9.12 AIAVT News

Understanding Vermont’s Labor Regulations: What Do They Mean for Architects?

Many architectural and engineering firms in Vermont hire consultants to complete special services that these firms do not provide internally, but are, however, part of their overall contract with the owner. Recent developments in Vermont’s Workers’ Compensation (WC) and Unemployment Insurance (UI) regulations present some challenges to these traditional hiring practices.  More...

Understanding Vermont’s Labor Regulations: What Do They Mean for Architects?

Many architectural and engineering firms in Vermont hire consultants to complete special services that these firms do not provide internally, but are, however, part of their overall contract with the owner. Recent developments in Vermont’s Workers’ Compensation (WC) and Unemployment Insurance (UI) regulations present some challenges to these traditional hiring practices. 

Last year, as part of a larger omnibus labor bill (H.762), the Vermont House Committee on Commerce and Economic Development attempted to pass a set of provisions to rectify these challenges. At the last minute, the bill was held up in the Vermont Senate due to conflicting goals of the Senate’s version of the bill, and lack of testimony taken on unrelated provisions that could have added to the cost of the workers’ compensation system. 

Both the Vermont Chamber of Commerce and Vermont Businesses for Social Responsibility actively supported the proposed provision, which clarified the ability of independent contractors and sole proprietors to work outside of WC and UI requirements. The provision would have also created a voluntary certification program with the state for sole proprietors and those who define themselves as independent contractors.  However, for now, architecture firms must live with the current WC and UI guidelines and would be advised to go through them in detail to understand the implications on current hiring practices.

According to Jessica Gingras, a workers’ compensation and unemployment insurance lobbyist for the Vermont Chamber of Commerce, “It is important for AIA Vermont members to use caution when utilizing temporary workers as independent contractors. It is also important to note that there have been cases in the Vermont Supreme Court that have stated clearly that even if there is a signed contract involved—intending to absolve an employer of liability—a worker can still be determined an employee. We recommend contacting the Department of Labor directly with any specific or unique cases and questions before hiring—as a cautionary measure.” 

For more information about these guidelines, see the descriptions of both, as shown below, or contact Jessica Gingras at (802) 262-2130. Architects who have been affected adversely by the current programs and would like to see changes are also encouraged to contact their legislators. 

VERMONT WORKERS’ COMPENSATION PROGRAM 

Is an individual my employee for Workers’ Compensation purposes? 

YES - if the individual has entered into the employment of, or works under contract of service or apprenticeship with you as the employer...

There are a few limited exemptions:

• Work of a casual nature AND not for the purpose of the employers trade or business

(Casual work is generally one time in nature and not similar to work done by the employer)

• Amateur Sports
• Agriculture employment if farm payroll < $10,000 per year
• Family member living in employer’s house
• Licensed real estate broker/sales
• Service in and about a private dwelling
• With approval of VDOL, up to 4 executives of a corporation or LLC
• Sole proprietor or partner owner of his/her own unincorporated business, if;

¨ Work is distinct and separate from work of the person the individual contracts with, AND

¨ Individual is in business for self, AND

¨ Individual is not treated as employee for income tax, AND

¨ There is a written contract expressly waiving coverage. 

Ask the following questions:

1.       Did the individual perform services?  If yes,

2.       Did you pay the individual wages?  If yes, then “right to control” and “nature of business” tests must be applied. 

The worker is only an independent contractor if the employer meets his or her burden by showing:

A.     Worker is free from direction and control; AND

B.      Worker is doing work outside the usual course of the business. 

• If an individual is an employee under the WC tests he/she must be covered with WC insurance even if the wages earned are small or the hours worked are few.

VERMONT’S UNEMPLOYMENT INSURANCE PROGRAM 

Is an individual my employee for Unemployment Insurance purposes?

§         Ask the following questions:

1.      Is the person or entity you hired an “individual”?  If yes,

2.      Does the individual have other workers?  If no,

3.      Did the individual perform services?  If yes,

4.      Did you pay the individual wages?  If yes, “ABC” test must be applied. 

UI PROGRAM “ABC” TEST

§         The worker is an independent contractor only if the employer meets his or her burden by showing:

¨   Worker is free from direction and control; AND

¨   Worker is doing work outside the usual course of the business, or outside the place where the business is conducted; AND

¨   Worker is independently established in a trade, occupation, profession or business. 

§                     All three prongs of the test must be met to find individual is not your employee. 

