Resistance to Firm Registration
Resistance to Firm Registration
(OP)
I apologize in advance for not being brief but I would appreciate your comments, opinions, or advice.
Late in '07 and earlier this year my boss (the Engineering Manager, EM) and his boss (V.P. Engineering & Production, VPE&P) collaborated with our outpost business units (in several states) to develop a Product Support Engineering (PSE) function at our manufacturing center. I was asked by the EM to review and offer comments on the PSE pseudo job description/charter. Having Professional Engineering Licenses I offered caution based on the fact that the company is not licensed to offer any semblance of engineering services to the public.
We are a natural gas equipment packager that designs and manufactures 'units' for our own rental fleets (business units). We also sell custom 'units' that we design and manufacture to customer specifications. In addition to managing rental units, our business units offer maintenance services and support to other companies that have equipment like what we manufacture and rent.
Having been with the company for less than two years, my understanding at that time was that the proposed Product Support Engineering (PSE) initiative would be a new offering to expand the types of maintenance services and support function that would be offered by the business units. Basically, instead of offering to just overhaul engines and other equipment we wanted to start consulting on equipment reconfigurations intended to change the equipments' performance characteristics.
So I raised the flag stating that the company should be licensed and registered in all the states we're proposing to offer these services. Shortly thereafter I got in on an email exchange between our legal department and the 'local' State Board of Professional Engineers. Paraphrasing, the legal department said that we build stuff, rent stuff, and services stuff and that we're thinking about adding an engineering function to support our service teams for the reconfiguration of our own fleet and customer owned units. The need to be a registered company was asked. The State Board followed up with a very conditional response stating that the company doesn't have to be registered as long as firm does not represent to the public that it has the ability to offer and/or provide consulting engineering services to/for the public and does not actually provide engineering services to the public. My contribution to the conversation was to elaborate on what was actually involved in the proposed reconfiguration services to which the State Board's representative said that he tended to agree that licensing and registration is applicable.
While communicated that information to the EM and VPE&P I learned that the business units have been providing the reconfiguration services for quite awhile and that the PSE function was and attempt to consolidate the engineering needs and take some of that load off of the business unit staffs.
Several months passed and in May I found myself at a company function that included a workshop with the business unit members that actually perform the services in question. I took the opportunity and spoke my mind and was summarily dismissed even by a Manager that was there.
In a recent conversation with the VPE&P I referred to my obligation to formally complain to the State Board(s). That prompted another round with a different member of the legal department who proposed consultation with a legal firm with subject experience to clear up all the "interpretation issues." To my knowledge, two teleconferences have taken place with the legal firm and I was only allowed to participate in one, the most recent.
Late in '07 and earlier this year my boss (the Engineering Manager, EM) and his boss (V.P. Engineering & Production, VPE&P) collaborated with our outpost business units (in several states) to develop a Product Support Engineering (PSE) function at our manufacturing center. I was asked by the EM to review and offer comments on the PSE pseudo job description/charter. Having Professional Engineering Licenses I offered caution based on the fact that the company is not licensed to offer any semblance of engineering services to the public.
We are a natural gas equipment packager that designs and manufactures 'units' for our own rental fleets (business units). We also sell custom 'units' that we design and manufacture to customer specifications. In addition to managing rental units, our business units offer maintenance services and support to other companies that have equipment like what we manufacture and rent.
Having been with the company for less than two years, my understanding at that time was that the proposed Product Support Engineering (PSE) initiative would be a new offering to expand the types of maintenance services and support function that would be offered by the business units. Basically, instead of offering to just overhaul engines and other equipment we wanted to start consulting on equipment reconfigurations intended to change the equipments' performance characteristics.
So I raised the flag stating that the company should be licensed and registered in all the states we're proposing to offer these services. Shortly thereafter I got in on an email exchange between our legal department and the 'local' State Board of Professional Engineers. Paraphrasing, the legal department said that we build stuff, rent stuff, and services stuff and that we're thinking about adding an engineering function to support our service teams for the reconfiguration of our own fleet and customer owned units. The need to be a registered company was asked. The State Board followed up with a very conditional response stating that the company doesn't have to be registered as long as firm does not represent to the public that it has the ability to offer and/or provide consulting engineering services to/for the public and does not actually provide engineering services to the public. My contribution to the conversation was to elaborate on what was actually involved in the proposed reconfiguration services to which the State Board's representative said that he tended to agree that licensing and registration is applicable.
While communicated that information to the EM and VPE&P I learned that the business units have been providing the reconfiguration services for quite awhile and that the PSE function was and attempt to consolidate the engineering needs and take some of that load off of the business unit staffs.
Several months passed and in May I found myself at a company function that included a workshop with the business unit members that actually perform the services in question. I took the opportunity and spoke my mind and was summarily dismissed even by a Manager that was there.
In a recent conversation with the VPE&P I referred to my obligation to formally complain to the State Board(s). That prompted another round with a different member of the legal department who proposed consultation with a legal firm with subject experience to clear up all the "interpretation issues." To my knowledge, two teleconferences have taken place with the legal firm and I was only allowed to participate in one, the most recent.





RE: Resistance to Firm Registration
I suspect that your company operates under the industrial exemption in most instances, but it's the lawyers that should be the experts on the law.
-b
RE: Resistance to Firm Registration
"Art without engineering is dreaming; Engineering without art is calculating."
