Tagging your state license to a large company

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berdaddy

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Location
Medina, Ohio
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Electrcial contractor
I recently sold my HVAC, and Electrical business to a guy with no state license and he wants to use mine for a year or two. I will be a W-2 employee but there will be no way that I can over see all the electrical and HVAC jobs going on in the field. The new company owner will have the proper insurance .
What would be my risk if a job goes bad like a building burns downs or someone gets hurt and its the company fault also most of the employees will have their state license and there will be about 25 workers under my license. I would like to here everybody thoughts
Thanks
 
berdaddy said:
I recently sold my HVAC, and Electrical business to a guy with no state license and he wants to use mine for a year or two. I will be a W-2 employee but there will be no way that I can over see all the electrical and HVAC jobs going on in the field. The new company owner will have the proper insurance .
What would be my risk if a job goes bad like a building burns downs or someone gets hurt and its the company fault also most of the employees will have their state license and there will be about 25 workers under my license. I would like to here everybody thoughts
Thanks
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Exactly why this should not be allowed. Plan on losing everything!
 
The guy with the big license in any significant size contracting company can't possibly do any significant amount of overseeing of every job just because there's only so many hours in the day. I would not get real excited about that. Make sure the company insurance covers you specifically and that your lawyer approves whatever arrangement is made.

You would also want to make sure that the principals of the company, and you should be one of them, are honorable people. That gives you far more protection than anything else. Sadly the contracting businesses are full of fly-by-night low lives that run them. They don't usually last long, but there's lots of them out there. You cannot protect yourself from them by taking their money and doing nothing for that money other than holding a license.
 
This is a tough one! In OHIO you have to tag your license to a company to keep them active. I'm sure there are lots of other contractors using an employees license to run there business. I just don't want to lose everything that I worked for in the last 30 years. Insurance only goes so far. Thanks for the insight guys I will contact my lawyers and see what they have to say
 
I sure will. I see Oldsparky52 is in NC. Do you know if I can transfer my license's from OHIO to NC? I have HVAC, Plumbing and Electrical
 
Along with what everyone else said concerning insurance, bonding would probably help too, if it's not already required by your state. The legal kind of bonding, not the Article 250 kind. Although, making sure the business knows the Article 250 kind of bonding would probably help you not burn buildings down.
 
Don't know if this helps or not all states are different.

In MA. a Master is responsible to make sure that he has all licensed journeyman in the companies employ and the proper apprentices. He is not specifically responsible for the the work the journeymen does that's what the journeyman's license is for, Unless he tells the journeyman to do something wrong then he has a problem.
 
Proper legal arrangements and insurance are what you need. There are multitudes of companies that operate that way. My license is tied to a large company. We only hire journeymen to perform work.
 
My advice: don't do it. You can get sued and lose everything because of someone else's screwup. It's not supposed to be that way but if you're named in a lawsuit you could end up having to pay a lawyer to get yourself out of it or to sue the company you formerly owned to enforce their responsibility to cover damages.

At the very least I would insist, contractually, on sufficient oversight of the insurance policies. That way you can ensure you're covered by something more than your own assets. If you can't actually supervise the work then you should at least supervise your liability.
 
Another couple of thoughts:

Have in writing, since you will be the Qualifying Party for the business, that any and all legal fees, judgements, etc. (a lawyer will know what to include) would be the sole responsibility of the company.

Make sure that the insurance levels are comfortably high. When I had my business, the minimum insurance required was, I think, 150K I had a 1Mn dollar policy when I started. Later, when I moved into working as a sub and directly with high risk clients (TV station, radio station, manufacturers, multi-millionaires) where mistakes could cost a lot of money I bumped my policy up to 3Mn. Because of my track record and years with my insurance company, the additional cost was around $400/year. Doesn't stop you from getting sued and having to deal with everything that comes with it, but the money is there to minimize your personal financial risk.
 
While liability insurance is important, it has more to do with having an insurance company pay your legal bills than any settlements that might come from a lawsuit. And a lot of cases the legal expenses cost more than the settlement, which is why a lot of times people are forced to settle since they can't afford to pay for the legal expenses to fight it.
 
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