Aspirations to start Engineering Business!! 9

[TheRealEngineer]

Hi All,

I have masters degree in Mechanical engineering but not PE license. In past, I worked for several small and huge corporations (Fortune 10)in different functions as Design Engineer,Supplier Quality Engineer, Product Validation Engineer etc. As I never needed to be a PE to work for big jobs in big corporations, i never really looked into getting the PE license myself. Now I want to start my own company in Minnesota. I would like to start by providing engineering consultation services to the companies and its getting very confusing to whether i can do that without being PE. Also, i have not been able to clearly understand which services i can provide without being PE. For example, lets say i would like to help a client with their supplier quality assurance and quality management system related work, am i allowed to do that under my own company? Is there any clear list posted anywhere that shows which engineering related tasks/functions can be done without PE under my own company and which cannot? Is manufacturing/quality support even considered as engineering work?? What is considered engineering practice vs other management tasks? Mostly by reading the Statutes i felt they were more related to civil/construction/architectural/geoscience related stuff, or using the term engineering in general.

If anyone of you have faced similar situation? Any solutions? Suggestions? Who should i contact? Where to look this type of info?? It appears “Engineers” per state are different than “Engineers” working in all small and big industries/corporations and it appears the same work which i was doing inside the companies i used to work for is not allowed to do on my own by making my own company.

Thanks a ton in advance for help !!

 

[3DDave]

It depends on the state. You should contact the engineering licensing boards for the states you intend to work in and describe the sort of work you want to do.

Some state boards have gone after people for submitting a calculation and mentioning they have an engineering degree. I think the state board lost on that, but the legal costs (money, time, worry) for defending weren't compensated.

There may also be questions for any insurance company providing liability coverage. If you design a widget for some major company that ends up injuring or killing people (think choking hazard from a toy) you may need a lot of coverage.

 

[IRstuff]

Almost every state that cared about this subject would have a very loosey-goosey definition of what "engineering" is, such as this

6701. Professional engineer defined
“Professional engineer,” within the meaning and intent of this act, refers to a person engaged in the professional practice of rendering service or creative work requiring education, training and experience in engineering sciences and the application of special knowledge of the mathematical, physical and engineering sciences in such professional or creative work as consultation, investigation, evaluation, planning or design of public or private utilities, structures, machines, processes, circuits, buildings, equipment or projects, and supervision of construction for the purpose of securing compliance with specifications and design for any such work.

So, your state will have an equivalent PE Act, and in there will be a description of what constitutes "engineering" in that state. Note that most states have overly broad definitions, such as Oregon, wherein someone looking for a fight about the subject opined his engineering opinion about the timing of traffic lights and got in the sights of the state's PE board, which was severely castigated for having such overly broad definitions.

Note that California has an "industrial exemption" wherein consultants for companies producing products are typically exemption PE law in the state, since it's up to the company to police its own work.

Note that as a consultant to industrial companies in the California, your work is offered to the general public, and as stated in the California PE Act, the intent is to protect public safety

6730. Requirement for licensure to practice civil engineering, electrical engineering, and mechanical engineering
In order to safeguard life, health, property and public welfare, any person, either in a public or private capacity, except as in this chapter specifically excepted, who practices, or offers to practice, civil engineering, electrical engineering or mechanical engineering, in any of its branches in this state, including any person employed by the State of California, or any city, county, or city and county, who practices engineering, shall submit evidence that he is qualified to practice, and shall be licensed accordingly as a civil engineer, electrical engineer or mechanical engineer by the board.

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[MintJulep]

1805.1500 REGISTRATION.
No corporation, partnership, or other firm engaged in the practice of architecture, engineering, land surveying, landscape architecture, geoscience, or two or more of these professions, shall contract with or accept employment for professional services of an architectural, engineering, land surveying, landscape architectural, or geoscience character as defined in Minnesota Statutes, sections 326.02 to 326.15, unless a member or employee of the corporation, partnership, or other firm in responsible charge of the work is registered and licensed under Minnesota Statutes, sections 326.02 to 326.15, to practice the profession called for by the employment.

