Fechino Files: Trust Your Subs, Just Document!

Words: Steve Fechino

When I was working for a large masonry contractor, we typically performed masonry work with our own employees. When we would construct large Segmental Retaining Walls, often we would require a subcontractor who had larger equipment for different portions of the project, so we would hire a familiar contractor that knew us, knew us well, and was very well-trusted. It was not uncommon to go to the site and get a verbal quote, write up the papers, and have him start as soon as things were ready, even before the subcontract was activated. My paperwork was not always as complete as it should have been, even back then.

Today, documentation is the key to keeping things flowing smoothly. That was then; today, you still may walk the job and receive a quote verbally. However, until you receive a written qualified quotation and a certificate of insurance, you would not even consider beginning work until the contract is written, returned, dated, and signed. Back then, when things came up, and an additional amount was necessary to complete the job, a change order, it was not entirely common, but not uncommon, to proceed with a handshake until the paperwork was written, so as not to hold up the job. Today, that is a hard no! Documentation has changed a great deal. Back then, a written change could take a day or so; today, we can do the paperwork within a few short hours.

Why is this important? If you are young and beginning in the trade, you may have heard stories, but that was then; today, documentation is the key to staying in business. It sounds dramatic, but here is another example. Occasionally, you get on a project that is so messy, in such a time crunch, and with a limited timeframe, that you must figure out the scope as you go along. This is when you are getting into something that is not fully understood but has to be done. This includes blind time and materials, overtime, or change order scope. This type of work is expensive for the owner and the contractors who perform the work. The thing is, all the accounting falls into your lap. You must keep up with the timesheets, fuel, equipment, and materials, all separated from the original scope of work, burden, in some cases, overtime rates, and even the percent of completion for an added schedule of values for owner billing. The thing is, when this occurs, it is a portion of your daily work that you did not plan for; therefore, you still have to run all of your other jobs.

DO NOT underestimate paperwork requirements for the blind change or some additional management tasks you should perform daily. Regardless of who pays for the material, the receipts need to have purchase tickets and invoices matched. The material amounts should be checked for accuracy in both the delivery amount and the amount purchased. It is critical to know if the person (possibly your subcontractor) has purchased enough material to do the job properly, or if too much material has been purchased that is slipping away from the site. Fuel can also be an item that can easily get away from you. You know what it costs to run your truck all week. That is a useful base number when trying to manage fuel expenses. Overtime: Do you pay overtime for folks who work late but do not have 40 hours? Do you pay overtime for time greater than 8 hours in one day? All this must be established, and the subcontractor will likely be required to show their timesheets for contract work if the project is large enough. In addition to the paperwork, project supervision will be increased from base contract to base contract and blind change work, possibly doubling the amount of time you will be required to oversee this project. Weekly face-to-face meetings with the subcontractor to go over invoicing are an ultimate time and confusion saver.

The biggest, most important thing to remember is that “YOU WILL NOT REMEMBER.” When you walk to the site, photograph everything twice and maybe even three times, because you seldom get enough accurate and forever information from the first photo you take. I remember thinking I had good photos until I would get back to my office and realize I was just short of having what I needed. It happened more than once. Take the extra photos; your phone will not run out of memory. Write it down. You will forget the names of the folks doing the extra work by tomorrow, so write down their name, where they were working, the time, the weather, and the date. Why all the extra? Well, when you make the daily site visit, it is just that daily, but when you invoice, it will usually be a day or even a few days later. No, you will not remember their name or how late they worked a day or so later, not with everything else you have to keep up with.

When doing extra work, verbal communication is not a thing; words do not translate into billing or invoicing. Only written and signed daily reports matter, period. If you are seasoned, share this with a young management employee so they can understand the importance of documentation. It will help keep you in business. Trust your subs but manage them closely, because when there is no room for questioning, there is more room for success.

It is always one over two, unless you are doing a stack bond, and then, even then, it is still one over two, just the top one is a little to the left...I do not want to hear it. One in two, be safe!

Fechino Files: Trust Your Subs, Just Document!

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