In this weeks episode, we take a user question pertaining to a problem between a general contractor and a subcontractors employee.

Don’t forget to Subscribe, Rate and Review on Apple Podcasts!
Visit HelpDeskSuites.com

Announcer:

Small Business Spoonfuls is a weekly Q&A with Lisa Smith and Mason Merrell providing the answers to questions you have about running your small business.  This podcast is sponsored by HelpDeskSuites.com.  If you are a busy employer, we are your employment law compliance help desk.  Visit HelpDeskSuites.com to find out more and become a member.  Now, here’s your host, Lisa Smith and Mason Merrell.

Lisa Smith (LS):

Hello, and welcome to Small Business Spoonfuls.  I’m Lisa Smith.

Mason Merrell (MM):

And I’m Mason Merrell.

LS:

And today we are discussing a question from one of our members regarding I-9’s and your general contractor’s rights and responsibilities.

MM:

You know, when we saw this question come in, we were both like, “We have to do a podcast on this because this is such a tricky situation.”

LS:

It really is.  I tell you what, when Jo from Tennessee wrote this, I just about fell out of my chair.  She starts her email with, “Hi, ‘Be Audit Secure,’ today is a bad day.”  And, I just thought, “Uh oh.”

MM:

It’s never a good day when somebody is, number one, writing in about I-9 violation and, number two, when they start their email off with, “This is going to be a bad day.”  So, we know it’s not going to be your average situation.

LS:

And it was not your average situation at all.  She has basically two issues here that she’s addressing, but one big one.  She starts out with, she had an employee who violated the law, basically. Went to a job site he wasn’t supposed to be at, used another employee’s security badge to enter that job site, and got caught by the general contractor’s company.  So, then, of course, there is serious safety and security concerns there.  And now, possibly, Homeland Security could even be invited in to this situation because of this.  So, this is a big deal.

MM:

It is a big deal, but you know what the beautiful thing about every single situation is with these things?

LS:

What?

MM:

There’s always something to look back to, in court cases, or Supreme Court, Department of Justice, different things. So that’s exactly what we’re doing here today.

LS:

Exactly.  She goes on to say that what her big question is, is that there’s no doubt her employee was wrong in all the garbage here that went on with the badge and accessing the site illegally and everything.  But the situation turned into the fact that this employee is Latino and working with a permanent residency card.  Now, she says, “We I-9 all of our employees, and the payroll company that they use is a large national company, and they do the E-Verify program.”  So, all of that is really covered as far as, “Are these workers properly documented or not?”  But the general contractor decided they weren’t going to go to the sub and say, “Hey, we want to make sure that your employees are properly I-9’d, and we want to have this conversation with you, the employer.”  Instead, the general contractor went out and started just hand picking these workers, primarily Latino workers, and started to demand that they just immediately show their residency cards or whatever other type of documentation that they had on them and that they wanted to have proof that they were legal to work in the U.S.  And, another word she used here is that they were just randomly picking people out of the crowd who mostly seemed to be Latino workers.

MM:

And that is where the big wrong is here.  This comes up a case of racism and discrimination, and aside from this violation that the worker made, the safety violation, that opens up a whole other can of worms for him, for this general contractor, going into a whole other segment of things that are violations in the work field or work placeworkplaceent things like that.

LS:

And it’s kind of like if you watch football, sometimes you’ve got, one team will have a flag thrown because they’ve had a foul and, then, they’re offsetting flags, offsetting penalties.  And so, then, nobody really gets a penalty because both sides held each other or they were both jumping off sides, or they were both grabbing each other’s face masks or whatever.  This kind of turns into a situation to where the employee violated the law, but now the employer is possibly creating an even larger violation for himself, this general contractor is.  And, so, is this even going to be an offsetting penalty at this point?  It may even be a bigger problem.

MM:

Exactly.  You got double personal fouls on the other side, and now you’re back 30 yards when you could have been up 15.

LS:

And I really hope our listeners are football fans.

MM:

Yeah.  Seriously.

LS:

Because we’re terrible.

