The Contractor's Compass - February 2023

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Sara Garcia

DB Utility Contractors, Controller

is the monthly educational journal of the Foundation of the American Subcontractors Association, Inc. (FASA) and part of FASA’s Contractors’ Knowledge Network. FASA was established in 1987 as a 501(c)(3) tax-exempt entity to support research, education

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The Contractor’s do not necessarily represent the opinions of FASA or the American Subcontractors Association, Inc.

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EDITORIAL SUBMISSIONS

Contributing authors are encouraged to submit a brief abstract of their article idea before providing a full-length feature article. Feature articles should be no longer than 1,500 words and comply with The Associated Press style guidelines. Article submissions become the property of ASA and FASA. The editor reserves the right to edit all accepted editorial submissions for length, style, clarity, spelling and punctuation. Send abstracts and submissions for The Contractor’s Compass to communications@ASA-hq. com.

ABOUT ASA

ASA is a nonprofit trade association of union and non-union subcontractors and suppliers. Through a nationwide network of local and state ASA associations, members receive information and education on relevant business issues and work together to protect their rights as an integral part of the construction team. For more information about becoming an ASA member, contact ASA at 1004 Duke St., Alexandria, VA 22314-3588, (703) 684-3450, membership@ASA-hq.com, or visit the ASA Web site, www. asaonline.com.

LAYOUT

Angela M Roe angelamroe@gmail.com

© 2023 Foundation of the American Subcontractors Association, Inc.

PRESIDENT 'S LETTER

Dear Readers—

We’ve got about a foot of snow on the ground here in Colorado, and I am looking forward to Spring arriving in a few weeks. February harkens the full Congress back in high gear. Our ASA team is working closely with the 118TH Congress, making sure the priorities of subcontractors are heard. More details can be found in the Contractor Community section. Personally, I’m looking forward to SUBExcel and getting together with folks from around the country to just sit back and learn from you all.

• What trends do you see?

• What are your plans?

• How are you coping with supply chain issues? And what’s so cool is that I can ask the same question, and we’ll get a bunch of different answers just depending on the industry, the state, the food, the weather. Well, maybe food doesn’t impact us…but it DOES! Are you registered yet for SUBExcel? If you’re not, we’re only a week away. Get moving! Yes, there’s still time, but no more dilly dallying. Go HERE. Register. Get your hotel room. And fly or drive to Fort Worth. If you’re waiting for a written invitation—here it is!

This SUBExcel is set to be more dynamic than ever in many ways:

•We've got peer-group sessions to discuss the issues you’re dealing with.

• We’ve got great keynote speakers to inspire you and get you thinking in new ways.

• We’ve got great companies showing off their latest gear and services.

• And we’ve got super fun, Fort Worth-only events, including the largest honky tonk in the world (5 indoor acres of activities) and a long-horn cattle drive (with a pub crawl). Plus tour the largest whiskey distillery west of the Mississippi. And don’t forget our hospitality suite where you can just chill. (Shhh - that’s a secret.)

I also want to hit on one housekeeping item on the business side of things (because it’s ALL about the business). While we do our best to keep our emails to you at a minimum, we do have to remind you about important events and news. We really DO want you to excel (sure, you can call us “Mom”).

You may have noticed some emails with polling questions—Do you plan to come to SUBExcel? Why? Why not? Plus others. There will be more coming. Please take a minute out of your day to respond to these. While some of you are not shy about what’s bugging you and keeping you awake at night, this provides a way of getting to learn more about you, so we can be a better association attuned to your wants and needs. We would appreciate it if you would respond. Many thanks in advance.

While we're supporting subcontractors and the construction industry at SUBExcel, we're also pleased to be supporting NAWIC's Women in Construction week, which runs March 5-11. You can find out more about WIC Week events here: https://wicweek.org/.

Also - if you're not a subscriber to Contractor's Compass, but want to be...Click here to sign up and get our "Best of 2022" edition! ASA Members - you'll be sent the link to this special edition in our newsletters.

I’m excited to see ya’ll in Fort Worth next week. If I don’t know you, please introduce yourself. If I do…better watch out! If we don’t cross paths, then introduce yourself to someone you don't know. We're a big family and getting bigger. But we're all connected.

Rusty Plowman ASA President 2022-2023

CONTRACTOR COMMUNITY

ASA Begins Working with the 118th Congress

Since the members of the 118th Congress were sworn in a few weeks ago, ASA has been working to introduce our association to these newly elected members of Congress, along with maintaining our relationship with the returning members. ASA looks forward to continuing to serve as a critical voice for small and privately owned construction businesses in what is expected to be another challenging year on Capitol Hill. We will work with the 118th Congress to advocate for the protection and promotion of tax issues that are important to small businesses, privately owned businesses, and their owners, along with our continued commitment to maintain a high estate tax exemption to protect privately owned and small businesses from destructive taxes when they are passed down to future generations. Immediate priorities will include continued investment in infrastructure, tackling supply chain issues, addressing the labor shortage, promoting workforce development and contracting reform. Finally, opposing intrusive and burdensome legislation and regulations will be a major objective for ASA in 2023. Compliance and disclosure issues relating to ESG requirements, particularly those that are overly costly and/or burdensome, will be a major priority. We will keep you posted on our efforts throughout the year.

OSHA Adds “Instance-ByInstance” Citation Policy

On January 26th, the Occupational Safety and Health Administration (OSHA) issued new enforcement guidance allowing “instance-byinstance” citations for high-gravity” serious violations of several agency standards. Regional administrators and area office directors will have the authority to issue instance-byinstance citations for violations of fall protection, lockout/tagout, machine guarding, permit-required confined space, respiratory protection, and trenching standards, as well as for cases

with other-than-serious violations of recordkeeping requirements. The new policy becomes effective March 27th.

In a separate enforcement memorandum, the agency reminded regional administrators and area office directors of their authority not to group violations but instead to cite them separately.

as expressly prohibiting discrimination against employees because of their pregnancy or pregnancy related conditions. To the extent that the employer is located in a state with no pregnancy accommodation law, the employer will need to make sure that they are complying with the Pregnant Workers Fairness Act by June of this year.

• Pump for Nursing Mothers Act –The Pump for Nursing Mothers Act expands employers’ obligation to provide employees with time and space for lactation. The major provisions of the new law went into effect at the time the legislation was signed into law.

date [generally limited to 30 days maximum]

The FY23 Omnibus Appropriations Bill Brings Employment Law Changes

The Fiscal Year (FY) 2023 Consolidated Appropriations Act contained two important employment law changes, which will go into effect this year.

• Pregnant Workers Fairness Act – The Pregnant Workers Fairness Act has been introduced in every Congress since 2011 and made it across the finish line as an amendment to the spending bill in large part due to bipartisan support and backing from some of the large employer-side groups including the Society of Human Resources Management (SHRM). The provisions will go into effect on June 27, 2023 and apply to all private employers with 15 or more employees. The new law requires covered employers to provide reasonable accommodations for pregnancy, childbirth or related medical conditions the same way that they would for other disabilities. Up to this point, federal law has only gone so far

New Core + HVACR Level 1 NCCERConnect Course Now Available

To help provide more seamless training options for introductory heating, ventilating, air conditioning and refrigeration skills, the National Center for Construction Education and Research (NCCER) is releasing the Core + HVACR Level 1 NCCERconnect course.

