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sub work

Discussion in 'Business Fundamentals' started by JTS Landscaping & Lawn Service, Mar 17, 2008.

  1. ive done sub work for a company for 5yrs now. i want to get a guy doing some sub work for me next season while im still subbing for the one company. im wondering all what forms should i have them fill out and what not. i know they need to have there own insurance what not. never had to sub out any work before and would definitally like to get into doing that more and expand my business. anything would be helpful. thanks
     
  2. QuadPlower

    QuadPlower PlowSite.com Addict
    Messages: 1,056

    Do you plan on getting your own contracts to give out to the sub you want to hire or are you going to give the sub you hire jobs that are subbed out to you?

    Search goggle for "sub contractor contracts" that will get you started. You will have to change the wording and put in what you like and take out what you don't like.

    Hiring a sub to to work that you were hired as a sub to do might be weird. If I was the guy that hired you, I did so because I know your work and your reputation. If you send out a sub to do the work I hired you to do, I would at the very least want to know that is what you plan to do.

    If I get $100 for the job and I hire you to do it for $50 and you hire a sub to do it for $25. I hope the sub you hire doesn't drop you and come straight to me.

    I don't hire subs that hire subs, so this might happen all the time.
     
  3. i was planning on getting my own accounts to sub out to another guy. so that way im able to still able to sub for the company i have been for 5yrs now. that way when its not snow and i have some my own can still make some money and not have to wait for it it snow inorder to make money.
     
  4. jimaug87

    jimaug87 Senior Member
    Messages: 179

    Why don't you just plow the accounts you pick up? Then you wouldn't need to work for someone else.
     
  5. KGRlandscapeing

    KGRlandscapeing 2000 Club Member
    Messages: 2,660

    ok here ill try and clear this up. he subs because the checks roll in but to make his company bigger he cant afford another truck of his own. so in turn he hires a sub so that he can get more work. kinda like an emplyee with his own rig. the sub dose the other work that he bids not that the guy hes subs for dose.
     
  6. Clapper&Company

    Clapper&Company PlowSite Veteran
    from NE OHIO
    Messages: 4,413

    I understand LOL

    They need to have a W9 and Ins as well as Workers Comp.

    I make mine sign a 5 year non Complete Clause. O and thats 5 yrs after my contract ends:D
     
  7. you got it right KGRlandscaping. thanks for the help on what they need fill out and what not hopefully next season will be even more better.
     
  8. SnoFarmer

    SnoFarmer PlowSite Fanatic
    from N,E. MN
    Messages: 8,518



    http://www.irs.gov/businesses/small/article/0,,id=99921,00.html

    IF you have been a subcontractor for 5 years you should know this already?

    What forms did you fill out?

    When I hire a contractor to be a subcontractor I want to see there business lic, a copy of there INS policy then you fill out a 1099.
     
  9. SnoFarmer

    SnoFarmer PlowSite Fanatic
    from N,E. MN
    Messages: 8,518

    You only w9 and pay workmans comp for employees, not contractors..
     
  10. Burkartsplow

    Burkartsplow PlowSite Veteran
    Messages: 3,245

    Hey Ron. I dont think it is legal to to sign a 5 year no compete clause. I think the longest period of time is 2 years. The person signing may not know you only legally can have them sign a two year, but 2 years after they have not worked for you then the no compete clause is null and void. Correct me if I am wrong, but i had an old employer try and make me sign one for 5 years and I called up my lawyer and he said it is like the statue of limitations. For example if you get in a car wreck, you have two years from the time of the wreck to sue the other motorist for damages or anything else. Same thing just reversed. After two years then they can compete with you. sorry to go off base on this thread. just wanted to throw some info out there. Correct me if i am wrong that is for
    sure....ussmileyflag
     
  11. KGRlandscapeing

    KGRlandscapeing 2000 Club Member
    Messages: 2,660

    i would like to see if that really is true just out of curiousity
     
  12. LHK2

    LHK2 Senior Member
    Messages: 205

    Sorry, If you sign a non compete, it's all legal, there's no staute of limiations. I sold off one of my companies 4 years ago and we both signed 5 year non competes. You can have it ten years if you want. Otherwise, you may have a large law suit on your hands. t's not like a car accident where you have only two years.
     
  13. QuadPlower

    QuadPlower PlowSite.com Addict
    Messages: 1,056

    I'M NOT A LAWYER. I just watch a lot of them on TV

    Like LHK2 said. If you sign a contract it is a contract. You read and signed so you must do what it says.

    Good points SnoFarmer about him being a sub for 5 years. Any body wanna bet he is really an employee?
     
  14. Burkartsplow

    Burkartsplow PlowSite Veteran
    Messages: 3,245

    I am not saying it is exactly like a car wreck. I am saying that you can not have it for that many years. You guys may have agreed on 5 years, but i dont think it is legal. there has to be a limit, you cant put down 20 years and sign it and have it be legal that is the thing i am saying. here is some info i found on lawyer.com. two years is an acceptable amount for an employe/employer agreement. for your case 5 years is more acceptable. but it does say that an agreement for the E/E can maybe only last for the amount of time it takes to hire and train a new employee to take your position. and if you sign it after you are already employed and dont get anything in exchange for signing it then it is null and void in most cases.