Interesting.

You work be allowed to start an engineering company, however that company is not allowed to do engineering.

I don't find that MN actually defines "engineering".

 

[IRstuff]

Seems to be there

https://www.revisor.mn.gov/statutes/cite/326.02[/URL]]Subd. 3.Practice of professional engineering. (a) Any person shall be deemed to be practicing professional engineering within the meaning of sections 326.02 to 326.15 who holds out as being able to perform or who does perform any technical professional service, such as planning, design or observation of construction for the purpose of assuring compliance with specifications and design, in connection with any public or private structures, buildings, utilities, machines, equipment, processes, works, or projects wherein the public welfare or the safeguarding of life, health, or property is concerned or involved, when such professional service requires the application of the principles of mathematics and the physical and applied engineering sciences, acquired by education or training, and by experience.
(b) No person other than one licensed under sections 326.02 to 326.15 as a professional engineer may:

(1) use the term "professional engineer";

(2) use any other abbreviation or term, including the initials "P.E." or "PE" by signature, verbal claim, sign, advertisement, letterhead, card, or similar means that would lead the public to believe that the person was a professional engineer; or

(3) use any means or in any other way make a representation that would lead the public to believe that the person was a professional engineer.

(c) A professional engineering license satisfies any requirements by the state or its political subdivisions to perform any actions authorized under the professional engineering license. A person licensed as a professional engineer under sections 326.02 to 326.15 shall only be required to obtain a license, certification, or other form of approval for a skill or service in addition to a professional engineering license if the state or political subdivision has made an affirmative written determination in statute, rule, or ordinance that such additional license or certification is necessary to safeguard life, health, or property, or promote the public welfare. This section does not preclude the state or a political subdivision from including additional requirements when soliciting public contracts for engineering services. This paragraph does not apply to practice areas where licenses or certifications are required prior to August 1, 2015.

The industrial exemption

https://www.revisor.mn.gov/statutes/cite/326.02[/URL]]Subd. 5.Limitation. The provisions of sections 326.02 to 326.15 shall not apply to the preparation of plans and specifications for the erection, enlargement, or alteration of any building or other structure by any person, for that person's exclusive occupancy or use, unless such occupancy or use involves the public health or safety or the health or safety of the employees of said person, or of the buildings listed in section 326.03, subdivision 2, nor to any detailed or shop plans required to be furnished by a contractor to a registered engineer, landscape architect, architect, or certified interior designer, nor to any standardized manufactured product, nor to any construction superintendent supervising the execution of work designed by an architect, landscape architect, engineer, or certified interior designer licensed or certified in accordance with section 326.03, nor to the planning for and supervision of the construction and installation of work by an electrical or elevator contractor or master plumber as defined in and licensed pursuant to chapter 326B, where such work is within the scope of such licensed activity and not within the practice of professional engineering, or architecture, or where the person does not claim to be a certified interior designer as defined in subdivision 2, 3, or 4b.

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[MintJulep]

Seems to be there

Thanks.

That's vague as hell, and overly broad.

 

[TheRealEngineer]

Thank you 3DDave, IRstuff and MintJulep for the responses.

I did look through the sections 326.02 to 326.15 as well as the Subd/ 5 Limitation. Again, to me, it feels like it is more specifically related to civil/construction/building related stuff. The engineering term is used in much broader sense and doesn't clearly defines which tasks/functions are allowed/not allowed considering providing services to industries rather than direct to public or govt. Like I mentioned in my original post, say if I want to help a client with their supplier quality assurance and quality management system related work, am I allowed to do that under my own company? The sections don't really give any clear guidance on it. If I was working for any established corporation, I would be working as a "supplier quality engineer" / "quality engineer" responsible for the same. Would state/board consider this as an engineering service work if I want to do this under my own company? I do not see any mention of say "Quality Engineering" / "Manufacturing Engineering" or related terms in any of the section. Say if my company engages in inspection of parts, or helps the client with 6-sigma methodologies, or help them improve their manufacturing processes, would this be considered as "engineering services"? Lets say if I do not design anything new for company and choose to do Inspection of parts or Gage R&R studies on internal or supplier parts, this will involve some mathematical calculations resulting into some specific suggestions for process improvements. Does this mean its "engineering"?