This new offering includes all the content from Core: Introduction to Basic Construction Skills, Sixth Edition and HVACR Level 1, Sixth Edition in a single online course. This will allow instructors to deliver both Core and the first level of the HVACR program using one learner access code, online grade book and classroom setup. To learn more about the Core + HVACR Level 1 course, sign in or register for NCCERconnect.

ASA Supports Public-Private Partnership (P3) Water Infrastructure Projects

In the 117th Congress and now in the 118th Congress, ASA will continue to support public-private partnership (P3) water infrastructure projects. At the very end of the 117th Congress, Reps. Lynch (D-MA) and Balderson (R-OH) introduced, H.R. 9665, which

would apply payment and performance requirements for all construction projects receiving Water Infrastructure Finance Innovation Act (WIFIA) funding. In most instances (95-99%), the states’ “Little Miller Acts” require bonding at 100% or in practice, states and localities are requiring bonding at 100% for traditionally procured projects, so state or local applicants can merely attest to the Environmental Protection Agency (EPA) that the project(s) will be bonded as required under the state’s “Little Miller Act” and provide the percentage of bonding. Additionally, the legislation would provide a floor for security (bonding) at 50% of the construction costs, implementing a recognized industry standard minimum level of bonding, for security for large water projects to protect the federal interests in the prudent use of federal financing. This removes the burden from EPA to determine what would be an “appropriate” level of bonding. This would address the gaps existing in the bonding requirements for newer forms of project delivery, specifically P3s and possibly others. In those instances, the legislation contains a provision requiring state or local statutes or regulations for security requirements to be accepted by EPA so long as these requirements are at a minimum of 50% of the construction costs. As this legislation matriculates through Congress, we will keep you posted on it.

Latest from SESCO: Staff Recommendation Inclement Weather

This is article is from our friends at SESCO Management Consultants, ASA's Human Resource company. To learn more about this and all of the member benefits available through your ASA membership, click here.

Poor weather conditions in the winter months often raise pay-related questions for employers and employees. Employees may not report to work because of hazardous conditions or your business may close for the day. The issue is straightforward for nonexempt employees (i.e., paid on an hourly basis,

subject to overtime pay). Nonexempt employees are paid for the actual time worked in a given workweek. Thus, if they do not report for work or the business is closed, they are not paid for the day. An employer may choose to allow these employees to use vacation or other paid time off to cover the lost wages.

The issue is a little more complex for salaried exempt employees. The question of pay is determined by whether or not the employer is open for business and whether the exempt employee works any part of the day. An employer that remains open for business during a weather emergency may lawfully deduct one full-day’s absence from the salary of an exempt employee who does not report for work for the day due to adverse weather conditions. In a recent opinion letter, the Department of Labor considers this an absence due to personal reasons; therefore, a deduction of a full-day’s pay will not violate the salary basis rule or otherwise affect the employee’s exempt status. It should be noted that deductions from salary for less than a full-day’s absence are not permitted for such reasons under the wage and hour regulations. The Wage and Hour Division has stated that an employer may, as an option, require an exempt employee who fails to report for work in this situation to take vacation or other paid leave to cover the full-day’s absence.

What about the pay of a salaried exempt employee if the business is closed? An employer may not make deductions “for absences occasioned by the employer or by the operating requirements of the business.” If the employer closes operations due to weather or other emergency for less than a full workweek, then the employer must pay an exempt employee “the full salary for any week in which the employee performs any work without regard to the number of days or hours worked,” because “deductions may not be made for time when work is not available.”

Again, the Wage and Hour Division has ruled that an employer may direct exempt employees to take vacation or other paid leave in this situation, provided the employees receive in

payment an amount equal to their guaranteed salary. However, if an exempt employee has no vacation or paid leave, they would still receive the full week’s salary in this situation (where the business is closed for less than a week).

Nonexempt employees paid based on a fluctuating workweek provide yet another challenge. Since an employee who works fluctuating hours for a fixed rate of pay is supposed to get the same pay whether he works short or long weekly hours, the government does not permit deductions for absences of less than a week, whether for illness, personal reasons, or other reasons including the employer’s failure to provide work or the inability to reach the workplace because of weather conditions. In other words, whether the business is closed for part of the week or remains open during inclement weather, nonexempt employees on the fluctuating workweek plan are paid their fixed weekly rate without having to use vacation or paid time off.

As a reminder, state regulation may differ from the federal Department of Labor, Wage and Hour Division’s wage payment regulations. Before making any weather-related deductions from guaranteed salary exempt employee wages, please contact your SESCO Consultant of record to verify compliance with state and federal regulation.

Do you know exactly how much money you're making on each project, and why? Are you confident you're bidding as aggressively as possible without risking your margin? Knowify has just published "The Essential Guide to Construction Job Costing," which answers what to track, how to job cost, how to come up with a bid. If you've got questions, check out their 31-page, well-organized guide.

You can find it here in the InfoHub resource library along with a multitude of other critical resources like The Subcontract Document Suite, Negotiating Tips, Retainage Laws and so much more.

Starting his business in 1985 an electrician that saw a brighter future with him at the helm, Calvin Mims had a mentor, Fred Churchman, of Enterprise Electric, who encouraged him to network with other subcontractors. He recommended ASA as an excellent means to do that. Calvin’s been a member of the Baltimore chapter since 2007, as well as the National Electrical Contractors Association (NECA) and the President’s Roundtable of Baltimore.

Calmi Electrical Company provides clients with electrical construction, electrical maintenance, and electrical control installations in the commercial, industrial and institutional environments in the Baltimore metro region, DC, and Virginia. Since June 2002, Calmi Electric has continuously provided security installation services and general electrical installations at the Martin State Airport Facility and at the BWI Thurgood

Marshall Airport Facility. As well as several other notable projects through the Baltimore Metropolitan area.

As an African-American owned business, Calvin’s advice to other businesses is: “maintain exemplary integrity. Treat your employees as you would want to be treated. They are the backbone of your company.”

And yes, 2023’s going to be a good year for business.

Mental Health Resources for African Americans

Coffee, Hip Hop, & Mental Health: Their mission is to bring awareness to the importance of mental health, emotional intelligence, and self-awareness to one’s quality of life, particularly in the black community. Their primary service is to provide access to mental health

and therapeutic services by removing the financial, systemic, and emotional barriers which prevent healing.

Melanin & Mental Health: Melanin & Mental Health connect individuals with culturally competent clinicians committed to serving the mental health needs of Black & Latinx/Hispanic communities.

Black Emotional and Mental Health (BEAM): BEAM is a national training, movement building, and grant-making institution that is dedicated to the healing, wellness, and liberation of Black and marginalized communities.

Mental Health America: Throughout the month, they are highlighting Black and African American contributions to the mental health movement. Also, offering a multitude of resources.

The Contractor’s Compass is recognizing excellence in ASA’s ranks. Every month we are highlighting the activities, achievements, and actions of ASA members that might inspire others. Do you have something you want to share?