    * Rule of Reasonableness: In order to be valid, a non-compete agreement must be reasonable. Courts recognize that employers have a legitimate interest in protecting the time, investment, and other resources they have invested in employees, but that interest must be balanced against an employee's job mobility in a free enterprise system. Courts generally will scrutinize non-compete agreements carefully to make sure that they are geared to protect the reasonable business interests of an employer without unduly limiting an employee's other work opportunities. Therefore, these arrangements must usually be tailored narrowly to restrict truly competitive activities without forbidding an employee from working in the same industry or profession in a way that is not competitive.
    * Independent Consideration: In many states, a non-compete agreement is valid if entered into at any time after an employment relationship begins. But in some states, courts will not enforce non-compete agreements unless the employee gets what is termed "independent consideration" - in other words, if they get something in exchange for signing the agreement. If this principle applies in your state, a non-compete agreement will be valid only if it is signed at the time employment commences, or at a later date if the employer gives you some additional benefits such as increase in salary, promotion, or other items of value.
    * Duration: In order to assure that these contracts are not too stifling, courts will generally require that they only last for a limited amount of time. The duration depends upon a number of circumstances, including how long it will take to train another employee to take over the position being vacated. Generally, non-compete agreements one or two years in length will be valid, and longer time periods may be suspect. Courts generally will permit longer non-compete periods in connection with a sale of a business when a new buyer insists that the old owner refrain from competing for a prescribed period of time. In these situations, courts reason that the parties should be permitted to negotiate whatever time frame they want since the exchange is less coercive than it is in an employer-employee relationship.
    * Distance: In addition to duration, a non-compete agreement often must have reasonable geographic limits. In today's global economy, the distance factor is less significant than it has been in the past. But if an employer has a particular market area, courts may refuse to enforce non-compete agreements that extend beyond that. For instance, a cosmetology business that draws most of its customers from a radius of 10 or 15 miles probably couldn't limit a former employee from working in the cosmetology business outside of that market area.
    * Blue Pencil Rule: Many courts follow the "blue pencil" rule, which means if an agreement is too restrictive, the courts can modify it and then enforce it. But in some states, the "blue pencil" rule is prohibited, and courts must either uphold non-compete agreements as drafted or invalidate them entirely.
    * New Employer Liability: In many states, employers who lose an employee to a competitor in violation of a non-compete agreement can sue the new employer, as well as the old employee. In these states, employers are reluctant to hire away employees who have non-compete agreements. The best approach for employees in these states is to let their prospective new employer know about the non-compete so that the employer is not later "surprised" with a lawsuit by the old employer. The new employer may decide that the non-compete agreement is invalid, or may be willing to assist the employee, including payment of legal expenses, in the event of a lawsuit by the former employer.
     
  15. Burkartsplow

    Burkartsplow PlowSite Veteran
    Messages: 3,245

    To have a contract that covers everything is impossible and with that there are plenty of loop holes to get around that contract. I am not saying i know all law,but i do have a minor in business law and a bachelors in HR Management and this is all we deal with, contract and tort law and there have been many cases that we studied in class where a contract was signed and it did not hold up in court. even non compete clauses. Ruled in favor of the latter. There is a limit in the duration of time. 2 years is usually acceptable. that is what the companies like microsoft do. 2 years. Anything over that most likely wont hold up.
     
  16. QuadPlower

    QuadPlower PlowSite.com Addict
    Messages: 1,056

    Burkartsplow, I'm putting together an employee handbook. Do you have an example of a non-compete agreement? Legal wording for "the knowedge I gave them", penilties for breaking it, etc. I have length of time and area wording already.

    Here's what I have

    Due to the information, knowledge and training that an employee receives while working for B&B Yardscape, they are restricted from working for another landscape or lawn maintenance or snow removal company inside Kalamazoo County for a period of one (1) year. Violation of this clause will result in B&B Yardscape being entitled to recover damages such as legal fees, lost revenue, and other monetary rewards.

    Thanks in advance.
     
    Last edited: Apr 2, 2008
  17. KGRlandscapeing

    KGRlandscapeing 2000 Club Member
    Messages: 2,660

    i dont think you have the right to tell somebody that they cant work for another company for a year. i think non compete is only in accordance to accounts and or starting your own company
     
  18. Burkartsplow

    Burkartsplow PlowSite Veteran
    Messages: 3,245

    im some instances it is possible, but most likely you can not deny someone a job if that is what there skill is in.
     
  19. SnoFarmer

    SnoFarmer PlowSite Fanatic
    from N,E. MN
    Messages: 8,518

  20. QuadPlower

    QuadPlower PlowSite.com Addict
    Messages: 1,056

    Thanks for the links SnoFarmer. I think my wording is fine.

    There are a couple of reasons I want it signed. I pay for education, training, etc. or in some cases, an employee might know the secrets to a bid package I have put together and won. In these cases, I don't want them leaving and going to work for the competition and letting them know my secrets or using the skills I have paid for to help the other company. I fully trust my employees but stuff happens and I’m trying to cover my butt. Yes, if they leave and work for the competition, it would be hard to prove, win, and get compensated. But, this might be enough to make them not do it.