UI PROGRAM -“ABC” ADDITIONAL THOUGHTS 

1. Individual is free from direction and control; examples of this might be: 

¨      Individual bids for the job and is paid by the job

¨      Individual completes job with no direction, supervision or set hours

2. Individual is doing work outside the usual course of the business, or outside the place where the business is conducted; examples might be:

¨       Individual does work which none of your employees does and for which you do not advertise

¨       Individual does all work at their own facility

3. Individual is independently established in a trade, occupation, profession or business; examples might be:

¨       Individual has employees of his/her own

¨       Individual has liable UI account with VDOL

¨       Individual advertises  his/her  business services to the general public

As you can see, if there is a connection between your business and the “individual”, in most cases the individual is your employee for both WC and UI purposes 

¨      EVEN when the individual believes him or herself to be an independent contractor

Reminder…

¨      “Individual” is one who has no workers

Side note:

¨      For the past several years VDOL has attempted to get the law changed to have the same test for both programs. 

STATUTORY EMPLOYEES 

§         Pertains to Workers’ Compensation only, not UI.

§         If you subcontract a part of, or process in, your business to another business or company you may become the statutory employer of that company’s workers on your job.

§         If the direct employer of these employees has covered each of them with workers’ compensation, you may not have liability. 

However, if the direct employer has not provided coverage, you may be liable to do so; your workers’ compensation insurance carrier may charge you for this exposure. 

For “scenarios” with worker types an architect might hire, see the companion article, “Is She or Isn’t He?” in the sidebar of this issue.

Calendar

9/1-30     AIAVT Design Awards Traveling Show—Hooker Dunham Gallery, Brattleboro

10/19-21     AIANE Conference & Design Awards

11/8   AIAVT People’s Choice Reception— All 2012 AIAVT  Design Awards entries on display, hosted by Brownell Windows & Doors, Williston. Votes accepted through 11/28.  

11/14-16   Workshop—Methods & Materials for Wooden Window Restoration course description & registration information (PDF), presented by Historic Windsor,  Windsor  

11/29-30     Workshop—Preservation Business & Project Management  course description & registration information (PDF), presented by Historic Windsor, Windsor

12/6     AIAVT Annual Meeting & Design Awards

Is She or Isn’t He? Scenarios to Help Architects Determine Workers’ Employee Status

(This is a companion article to “Understanding Vermont’s Labor Regulations…,” also in this issue)

By Donna Leban, AIA 

For architects to better understand their responsibilities regarding unemployment insurance (UI) and workers’ compensation (WC) when hiring individuals’ assistance on projects, it’s helpful to look at some typical cases in point. Let’s imagine that an architect is hired by a client to design and create drawings and specs for a building renovation project. The architect has a professional license, is a sole proprietor, has no workers’ compensation insurance, and has never had any employees.  Due to the project size, scope and schedule, the architect decides to bring on the limited-term assistance of four individuals (described below), each of whose contribution is integral to the work the architect has been hired to complete. 

1)      Lighting Design Specialist. The designer has a professional license, is a sole proprietor, advertises her design services to the public, and has her own client base.  The designer generally works alone, has no employees, no workers’ compensation policy, and is not registered as an employer with the Vermont Department of Labor (VDOL), Unemployment Insurance.

a.      UI—If the scope of the architect’s contract includes providing lighting design and the architect hires the designer described above, the designer is a statutory employee for UI coverage. 

b.      WC—The designer is also be a statutory employee for whom the architect would be required to provide WC coverage.

c.       If the lighting designer is paid directly by the owner and is not working under the direction of the architect, neither UI nor WC applies. 

2)      Certified Engineer.  The architect seeks this individual for some of the structural aspects of the project.  The engineer has a professional license, is co-owner and officer of an incorporated engineering firm, employs two apprentices and an office manager, is registered with VDOL, UI and has a workers’ compensation policy that covers everyone in the firm.

a.      UI— Since the engineer’s corporation has employees and therefore a UI account, the individual would not be an employee of the architect.

b.      WC—Since the engineer brings his own coverage to the relationship, liability is not likely to fall to the architect.

c.       If the engineer were a sole proprietor without WC or UI, then the provisions from 1a and 1b, under “Designer,” would apply. 

3)      Interior Decorator. This individual is hired to plan the finishing touches of the project and is a co-owner and member of a three-person limited liability corporation (LLC). This corporation employs an office manager, is registered with UI and has a WC policy.  However, the decorator has filed a Form 29 to exclude himself from coverage under his company’s WC policy.

a.      UI—Since the decorator’s LLC has employees and therefore a UI account and pays UI taxes, he would not be an employee of the architect.

b.      WC—The decorator is a statutory employee for whom WC coverage must be provided since he is not covered by his own policy.

c.       If the decorator is paid directly by the owner and is not working under the direction of the architect, WC would not be the responsibility of the architect. 