Send us an email at communications@asa-hq.com.

Member Focus by Mary Klett, TCC Communications Team

Is it time for my construction company to become an S-Corp? How will it benefit me?

by Timothy Wingate Jr., EA, G+F Business and Financial Consulting

I think I’m an S-Corp, so what does that mean, and how can I find out if this is true? These questions are asked every year. My goal is to clarify how and when to use these designations.

So, you’re a construction owner currently running your business as a sole proprietor or SMLLC (single member LLC). Are you ready to become an S-Corp? Start with two questions. Are you paying more than 25.3% in income taxes without considering state taxes or more than 28.2% if you’re paying state income

taxes? If you are paying more than the applicable income tax rates, it’s worth going down this road. Do you have a company generating at least 10% to 15% net income/profit after your draws or payments to yourself are considered? If so, you are ready to discuss this strategy with your tax professional.

Becoming an S-Corp, how will this benefit me?

The primary reason construction companies convert to an S-Corp is to

save on the 15.3% self-employment tax. For example:

If my business earned $100,000 as a sole proprietor or SMLLC, you would pay federal income tax, self-employment taxes, and state income taxes on the total $100,000. This income is getting beat up by three tax rates. If you become an S-Corp and pay yourself a salary of, let’s say, $50,000. The $50,000 you are paying yourself will get hit with federal income tax, selfemployment taxes, and state income taxes. The other $50,000

Image by Firmbee from Pixabay

left in the company’s bank account will only be hit with federal and state income taxes, not selfemployment taxes. This will give you a possible tax savings of $7,650.

How to set up an S-Corp properly?

You may be asking yourself what is needed to set this up properly. First, you need an EIN. Next, you must register your business with your state revenue department to pay reemployment taxes and other state business requirements. Thirdly, set up payroll for yourself; you must pay employment taxes and file a quarterly and annual payroll tax return. Next will be to have your tax-professional file a timely form 2553 to make the S-Election. If you want the S-Corp status for the current year, this form must be filed by March 15th. Once the IRS approves your S-Election, you will receive a letter stating your S-Election effective date. Lastly, I recommend scanning this letter into a cloud document storage like Google Drive, Dropbox, etc., if you want to keep this letter. Send this letter to your tax professional so they can also store it in their records.

Now there are three major IRS compliances to consider by having the S-Corp status.

If you ever lose or voluntarily remove this status, you lose it for five years. You will no longer file a form Schedule C for your business, which is generally filed with your individual tax return. Compliance #1 you need to file a form 1120S for your business that will be filed or extended by March 15th of every year. You must pay yourself reasonable compensation. Compliance #2 paying yourself reasonable compensation requires you to set up payroll, and I highly recommend Gusto as a payroll provider. The IRS hasn’t given us guidance or clarity on determining

reasonable compensation for an S-Corp Owner. Here at G+F, we can conduct a reasonable compensation analysis; click here to get your analysis. Compliance #3 you need to keep track of your stock and debt basis. Having enough basis determines whether your draws and net income will be taxed. You must have enough basis to take a net loss. In other words, I recommend not converting to an S-Corp if you see consistent net losses yearly.

Can I still deduct my home office and vehicle expenses as an S-Corp?

The short answer is yes. Can you pay these expenses out of your business bank account? The answer is it depends. We will discuss how to deduct these expenses if they are paid from your personal account or business account.

Let’s start with if they are paid from your personal bank account. You need to be reimbursed for these expenses just like any other employee. Remember, as an S-Corp owner, you are considered an owneremployee. The S-Corp needs to have a documented accountable plan; this is a plan that describes how expenses should be reimbursed. First, we need to know what home office expenses are deductible. You will have indirect and direct expenses related to the home office.

Indirect expenses apply to the home, like electricity, water, internet, security, and home depreciation, just to name a few. Direct expenses only apply to the home office, like paint for the office, office furniture, etc... You may be asking how much of the indirect expenses are deductible for the business. We must first figure out what percentage of the expense gets applied to the home office; to do that, we must come up with an allocation. To do this, you must take the home office's square footage and divide it by the home's square footage to determine your percentage.

For example, the home office is 300 square feet, and the house is 1900 square feet. 300/1900 = 15.8%. So if the electric bill were $250, the amount allocated to the home office would be $39.50 = $250 x 15.8%.

I want to pay my home office and vehicle expenses from my business bank account. How can I do this? You can follow the same process as mentioned above. This is essentially an accountable plan written, documented, and followed as part of the company’s process. You can also pay from the business account under a nonaccountable plan. This means that the amount paid by the company will need to be included in the owner's gross income. This recorded income will not be hit with social security, Medicare, or federal unemployment taxes.

I hope that you now understand what it truly means to be an S-Corporation if it’s the right decision for your construction company, and if you already have made the election, that you know what is required now that you are an S-Corporation.

About the Author

Timothy’s father owned a general contracting business in Florida, and he worked alongside him for many years. Timothy saw the sacrifices he made to keep the business running. Everyone was depending on him. That pressure can get overwhelming at times. But you don’t have to go it alone. G+F can be your trusted adviser who will craft the blueprint you need to set up your business for financial success. He is a Licensed Enrolled Agent authorized to practice before the IRS. Member: Associated General Contractors of America Florida East Coast Chapter; QuickBooks Online Certified ProAdvisor. If you have any questions about this topic or construction accounting and tax, you can contact Timothy by clicking on this link.

FEATURE A Pocket Guide to Maximizing Tax Returns for Subcontractors

by Jon Katz, Billd

Taxes. Everyone’s favorite topic, right? Especially for subcontractor business owners familiarizing themselves with construction industry tax minutiae. But, if you master the details you also avoid leaving money on the table. We want you to squeeze every last cent out of your return, so we sat down with a construction industry CPA to hear what advice she had to share with her subcontractor clients.

Before we dive into the specifics, the best piece of advice she shared was: don’t take advice. When it comes to

reducing taxes owed you’ll hear advice from everyone under the sun about what you should be doing, but we encourage you to scrutinize everything and not take what you hear at face value. Just because it worked for someone else doesn’t mean it’s best for your business.

Lastly, we have to say it, there is no magic bullet to reducing taxes. This article is for informational purposes only and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. Of course, we encourage you to consult with a tax

professional before implementing any of the strategies below.

Deductible Expenses You May Be Missing Out On

Many businesses overlook basic tax deductible expenses. Don’t be that guy. Below is a list our expert CPA recommended you look out for:

1. Yes, lunch with your GC is deductible. As a relationship-based business, construction companies can deduct for schmoozing. Lunch with

your top GC is a good example of this kind of expense (I hope you sprang for oscar-style because you can claim 100% deduction at a restaurant in 2022, but it’s going back to 50% in 2023).

2. Your vehicles are the gift that keep on giving. Subcontractors tend to be vehicle heavy, and how you treat vehicles when filing your taxes is probably the #1 missed opportunity for deductible expenses. Here’s what we heard:

• For your personal vehicles, track all the mileage you put on them throughout the year and charge the company based on mileage. The company will reimburse you based on mileage, and that mileage is tax deductible for the company. If you have the option to pay for gas on the company card, consider going the mileage route instead, because that includes wear and tear (you can’t double dip and do both).