MM:

Let’s take a white board with this situation on it, a figurative white board.  Let’s erase it all back to the violation, the worker.  So, what should the general contractor have done in this situation?

LS:

The general contractor should have clearly just worked with the subcontractor who was the employer of this worker who violated safety protocol.  Of course, this worker immediately just needs to be fired.  There needs to be no more contact with this guy.  He has accessed this site illegally using somebody else’s badge.  I don’t care if the guy is legal or not, he’s not working here anymore.

MM:

That’s right.  And, so, who does the general contractor go to, the worker or the subcontractor, just to clarify?

LS:

At that point, whoever is on site, which apparently was the general contractor’s either management or him himself.  He would have that absolute right to terminate that worker from the site.  So, he could say, “You go home.  I’m calling your boss, and you’re not to come back to this site.”  And then he would call the subcontractor, the employer of the worker, and say, “Hey, your guy did this, and I don’t want him back here.”  And then that sub would need to deal with that employee or face some sort of legal penalties.  And, depending upon how big this breach was, and we don’t know what’s going on here, is this a government contract site?  Is there something that Homeland Security really does need to be called in for?  Maybe this is like a serious security risk, and it’s not just some random house being built.  Maybe it is a government facility being built or something.  Maybe there’s something they really need to be called in for that has nothing to do with, “Are you legal to work in the country?” but has everything to do with, “Why did you access this site illegally?”  So, that could be a whole other set of issues.  But, one way or the other, this guy is not on this job anymore and, hopefully, not working for this subcontractor anymore either.

MM:

That’s basically what the contractor did, right?  He went to the guy and said, “Get out of here,” basically, “you’ve violated this.  I don’t want you on this site anymore.”  But where was his misstep here?  What did he do next?

LS:

Well, then, he starts approaching Latino workers, and he just starts saying, “Hey, I need to make sure you’re properly documented to work in the United States.”

MM:

Yes.  So, is that a big no-no, or is that okay?

LS:

No, that’s a big no-no, because these are not his employees.  These folks are employed by the subcontractor, and he has no reason to approach these people.  He has no suspicion of anything.  He doesn’t govern this part of the work.  Assuming he has a contract, and he’s done his due diligence and he has a contract with the subcontractor that says they have agreed that the sub is handling all of these things, and the sub clearly is doing the E-Verify program through their major payroll provider, so they have proof that they could show that people have been E-Verify’d.  And if you’ve been E-Verify’d, you’ve been I-9’d.  So, you’re covered.  So, there’s no reason for this guy, except for discrimination, and that always stems with racism.  I mean, I want to know, is he going around to the white guys?  I want to know, is he just picking out Latino?  Is he picking out Middle Eastern?  Is he picking out French Canadian?  I want to know, who is he picking on?  If he’s picking on all of them, it’s still illegal.  I want to know what’s going on here because this guy is putting himself in a position to lose his entire general contracting business.

MM:

And license and everything.  So, let’s go back.  Rewind just a little bit.  He sends the worker home.  Now what is the right step for this general contractor to make instead of going and bullying these other guys who are on the job site who did nothing?  In the case, we weren’t there, but from we’ve been told on this situation, those guys are free and clear.  They’re there.  They’re all right to be there.  All of the above.  What should this general contractor who Don reached out to, filed forms, what should he have done in that case?

LS:

He should have just contacted the sub and said, “I’ve sent your employee home.  I don’t want him back on the site.”  The end.  And, that’s it.  If there was a larger safety concern, then he should have said, “I need to involve Homeland Security in this because of a government contract,” or whatever.  He needs to follow whatever rules he’s under with his contract.  But if there’s nothing else, then there’s nothing else.  The guy’s just off the job.

MM:

So, if the contractor wants to take any sort of action, can he do that in that case except for obviously sending the guy home?  Can he look into the subcontractor’s business, anything like that, ask any sort of questions to see what’s going on behind the scenes there?  Or, is it, if he’s too leery about it, should he just terminate the contract from that point?

