# Subbing Work Out To Others - Basics



## artinall (Aug 14, 2007)

My insurance guy tells me to make sure that if I sub work out that then sub has insurance and workmans comp.

Workmans comp is not normally gotten by the one man operation, right? Like I don't cover myself. 

Doesn't this pertain to only if the sub has employees?

Then the question is would the trade insurance be sufficient to cover the one man subcontracter -- from what I've seen, most medical coverages with trade policies are an outright joke. We are talking basic minimum payouts.

Myself, I have one of the best medial plans available, separate from the trade policy.


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## blacktop (Oct 28, 2012)

artinall said:


> My insurance guy tells me to make sure that if I sub work out that then sub has insurance and workmans comp.
> 
> Workmans comp is not normally gotten by the one man operation, right? Like I don't cover myself.
> 
> ...


If YOU! Carry comp? 
Any check you write to a sub that don't carry comp ...You have to carry It on him!


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## blacktop (Oct 28, 2012)

I have no employees .. I have to carry comp or no G/C will hire me !


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## artinall (Aug 14, 2007)

blacktop said:


> I have no employees .. I have to carry comp or no G/C will hire me !


 So you have yourself on a payroll?


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## blacktop (Oct 28, 2012)

artinall said:


> So you have yourself on a payroll?


Dude ! Your killing me!


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## blacktop (Oct 28, 2012)

Any G/C that carries comp and Liability will expect his subs to do the same ! 


He don't care If your one man or twenty men !!!


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## rselectric1 (Sep 20, 2009)

blacktop said:


> Any G/C that carries comp and Liability will expect his subs to do the same !
> 
> 
> He don't care If your one man or twenty men !!!


Same here.

It's quite the scam. For years *without* employees, I had to pay for a policy that covered non existent employees and not me
either to the tune of a couple grand a year. So basically it didn't cover anyone, but that was enough to satisfy the GC's yearly audit to keep working for them.



I'm guessing it's similar where you are. You can exempt yourself from the policy and it makes it a bunch cheaper, but YOU are not covered.


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## blacktop (Oct 28, 2012)

rselectric1 said:


> Same here.
> 
> It's quite the scam. For years *without* employees, I had to pay for a policy that covered non existent employees and not me
> either to the tune of a couple grand a year. So basically it didn't cover anyone, but that was enough to satisfy the GC's yearly audit to keep working for them.
> ...


YUP !! It's a scam! 
I'm thinking about going INC ... Just so i can work till I'm 100 .


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## gbruzze1 (Dec 17, 2008)

In NYS, they don't care if you're a one man band and you have an "exemption". That used to fly as a GC. Show up to the audit with a stack of checks made out to subs that had "exemptions". Basically an affidavit stating the sub has no employees. But now they don't allow that. If someone is getting paid by a contractor, they need to be covered somehow. Whether they have their own Comp or the GC winds up paying the comp for them, they just wanna get paid. 

Only thing to be careful of if you're using subs without comp and you wind up paying it for them, if you don't separate labor and materials, you'll pay the comp on the materials too. 


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## blacktop (Oct 28, 2012)

gbruzze1 said:


> In NYS, they don't care if you're a one man band and you have an "exemption". That used to fly as a GC. Show up to the audit with a stack of checks made out to subs that had "exemptions". Basically an affidavit stating the sub has no employees. But now they don't allow that. If someone is getting paid by a contractor, they need to be covered somehow. Whether they have their own Comp or the GC winds up paying the comp for them, they just wanna get paid.
> 
> Only thing to be careful of if you're using subs without comp and you wind up paying it for them, if you don't separate labor and materials, you'll pay the comp on the materials too.
> 
> ...


I'm labor only ! :thumbsup:


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## gbruzze1 (Dec 17, 2008)

You're hired!


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## blacktop (Oct 28, 2012)

gbruzze1 said:


> You're hired!
> 
> 
> Sent from my iPad using Tapatalk


When do I Start?


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## artinall (Aug 14, 2007)

gbruzze1 said:


> Only thing to be careful of if you're using subs without comp and you wind up paying it for them, if you don't separate labor and materials, you'll pay the comp on the materials too.


