clearcut
If a licensed surveyor can't use subcontractors in CA, then do you guys actually put the pilot and the aerial mapping guys on the payroll when you have a large parcel that you need flown for topo?
Well, you seem to be ignoring the Lucas article, and the quotes from the IRS, etc. regarding the IRS's position on "supervision". If the IRS "doesn't give a crap", then why'd they write that part of the regulation?
Anyway, what you are doing sounds fine to me. I don't think you are doing a disservice by hiring other licensed firms and surveyors to do contract for you.
My experience in Florida is much different. The new trend here is for broker-type survey outfits to offer statewide coverage by using a network of contract crews and draftsmen, which are made up of out-of-work crew chiefs and I-men and CAD techs, at an extremely low pay-per-job rate. You basically have one surveyor, at his desk, rubberstamping dozens of surveys a day performed by dozens of crews, across the whole state. I know a guy who took one of these jobs and what he tells me leads me to believe that their PSM is taking the IRS regulation of 'no supervision' very, very seriously. And in the end, it's just a method for these guys to keep costs down so they can further lowball their competion. Florida needs to do like some of the other states and make a law that you can't contract with an unlicensed individual or firm ...
clearcut
Perry,
I never said a surveyor can't subcontract in california.
However, a contractor (or sub) has to be licensed in order to maintain a business offering survey services, or has to have a licensed surveyor in a mangerial position over the survey functions of the company.
A surveyor can subcontract out surveying services in california, however he must understand clearly what constitutes a subcontracting relationship vs an employee/employer relationship.
In our state, an aerial mapping firm needs to have a licensed surveyor or photogrammetrist in the company makeup if they provide the orthorectification of the aerial imagery.
> Well, you seem to be ignoring the Lucas article, and the quotes from the IRS, etc. regarding the IRS's position on "supervision". If the IRS "doesn't give a crap", then why'd they write that part of the regulation?
>
> Anyway, what you are doing sounds fine to me. I don't think you are doing a disservice by hiring other licensed firms and surveyors to do contract for you.
Pseudo... Please re-read my post. I didn't say the "IRS doesn't give a crap." They are VERY serious about contractor/employee relations and issues. Lucas' article brings that out quite well and his advice should not be ignored (he's right that this is a common problem in our profession). Any business can get itself in trouble when they don't know/understand the employment laws.
What I said was, "The IRS doesn't give a crap about my direct supervision." That's a board issue that surveyors confuse. Just because the same words might appear, doesn't mean that it's the same thing. "Direct supervision" in IRS terms includes indicators such as, do you tell the contractor when to come and go, what to do, or what order to do it in.
It's not illegal for surveyors to subcontract. What Lucas was pointing out in his article is that it IS illegal for any business to hire an employee under the guise of a contractor to avoid paying employment taxes, insurances, etc. That's what the issue is.
> My experience in Florida is much different. The new trend here is for broker-type survey outfits to offer statewide coverage by using a network of contract crews and draftsmen, which are made up of out-of-work crew chiefs and I-men and CAD techs, at an extremely low pay-per-job rate. You basically have one surveyor, at his desk, rubberstamping dozens of surveys a day performed by dozens of crews, across the whole state.
So, basically, the problem isn't in contracting services or hiring temporary workers. The problem is that you have licensed professionals who are ignorant enough to "rubber stamp" work without providing direct supervision.
What is wrong with hiring workers via contract with a temp agency? Nothing wrong or illegal about that. What's wrong with a licensed surveyor failing to provide direct supervision over the work? BIG PROBLEM. Surveyor should loose his license. No problem whatsoever with the surveyor hiring workers who supposedly possess certain levels of ability or skill, AND directly supervising them to confirm that they are performing the work to the satisfaction of the surveyor.
>I know a guy who took one of these jobs and what he tells me leads me to believe that their PSM is taking the IRS regulation of 'no supervision' very, very seriously.
As they should. Failure to provide adequate supervision is a problem that the board should be all over.
>And in the end, it's just a method for these guys to keep costs down so they can further lowball their competion. Florida needs to do like some of the other states and make a law that you can't contract with an unlicensed individual or firm ...
There is no way that you can "keep costs down" when you are hiring contract labor. Contract labor is ALWAYS more expensive. The taxes are higher, the costs to the contracting company are the same as any employer, but the added overhead raises the costs. The only way for those costs to be lower is for the contractor to fail in their compliance with the employment laws. That's where both the contractor and the surveyor hiring them are open to MAJOR issues.