• Your trips between job sites, those can be deductible. Even your hikes across town to pick up your hardearned checks from your GC. As long as they’re not your first destination of the day.

With all your hours on the road and the right documentation, this has the potential to be a lucrative write-off.

3. Renting or leasing equipment, here’s what to consider: If you decide renting or leasing equipment makes sense for your business, or on a particular project, you can deduct the cost. The benefit of leasing or renting equipment is that, generally, maintenance comes with it. But, if not you can at least deduct those expenses on your taxes. Unfortunately, you won’t get to claim depreciation on these assets, even on long-term leases.

4. The inevitable wear and tear on owned equipment. Countless assets used by subcontractors like equipment, vehicles and heavy machinery will be used for years and are subject to depreciation if those assets are owned by the business, or under a conditional sales contract.

What’s equally exciting about this is that you have flexibility on when to save.

Depreciable assets can be used to claim deductions over multiple years or they may be eligible for accelerated bonus depreciation in the year you purchased the asset. That means you can front load your depreciation benefits on 100% of the item’s value (changing to 80% according to the IRS).

5. Interest expense: As a subcontractor, there are a lot of reasons to love financing, but the one that doesn’t get brought up often is the tax deductible nature of interest. While the principal on debt is not tax deductible, the interest is. So, go ahead and leverage financing to take on that bigger project.

The “Check Before You Deduct” Expenses that Aren’t Viable or Recommended, Despite What Many Might Think

1. Principal payments on debt: While interest payments on debt may be tax deductible, the principal payments are not. Consider the benefits of keeping extra cash in the business versus putting it towards debts.

2. If you made an acquisition this year, you’ll need to be detailed. ou cannot take the money you spent as a whole to purchase the company as a tax writeoff. BUT you can deduct specific things that you used that money to buy, like equipment. In order to maximize your deductions make sure that you have detailed line items in your paperwork on what is conveyed.

Best Practices to Keep Your Taxes in Check

Maintain Accurate Financial Records

It goes without saying, but have a dedicated person in the office whose sole job is to maintain the books, or hire a bookkeeping firm to fulfill that role. Close the books and reconcile every account in the financial statement at the end of the month.

• The CPA we spoke to encourages you to specifically maintain the following:

• A work in progress schedule

• Billing per job

• Cost per job

• A solid estimating process

• Update your estimated costs as needed

• Pay attention to them all throughout the year

Hire an Expert and Avoid Guesswork

Taxes are inherently nuanced and complex. Hire an expert to ensure you are setting everything up correctly and aren’t missing any of the hairy details. There is always a chance that you could get audited, and a sloppy tax job will hurt you in the long run. When push comes to shove, hiring an expert is the number one piece of advice the CPA could give you. Not doing so is the #1 mistake she sees subcontractors make. The best part? Their services are generally taxdeductible as well.

Tax write-offs are a blessing for anyone who owns a business. While they minimize the burden of running a business, finding all of the write-offs available to you can be a burden in and of itself. This tax season, take a slow and patient approach to your write-offs, go through your financial documentation carefully, and above all else, hire an expert to help you navigate the jungle that is the construction tax space.

About the Author:

Jon Katz is SVP of Market at Billd. He is an experienced marketing executive with a proven record of effectively scaling businesses and generating significant revenue and profit growth. He brings an entrepreneurial spirit, selfstarter mentality and passion for lifelong learning to his role. At Billd he has developed a passion for the construction industry and the clients he works with. Now he uses his skills to help contractors grow their businesses by providing the tools needed to learn, improve, and network.

Making Estimated Tax Payments: Benefits for Construction Companies

by Patrick Hogan, handle.com

Estimated tax payments are a critical aspect of financial planning for any construction company, regardless of its size. Being conscientious about each component of your construction business is essential to ensuring success. Taxes may seem like a mundanity, but this area offers a lot of opportunities for optimization that

allow your company to improve its financial position and operational efficiency and avoid pitfalls that can significantly impact your business. Why pay ahead? Let’s look into some reasons. Here are three benefits of making estimated tax payments for construction companies.

Tax liability clarity, avoiding underpayment penalties

Making estimated tax payments give construction companies a clear picture of their tax liability and allow them to budget accordingly, helping them to ensure they have sufficient funds to cover their tax obligations

and avoid financial difficulties. Gaining clarity into tax liabilities is crucial in guaranteeing that financial resources are used smartly.

Of course, avoiding unnecessary penalties and interest charges is also a key benefit.

Margins are already razor-thin in the industry, and underpayment penalties can be costly for construction companies that fail to plan appropriately for their tax obligations. This happens when they owe more taxes than it has paid in estimated tax payments. Estimating tax expenses is a proactive approach to avoiding underpayment penalties. Companies can make payments that align with their projected tax obligation by evaluating their tax liability in advance, ensuring that they pay the correct taxes throughout the year. This allows companies to avoid high lump-sum costs that may trigger underpayment penalties.

Establishing a system for making estimated tax payments can also improve record-keeping and financial management practices, which can help prevent tax penalties and interest charges. When a company fails to pay its taxes on time, it may be subject to fines and interest charges, which can increase its tax liability significantly. By making estimated tax payments, subcontractors avoid these penalties and interest charges, ultimately reducing stress and improving their ability to focus on growing their business.

Improved cash flow through spread-out payments

Spreading out tax liabilities over the year, rather than paying a large amount at tax time, is a significant benefit of estimated tax payments for construction companies. Spreading out payments reduces their cash flow burden and frees up funds for other essential expenditures, such

as investments in equipment or personnel. Through these payments, companies can avoid the stress and financial burden of paying a large tax bill all at once.

Making estimated tax payments helps companies manage their cash flow more effectively. Instead of facing the daunting task of finding a lump sum of money to pay a sizable tax bill at year-end, they can spread out the payments over the year, matching their tax obligations with their financial situation. This approach helps companies avoid potential liquidity issues and frees up capital that can be put to better use in the business.

Estimated tax payments offer a beneficial solution for business owners and managers seeking peace of mind regarding their tax obligations. Instead of worrying about a big, endof-year tax bill, they can make regular payments throughout the year that align with their financial situation. This not only eliminates the stress and uncertainty of a large, one-time payment, but it also provides a clear understanding of the company's financial health. By tracking the tax payments and observing the impact on cash flow, business owners and managers can make informed decisions for the business's overall financial health.

Demonstrates good-faith tax adherence

Construction businesses can show their intention to fulfill their tax obligations and strengthen their reputation with tax authorities by making estimated tax payments. This helps prevent financial and operational disruptions caused by disputes over taxes and makes it easier to demonstrate compliance with tax laws and regulations. This proactive approach minimizes the risk of audits and other compliance issues that may arise in the future.

When a company makes these payments before the legal deadline,

it signals to tax authorities that they are committed to meeting its tax obligations and are willing to proactively work with the authorities to maintain compliance. This positive attitude is highly regarded by tax agencies and can help to improve the company's overall reputation, which is essential for establishing trust and credibility with tax authorities.

