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seosmp

Question - contractors - Time and Materials - lunch?

2 years ago

Let's say you have a contractor w/ employees doing some project for you. Agreement is to pay for time and materials w/ a per-hour cost for the labor. Time is tracked. Materials tracked.


Would you expect those tracked hours to include the contractors 30 minute lunch where they were not actually working (so for example, if there are 3 contractors, that's 90 minutes of lunch)?


Thanks!

Comments (24)

  • 2 years ago
    last modified: 2 years ago

    Thanks! I'm not sure where tile came into the picture - it was a general question (unless I had a typo??)..

    I definitely understand the employer pays for their lunch/etc. as applicable by law. I would expect the client's hourly charge to account for overhead/etc. as necessary rather than the client explicitly paying for them eating lunch. I don't fault anyone for taking 30 minutes for lunch obviously.

    It's a question of paying for a 9 hour day per person versus a 8.5 hour day per person -- as the client.

  • 2 years ago
    last modified: 2 years ago

    What does your contract say about tracking hours - are workers recording their time and clocking in and out for lunch?


    seosmp thanked JP L
  • 2 years ago

    For the purposes of this discussion, let's assume there is nothing explicitly documenting clocking in/out for lunch in contract form, otherwise I suppose this discussion would not be necessary :).

  • 2 years ago
    last modified: 2 years ago

    Ha @seosmp - that's the point. If there's nothing specified in the contract, there's nothing preventing them from taking a reasonable lunch break on your dime. Again, if everything else is going well, I'd pick my battles here. And consider it a lesson learned - avoid time/materials based agreements in the future or develop a super prescriptive agreement that covers all of these potential issues.

    seosmp thanked JP L
  • 2 years ago

    Actually @Stax depending on where he/she is, reasonable break periods are entirely allowed (sometimes required!) - people need to use the bathroom, or have a drink of water (or coffee) - I've dealt with employee greivences around cigarette breaks at different organizations and in many cases these were honored as reasonable. Excessive breaks are another story, but in general, if the contract doesn't outline these things, it's hard/impossible to enforce them. That's why most folks avoid T&M based contracts. If the contractor feels so confident about the timeline required to deliver, he/she should feel confident giving you a project-based quote vs. handing over the risk to the client.

    seosmp thanked JP L
  • 2 years ago

    A T&M contract does not include lunch breaks, naps, or dentist visits. Unless you are there clocking everyone in and out**, a contractor can charge the hours they want. And one who charges for lunches, breaks, or whatever, is one who can just as easily add an extra "0" to the hours anyway, so what does it matter?

    T&M contracts are used elsewhere besides construction labor. A review and estimation by the client, along with the trust and business practices of a professional charging for their services, is enough of a check & balance.


    **staking out the tradespeople will certainly garner the extra "0" added.

    seosmp thanked 3onthetree
  • 2 years ago

    ^^^^ exactly, you will be paying for their lunch breaks one way or another. And if this is the hill you want to die on the extra zero may become zero's.

  • 2 years ago
    last modified: 2 years ago

    @JP L said, ”Actually @Stax depending on where he/she is, reasonable break periods are entirely allowed (sometimes required!)”

    I can’t comment on every place, but in the U.S. a time and materials contract is only for reasonable and necessary time spent working on the job. You are not their employer, you don’t have to pay for lunch breaks, coffee breaks, etc.

    You are also not required to pay for any time that wasn’t necessary, so technically even time spent to correct errors is disallowed. However, I wouldn’t have that fight with your contractor until the stakes are high.

    Having said this, if workers are productive, I wouldn’t fight over 30 minutes, and certainly not before the work was done. I would be less worried about their adding another zero to the total than their actually taking a couple more zeros to finish the work.

  • PRO
    2 years ago

    @ seosmp I guess expecting a glass of water, a cup of coffee, or a pizza pie from you is out of the question.:-)

  • PRO
    2 years ago

    "I would never ever expect a quality tile professional to work for time and materials. An unskilled and unqualified handyman, yes."


    I recently promised a bar top reset with seams based off pictures the customer sent. The customer loved it, but I got hammered. Of course it was a two-man job and they couldn't get it done the first time so it became a 2-tripper.


    The next time I'm going time and material. Sure, you could probably have the tops replaced for what I'm going to charge, but that's not my call or problem.

