# Five Brothers



## UnitedFieldInspections (Dec 20, 2012)

I received an email like most today from Five brothers Requiring all Contractors,Inspectors,Bpo etc Requiring everyone to carry workers comp lol.
They just took all inspectors and made them employees! How can you place someone as an employee making $3.00 per inspection?Requiring taxes with held,unemployment insurance,Disability insurance etc!It will be interesting to see how it all pans out.

What do you guys make of it?:thumbup::lol:


Note NYS:18% Of gross Payroll


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## GTX63 (Apr 12, 2012)

I would think that the lawyers they have wouldn't let anything fgo out officially until they did their due diligence and made sure they were protected. They seem to be laying groundwork for a precedent.


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## Framer1901 (Nov 2, 2013)

5 Cousins is located in MI. MI law requires all business' to provide workers comp insurance, just like every other state I'd bet. That means all sub contractors must provide comp also. 

In MI, if you are a business with no employees, you work by yourself and maybe only hire subs, you can apply thru the state for a work comp waiver form - meaning you don't have to go thru the BS of minimum policy costs and audits....

Years ago, during the building boom, everyone was "self employed" and a lot of people just carried those waiver forms here in MI. 

I have employees, carry comp - now during the yearly audit, they don't easily accept those waiver forms. They want to see how much you paid, how often they worked, what work they completed, their liability ins and how their business is registered. Basically, they want to make sure this sub is a true sub and not some 1099 person working for you. One guy has worked for me for years plowing snow, my insurance refuses to take his comp waiver for whatever reason and I have to deduct comp costs from his pay.

I'd bet that 5 Cousins insurance carrier is dictating this policy and in reality, it really is no different than in the past - the law hasn't changed, you should have always carried comp or some type of waiver.


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## Field Audit Services LLC (Mar 24, 2013)

Curious as to how you think that requiring WC makes one an employee? Makes no sense.


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## UnitedFieldInspections (Dec 20, 2012)

Each state is differently,Here in NY it works by Employees its 18% for every $100 Of Payroll. They will have to hire each inspector with an hourly rate and milage reimbursement i would assume(NYS Fair Play act-any person working in construction is presumed to be the employee of the person or business for whom he or she is working.)Preservation falls in that category so if you sub out a boardup or lock change ets its all under this law.How can you sub out a lawn to someone with out classifying them as an employee?Its not gonna happen.Anyways i don't care i no longer do any work with them they call me everyday.


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## Framer1901 (Nov 2, 2013)

I find it hard to believe that NY has a flat 18% comp rate.

A person cleaning offices has just a tad less exposure than a guy setting steel 30 stories in the air.

This is why we have payroll classes, it makes it easier when audited.


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## RichR (Sep 22, 2012)

NY is not Flat Rate. The rate varies by Classification. 
IE: Roofing is about 36% where as Landscaping is about 10%


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## UnitedFieldInspections (Dec 20, 2012)

My mistake NY fund is 18% for carpentry.Scarpentry . still how can you pay that with 2.75 an inspection that safeguard pays if you have subs????


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## Field Audit Services LLC (Mar 24, 2013)

I thought we were discussing 5 Brothers, not Safeguard?


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## Framer1901 (Nov 2, 2013)

1) Cause if you are doing inspections, you ain't doing carpentry work.

2) If you are subbing it out, your sub should carry the insurance also which cancels the cost out on your policy - otherwise charge the sub the insurance rate.

Try and be smart about what you say you exactly do when going thru audits. In MI, comp does not cover the business owner. Therefore, the business owner did 90% of the "risky" work and employees were classified as janitorial - 6.75% rate.


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## brm1109 (Sep 17, 2012)

Framer1901 said:


> 1) Cause if you are doing inspections, you ain't doing carpentry work.
> 
> 2) If you are subbing it out, your sub should carry the insurance also which cancels the cost out on your policy - otherwise charge the sub the insurance rate.
> 
> *Try and be smart about what you say you exactly do when going thru audits. In MI, comp does not cover the business owner. Therefore, the business owner did 90% of the "risky" work and employees were classified as janitorial - 6.75% rate.*


*
*
So in others words I guess what you are saying is that when you are audited you should not tell the truth? Sure tell them that the owner does 90% of the work. That works well until one of your employees falls and gets hurt. Also if you give false information to an insurance company, that is called insurance fraud.
But hey, what the hell right? that is why this industry is now ****.


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## rjmalibo (Feb 14, 2014)

For inspections, you can be classified as a photographer. It's a much lower rate, as long as you aren't doing preservation work.


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## UnitedFieldInspections (Dec 20, 2012)

still ridicules for the prices they pay i don't care who it is.


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## Framer1901 (Nov 2, 2013)

"So in others words I guess what you are saying is that when you are audited you should not tell the truth? Sure tell them that the owner does 90% of the work. That works well until one of your employees falls and gets hurt. Also if you give false information to an insurance company, that is called insurance fraud.
But hey, what the hell right? that is why this industry is now ****."

Certainly don't lie - I never said that- I said be smart about what you say you do.

My payroll was 4500 per week or roughly 225k per year. At the 6.75% rate, we paid about 16k in insurance, at the carpentry rate of 14.85% - I would have paid 35k - 20k more. 

So if the business owner, who pays the comp policy but isn't covered by that same policy, does 90% of the "at risk" work, the remaining 10% is tarping shed roofs or cutting up downed limbs - you think that's fraud? You think it's fair and good business practice to pay double rates for a guy carrying a trash can and pushing a broom?

Be smart about anything you do, you don't send numb nuts up on a roof, you don't give a chainsaw to needle dick - I would go out and do those things. You need to look at the jobs you have employees do and see if those "risky" jobs are worth the across the board increase in comp rates - for us it wasn't, so my ass got up on the roof or dropped the trees.


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