You Aren’t Going to Pay Me Because ... Why?
Know what I like in a project? Simple answer: Get in, get out, and get the money! And I bet that's also the same for you. But if I ask myself, how often do I get these kinds of projects, the answer is disappointing. Here's my answer: Almost never! You? I'm guessing we're alike, here.
Recently, I ran into a situation where someone didn't want to pay for some work that was performed, and they used a really lame reason. It's something that you need to know about. But, I'll come back to it in a moment.
You know, it's a crazy world out there. Our clients all demand top craftsmanship from us, yet are not willing to give us the time (and money) required.
The masonry, concrete and other contractors I talk to all seem to have one thing in common: their jobs never go exactly as planned. And a lot of times, it's a simple case of the plans themselves being inadequate to build what the contractor has bid. Tell me I'm wrong. Send me an e-mail and tell me that almost all of your projects go according to plan; I'd love to hear that from our industry, but right now I'll settle for at least one person. Between you and me, I don't think I'm going to get that e-mail.
Okay, here's a deal for you: Tell me about the craziest, the hardest, the strangest change you ever had to deal with on one of your projects, and I'll give a copy of my e-book, "Get Paid for a Change!", to the contractor with the best answer. Hey, it sells for about $40, and might only take a minute of your time to drop me an e-mail, so give it a shot.
"Hey, Coach," I hear someone else say, "what can we do the next time we run into these changes, which will probably be tomorrow?"
First, we can do some practical stuff, team. By the time you read this, you should be able to log on to www.fullcontactBlog.com. There you'll find some new resources, such as regular audio updates from Coach Gary, to help you with your PM issues. I think you're going to like it. Check it out today. As always, almost all of the helps on the site are free to you, so surf on over, check it out, and sign up.
Second, drop me an e-mail when you run into something difficult or strange. Maybe a fresh set of eyes can help you sort things out.
The third thing we can do for you today is to offer an answer to the most difficult job in construction: collecting your money!
Now, where was I? Oh,yeah: "I don't want to pay you." How in the world do we get into messes like these? Listen up, now, and don't miss this because it is critical, and can happen to just about anyone.
We all do extra work. We are all used to getting a ticket signed when the extra work is done, and then we bill for it. But there can be a twist, and you need to look out for it or your client might not pay you.
So picture this: You're asked to do some extra work. You say, "No sweat! I got my signed ticket, right?" Unfortunately for your company, you might not be covered.
When you check that fine print stuff in your contract, you will probably read that no work will be paid for if it is not authorized in writing before the work begins. In essence, this means that a client can tell you to do the work, sign your ticket, and still not pay you. How's that?
You look at your signed ticket, and you see that the superintendent wrote on it, "Verify hours only," or words to that affect. That's legal-speak for, "Hey, I agree that your crew spent hours doing that work, but I don't agree that the work was not in your contract. I was asked to verify that the work was done, and that's all I did. I never said it was extra work; I just told you that you needed to do it. Sorry!"
Sorry? It's not right! It's not fair. I object! I've been, shall we say, violated!
Settle down, team. Because right now we're going to learn a play that we can run, which will avoid a lot of this. And it's simple. It's so simple you'll just about slap yourself in the head, and wonder why you didn't think of it yourself.
When your client or the superintendent tells you to do some "extra work," wants you to do it T&M, and promises to sign your ticket afterwards, here's what you say: "Love to help you. We'll get right on it. But first, your office needs to fax over to my office a note or send an e-mail telling us to do the work, and the note needs to say that it's extra work. Your contract documents require us to do things this way before starting your work. Sorry for any inconvenience!"
Now, when your office bills your client for this extra work, as shown on the signed ticket you have, your office can reference the note or e-mail stating the work was "extra."
It only takes a moment longer to do things this way to protect yourself. A hassle? Maybe. But if you ever get into an argument with your client, or into arbitration, or into a courtroom battle over an issue like this, would you rather have just the signed ticket, or the signed ticket plus the note authorizing the "extra" work? And the cool thing? You didn't even have to write the note!
Put this to work for your company immediately, and see how much grief and money it saves you.
About the Author
Gary Micheloni is a working project manager, speaker, author, consultant and coach. He has severals years of industry experience, including a background as a licensed general engineering contractor. For further information and insight on the Full Contact Project Management approach, write Coach Gary at FullContactTeam@gmail.com.
Copyright © 2007, Gary Micheloni and Full Contact Project Management