4)      Part-time Administrative Assistant. The architect pays his/her spouse to perform this work and he/she is not employed elsewhere.

a.      UI—The spouse of the sole proprietor architect is exempt from UI reporting as a family member.

b.      WC—The spouse, though a direct employee, is exempt as a family member residing with the employer. 

Note: If the architect had formed a corporation or an LLC, no family member exemptions would be permitted. 

For more information about this topic and to determine what is appropriate for their firms, architects are advised to consult with an employment attorney and/or accountant or visit the VDOL website.

AFFILIATE news

NEW MEMBERS

Holly Hickey Moore Interior Design   Holly Hickey Moore is a licensed interior designer offering full service project management, consulting and design services.  She has been involved in a variety of projects including residential, commercial, hospitality and boutique retail stores. Contact: Holly Hickey Moore, RID, IIDA, 802-448-2998

The Sherwin-Williams Company offers consultation for project specifications requiring architectural or industrial coatings, updating of master specifications to include new S-W products or Rex Numbers, S-W Low VOC or 0 Voc systems, and MPI cross-referencing. New, AIA HSW SD technology seminars on subjects including new LEED 2009 rules for paint and coatings are also available. Contact:  Mark Weiner,            617-438-1408.

United Steel Products Company is a metal fabricating manufacturer serving the residential and commercial building industries throughout the U.S. USP's product line encompasses standard construction hardware for the light construction and retail/do-it-yourselfer markets, as well as a complete line of connectors for the Engineered Lumber and Plated Truss industries. Contacts: Steven Archer, and Mark Judson.

ANNOUNCEMENTS

Engineering Ventures has added two new owners and shareholders:  Paul Hobbs, PE, and Paul Boisvert, PE, LEED AP.  The company operates from offices in both Burlington, Vermont and Lebanon, New Hampshire, providing a broad range of civil and structural engineering services.

Hobbs, a senior engineer who joined the firm in 2001, specializes in structural design. He has served as the project manager on many municipal and recreational projects, including municipal treatment, industrial, and manufacturing facilities.

Boisvert, also a senior engineer, joined the firm in 2007. He has a wide range of experience, including site design, project management, contract administration, and permitting.  His approach to projects combines a strong interest in sustainable design with an in-depth understanding of the operational implications that follow. 

Trumbull-Nelson Set to Begin Multi-Million Dollar Essex Junction Wastewater Treatment Facility Refurbishment

Trumbull-Nelson Construction of Hanover, New Hampshire and Montpelier, Vermont was recently awarded the Essex Junction Wastewater Treatment Facility Refurbishment Project contract for $11.8 million. Trumbull-Nelson will be collaborating with the project’s designer, Aldrich + Elliott, P.C., Water Resource Engineers of Essex Junction, Vermont to oversee the project’s successful completion. 

Improvements to the Essex Junction Wastewater Treatment Facility will enable the plant to operate more effectively and to improve compliance with its State operating permit. Work will include the upgrade of primary and secondary clarifiers and aeration tanks, and provide new tertiary filters, sludge dewatering, chemical feed, refurbishment of the two existing digesters, and new grit collector system. Additionally, the scope includes new pumps, SCADA System work, associated mechanical and electrical requirements, and a geothermal well component.

latest ACHIEVEMENTS

Donna Leban, AIA, Light/Space/Design, South Burlington, presented a session at the BuildingsNY 2012 conference on May 3 about the rapid advances in LED lighting and how best to apply such advances in new and renovation projects.

Jonathan M. Miller, AIA, JMMa Specs, has achieved much recently. In July, he began serving his third (and last) term as Chair of CSI's Institute Certification Committee, the group that maintains the Construction Documents Technology (CDT) Certificate Program, as well as the Certified Construction Specifier (CCS), the Certified Construction Contract Administrator (CCCA), and the Certified Construction Product Representative Certification Programs. He is also a contributing author to CSI's Sustainable Design and Construction Practice Guide, due to be published in January 2013 (Wiley). He also became Vermont’s first and only Fellow in CSI and one of only 410+/- Fellows named since CSI was founded in 1948.  

Ingrid Nichols, AIA, Banwell Architects, was a co-presenter at the 2012 Traditional Building Conference on July 25 held at The Exchange Conference Center in Boston. With Art Reeves of Marvin Windows and Liz Pritchett, a historical consultant, they discussed energy efficiency upgrades, including a biomass wood pellet boiler, to the Windsor Village Housing project in Windsor, Vermont.

AIAVT News is published by AIA Vermont, a Chapter of the American Institute of Architects. 

Opinions are the author’s and not necessarily the views of AIAVT or any other organization.

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Please send articles, notices, letters, and graphic submissions to the editor:

Carol Miklos, Executive Director, AIA Vermont

CMiklos@ aiavt.org

88 Blackbird Lane

Charlotte, Vermont 05445

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