely thinks he will make more money for himself with you, one way or another!

Andy

Amen brother...........How do you go about setting up a pay schedule with a new gc that you are leary about?

..Whats wrong with asking for references???
They'd ask you,if they were so inclined to..
If I were getting together with a new GC,and he's proposing some "big" work, I'd run a check on him fer sure!!,,also it helps if its a larger company..These little fly-by- nite guys scare me...I've had one GC,for about 2 years now,and its good work..at least I know him and his company, and it doesn't hurt so much when he penny-pinches now and then...at least I know what I'm in for,and I guess you can say, I'm used to it..at very least,he pays...which is more than I can say about some other people...
AR

This is an age old problem.
I remember my first year of apprenticeship ('71) and the contractor I worked for (Wasatch Electric)had us load up all of our material we had just unloaded the week before, park the trucks at the shop, and sent us to a job in the next town. Seems the general contractor was late on his payment. Three days later all was well, and we finished Salt Lake's First Hilton Hotel on time.
Sometimes you gotta send a message to the GC. BTW, all the trades pulled out together. There is power in unity.
Earl

We were always a small contractor, but had a reputation for doing quality work, and ususlly had a reasonable price. There were those jobs where we were just outbid. I should say that this was back in the late 80's early 90. It was during that time that our area's economy was heading for the toilet. There were a number of projects that somehow ran out of funding. We had always legally pursued monies that were clearly owed to us, but the percentages quickly outweighed our ability to stay afloat. When we looked back at what our legal expenses were, the addage about lawyers were the only ones making money proved true. I remember "closing the doors" on Haloween of 1990. It was very debilitating, to say nothing of the monetary losses we incurred. We had our problems, but workmanship wasn't one of them. I believe that to be a true "contractor", knowing your trade and how to apply that in the field are only 50% of the equation. The rest must be that of "business" and "money". If you're a one man band, it's a bit different, but growing larger brings a whole nest of other responsibilities.

JohnD24:
As to your idea of, no final inspection until paid in full.....

The esteemed lawmakers in our state capital decided in the interest of consumer protection to adopt the following LAW.....

Final payment is due the contractor upon final inspection/approval. This is not the verbatum wording of the law, the law book is in my truck.

A two sided sword, without a handle???

What eloquent words have ye, Sparky???

John

John,
We were were bonded, so we could collect before inspection. The idea was if a job was incomplete, or did not pass inspection, the bond would be pulled and you were out of business. Who are these Legal &&)&&^ in Trenton. Every Electrical Contractor in the state should be mad as he77.
The Consumer law was needed for non licensed and non bonded Contractors, not us.

[This message has been edited by LK (edited 01-29-2004).]

LK:

You hit the nail dead on. Unfortunatley, the FEW bad contractors, be they of whatever trades are the cause of consumer protection laws.

Reading some excerpts from the EC Law Book, to a few EC's that needed a 'refresher', you may be surprized how many (or few) do not understand the term "professional mis-conduct", nor the consequences of that charge. "Price gouging" is also addressed, and that was a shock to someone also.

Having the GC's get a license may help, but you still have good old Chapter 7,11,13 and god help the subs.

Fortunatly, the DCA listens to both sides, as does the Board of Examiners regarding Consumer complaints.

For the members of this forum that reside and work in no permit, no lic, no inspection areas, I feel for you guys. Remember Virgil, aka Sparky66WV???

John

John,it's not all bad,but if you're just starting out,it's a tough go when you start code-thumping.

95% of the work I do is for people who don't know good work from bad,and there's no one to tell them the difference.

This is the primary reason we do plumbing,and septic installation/repair,waterlines,a few footings,and some other stuff in addition to electrical. We used to get outbid a lot until I found 3 builders that WANTED quality work,and were willing to pay for it.

If We didn't do the "other stuff" we couldn't make a decent living bidding jobs done to comply with The Nec.

Russell

What happened to Virgil?

"a few EC's that needed a 'refresher', you may be surprized how many (or few) do not understand the term "professional mis-conduct", nor the consequences of that charge. "Price gouging" is also addressed, and that was a shock to someone also."

I need a refresher too. Where can I get more info on what you're talking about?

To make a long story shorter,Virgil was an EC working in WV in an area with no code enforcement. Virgil was/is a good man,and a good electrician who was constantly striving to be 100% code-compliant.

He was constantly forced to bid against people who could care less about code compliance. Last time I heard from him,he was out of the trade.

Russell

I put in terms of payment 1/3 to start, 1/3 for rough in, and 1/3 for final. I am pretty much guarenteed 2/3 if they want the project done. If a G.C. pays you upfront usaully there good to pay the rest of the way.


[This message has been edited by wall-i-slayer (edited 01-29-2004).]

John,
Do we drop our bond now, since it serves no purpose.
The Board must have been isolated from reality, at one time, when business practices were discussed, they said that you should not mark-up your material more than 10%, well if you move a stack of 1/2 rigid conduit, there goes the 10%. This statement was made years ago at a group of new test takers. So when you say "Price gouging", this can include those of us who may mark-up more than 10%. Most of the EC's try to conduct business in an Ethical way, however Ethics, mean one thing to me, and another to someone else, you cannot define Ethics. The Board has defined Rules, which if not followed, will lead to Misconduct, for those who are licensed. I think most of us worked very hard, and long hours to get our license, and do not want to lose it for any reason.