Before You Hire, Ask Contractors These Questions

JUST LIKE YOUR COMPANY’S EMPLOYEE RECRUITMENT PROCESSES, IT’S IMPORTANT TO PROPERLY VET POTENTIAL CONTRACTORS TO ENSURE THE BEST FIT.

By Eric Lecky

When planning a large capital improvement project, selecting the right contractor is the most critical component to success. Finding the right mix of quality workmanship, price, process, credentials, and capabilities is essential. You’ll want to examine bids and work through a selection process to recognize potential risks.

Think of choosing contractors like hiring new employees and implement a similar vetting process. After all, for the duration of your project, contractors are an extension of your team.

Here are a few things to ask contractors that can help you make the best choice for your community and help mitigate risk.

WHAT DOES TURNKEY MEAN TO THEM?

In a true turnkey project, the contractor completes every step in the process. So ask: Who do their employees actually work for? Are they direct employees or are they subcontractors or 1099 employees working as hired help? Contractors that rely extensively on outsiders can create a risk because these so-called “employees” are not bound by your contract.

HOW IS PROJECT MANAGEMENT HANDLED?

Some contractors will provide dedicated, on-site project managers who are available 24/7 should any issues arise. Others may split their managers across two or more jobs, so they may not be as readily available.

Ask, too, about their project manager’s experience managing your specific type of project. Project managers who oversee multiple kinds of projects may have less experience with yours.

HOW WILL THEY COMMUNICATE?

Ensuring owners and residents know what will happen, and when, is vital for your project to run on schedule and with few complaints. Will they use paper or electronic notifications to advise and update residents? Make sure you select the contractor whose communication methods meet your community’s needs.

DO THEY CONDUCT EMPLOYEE BACKGROUND CHECKS?

Knowing who will be working in their home can be very important to many homeowners and residents. Verify how the contractor hires and screens employees by asking questions like:

• Do all of your employees undergo a background check?

• Are they all legally permitted to work in the United States?

• Do any of them have criminal records?

• Do you randomly test for drugs and alcohol?

HOW DO THEY HANDLE CHANGE ORDERS?

Some contractors will provide a very low initial bid, knowing they will use change orders later to make up the costs. Others will provide a more thorough bid to reduce surprises down the road. When checking references, ask former clients how many change orders they had to deal with.

HOW DO THEY HANDLE REQUESTS FOR INFORMATION?

If the contractor comes across an unexpected condition, do they have a formal RFI process? Ensure they use formal documentation to detail what they found and to request input from the construction manager, engineer, or board.

HOW ARE THEY BONDED AND LICENSED?

Understand the contractor’s bond limits. Bonding capacity is for the company as a whole, not an individual project, so if they have several other large projects going on simultaneously, they may not have enough bonding capacity for your specific job.

Also, find out the credentials of the team working on your property. If the people running the company are general contractors, who has the specialty licenses for trades like plumbing, electrical, elevators, etc.? Do they rely on others’ licenses to get their job permitted and completed?

HOW DO THEY HANDLE INSPECTIONS?

Formal inspections ensure your project was completed safely, correctly, and to code. Ask your contractor how they handle inspections. Will they obtain all the required permits? Who will be on site to meet the inspector and show them the work? How do they handle a failed inspection?

WHAT IS THEIR INSURANCE COVERAGE?

Of course, any contactor working in your building should carry insurance, otherwise your community runs the risk of paying out if there is an accident or problem. Look at their certificate of insurance, including their liability limits, to make sure they are carrying enough insurance for your project and not just the minimum required.

WHAT COVID-19 PRECAUTIONS WILL THEY TAKE?

Inquire about protective measures the contractor uses while on site. If your community has defined requirements, ask about the contractor’s willingness and their process to ensure workers comply.

In the end, selecting a contractor to perform your capital improvement project is a personal choice that balances who brings the best solution, price, process, credentials, and capabilities. On a bid form, contractors may appear similar, but these subtle considerations often make the difference between a successful project and a frustrating renovation.

Eric Lecky

Eric Lecky is the Chief Growth Officer at SageWater, North America’s leading pipe replacement contractor. SageWater is headquartered in Alexandria, Virginia, with offices nationwide. Over the past 30 years, they have replaced more than 35 million feet of pipe in over 100,000 occupied residential units.