Estimated tax payments offer numerous benefits to construction businesses. From improved cash flow management to peace of mind, estimated tax payments provide a simple, straightforward, and effective way to meet tax obligations while mitigating the risks associated with large, end-of-year payments. Whether you are a budding subcontractor or an industry veteran, estimated tax payments are a smart choice for anyone looking to simplify and optimize their tax management process. Consider making estimated tax payments a part of your overall financial strategy, and enjoy the peace of mind and financial stability it provides.

About the Author:

Patrick Hogan is the CEO of Handle.com, where they build software that helps contractors and material suppliers with lien management and payment compliance. The biggest names in construction use Handle on a daily basis to save time and money while improving efficiency.

LEGALLY SPEAKING

Nonresident Construction Contractors Working in Georgia:Avoiding Sales/Use Tax Mishaps

by Richard C. Litwin, Esq. , Litwin Law

Nonresident contractors and subcontractors planning to enter into and perform construction contracts in Georgia face filing requirements that must be fulfilled before starting the Georgia project. The Nonresident Contractors Act, part of the Georgia Revenue Code and clarified by Georgia Department of Revenue regulations, imposes the filing requirements.

Who/what is a construction contractor in Georgia? A construction contractor is a person who or business that engages in construction projects relating to the premises or property that is the subject of the contract and that performs services and/or furnishes materials for constructing, altering, repairing, improving, dismantling or demolishing buildings, roads, bridges, viaducts, sewers, water and gas mains, streets, disposal plants, water filters, tanks and towers, airports, dams, water wells, pipelines and every other type of structure, project, development or improvement that meets the definition of real property. Thus, a nonresident business that provides materials and services for improving real estate is a construction contractor under the Georgia definition.

Who/what is a nonresident contractor? A nonresident contractor is a contractor that has no bona fide place of business in Georgia. A contractor that does not maintain a permanent domicile or business facility in Georgia is a nonresident contractor that must comply with the Nonresident Contractors Act. The specific requirements are discussed below.

Registering as a New Business with the Georgia Department of Revenue. A nonresident contractor/subcontractor must register as a new business with the Georgia Department of Revenue’s Taxpayer Services Division. The nonresident contractor/subcontractor can register at the Georgia Tax Center, which is the online portal for Georgia Department of Revenue. After the contractor/subcontractor registers, then the Georgia Department

of Revenue will issue a sales/use tax certificate of registration that bears a unique sales tax number assigned to the contractor/subcontractor.

Registering with the Georgia Secretary of State. The nonresident contractor/subcontractor must obtain a certificate of authority to transact business in Georgia as a foreign entity. The nonresident contractor/subcontractor can obtain the certificate of authority online at the Georgia Secretary of State’s registration portal.

Other Department of Revenue Registration Requirements. After the nonresident contractor/subcontractor gets a sales tax registration number and registers as a foreign business with the Georgia Secretary of State, the entity must comply with other requirements. For each contract performed (or project) in Georgia that is equal to or exceeds $10,000.00, the nonresident contractor/subcontractor must complete the following:

(1) Georgia Department of Revenue Form ST-C 214-

1, Nonresident Contractor’s Application for Authorization to Perform Contract, (2) Form ST-C 214-4, Nonresident Contractor Performance Tax Bond (with a bond, which is discussed below), and (3) Nonresident Contractor’s Consent to Service of Process. For this last form, the contractor/ subcontractor completes the form based on the entity type. The business must use Form ST-C 214-8, if the business is a corporation, must use Form ST-C 214-9, if the business is a sole proprietorship, must use Form ST-C-214-10, if the business is a partnership, and must use Form ST-C 21411, if the business is an LLC. All forms can be obtained at the Georgia Department of Revenue’s website. As noted above, the nonresident contractor/subcontractor must complete one set of forms for each contract/project. After completing each set of forms (one set for each project), the nonresident contractor/subcontractor must log on to the Georgia Tax Center portal (using the sales tax log on user name and

password). The nonresident contractor/ subcontractor must submit the completed/ signed forms by uploading each set of completed/signed forms at the Georgia Tax Center portal.

Consequences of Failing to Register. A nonresident contractor/subcontractor that fails to register with the Georgia Department of Revenue has no access to Georgia courts, even if the nonresident contractor obtained a certificate of authority to transact business issued by the Georgia Secretary of State. Indeed, failure to comply with Nonresident Contractors Act is an affirmative defense that can be asserted by the property owner in a nonresident contractor/subcontractor’s action for payment. The nonresident contractor/subcontractor can cure this default, so that it can proceed in a legal action (or lawsuit) -- late registration and payment of all taxes and revenues owed to the Department of Revenue is substantial compliance and removes the bar to maintaining an action based on contract. Also, failing to register as a foreign business with the Georgia Secretary of State can bar the nonresident contractor/ subcontractor from maintaining an action or defending itself in an action filed against the nonresident contractor/subcontractor. To be clear, the nonresident contractor/ subcontractor can file (commence) a lawsuit in Georgia, but the contractor/ subcontractor cannot continue (maintain) the action without authority to transact business. If the nonresident contractor/ subcontractor files a legal action (lawsuit) without having registered with the Georgia Secretary of State as a foreign business, then the nonresident contractor/ subcontractor can cure the default by registering with the Secretary of State as a foreign entity authorized to transact business in Georgia. The contractor/ subcontractor can register after filing suit but should register before the opposing party files a motion to dismiss.

Bond Requirement. As noted

above, Form ST-C 214-4 is a contractor performance tax bond that must be obtained by the nonresident contractor/ subcontractor. The Georgia Department of Revenue requires that the nonresident contractor/subcontractor obtain a separate bond for each project equal to or exceeding $10,000.00 and before starting the project. The bond must be issued by a surety company authorized to do business in Georgia. The Department of Revenue may require a master or blanket bond when the nonresident contractor/ subcontractor is engaged in continuing service under several contracts or is performing services on a contingent or unit basis (and the contract price is not determinable until after performance). The bond must be an amount no less than $10,000 with respect to all contracts performed during the current calendar year. Further, by March 1 of each year, the nonresident contractor/subcontractor must report and register all contracts of $10,000 or more completed during the prior calendar year and must pay a fee of $10.00 for each contract. The prime or general contractor or property owner may be required to withhold 2% on payments to the nonresident contractor/subcontractor if the total of all subcontracts on a job is greater than or equal to $250,000. The withholding ensures that the nonresident contractor/subcontractor complies with Georgia sales and use tax obligations. In lieu of having 2% of its pay withheld by the prime contractor, a nonresident subcontractor can post a surety bond. The nonresident subcontractor must complete and file with the Department Form ST-C 214-2, Application for Non-Resident Subcontractor’s Sales and Use Tax Bond. The surety company must complete and sign Form ST-C-214-3, Nonresident Subcontractors Sales and Use Tax Bond. After Contractor Completes a Georgia Project. Upon completing the project, the nonresident contractor/ subcontractor can apply for release of the bond. The contractor/subcontractor must print (from the Georgia Department of Revenue Website) Form ST-C 214-14, Nonresident Bond Cancellation Request Form. The contractor/subcontractor must complete the form, sign the form in front of a notary public and upload the completed/signed form at the Georgia Tax Center. The nonresident contractor/ subcontractor should include written notice from the Georgia Commissioner of

Labor that confirms that all fees related to the contract (e.g., unemployment insurance taxes owed to Georgia Department of Labor) are paid in full. Getting release confirmation from the Georgia Department of Labor can take time. Form ST-C 214-14 includes the Georgia Department of Labor contact information and telephone number. The nonresident contractor/subcontractor may need to visit a Georgia Department of Labor office and meet in-person with an adjudication supervisor. The Adjudication Section is in the Georgia Department of Labor’s administrative offices, located at 148 Andrew Young International Blvd., Atlanta, Georgia 30303. The Georgia Department of Revenue will not release the bond until the nonresident contractor gets the clearance from the Georgia Department of Labor.