Not sure if this is a right question for this forum/thread, but do you guys know if boards carry list of tasks/functions that they would specify as engineering vs non-engineering, which can help them go investigating the Firms in question? something like that would be a good point of start for me to identify which specific services I am allowed to provide without being a PE.

Thanks again for the responses and guidance.

 

[phamENG]

TheRealEngineer - I agree, those regs are generally written for us (civil, structural, etc.), but they throw in that "machines, equipment, processes" that rope mechanical and electrical engineers in as well.

It will probably boil down to a) the name of the company b) the name of the services you provide and c) the actual nature of those services.

a) TheRealEngineer LLC would probably get flagged and the secretary of state would demand approval form the engineering board, which you wouldn't get. So best to pick something without "Engineer" in it.

b) If you try to sell a "Process Improvement Engineering" service item or job title, you're running afoul of the regs. Maybe go for "Manufacturing Efficiency Consultant".

c) Don't have techs out there altering machines. Give guidance on how things could be done better, and let the company interface with the machinery manufacturer's engineers for technical adjustments.

Once you put this together in a business plan, make an appointment with a board member and ask to discuss it and see if they have any issues. I did this in Virginia - my first job out of school was working for a company as a structural engineer, but they had no licensed engineers and had consultants do everything. They wanted to bring me in to do preliminary designs to improve estimating and speed up the work flow. My concern was that the time wouldn't count toward my license. I scheduled a call with a member of the board, we walked through it, and they informed me that as long as I worked closely with the consultants and they provided recommendations, it would be fine.

 

[CWB1]

The key distinction stateside is whether/not you are selling services to companies or the public, the public being legally defined as excluding companies.

 

[phamENG]

CWB1, how does the line:

"...who holds out as being able to perform or who does perform any technical professional service, such as planning, design or observation of construction for the purpose of assuring compliance with specifications and design, in connection with any public or private structures, buildings, utilities, machines, equipment, processes, works, or projects..."

square with your interpretation of not needing a license to provide engineering services to companies?

Perhaps mechanical engineers are regulated differently, but I know that if I were unlicensed, hired as a consultant, and completed the structural design of a manufacturing facility directly for ABC Widgets, Inc., I would be squarely on the wrong side of my state laws and regulations for the practice of Professional Engineering. Board discipline lists usually have a handful of people doing just that every quarter. 90% of my work is directly with businesses. Even if I dropped the other 10%, I would still need my licenses.

 

[weldstan]

There are specific items/services that jurisdictions require the signature of a PE. Check the services/items that you will be providing to determine whether you will need a PE in the jurisdictions that you will be providing those services. If so, you can always hire a PE to perform the required services. I certainly know of many companies that do not have PE's on their payroll.

 

[MintJulep]

At any rate, "quality assurance consulting" is not engineering.

 

[SWComposites]

TRE - here is a bunch of opinions (and rants) from an aerospace engineer (not a civil structures person).

For example, lets say i would like to help a client with their supplier quality assurance and quality management system related work, am I allowed to do that under my own company? > Sure, why not, assuming they don't want a PE stamp on anything (which is unlikely for an industrial company). Just don't put "Engineering" or similar into your company name, and if you apply for a local business license, don't use any term like "engineering"; just state you are doing "manufacturing and management consulting" or something vague like that.

Is there any clear list posted anywhere that shows which engineering related tasks/functions can be done without PE under my own company and which cannot? > Nope. Nowhere that I know of.

Is manufacturing/quality support even considered as engineering work?? > Nope, not in relation to needing a PE license. And there are many such consultants who don't even have engineering degrees.

What is considered engineering practice vs other management tasks? > it is not well defined.