LS:

At this point, he may or may not be able to terminate the contract with the sub.  We don’t really know.  But the most he could do at this point would just be to go grab an attorney and say, “Hey, we’ve got some issues here.  I need for you to help me.”  And, it may need to be one of those things where the attorneys start talking to each other if this is a big enough and bad enough situation that we’re going to get some legal involvement here because it’s not about discrimination, it’s about something else.  Again, not having all the details, it’s hard to know.  But you just don’t go barging in, demanding things.  You get your attorney to do that kind of thing for you.

MM:

Since this general contractor decided to be basically a bully about it, what is the subcontractor’s place here?  They’re already got the worker who’s violated the security thing. What is the right thing for this subcontractor to do in this case now that he’s discriminating and bullying and all that kind of stuff?

LS:

They have to handle both issues.  Number one, I hope that they terminated the guy who stole the badge and accessed the site.  I don’t know, but I hope they got rid of him.  Number two, as far as anyone who is being discriminated against with being asked for this information, I hope that they have contacted legal counsel, and this contractor has been told, “You must cease and desist this activity.” Because they have to back up their employees 100%.  Otherwise, they are participating in this discrimination.

MM:

That’s right.  To prevent anything with the subcontractor in this situation, what can the subcontractor do before the job even starts?  When they start their business, when they hire a new employee, what do they need to do to ensure that they’re covered in a situation like this?

LS:

They really did, from what I can tell here, they did everything they should have done.  They did background checks it looks like.  They did, of course, the I-9 and the E-Verify process.  And they’ve got contracts, I’m hoping.  And I’m sure they do with their general contractor.  That’s all you can do, is just make sure that you cross all of your “T’s” and dot all of your “I’s” and, then, have good, solid, written policies and procedures and make sure that you do have anti-theft policies and procedures, and you have zero tolerance for this kind of issue with stealing badges and accessing job sites.  Maybe you don’t have a policy about this particular instance, but now that this has happened, let’s write a policy about illegal access to job sites.  And it might seem crazy that we have to write a policy about this but, apparently, we do.  It’s like, “Why do they put on the outside of the hair dryer box ‘Don’t use this in the shower’?”  Because some idiot took a shower with a hair dryer.

MM:

Yeah.  And employers, it is okay to get that specific in a policy.  That is what you should be doing if there’s any concern or any type of situation that you think might occur. If you want to put it in there, put it in there.  Make sure you’re covered.

LS:

And unfortunately, it’s not just okay, it is mandatory because we have to make, and I hate to use this terminology, but we’re all HR professionals, we do this for a living, you got to make your policies idiot proof.  I’m sorry, hair-dryer-in-the-shower proof.  You’ve got to think that ridiculous when you’re writing your policies because, these days, you’ll terminate someone and they’ll say, “You’re terminating me for this, but there was no policy about that.”  And, you’re like, “But that’s common sense.”  “Oh, but there was no policy about that.”  And, then, they will get their job back, and you’ll be the one looking like the idiot because you didn’t have a policy about it.  So, always remember this, if you have to defend yourself, your policies and procedures are your star witnesses.  And if they are silent on the issue, that can hang you out to dry so hard.  So, no matter how dumb it seems, write the stupid policy and put it in the book.  And then enforce it equally for everyone.

MM:

Exactly.  And, guys, I-9 is only two pages.  It’s a complicated little document, but it’s only two pages.  So, making sure that is in place is key in this situation.  And just getting that done right when the employee comes and starts working for the company is very, very important.  We can’t stress that enough.

LS:

Oh, my goodness, yeah.  You got to do Page 1 on Day 1.  And then you have until the end of Day 3 to get Page 2 done.  But just do them all on the same day if the person shows up with the documents.  Don’t wait.  Just try to knock it all out, if possible.  Sometimes it’s not possible.  But, if possible, don’t wait around.  Just do these things.  Get them over with.  Do them right.  And, of course, that’s where we here at HelpDeskSuites.com, our motto here is “Be audit secure.”  We know nobody can be audit proof.  There’s no way.  I used to be an auditor.  You want to challenge me not to find something you’re doing wrong, well then, we got a fight on our hands.  I will roll my sleeves up until I find what you’re doing wrong, and it won’t take me very long.