Other Sales/Use Tax Obligations. Nonresident contractors/subcontractors must also comply with all Georgia sales/ use tax laws on materials purchased outside Georgia and brought into Georgia. Specifically, a nonresident contractor/ subcontractor may have to pay additional second-level sales/use tax on materials that the nonresident contractor/ subcontractor buys outside Georgia and uses to fulfill a contract in Georgia. For instance, a South Carolina contractor may buy materials in South Carolina, pay the South Carolina sales/use tax, and then bring the materials into Georgia to use on a Georgia construction project. In this case, the contractor may have to pay any additional use tax, less credit for taxes paid to South Carolina. In the example, the hypothetical contractor is based in Aiken County, South Carolina. The contractor pays 6% South Carolina state sales/use tax and 2% county sales/ use tax on the purchase of the materials that the Aiken County contractor buys and takes delivery of in Aiken County, South Carolina. Upon bringing the materials into Georgia, the contractor owes a secondlevel Georgia use tax. The tax is based upon the county into which the contractor brings the materials. If the contractor brings the materials into the City of Atlanta, then, as of August 2022, the contractor must accrue and pay an additional City of Atlanta local tax of 3.05%. In paying the second-level Georgia use tax, the Aiken County contractor gets credit for taxes already paid (in Aiken County). Specifically, the contractor can take a credit for the 6% South Carolina state tax (applied against

the 4% Georgia tax) and 2% (applied against the 3.05% City of Atlanta local tax). The Georgia law that offers the credit for sales tax paid to another state requires “like” taxes. Thus, as to the 6% state tax, the Aiken contractor can only apply 4% to the Georgia state tax of 4%. The contractor can apply the other 2% of South Carolina state sales/use tax to the City of Atlanta local taxes, to reduce the second-level tax to 1.05%.

Conclusion. A nonresident construction contractor/subcontractor must understand all obligations before starting a Georgia construction project. Although beyond the scope of this article, but indicated above, the nonresident contractor/subcontractor must also file monthly sales tax returns and remit any sales taxes to the Georgia Department of Revenue. Failing to file the forms and file and pay any sales taxes can lead to a host of unintended consequences. A nonresident contractor/ subcontractor that violates Georgia sales and use tax laws, including filing obligations, can take steps to minimize its liability by coming forward through a voluntary disclosure to the Georgia Department of Revenue to limit exposure and penalties (criminal and civil). This option is not available to every taxpayer, so the nonresident contractor/subcontractor should consult a state tax attorney about the best course of action.

Note: This document is an overview and summary of state and local tax obligations. This document is not intended to be, nor should be interpreted as, legal advice. For legal advice, the reader should contact an attorney.

About the Author

Richard C. Litwin, Esq. - Based in Atlanta, Richard C. Litwin (Litwin Law) has a national tax practice, where he counsels on state and local tax issues and represents businesses in state and local tax disputes, including sales and use tax and multistate corporate income tax. Mr. Litwin is a Fellow of the American College of Tax Counsel and is listed in U.S. News and World Report’s “The Best Lawyers in America,” for Litigation and Controversy – Tax. For further information, visit www.litwinlaw.net and read Litwin Law’s legal blog: Pass the SALT.

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HAVE A LITTLE FUN

Welcome Reception

Wednesday, March 8, 6:00 pm

President’s and Texas Chapters’ Welcome Reception

Pub Crawl & Cattle Drive

Thursday, March 9, 1:00 pm

Discover the history of Fort Worth’s famous Stockyards as you visit local saloons and watering holes. Enjoy the hidden history, cold drinks, and good times. Experience the Stockyards like you never have before!

World’s Largest Honky Tonk

Friday, March 10, 7:00 pm

Whether you want to strut your dancing stuff, ride a bull, or shoot some pool, we’ll all be having fun at Billy Bob’s Texas. We’ll start the evening with authentic western cuisine in Texas-sized portions, then move on to working off some of that great food by exploring the music memorabilia, dancing, or enjoying a variety of other activities.

FEATURES Financial Capital vs. Social Capital

by Dale Carnegie Staff

• Working from Home (WFH) will be coming to an end for many who expected otherwise: physical offices are set to make a bigger rebound than anticipated.

• The widely-publicized cost savings of remote work could be outweighed by the impact of declining social capital and changing communication patterns.

• Whether operating remotely, in a hybrid model, or in-person, organizations may want to turn some attention to strengthening social capital.

As keen observers of human relations and their impact on organizations’ performance, we wrote several blogs back in 2020 on the future of WFH. We weren’t convinced then that remote work would become the “new normal” and it seems that many business leaders now agree.

A McKinsey pulse survey of CEOs reports that while many leaders don’t expect to really be settled into their postpandemic working model until after 2022 (whether that’s back to their pre-pandemic mode of operation or a “new normal”), most now expect to return to the physical office.

Despite some high-profile exceptions, “wholesale moves toward remote working remain the exception rather than the rule”, they conclude. In fact, fewer than a third of business leaders surveyed are now committed to a hybrid model including two to three days of remote work per week.

Why?

Even with the appeal of significant cost savings from WFH, we think that recent experiences have given business leaders a heightened sense of the importance of social capital and its impact on collaboration, corporate culture, talent development, productivity and performance, which we explored in prior blogs

At the heart of social capital development are trusted professional relationships and effective communication, and we’ve all seen

how difficult it can be to consistently communicate well when restricted exclusively to email, texting and Zoom.

Our research (consistent with work done by many others) has found again and again that effective communication and social intelligence are key for psychological safety and team effectiveness, resilience, organizational agility, and the genuine inclusion that supports sustained diversity

We’ve undergone our own digital transformation at Dale Carnegie to offer new flexibility to participants – Learn From Anywhere (LFA) option. Opportunities on the horizon for bringing people together for training around topics such as interpersonal skills, social intelligence, and leadership are good news as research suggests it may be more effective when taught using a blended approach that includes live instruction together with online enhancements.

If you’re ready to learn more about enhancing social capital-building skills within your team build, please contact us –we look forward to talking with you.

About the Editor:

Robert Graves, MBA, is a Dale Carnegie Certified Trainer for Dale Carnegie Tampa Bay. His focus is Relationship Selling. He is the author of “Making More Money with Technology.” He often speaks on the evolution of Marketing, Sales, and Service. Robert can be reached at robert. graves@dalecarnegie.com or call/text 813-966-3058.