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RE: Resistance to Firm Registration
Basically our reconfiguration services involve evaluting customer owned equipment (pressure vessels, heat exchangers, piping, etc.) for changes in service conditions that could include higher pressures, more throughput, etc. We advise said clients on the suitability of their equipment.
In this state the Rules Concerning the Practice of Engineering states, "...the term 'public' includes but is not limited to political subdivisions of the state, business entities, and individuals." I've found no reference to industry specific exemptions and trust me, I've looked. I'm putting a lot of stock in State Boards opinion that registration would be appropriate.
RE: Resistance to Firm Registration
If your legal department can clear up all the "interpretation issues" with a written letter from each board allowing this, then there should be no problem. But you know that won't happen. It's more likely the legal department will say, "it's all taken care of, now go away". You will likely get fired soon, sorry to say. But you may have legal recourse for that, see an employment attorney soon.
Another remote possibility is that the company is trying to spin-off those units, which is why it is being consolidated and why the legal department is looking to skirt the registration question.
I don't know what the line is between a manufactured device that falls under the "industrial exemption" standard, and one that is engineered. I am guessing it is when you start to offer services to the public. It varies state to state, as well. In Connecticut, for instance, if the engineering is "incidental" to the manufacturing activities, then no license is needed. "Incidental" is the word in the statutes, but there is some interpretation as to what it means. I don't know what it means.
I wish I could help you more. I pay a lot for the license every year, and wish it would be more clear cut as to when it is needed.
Nat'l Society of Professional Engineers has a legal hotline for members: 888-384-4295, or legal@nspe.org
RE: Resistance to Firm Registration
The only exemption I've identified relates to products that we design and manufacture.
Basically our reconfiguration services involve evaluting customer owned equipment (pressure vessels, heat exchangers, piping, etc.) for changes in service conditions that could include higher pressures, more throughput, etc. We advise said clients on the suitability of their equipment......"that pressure vessel is good enoug...that heat exchanger needs repalced."
In this state the Rules Concerning the Practice of Engineering states, "...the term 'public' includes but is not limited to political subdivisions of the state, business entities, and individuals." I've found no reference to industry specific exemptions and trust me, I've looked. I'm putting a lot of stock in State Boards opinion that registration would be appropriate.
RE: Resistance to Firm Registration
First off, the states vary on what requires firm registration. The primary intent is that consulting companies should be licensed, but a lot of non-consulting companies get included in the definitions. So you might find yourself needing licensing in one state and not in the next; it's not an all or none situation.
From the state board's perspective, any inquiry which is not entirely clearcut is going to be answered by the affirmative. It's like calling up the IRS and asking "Should I pay a bunch of extra money or not?" If they're not too sure, they're going to answer in their favor, not yours. You'll never hear a state board saying "I'm not sure, so just skip the licensing." And, in discussing these kinds of issues with people that know nothing about your specific business, it's unlikely that they full understand the entire issue, regardless.
That being the case, if I worked for a company whose lawyers said they were within the law, I'd be very hesitant to lodge a complaint with the state board that said otherwise. If it looks like a potential issue for your personal licensing, then go get your own legal opinion before doing anything. Otherwise, it's not an unreasonable thing to rely on legal advice your company has been given.
RE: Resistance to Firm Registration
When the compressor company does engineering on equipment owned by other people, they are on the wrong side of the line and are actually "holding themselves out to the public as providing engineering services". I don't think that this is very grey at all.
David
RE: Resistance to Firm Registration
JStephen - The claims I've made to my supervision have always carried the disclaimer that I'm only speaking to the states I'm licensed in and that it's likely the other states we do business could have different rules. The point being, we need to check.
DonPE - Thanks for the NSPE legal hotline information. I am a member.
RE: Resistance to Firm Registration
RE: Resistance to Firm Registration
RE: Resistance to Firm Registration
I sometimes see plans sealed by licensed engineers but the drawings appear to have been created by a contractor. Needless to say, the contractor does not have a COA and the engineer's firm, if there is one, is not on the drawings. Those I ignore. The building code only requires registered design professionals.
However, if an engineer's license is expired (happened to me twice this year), I report the engineer and advise the Board no COA was found. I do not know what the Board does with my complaints but I read the discipline portion of my state newsletter for names I recognize.
Don Phillips
http://worthingtonengineering.com
RE: Resistance to Firm Registration
Although I haven't been included in them I've been told that there have been discussions with the legal firm that was employed. Their/his ruling went something like, "You guys really need to be licensed and registered for the types of services you're offering."
Not that I was expecting anything different but it's somewhat validating to hear it from someone that has credibility with my employer. Though I'm still annoyed at my apparent lack of credibility.
Now comes the task making it all happen and I'm on point since I'm the only 'functional' PE in the company. I suspect it's going to be a painful transition for most players, me included. Anyone expecting my role to be the equivalent to that of a Notary Public isn't going to be pleased.
RE: Resistance to Firm Registration
-- MechEng2005
RE: Resistance to Firm Registration
RE: Resistance to Firm Registration
Oh yeah, been there and done that. Along the lines of,"...had to take and pass an exam over engineering law/rules to even be considered for a license."
Side Note...the Engineering Manager left the company severl months ago, has since gotten his PE, and is/has been in full agreement with my position.
RE: Resistance to Firm Registration
Don Phillips
http://worthingtonengineering.com