  • 2 years ago
    last modified: 2 years ago

    The overall point, I think, is that time and materials contracts are complicated (i.e. different industries and states have different requirements and expectations) - we can all pontificate on our specific experiences, but overall an individual consumer likely doesn't have the necessary tools or bandwidth to administer a time and materials contract at any level of detail or accuracy. Typically folks that do administer these agreements require at a minimum a system for timekeeping - clocking in and clocking out. Negotiating a time and materials contract as a consumer results in the contractor removing potential risk from overages, etc. and placing that risk with the consumer. For a routine job (which, what even is that anymore?), this could mean the contractor isn't confident in his/her abilities to manage the work. For something more complicated, it could be entirely reasonable from the contractor's perspective (see @Joseph Corlett, LLC), but honestly (one consumer's opinion), I'd prefer you estimate high and deliver - if I'm coming to you for something custom/specialized, I should be prepared to pay you for extra resources. TLDR - don't do time and materials for individual residential projects unless there is 1) a great reason for doing so and 2) adequate terms, conditions and processes/systems to hold folks accountable. Even with 1 and 2 in place, expect struggles, arguments and potentially tears at some point.

    And I'll repeat it again for OP - if everything else on this work is satisfactory, let the team have a lunch break - heck, treat them to lunch! Finding great tradespeople is worth some pizza or burgers or beers - they are a rare commodity in most markets. I worked in professional services for a long time, and a big part of it is relationship management - pick your battles.

  • PRO
    2 years ago

    @JP L Couldn't agree with you more. In almost 40 years not had a single T&M job, simply to avoid all the BS.

    I can see this being used in other trades but definitely not in the remodeling industry.

  • 2 years ago
    last modified: 2 years ago

    @JP L - ”we can all pontificate on our specific experiences, but overall an individual consumer likely doesn't have the necessary tools or bandwidth to administer a time and materials contract at any level of detail or accuracy.”

    I am not discussing specific experiences, I am discussing the common law of contracts. It has been a while since my contracts class, but I am confident my memory is correct on this.

    Time and materials is not difficult to verify and it doesn’t require any specialized tools or skills. Job order costing is the most popular costing method and every business who uses it tracks job time. You don’t need to monitor every minute to figure out if they are padding time. You just take their job cost sheet for the week and see if it reconciles. If the job cost sheet says 50 hours in five days but they weren’t there 50 hours then you know they are padding their time.

    -—

    It is fine to advise someone to pick their battles, but a little due diligence is both doable and advisable.

  • 2 years ago
    last modified: 2 years ago

    Somehow I knew you were an attorney @bry911 - I'm not questioning or doubting your expertise or experience here. My perspective is different as someone who had to administer and somehow defend/respond to grievances in professional services contracts across multiple states and several countries (for over 20 years) - there are different requirements. Not looking to argue on the internet incessantly (I have a real job, yo and I've seen you head down this path with other posters) - I have had arbitrators determine that breaks are a reasonable thing in T&M contracts before. In a U.S. state. Maybe that was in error (multiple times) but honestly it's irrelevant to the question posed by the OP. And as an end-user (not an attorney) who has had to deal with these agreements, I stand by the statement that an individual and contractor/GC would find them potentially problematic to administer - it's one thing when you're badging in and out and tallying hours via an ERP - it's a whole other ball game when someone is documenting ballpark hours worked on a piece of paper. Individuals aren't businesses with accounting departments. And I live and breathe due diligence. If you only knew. :)

  • 2 years ago
    last modified: 2 years ago

    My advice to anyone. Do yourself a favor... when someone gives you a reason to question their integrity, don't ignore it.

    This has nothing to do with being nice to people. I keep snacks, drinks, deli meats, etc. for workers in my home. In the summer I have a planter on my porch which is actually a cooler for sports drinks and waters for delivery drivers and the yard crew. But that doesn't mean that I would be OK with a contractor adding 10 hours a week to their bill.

    You don't need a complicated system to verify the billed hours, we reconciled time to job before there were even computers. It really isn't that hard and if you don't know how to do it. You are in luck, because now that we have computers there are plenty of resources to help you learn it.

    However, the simplest method is just to make a note of the time the contractors arrive and leave for the day. It really isn't that hard... if you note they arrive at 8:30am and leave at 4:00pm, they can't have 8 hours at your home. It doesn't take a badge or an ERP system to track that. Do that for a whole week and you have a reconcilable job cost sheet. Do be aware that from time to time they may need to make a trip offsite related to your job.