MM:

And like you said, “That’s what auditors are looking for.”  I’m glad you brought that up because I-9 audits are key, too.  Say you’re new in your HR role, you’re the HR manager of this construction company, but you’ve only been there three months, it would absolutely be appropriate, one of the first things you do on that job is to do your I-9 audit, and if you’ve been at the job for a long time, you need to be doing, what would you say, six month audits, yearly audits on your I-9’s just to make sure all your paperwork is in place?

LS:

At least an annual audit.  Once you get it all cleaned up, and it may take you a year to get it cleaned up.  Don’t think you’re going to do it overnight, because you probably won’t.  But if you can get it cleaned up within the first year that you take over this mess that you’ve inherited probably, then if you just do the I-9, just audit yourself as you go.  But sometimes we don’t always do it and other people help us and things.  So, at least kind of do an annual audit.  And if you can afford to do it every six months, go through them and keep them up to date.  The more frequently you do this, the better intact they’re going to be.  Because, I got to tell you, it costs you $216 for every technical error that they find on an I-9, and we don’t have time in this podcast today to go into what that consists of.  We’ll do that on another day.  But I got to tell you, it can be tens of thousands, and even hundreds of thousands of dollars super fast, if you even have a hundred I-9’s in your file right now.  You can be looking at a half million dollars or more before you even blink your eye.  And, since we know the I-9 audit is right now considered to be the number one audit in the United States, you can’t play around with this.

MM:

That’s right.  So, in conclusion, if you are a general contractor, don’t be a bully.  If there’s a situation, handle it with the subcontracting company.  And if you’re the subcontractor, make sure you’re as covered as possible.  We know we can’t control the actions of others and different things.  And if there’s a question and it looks bad enough, don’t keep that employee around to bring your company down.  That’s absolutely appropriate if you have to terminate them for some type of situation that needs to happen.

LS:

Yeah.  When you have cause, you have cause and take care of business.  And learn from those lessons.  Write those policies.  Have them in place.  That way, when they happen, nobody can ever question, “Oh, but I didn’t know it was wrong to access a site illegally.”  Like, you will have a policy that says everything you need to say.  And it can be labor intensive.  But you know what, that’s what people like us are here for.  At HelpDesk, this is what we do for people all day long.  So, it doesn’t have to be expensive.  It doesn’t have to take up all your time because you have folks like HelpDesk.  So, come out and visit us at HelpDeskSuites.com, take a look at our Deluxe Suite and the things that we offer here, because we can help you take care of that type of…  I hate to call it “busy work.”  It’s really not busy work.  But when you have everything else to do in your life, it can feel that way, and it can go low on the priority list.  And, then, it comes up and bites you on a day like this when you’re writing to us, “Hey, today is a bad day.”

MM:

And, another thing about us, too, is if you got a question like this situation here, please write us.  We want to hear from you.  We want to help you.  Because that’s what we’re here to do.  And, also, if you’re looking at writing policies and things like that, that’s another thing you can come to use for.  We have an employee handbook creator.  We can help you write more customized policies and things like that, as well.

LS:

Now, if you’re not one of our members, we’re going to charge you for this.  But, our members, we do all this stuff for free for our members.

MM:

Yeah.  Absolutely.  That’s what we’re here for.

LS:

We take care of you guys hard.  Well, thanks, Mason.  I appreciate all of the critical thinking today.  That’s what this job is about.  This job is about critical thinking.  Isn’t it?

MM:

Yeah.  You just got to have all your bases covered, going back to a sports reference.

LS:

I know.  Right.  Exactly.  Another sport, but yet a sport.

MM:

Yeah.  And, we’ve been kind of out of commission with the podcast for a little bit, but we’re going to get back on doing these weekly or at least maybe twice a week and, hopefully, some of this will help you out in your small business or different things.

LS:

Yeah.  All right.  Well, until next time…

MM:

To find out more about us, visit HelpDeskSuites.com/podcast.  Don’t forget to rate, subscribe, and review on Apple Podcasts.