The answer isn't found in regulating who I can contract with. The answer is found in making certain that the labor laws are upheld. That's no business of the licensing board. It is an issue for the profession but only in educating its members how to properly conduct themselves in business. If they violate the law, they should be held accountable. The business of the licensing board is to make certain the licensed professional is providing the service in accordance with the standards of practice. I don't need the board meddling in my business affairs. There are already too many government agencies doing that.
JBS
Yes, surveyors can legally "subcontract." I subcontract field work, aerial photography, secretarial services, monument construction, and any other host of services which I cannot adequately perform and have no desire to perform.
The real issue isn't contracting. The issue is skirting labor laws under the guise of contracting. Here's what the IRS has to say:
>Topic 762 - Independent Contractor vs. Employee
>To determine whether a worker is an independent contractor or an employee under common law, you must examine the relationship between the worker and the business. All evidence of control and independence in this relationship should be considered. The facts that provide this evidence fall into three categories – Behavioral Control, Financial Control, and the Type of Relationship.
>Behavioral Control covers facts that show whether the business has a right to direct or control how the work is done, through instructions, training, or other means.
>Financial Control covers facts that show whether the business has a right to direct or control the financial and business aspects of the worker's job. This includes:
> The extent to which the worker has unreimbursed business expenses
> The extent of the worker's investment in the facilities used in performing services
> The extent to which the worker makes his or her services available to the relevant market
> How the business pays the worker, and
> The extent to which the worker can realize a profit or incur a loss
>Type of Relationship covers facts that show how the parties perceive their relationship. This includes:
> Written contracts describing the relationship the parties intended to create
> The extent to which the worker is available to perform services for other, similar businesses
> Whether the business provides the worker with employee-type benefits, such as insurance, a pension plan, vacation pay, or sick pay
> The permanency of the relationship, and
> The extent to which services performed by the worker are a key aspect of the regular business of the company
>For more information, refer to Publication 15-A (PDF), Employer's Supplemental Tax Guide, or Publication 1779 (PDF), Independent Contractor or Employee. If you want the IRS to determine whether a specific individual is an independent contractor or an employee, file Form SS-8 (PDF), Determination of Worker Status for Purposes of Federal Employment Taxes and Income Tax Withholding.
JBS
Well, you're partially right. I’ve been posting about this for years, so this is nothing new for me. My issue is with surveyors abusing the "contract crew" relationship and using it as a business model and cost saving measure. I'm pretty sure that was the gist of the Lucas article, as well.
You're statement that contract labor is always more expensive made me laugh. If it wasn't cheaper, then I can assure that low-ballers-r-us wouldn't be trying to exploit contract workers in every way possible.
You have no idea what's going on here. Basically, this one example ... for lot and block subdivision surveys … the "contract" crew chief is paid $75 per job, $90 if it requires an el cert., regardless of how long the job takes. From that, the PC has to supply his own gun or lease it from the company, supply his own tools, supplies, truck, gas, etc., he has to pay a helper himself if he wants one, pay his own employment taxes, of course, and any other expenses that pop up (maintenance, etc.) ... there is no way I can hire a crew and supply equipment and pay other expenses for less than that. I've seen Craig's lists ads for contract draftsman offering to pay $8 per job, and of course they are not supplying the computer or software. The sad thing is, these companies are about the only companies around here that appear to be thriving, and there is apparently no shortage of out-of-work crew members willing to take these jobs.
So sure, if it takes the BOR making a rule that surveyors can only contract with other surveyors and surveying companies, that's fine with me. Surveyors have made it abundantly clear that they are willing to push labor laws and survey regulation to the brink to make an extra buck. I'm frankly disgusted with the whole thing.
"Yes, surveyors can legally "subcontract." I subcontract field work..."
JB Do you have behavioral control over these subcontracted crews?
> "Yes, surveyors can legally "subcontract." I subcontract field work..."
> JB Do you have behavioral control over these subcontracted crews?
You mean, like, play nice, don't cuss, or pee in the neighbor's bushes? ;o)
>Behavioral Control covers facts that show whether the business has a right to direct or control how the work is done, through instructions, training, or other means.
The crew that I contract is responsible for their own control over how they want to do the work and they have already handled their own training. They also have their own business and are licensed and insured. The aerial photographer that I hire does the same. Likewise, my accountant, my attorney, and my secretary. I don't tell them when to go to work, what days to work or anything. They're contractors.
My "behavior control" happens when I have the next need for contract labor. If they couldn't behave on the last job, then they don't get the next job.
JBS
> My issue is with surveyors abusing the "contract crew" relationship and using it as a business model and cost saving measure. I'm pretty sure that was the gist of the Lucas article, as well.
You're absolutely right, Pseudo. The illegal behavior of skirting employment laws by hiring employees under the guise of "contract labor" is a serious bane on any profession. There are serious laws with serious penalties which deter such behavior. The problem doesn't lie with contract labor or labor laws. The problem lies in the illegal act of hiring employees (or contractors) who don't follow the labor laws.
