Q & A With Attorney Paul Gullion
January 27, 2009
By Paul D. Gullion
QUESTION: I am going to be hiring a company to do a job at my house. What are the steps I should take to avoid liability?
ANSWER: There are several legal issues involved in hiring people to work on your property, and certain steps should be taken to protect yourself.
QUESTION: What should I do?
ANSWER: First, you should make sure that, if required, the company doing the work has a current, valid license issued by the State of California. Each type of work has a specific type of licensing requirement, and these requirements can be found on the internet, or you can call the local State Contractor’s License Board.
QUESTION: What about insurance?
ANSWER: You must be sure to require that the company doing the work for you has a policy of liability insurance that will provide protection should someone get hurt or property is damaged. Ask for proof of the insurance, and check the amount of insurance and the dates that the policy is effective. Make sure the policy provides that it will not be cancelled without advance notice to you. On bigger projects that involve more dangerous activities (roofing, tree cutting, and demolition, as examples) you probably should talk with your own carrier and get their advice on what to require. Proper insurance is critical to giving some peace of mind during the project. Make sure the company has it and it protects you.
QUESTION: What if the company uses employees?
ANSWER: If the person doing the work is using employees, you must make sure that proper workers’ compensation insurance is in place protecting those workers. This is required by law, and cannot be avoided. Ask the company doing the work for you to provide a current proof of insurance with the dates of effectiveness. Don’t take any excuses from the company if they fail to provide proof of workers’ compensation coverage. If it is not in place, you could be liable for injuries to the employees.
QUESTION: Is there anything else I can do to protect myself?
ANSWER: Yes. You should have some form of a written agreement between yourself and the company doing the work. The complexity of that agreement will depend on the size and cost of the project, but any agreement should set forth the price for the work, how changes are to be handled, the insurance requirements of the company doing the work, when the work is to be completed and a statement that the company is an independent contractor and that you are not responsible for payroll or withholding taxes, etc. Make all payments by check to the company. Do not pay employees directly (especially in cash), and don’t pay suppliers directly. Work though the company you hire in making all payments.
QUESTION: If I do all of this am I totally protected?
ANSWER: No, there are no guarantees under the law. However, if you take these steps you have protected yourself as much as is reasonably proper, and you will have a greater peace of mind.
QUESTION: Why is life getting so complicated?
ANSWER: Although the legal profession and the insurance industry, among others, are often blamed for complicating life, the fact is that California has a strong public policy of protecting workers who perform services for others. While none of us can predict the future, this issue is not going away, and is in fact getting more support from the Courts and legislature. Thus, take steps to protect yourself.
THE INFORMATION PRESENTED IN THIS ARTICLE IS BELIEVED TO BE ACCURATE AS OF THE DATE OF PUBLICATION. IT IS INTENDED TO PROVIDE GENERAL ANSWERS TO QUESTIONS, AND IS NOT INTENDED AS A SUBSTITUTE FOR INDIVIDUAL LEGAL ADVICE. ADVICE IN SPECIFIC SITUATIONS MAY DIFFER DEPENDING UPON A WIDE VARIETY OF FACTORS. THEREFORE, IF YOU HAVE SPECIFIC LEGAL QUESTIONS YOU SHOULD SEEK THE ADVICE OF AN ATTORNEY OF YOUR CHOICE.
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