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Best practices when hiring contractors .

Posted 3/11/2019

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Owning residential and commercial property means that repairs and renovations are inevitable. Whether small or large—emergency fixes or routine upkeep—selecting a reliable contractor is essential. Taking a moment to review these hiring practices can help prevent a costly claim down the road.

  • Before hiring any contractor, check references and contact prior and current clients, if possible.
  • Check licenses, OSHA complaints and litigation history. You can check the disciplinary boards, Better Business Bureau and local court records for problems. If adverse, do not hire. To check licenses, you can use:
  • If possible, ask an attorney to review your contract for the work to be performed. Whenever possible, the contract should include the following, subject to your counsel’s advice:
  • A requirement that the contractor carry General Liability Insurance limits of a minimum $1 million each Occurrence & $2 million in the Aggregate.
  • You (as either the Owner or Property Manager) qualify as an “Additional Insured” under the General Liability policy in respect to all liability arising out of the activities/premises described in the contract.
  • “Primary and Non-Contributory” wording, along with a waiver of the right of subrogation in favor of you (as Owner or Property Manager).
  • Indemnification language that holds the Owner and Property Manager harmless.
  • Owner and Property Manager must be endorsed on the policy to require that they are given notice if the policy has been cancelled.
  • If the contractor plans to hire subcontractors, the same insurance requirements should apply to their work.
  • No work should begin until written contracts with indemnification language have been completed and signed.
  • Ensure that the contractor has completed jobs similar to yours before hiring and confirm how long they have been in business.
  • Make sure that the contractor is OSHA compliant. You can refer to the OSHA Compliance website to conduct a search to see if the potential contractor has been fined for non-compliance.
  • Confirm with the contractor that proper fall protection is provided and its use is enforced.
  • Confirm that a daily documented inspection is in place for all safety equipment, ladders, scaffolding, hoists, platforms, etc.
  • Ensure that formal safety training is provided by the contractor to all employees.
  • Owners should NOT provide fall protection, equipment or ladders to any worker. If that equipment fails, no matter the contractual agreements indemnifying them, the owner will likely be held liable.

Note: Distinguished Programs offers these Best Practices for informational purposes only (not as legal advice in any respect). Consult an attorney for advice specific to your situation.


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