> You're statement that contract labor is always more expensive made me laugh. If it wasn't cheaper, then I can assure that low-ballers-r-us wouldn't be trying to exploit contract workers in every way possible.
My statement is true. Contract labor, in its true sense, is more expensive. What's supposedly "cheaper" isn't contract labor, it's businesses who violate the law by skirting employment practices. These supposed "contractors"... show me their business license, their EIN, their training and continuing education certificates, show me their insurance policies. Prove to me that they are qualified to get the work, or I'm heading down the street to find a real contractor to provide the level of expertise that I require.
> You have no idea what's going on here.
I certainly do understand. I've seen the crap. Frankly, most of the crap that I've seen is with employees, not contractors. The employees who are underpaid, don't receive any benefits, and don't receive any proper training, yet are sent to job sites all over the country under the guise of "direct supervision." If we don't expect quality work for a quality wage from our own employees, how can we expect quality work from our contractors?
> ... there is no way I can hire a crew and supply equipment and pay other expenses for less than that. I've seen Craig's lists ads for contract draftsman offering to pay $8 per job, and of course they are not supplying the computer or software. The sad thing is, these companies are about the only companies around here that appear to be thriving, and there is apparently no shortage of out-of-work crew members willing to take these jobs.
These are the "out-of-work" crew members who have no business sense and no proper training because they didn't receive it from their last employer. These are also the very people that the labor laws were designed to protect. And, yes. Anyone who hires an individual under the false premise of "contract labor" needs to be called to the carpet. The penalties are stiff enough already. The problem is, that we witness these things happening and we sit idly by, wagging our heads in disgust, while we do nothing to prevent it.
> So sure, if it takes the BOR making a rule that surveyors can only contract with other surveyors and surveying companies, that's fine with me. Surveyors have made it abundantly clear that they are willing to push labor laws and survey regulation to the brink to make an extra buck. I'm frankly disgusted with the whole thing.
You're throwing the baby out with the bathwater, Pseudo. So, a surveyor can't contract an aerial photography company, who can't hire a pilot because they're not a licensed surveyor. A surveyor can't contract a monument setting crew who is better equipped, more efficient and more productive, because they're not a licensed surveyor. A solo surveyor can't contract a crew from a construction contractor even though they're better qualified than most, because the company doesn't have a licensed surveyor. You can't subcontract a GIS company to process data, or a drafting company to make your drawing, or a secretary to answer your phone, or an accountant to file your tax returns, all because they don't have a licensed surveyor. The list goes on and on and on...
The problem, again, isn't a contracting issue. The problem is a labor issue. The licensing board with all its' rules and regulations doesn't have jurisdiction over labor. A call to the labor board will, however, receive immediate attention.
JBS
I really don't think we are that far off. The bottom line is that there is a right way and a wrong way to use contract labor. I think a system that leaves the door open for a company to basically hire unemployed crew cheifs but call them "contract employees", so they can cut costs to bone while placing all the expenses on the employee, is a broken system. And I don't see it fixing itself, which is why I'd like to see more board involvement.
And fwiw, aerial photograph companies in Florida are licened as survey companies, but I get your point. The door should be left open so surveyors can contract non surveying related jobs from non surveying companies.
> I really don't think we are that far off. The bottom line is that there is a right way and a wrong way to use contract labor. I think a system that leaves the door open for a company to basically hire unemployed crew cheifs but call them "contract employees", so they can cut costs to bone while placing all the expenses on the employee, is a broken system. And I don't see it fixing itself, which is why I'd like to see more board involvement.
I completely agree with the defined problem. What I disagree with is the perceived solution. There is no reason for the licensing board to meddle into labor issues. It's not within their legislated authority and has nothing to do with a professional licensee. The problem is a labor problem and enforcement of existing labor laws. The labor department takes its charge very seriously already. The problem isn't just in the land surveying profession. It's a universal business problem.
One of my relatives recently received a check for back-wages due because his employer failed to properly calculate overtime payment. It all started by a simple phone call (to the labor department) from a disgruntled ex-employee. Prompted a two-year investigation of the payroll records by the labor folks and the IRS. Someone made the call.
There is no "open door" allowing licensed persons to break labor laws. The two issues have nothing to do with one another. Two completely different administrative systems, neither of which are "broken." When your tooth is broken, you don't go to your doctor to have it looked at. You call your dentist. If you don't call your dentist, you have little sympathy when you continue to complain about how bad your tooth hurts.
If you have evidence that someone is illegally skirting the employment laws, who's duty is it to make the call?
JBS