Don't forget the incremental cost of liability exposure.?ÿ If the sub screws up, the damage claim is coming to you first.
The sub is not licensed. Any professional liability is mine and mine alone.?ÿ?ÿ
Last time I did this (maybe 10 years ago) it cost my E&O provider about $35k.
I didn't see where the OP indicated the sub?ÿwas licensed or not.?ÿ Being that it's some kind of construction work that distinction might not even be relevant.?ÿ What would be important is if that sub has GL and E&O insurance.?ÿ I wouldn't take the risk in hiring them if they didn't.?ÿ
That doesn't alter the fact that you're incurring an increment of liability due to a reduced span of control over the sub's work.?ÿ Unless you have complete control over him, in which case the IRS would like to speak with you about the definition of "independent contractor."
Understood.?ÿ That is, after all, a big part of the justification for the markup. For the record, the work has been well checked (for a fee) and I'll sleep fine with degree of risk involved. I'm just not comfortable with assuming it for nothing.?ÿ ?ÿ?ÿ
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What would be important is if that sub has GL and E&O insurance.?ÿ I wouldn't take the risk in hiring them if they didn't.?ÿ
I don't think that an unlicensed person can get E&O. Am I wrong?
I don't think that an unlicensed person can get E&O. Am I wrong?
You're probably right however my point wasn't the specific type of insurance so much as the right type of insurance that would cover whatever work or service they were doing for me.?ÿ If they're not a legit company with their own insurance to backup their work I wouldn't hire them as a sub, neither would the GC.?ÿ