So as the sole owner, it is not required by the State of OH, but if the GC requires it, I need to buy a policy for "non-existent employees" to cover even myself. _Fun_.

It has been over 20 years since I subbed work from builders in (2) different states and neither required comp.

Now I'm coming across some work that I'd like to sub out, and, finding local guys that don't carry workers comp -- best to keep looking. I don't want to start that kind of paper trail with the state. They may always keep looking over my shoulder. 

One other thing I'm discovering -- a lot of local drywallers/painters say "licensed and insured". Well, insured is the easy part but when it comes right down to it, many don't have a license as they are presenting themselves. They may have a general business license but there is no license for painting and drywall to be given.


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## Irishslave (Jun 20, 2010)

rselectric1 said:


> Same here.
> 
> It's quite the scam. For years *without* employees, I had to pay for a policy that covered non existent employees and not me
> either to the tune of a couple grand a year. So basically it didn't cover anyone, but that was enough to satisfy the GC's yearly audit to keep working for them.
> ...


Audits. Gotta love it. Damn Insurance companies got their hand out and don't even lift a 4' step ladder. I barely get a cup of coffee when I go to my agents office, for the money I spend he should buy me breakfast once in a while.


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## gbruzze1 (Dec 17, 2008)

I'm. It familiar with Ohio, but in NY...

As a GC, do you have workers Comp? The issuers of your comp policy are the ones who require the subs to be covered. Hypothetically speaking, if I operate without Comp, then I have no Comp audit, then there's no one to charge me Comp for my uninsured subs. Downside of that, is we are all uninsured and if anyone gets hurt, I'm screwed. 

That's a problem I've seen with some one man show subs. They have no workers Comp, so the options are pay them for labor only and supply the material, and pay my workers Comp to cover them. Or, find another sub with workers Comp.

Even as a GC with no employees and your subs have Comp, it's still smart to carry Comp. Because when someone gets hurt, the lawyers will sniff you out right away. 


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## artinall (Aug 14, 2007)

Irishslave said:


> Audits. Gotta love it. Damn Insurance companies got their hand out and don't even lift a 4' step ladder. I barely get a cup of coffee when I go to my agents office, for the money I spend he should buy me breakfast once in a while.


 I think about mine, spilling my coffee.

Be lucky if he even returns my calls... which is one more reason I come here.

BTW - I'm not a GC and have no GC's license (can I not do this without having a formal GC badge ?). 

_Just someone taking a cut with the best possible intentions_.:thumbup:


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## blacktop (Oct 28, 2012)

artinall said:


> So as the sole owner, it is not required by the State of OH, but if the GC requires it, I need to buy a policy for "non-existent employees" to cover even myself. _Fun_.
> 
> It has been over 20 years since I subbed work from builders in (2) different states and neither required comp.
> 
> ...


Here drywallers Cant pass with a Journey mans license . We have to have a class License . Not to say there's not plenty running around without !!! I'm just saying it's law.


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## blacktop (Oct 28, 2012)

gbruzze1 said:


> I'm. It familiar with Ohio, but in NY...
> 
> As a GC, do you have workers Comp? The issuers of your comp policy are the ones who require the subs to be covered. Hypothetically speaking, if I operate without Comp, then I have no Comp audit, then there's no one to charge me Comp for my uninsured subs. Downside of that, is we are all uninsured and if anyone gets hurt, I'm screwed.
> 
> ...


The problem with that Is ,,,Comp will fight any other insurance you have if you claim an injury !! 

And trust me! They got more money and better lawyers than you! :whistling


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## hnguyen11033 (Aug 29, 2016)

Please excuse my ignorant because I am a young contractor ( Not young in age, but contractor  ). I am asking in the state of California. My brother and I both have our C-20 HVAC license. If I want to sub work for him, he needs to have worker's compensation? What about me? Do I need to carry worker's compensation?


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## casey344 (Dec 15, 2005)

*Work Comp*

Our carrier said they would not require a sub-contractor to carry comp if the state in which he worked did no require him to carry it. As I understood it, whether or not he needed work comp was dependent on the number of employee's he had, in this case it was just him (our sub) and one helper. The answer went against everything I had always known to be true and it came up during a routine work comp audit when I had the auditor sitting in my office. We work this guy in SC and NC.


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