About Dale Carnegie:

Dale Carnegie is a global training and development organization specializing in leadership, communication, human relations, and sales training solutions. More than 9 million people around the world have graduated from Dale Carnegie training since it was founded in 1912. Dale Carnegie Training can help your organization build effective interpersonal skills that generate the positive emotions essential to a productive work environment that lead to increased profits.

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30-minute Session, Thurs., March 15, 2023 from 1 to 1:30 PM

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wants to help you with Risk Transfer

The following are important coverage considerations before executing a sub-contract agreement with an upper tier.

INDEMNIFICATION REVIEW

Are you indemnifying Owner/Developers, GC’s and Prime Contractors for contract provisions that are not covered by your Liability Insurance?

ADDITIONAL INSURED REQUIREMENTS COVERAGE RESTRICTIONS & EXCLUSIONS

Does your Additional Insured coverage comply with contract language?

Do your insurance policies include coverage exclusions and conditions which may either restrict or not respond at all to certain contractual obligations you entered into, and land you in breach of contract litigation?

FEATURES

Best Practices for Risk Management

by Gary R. Semmer, AssuredPartners

The Construction Industry is facing a number of “external” challenges, ranging from materials price inflation, supply chain delays, to labor shortages, that translate into scheduling, productivity and profitability issues. Although you may have no control over these external factors, you can help control your Total Cost of Risk:

Total Cost of Risk (TCOR)

Premiums + Deductibles + Risk Management Expenses/ Construction Revenues= .0050% to 1.5% (acceptable range) and maintain a “competitive” advantage.

Let’s explore the “Best Practices” of a Risk Management Program to achieve these results:

Safety Program/OSHA

Compliance: Review every element of your program including safety manual, safety orientation & training, and OSHA compliance with your safety director or other responsible individuals. If you use a third-party safety consultant, consider having a mock OSHA audit performed to avoid steep fines and reputational harm should you get pulled into an OSHA situation. Share these results with your insurance carrier’s loss/risk control rep or consultant to demonstrate you’re doing everything possible to mitigate risk.

Claims Management: Review your past five years of claim history/loss runs for frequency trends and severity claims to determine how you can either avoid them or mitigate them in the future. You should also perform a periodic claims review with your insurance broker & insurance carrier to close out older claims that can impact

your Workers Compensation EMR, General Liability & Business Auto premiums.

Contract Review and Compliance: Set up a standard contract review process to make sure your insurance program aligns with the insurance requirements in contracts your signing. This will avoid any surprises that can land you into a “breach of contract” claim and lead to possible litigation with upstream parties with whom you’ve contracted.

Renewal Preparation: Making the above steps an “ongoing process” will put you in the most “favorable” position as you start the renewal process three to four months prior to the renewal dates.

First step in prepping for renewal is to meet with your insurance broker to review renewal updates (i.e. Payrolls, Sub-work values, Equipment and Vehicle changes) along with any updates on Safety/ OSHA issues and open claims that will impact your renewal program.

Next, based on market conditions, you should discuss what your current carrier(s) renewal appetite is, and whether you need to go to market and seek alternative proposals. If your current carriers are going to restrict any coverage, require higher deductibles/retentions or increase rates outside of the normal range, then ask your broker to select two or three carriers who fit your risk profile. Have them prepare submissions to go to market and set a deadline of three weeks prior to renewal to review and evaluate proposals.

Alternative Marketplace: In going through the renewal process, you may

find that you are in a better position to take on more risk by securing higher deductibles/retentions. Conversely, you may be “captive ready” and may want to entertain a Group or Single Cell Captive program to take control over your program.

About the Author

Gary Semmer, CIC CWCA, is Executive Vice President and Construction Practice Vertical Leader with AssuredPartners. Gary specializes in providing Insurance & Risk Management solutions to the Construction and Real Estate industries. He has served as President of the Independent Insurance Agents of Illinois (IIAI) and Associated Risk Manager (ARM) of Illinois. At AssuredPartners, we represent over 20,000 Construction Clients nationwide with 200+ offices to serve you. Contact our experienced team of Construction & Surety Professionals to help you achieve your lowest possible Total Cost of Risk (TCOR). AssuredPartners is the 11th largest Insurance Broker and Consultant in the country providing Commercial Insurance, Risk Management, Employee Benefits through consulting and services. For more information on AssuredPartners, please contact Gary at Gary.Semmer@ assuredpartners.com or asa@ assuredpartners.com.

What Employers Should Know About the EEOC Draft Strategic Plan for FY 2022-2026

by SESCO Management Group

The U.S. Equal Employment Opportunity Commission (EEOC) has released its draft 2022-2026 Strategic Plan — a blueprint of its proposed enforcement plan for the upcoming years. The Plan focuses on strategic objectives accompanied by targeted goals and performance measures. Though each four-year plan differs to some extent, the EEOC’s vision of “justice and quality in the workplace” and mission to “stop and remedy unlawful employment discrimination” remains unchanged. The EEOC’s Strategic Plan demonstrates yet again that the Commission is keenly focused on identifying and pursuing systemic discrimination claims with more robust tools and strategies. The EEOC’s fouryear plan also makes clear that the

Commission will expand its efforts to reach currently underserved populations through a more technological approach. At the same time, the EEOC also intends to harness its collective resources to identify, investigate, and litigate large discrimination claims, which it sees as the best use of its litigation budget.

Strategic Goal 1: Enforcement Authority For Preventing And Remedying Discrimination

The EEOC’s first Strategic Goal is to combat employment discrimination through the strategic application of EEOC’s law enforcement authorities. This goal is comprised of two key objectives: (1) having a broad impact on preventing and remedying

employment discrimination while providing meaningful relief for victims of discrimination; and (2) exercising enforcement authority fairly, efficiently, and based on the circumstances of each charge or complaint. The EEOC will focus on strengthening the capacity of the Agency in the private, public, and federal sectors.

Indeed, in the last three years, the EEOC reported an average of 67,000 private sector charges of discrimination, 8,300 requests for federal sector hearings, and 4,300 requests for federal sector appeals—an uptick from the last four-year period for the federal sector hearing and federal sector appeal requests. Given the large number of charges and federal sector requests for hearings and appeals, the EEOC notes

Image by neelam279 from Pixabay

it must “think strategically about how to target its resources to ensure the strongest impact possible.” The EEOC highlights a number of strategies for carrying out that goal, such as rigorously and consistently implementing the SEP to focus resources on EEOC priorities, and using administrative and litigation mechanisms to identify and eradicate discriminatory policies and practices. Additional information on these strategies appear on page 15 of the proposed plan.

Some insight into the Agency’s thinking, and potential impact for employers, can be obtained by looking at the performance measures that EEOC has set. (A summary table appears on the last page of the proposed plan.) For example, the EEOC aims to obtain targeted equitable relief in 90% of all conciliation and litigation resolutions by the final year of the plan. It also aims to resolve at least 90% of its enforcement lawsuits annually. The combination of these two measures suggests that employers must expect to provide some monetary relief to end disputes with the EEOC, but the EEOC also may feel some pressure to be reasonable in its demands in order to close enough of its files each year. That pressure may be particularly acute as each fiscal year draws to a close.

