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A growing number of state and local governments have adopted wage theft laws that aim to ensure employees receive full compensation by creating severe penalties. These laws often target the construction industry and impose significant penalties for employers who “misclassify” workers or fail to comply with expanded recordkeeping and notice requirements. Wage theft laws can make general contractors liable for their subcontractors’ or temporary labor brokers’ violations, even if these violations were not reasonably discoverable by the general contractor. Consequences for violating wage theft law can be severe, including fines and even criminal penalties in extreme cases. Some states have upstream liability provisions that can make the project owner liable for wage theft violations. Also, some wage theft laws negate the enforceability of specific contract provisions, while others require certain provisions to be included in contracts.
Termination for cause is costly and adversarial and has been covered in this article. But can a terminating party use equipment and tools left behind on the worksite (i.e., a crane)? The answer depends on what is in your contract.
ż of America has released a new state-by-state guide on wage theft laws. The comprehensive resource features information on wage theft laws from across the country in a user-friendly format not widely available from any other source. ż members can access the Wage Theft Guide for free on ż’s website.
Termination for cause on a construction project is the equivalent of “going nuclear.” Construction is riddled with claims and litigation, and termination for cause litigation may be the costliest.[i] Construction professionals need to be familiar with the termination clauses in their contracts. This article examines the importance of writing an effective termination for cause provision and how the American Institute of Architects (AIA) and ConsensusDocs standard construction contracts differ on this issue.
Construction contracts provide a foundation for project success or, if done wrong, project failure. Updating your contracts is essential. You should evaluate and update your contracts based on the latest technology trends, legal developments, and the insurance market. ConsensusDocs updates its documents more frequently than the American Institute of Architects (AIA). The ConsensusDocs Contract Content Drafting Council (Council) solicits and reviews industry feedback to keep the ConsensusDocs ahead of the curve in identifying and establishing industry best practices. UPDATE: On September 20th, ConsensusDocs published comprehensive revisions to its most used prime and subcontract agreements that address design-bid-build.
Delegated design is when the lead design professional, an architect or engineer, delegates a portion of design responsibility to the builder. Standard construction documents have traditionally addressed this issue in a rudimentary fashion. The updated ConsensusDocs now provide more details and procedures for design development, approval, and design coordination with the overall project design to better address delegated design.
Artificial intelligence or AI is causing significant disruption in the construction industry and our world. However, in the context of construction law, contracts, and risk management, the abbreviation “AI” refers (first and foremost and for purposes of this article) to additional insured (AI). Obtaining coverage as an additional insured is part of the foundation for insurance coverage and legal defense against claims in construction. AI status allows upstream parties to access downstream parties’ insurance coverage directly and request that the insurance carrier provide a defense. This article highlights the importance of appropriately tailoring AI coverage obligations in your contracts and how the ConsensusDocs and the American Institute of Architects (AIA) standard construction contract documents handle this issue differently.
Reaching an agreement on a construction contract that leads to a positive outcome for all parties involved – owner, builder, designer – should be the goal of your contract negotiations. What contract you start with as your foundation and which provisions you prioritize in your negotiations matter. On a webinar hosted by the Association of Corporate Counsel (ACC) entitled The Construction Tool-Kit for the In-House Counsel When Faced with a Construction Contract, Celestina Jimenez, Vice President & General Counsel at RK Industries, gave a brief overview of the three leading publishers of standard documents for construction, identified as the American Institute of Architects (AIA), ConsensusDocs, and the Engineers Joint Contract Documents Committee (EJCDC). She looks to provisions in ConsensusDocs to “come to a middle ground,” as they are “the best written to get to consensus.” Make plans to attend ConsensusDocs’ June 14th webinar on contract negotiation strategies for subcontract agreements. Register here.
ConsensusDocs is holding a webinar entitled What Contractors Need to Prioritize in Their Subcontracts on June 14th. General Contractors and Subcontractors will be able to identify the most important terms to negotiate and how ConsensusDocs addresses each issue by attending this webinar. These priorities include: