Help!!! Insurance being cut!!!
Help!!! Insurance being cut!!!
(OP)
Hello All,
I have a situation here that I am hoping that some of you will have some valuable insight into. Here is the back ground: I am a liscenced PE practicing structural engineering for a design build general contractor. I am the sole engineer, draftsperson, basically I am the engineering dept for this small company. We carry E&O insurance for my part of the business. This week I was told that 1)All employees are to take a 5% cut in pay, 2)All employees are to take two week unpaid leave, and 3)The big one for me - they are going to let the E&O insurance run out May 1. My initial comment to them was - well I'm done engineering for you. I can project manage, estimate, etc. but I am not taking the risk for the engineering personally.
Here is the problem - I recently received a PO to do some engineering work for a fabricator to raise a penthouse on an industrial building. Best case scenario is that I finish the calcs/dwgs end of March and the calcs/dwgs would go to the state for approval as well as the local municipality for permitting. Basically I feel that construction would start May 1 or thereabout. I would still be the supervising professional at that time (and thru construction) and the E&O insurance would have run out.
I have come flat out and told my employer that I am not going to finish the job or stamp it if I am not going to be insured through the project, period. I told them that if they wanted to subcontract the engineering out, that would be fine with me. I also told them that I feel obligated to let the customer know what is going on. Ownership in this company is 50/50 (two brothers). One brother is gone until the 24th of this month (March)and they really aren't giving me any direction on this. Meanwhile, my customer is assuming I am hammering away at this project.
What would you do???
1. Continue to engineer as usual, and when May 1 comes around say "I'm done find another engineer of record." (crappy, I think)
2. Continue to engineer as usual until the other owner comes back and, hopefully they decide what they want to do.
3. Sit on it and do nothing until both owners are back and decide what they are going to do?
4. Call my customer and say something is going to happen here, either I am going to leave or they are going to let me go, your deadline is not going to be met and you should probably be looking for another engineer.
5.??
6.???
Thanks in advance for your help/comments.
I have a situation here that I am hoping that some of you will have some valuable insight into. Here is the back ground: I am a liscenced PE practicing structural engineering for a design build general contractor. I am the sole engineer, draftsperson, basically I am the engineering dept for this small company. We carry E&O insurance for my part of the business. This week I was told that 1)All employees are to take a 5% cut in pay, 2)All employees are to take two week unpaid leave, and 3)The big one for me - they are going to let the E&O insurance run out May 1. My initial comment to them was - well I'm done engineering for you. I can project manage, estimate, etc. but I am not taking the risk for the engineering personally.
Here is the problem - I recently received a PO to do some engineering work for a fabricator to raise a penthouse on an industrial building. Best case scenario is that I finish the calcs/dwgs end of March and the calcs/dwgs would go to the state for approval as well as the local municipality for permitting. Basically I feel that construction would start May 1 or thereabout. I would still be the supervising professional at that time (and thru construction) and the E&O insurance would have run out.
I have come flat out and told my employer that I am not going to finish the job or stamp it if I am not going to be insured through the project, period. I told them that if they wanted to subcontract the engineering out, that would be fine with me. I also told them that I feel obligated to let the customer know what is going on. Ownership in this company is 50/50 (two brothers). One brother is gone until the 24th of this month (March)and they really aren't giving me any direction on this. Meanwhile, my customer is assuming I am hammering away at this project.
What would you do???
1. Continue to engineer as usual, and when May 1 comes around say "I'm done find another engineer of record." (crappy, I think)
2. Continue to engineer as usual until the other owner comes back and, hopefully they decide what they want to do.
3. Sit on it and do nothing until both owners are back and decide what they are going to do?
4. Call my customer and say something is going to happen here, either I am going to leave or they are going to let me go, your deadline is not going to be met and you should probably be looking for another engineer.
5.??
6.???
Thanks in advance for your help/comments.





RE: Help!!! Insurance being cut!!!
RE: Help!!! Insurance being cut!!!
I agree that #2 at this point seems to the most reasonable course of action. While waiting for the other owner to return, you might want to prepare a risk assessment for them to consider.
RE: Help!!! Insurance being cut!!!
To me you sound very upset, which is understandable with all that happened this week, so I have an advice for you: Take some time to think and calm down. The main thing is not to start accusing anybody, and to make sure that the client has as good and honest service as possible in this circumstance. If not, it might turn against you down the road.
Coka
RE: Help!!! Insurance being cut!!!
RE: Help!!! Insurance being cut!!!
1. Talk to the insurance company. You may get straight answeres from them. You may be supprized at how little is covered now.
2. Consider an "umbrella policy". I had one for a while for 2 million. IT was not that expensive.
3. The thing about professional libability insurance is how long does it last. IF you win the lottery next week and quit work can you be sued for something you did ten years ago?
4.) The standard answer for this question is "see your lawyer". Depending on where you live and if your married you may be safe. In some states join property is safe (for a long while anyway). Leagle fees at this point may be a wise investment.
RE: Help!!! Insurance being cut!!!
While it would not be proper to inform the client of something that is essentially an internal company matter, they should be informed that the work will not be covered by E&O insurance. That might be part of their contract with the owners.
I would also get a written understanding from the company and the owners personally that they will hold you harmless for all engineering work conducted during your employment. While this would not protect you if things really go wrong, it might get them to rethink the cutting of the insurance. If there is no other money than your personal assets left then that’s where the judgement might come from. You would be left with an agreement that could not be enforces against a bankrupt company and its bankrupt owners.
What does your state association say on this? Here in Manitoba we cannot consult without insurance. I am not sure about the situation for design builders. For employee engineers there is a secondary policy held by the association to cover this sort of issues. Your association might have something similar.
As in all legal and insurance matters contact a local professional well versed in these issues.
Finally you might have to consider moving on, polish up your resume.
Rick Kitson MBA P.Eng
Construction Project Management
From conception to completion
www.kitsonengineering.com
RE: Help!!! Insurance being cut!!!
RE: Help!!! Insurance being cut!!!
RE: Help!!! Insurance being cut!!!
Thanks again all.
RE: Help!!! Insurance being cut!!!
RE: Help!!! Insurance being cut!!!
Job interview is the way to go. Jump before everything collapses around you.
For the rest, protect your butt.
Do nothing that will come back and bite you later on.
But, don't go out with a lot of bad feeling.
If you need to stay until you firm up a new job, be polite but clear and explain your position to your existing employers. Work with them to establish what you can and can't do.
They may have a temporary cash flow propblem, they may be going belly up. If they survive and come back strong they may want you back and you may want to go back.
Bottom line, you are more important to you and your family than your employer is.
JMW
www.viscoanalyser.com
RE: Help!!! Insurance being cut!!!
That is a typical way employees become independent suppliers.
Rick Kitson MBA P.Eng
Construction Project Management
From conception to completion
www.kitsonengineering.com
RE: Help!!! Insurance being cut!!!
At the same time I would also look into the jobs that may be offered thru your current new interviews. Maybe this current project will be the first and last in your own independent endeavors.
At any rate #2 seems best for the customer at this point.
RE: Help!!! Insurance being cut!!!
1) Letting the insurance lapse may be a sign they don't expect to stay in business much longer. As such the owners don't care whether someone sues the bankrupt or closed company. The owners may have already consulted with a lawyer on a strategy that hasn't been shared with you.
2) Lawyers will be after the deep pockets regardless of the status of the company being in business or not, having insurance or not, and whether you work for them or not. If so you would need to protect yourself with appropriate insurance coverage.
3) On engineering ethics, I wonder if they are a company licensed to do engineering work. It seems odd to me that the owners are not licensed engineers. Is there someone knowledagle about these requirements?
RE: Help!!! Insurance being cut!!!
John