The EEOC also intends to measure its performance as a function of its capacity to conduct systemic discrimination investigations. This includes training more field staff to identify and investigate such claims, and to have staff members in each District who are dedicated to conducting systemic discrimination investigations. This suggests that employers can anticipate more systemic investigations to be opened, and for those investigations to be conducted more rigorously.

The EEOC intends to step up its efforts to monitor compliance with the conciliation agreements it has entered with employers. Employers who thought that conciliation agreements might bring some peace after an investigation may now face greater burdens in demonstrating their adherence to the terms of those documents.

In addition, the EEOC continues to

look at streamlining and improving its charge intake, including providing more availability for intake interviews and taking advantage of technological tools. Removing barriers to filing charges could lead to an increase in charge activity.

Strategic Goal 2: Education And Outreach

The EEOC’s second Strategic Goal is to prevent employment discrimination and advance equal employment opportunities through education and outreach, comprised of two main objectives: (1) public awareness of employment discrimination laws and rights and responsibilities under such laws; and (2) availability of information and guidance to employers, federal agencies, unions, and staffing agencies necessary for advancing EEO, preventing discrimination, and effectively resolving EEO issues.

Traditionally, the EEOC’s outreach programs were implemented through free education activities and training and, to a lesser extent, fee-based training through the EEOC’s Training Institute. The EEOC now commits to increasing its use of technology and expanding the EEOC’s social media presence to reach the agency’s varied and wide-ranging audiences. The EEOC will continue to enhance its use of social media to promote its education and outreach activities and to encourage greater use of its website. The EEOC’s website provides critical education materials, including information on the laws the agency enforces, the private sector charge and federal sector processes, data, and research.

Strategic Goal 3: Organizational Excellence

The EEOC’s third Strategic Goal is to strive for organizational excellence through the agency’s people, practices, and technology. This Strategic Goal is operational in nature with an objective of improving management functions with a focus on people and service to the public, among others. There are two primary objectives, including: (1) achieving a culture of accountability, inclusivity, and accessibility; and (2)

aligning resources with priorities to strengthen intake, outreach, education, enforcement, and service to the public to protect and advance civil rights in the workplace. This Strategic Goal functions to ensure that the other two Strategic Goals can be carried out effectively, as the EEOC must ensure excellence in its staff and the services it provides.

For example, recruiting and retention is a main highlight of this Strategic Goal as well as advance performance management and diversity and inclusion within its own workplace. After all, how can the EEOC monitor the quality and justice of America’s workplaces if it does not keep its own offices in check? To that end, the Strategic Plan identifies how large-scale industry layoffs or other changes such as the COVID19 pandemic could trigger a straining of staff capacity to timely resolve an inevitable influx of anticipated charges for the coming years. Further, the EEOC reports that population shifts may result in increased charge receipts at some field offices, but budget constraints may not allow for the hiring of additional staff. Here, too, the performance measures offer some clues about how employers may be impacted. Not surprisingly, the EEOC aims to be fully-staffed— to increase the number of employees involved in enforcement and to train those who are in “mission-critical” roles, including EEO Investigators, EEO Specialists, and Trial Attorneys. Employers can expect that larger numbers of investigators and attorneys, with better training, will lead to an increased number of investigations and lawsuits to be conducted in more depth.

About the Author:

SESCO specializes in human resources consulting services and federal and state employment law compliance. We welcome your call to discuss compliance questions as well as provide to ASA members free telephone and email consulting for human resource related questions or needs. Contact a SESCO Management Consultant today at (423)764-4127 or via email at sesco@ sescomgt.com.

Dates and Figs

This is a monthly compilation of construction/economic tables and information, assembled in one place for your review. Sources are provided in case you want to delve deeper.

Construction Materials Prices Rise 1% in January; Up 5% From a Year Ago

Construction input prices rose 1.3% in January, according to an Associated Builders and Contractors analysis of the U.S. Bureau of Labor Statistics’ Producer Price Index data released today. Nonresidential construction input prices increased 1.1% for the month.

Overall construction input prices are 4.9% higher than a year ago, which is the smallest annual increase since January 2021. Nonresidential construction input prices are also up 4.9% since January 2022.

Dodge Momentum Index fell 8.4% in January to 201.5 (Dec 220.0)

The commercial component of the DMI fell 10% and the institutional component receded 4.7%

Weakness in commercial planning in January was broad-based, with office, warehouse, retail and hotel activity declining. Slower activity in education and amusement projects drove down the institutional portion of the Index, nullifying the impact of gains in healthcare and public planning over the month. On a year-over-year basis, the DMI remains 32% higher than in January 2022. The commercial component was up 40%, and the institutional component was 16% higher.

Source: Dodge Construction Network

“Recent employment and retail sales reports indicate that the economy is not slowing nearly as quickly as predicted,” said ABC Chief Economist Anirban Basu. “That is the good news. The bad news is that the economy remains overheated, a phenomenon neatly reflected in the January PPI data, which indicated that construction input price gains accelerated on a monthly basis. For instance, construction machinery and equipment prices expanded 3.4% in January and are up more than 12% during the past year. “The implication is that the Federal Reserve will maintain higher interest rates longer,” said Basu. “Ironically, it is the current strength of the economy that makes a recession more likely sometime during the next 12 months. At some point, higher interest rates will meaningfully affect economic activity. With industry backlog high, according to ABC’s Construction Backlog Indicator, many nonresidential contractors will feel little to no effect from higher interest rates in 2023. But in certain construction segments and locations, these dynamics could make the next two years more challenging.”

Source: https://www.abc.org/News-Media/News-Releases/ entryid/19802/abc-construction-materials-prices-rise-1-injanuary-up-5-from-a-year-ago

Consensus Construction Forecast, December 2022 (AIA)

For interactive version and individual forecasts, click here.

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Upcoming Webinars Coming Up

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Wednesday, April 12, 2023 | 12:00 - 1:00 pm (EDT)

Check out the benefits in your ASA National Organization membership. Whether you just joined last month or ten years ago, this easy-going and informative session will show you what is available to you and how to access it.

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Understanding the Ins and Outs of Medical Leave of Absences

Tuesday, April 18, 2023 | 12:00 – 1:00 pm (EDT)

We’ll explore the practical application of crucial federal regulations such as Americans with Disabilities Act and the Family Medical Leave Act. Further, we will delve into these pertinent and complex regulations to give participants a fundamental understanding on how to navigate and apply these regulations compliantly within their organization. This session focuses on the intent and purpose behind ADAAA and FMLA and will cover the basic interpretations and practical applications of the law. Additionally, we will discuss and demonstrate how to reduce liability by avoiding common compliance mistakes. Participants will learn how to properly engage in the interactive Reasonable Accommodation process for ADAAA and effectively manage FMLA leave for eligible employees.

Key takeaways include:

• Understand the basic requirements of ADAAA and FMLA regulations and the impact to the organization.

• Explore the most common violations and how to avoid them.

• Recognize whom and when to apply the ADAAA and FMLA regulations and supporting documentation.

• Assist employees in handling accommodation and leave appropriately to protect yourself and the company from liability.

Presented by: Jamie Hasty, Vice President, SESCO Management

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• The Power of a Mentor

• And much more!