    If you have evidence that they are padding their time and want something more concrete then get a video doorbell for entry doors. There are video doorbells with event logs which are going to cost you less than $80 and you will have video evidence of what time they are leaving.

    ---

    This is not to say that you should confront them. As I noted above that you really need to consider the entirety of their work, their progress, and your job before you take action, but there have been posts of time and materials contracts running over their estimated (and reasonable) time, to the tune of six figure overages. So being informed and aware can be helpful.


  • PRO
    2 years ago

    @bry911 " There are video doorbells with event logs which are going to cost you less than $80 and you will have video evidence of what time they are leaving."

    You can keep a log of when they come and go, but they could be taking a nap inside, playing on the phone, raiding your fridge since you pack with so many goodies intended for them, etc.

    When you get home you have 5 cabinets up instead of 10 and they will tell you they ran into this and that and the next day something else, in the meantime the job is being milked... Seen that happened all the time.

    If you doing a job per the contract with scope of work and payment schedule, there is no if's or but's you do your thing in a timely manner with the best results to your customer satisfaction, there is no confusion and there is nothing to be bickering about because everyone is on the same page, vs. when someone questions every minute you billing them for and let's not forget the overhead, etc.

    In regard to your cooler on the front porch for people who coming and going if you got some Vodka in it there, I'm on my way! :-)

    Around here you leave something on the porch and if not nailed down it will walk.




  • PRO
    2 years ago

    Stax Nasty, not helpful, and likely moronic.

    To get it you need some sense of humor?

  • 2 years ago

    Not to mention @GN Builders L.L.C the loss of productivity that results when adult professionals are being monitored by someone who they don't report to (and who potentially doesn't understand the full nature of their work) - most folks find it incredibly distracting to know they're being watched (especially if it's tied to their compensation).

  • PRO
    2 years ago

    @JP L When they watch, I charge extra and I put that in writing :-)

  • 2 years ago
    last modified: 2 years ago

    You two should take this straw man show on the road.

    @JP L said, "Actually @Stax depending on where he/she is, reasonable break periods are entirely allowed (sometimes required!) - people need to use the bathroom, or have a drink of water (or coffee) - I've dealt with employee greivences around cigarette breaks at different organizations and in many cases these were honored as reasonable."

    When I pointed out that the above statement was simply incorrect, which it absolutely is, @JP L pivoted to, "an individual consumer likely doesn't have the necessary tools or bandwidth to administer a time and materials contract at any level of detail or accuracy."

    Which, again, is false. The average consumer has all of the tools they need to make a note of the time people arrive and leave. Seriously... this is no more difficult than texting yourself a message saying "workers left @ 4:30."

    So when this was pointed out we pivoted to you shouldn't do it because the workers may retaliate by adding time... Which I already said. You are literally using something from my first post and pretending to enlighten me. I will help you find it...



    Taking note, a.k.a. keeping records in case there is a problem, is not confronting the contractor. However, to respond to your assertion, I suspect a contractor who pads their time was always going to finish 5 cabinets instead of 10... This a great illustration of why several states, such as California, have outlawed time and materials contracts for remodeling projects.

    ---

    I am great with the advice to let this go unless it becomes a serious problem, but that doesn't give someone license to fabricate contract law or pretend that a regular person is incapable of sufficiently adequate record keeping.

    That was my only contention with the advice given.

  • 2 years ago
    last modified: 2 years ago

    I’ll just close this out by stating that it’s now quite clear why you had to learn to make your own cabinets - you sound like a delightful client. Best of luck, OP!

  • 2 years ago
    last modified: 2 years ago

    @JP L - I apologize that I offended you and for my tone. When I first came to gardenweb I noticed that homeowners would often struggle to get quality advice on contracts or dispute resolution issues. To be quite honest, I was appalled at some of the things that homeowners were told (e.g. a homeowner can only take issue with defective issues before installation). So I stayed to offer advice and developed a combative tone on these boards.

    I strongly suspect that you don't really believe I needed to learn to make my own cabinets. However, if you are really interested in why I am building my cabinets, it is because my wife asked me to. Then when I said, no... she bribed me with a 52" planer/sander.

  • 2 years ago

    No apology necessary @bry911 … but certainly appreciated. And you may be the attorney in the family, but your wife’s negotiation skills are definitely impressive!