Technically, in most states, though the "requirements" are incredible vague and unclear (and are written by and for mostly civil engineers), if you have an engineering consulting company and do work for a industrial exempt company, you need to be licensed. However, in practice this is completely stupid. I have worked for 40+ years in the aerospace industry, part of the time as a direct employee and part as an independent consultant, and NEVER has anyone cared one micro bit if I or anyone has a PE license, as nothing gets a PE stamp on it. The same for every other aerospace industry engineering consultant - almost no one bothers with getting a PE license. And besides, there is no PE discipline for most of what us aerospace engineers actually do (e.g., for CA see 3rd paragraph here:

https://www.bpelsg.ca.gov/applicants/appintrope.shtml

). I actually took and passed the Mechanical Eng PE exam at age ~ 40, though in hindsight it was a complete waste of time (nothing/nada/zip on the exam or in any of the practice exams/study guide/reference materials had anything to do with the engineering that I do).

So, if you are in an exempt industry (see info here:

https://fxbinc.com/wp-content/uploads/2016/10/state-by-state-summary-licensure-law-exemptions.pdf

) , and you keep "engineering" out of your company name, it is very likely that no one will bother you. And if questioned, just state you are doing "management consulting" (no one knows what those consultants really do anyway, other than charge a lot of $).

 

[NorthCivil]

I would say just get your P.E.

even if you dont need it, it will help with credibility and marketing.

 

[CWB1]

CWB1, how does the line....square with your interpretation of not needing a license to provide engineering services to companies?

Private use is neither public nor commercial.

Engineering boards are regulatory agencies, not legislators nor courts. They may interpret the law, accuse you of breaking it, and offer an opportunity to save court costs in exchange for penance and an admission of guilt, but that doesn't mean you've actually broken the law nor that their interpretation is correct. Manufacturing facilities and industrial sites have been overwhelmingly engineered by unlicensed engineers protected by corporate attorneys and the industrial exemption since each began. If an engineering board wanted to pursue an engineer for working in one then they'd be pretty quickly bordering on misconduct and opening themselves personally to liability.

Whenever this topic comes up I can't help but notice the same illogical suggestions and claims pushed. Dont use the word engineer in a business name, an unregulated title common in business names unrelated to engineering in all 50. Most everything done by engineers isnt actually engineering, nvm SQE, SME, etc. Seriously?

OP, if you are still employed I would recommend requesting that your corporate attorney give a class on the industrial exemption.

 

[3DDave]

What's your budget for fighting in court over the use of "engineer"?

It seems like it is safe in the state of Oregon, but other district courts are not bound by this decision.

https://ij.org/press-release/oregon-engineer-wins-traffic-light-timing-lawsuit/

For this guy the Institute for Justice stepped in to take it to a Federal District Court. It sits under the 9th Circuit Court.

 

[TheRealEngineer]

Thank you all for the responses and great discussion. I really appreciate all the insights shared here. I am new to the forum and never thought that it would be so helpful. So, Thanks a ton!!

3DDave- "What's your budget for fighting in court over the use of "engineer"?" --> As I am just planning to start the business, I would rather like to focus on the quality of my work to help my clients, than getting stuck and fighting in courts over the use of "Engineer". As I have experience in multiple functions I thought without being PE, quality assurance & manufacturing (like consulting them with more productive business processes/ assisting with PPAP etc.)would be something easy to start the business with without being stopped by board/state. That way I can at least get started with my business and once I feel that I should get into real "Engineering" type of work, like designing , calculations and stuff like that, I would consider getting PE myself or get someone who already has PE on-board. So, to avoid any kind of the "engineering" related roadblocks, I wanted to clearly understand which functions/actions I am allowed to do without being PE, so that I can at least start and not run into a wall on my first few steps.

SWComposites- "And if questioned, just state you are doing "management consulting"" --> Using Management Consulting makes sense, as it wont be "Engineering" services anyways.
"(no one knows what those consultants really do anyway, other than charge a lot of $)".--> Hahaha, I felt the same way when I was working in those big companies. I will make sure that my clients know what I am doing and possibly charge less?? haha.

MintJulep - "At any rate, "quality assurance consulting" is not engineering." --> I hope the same.

Now, I am planning to call the Board and ask them these specific questions, item by item, action by action and see what they say about it. It would be helpful to understand what their interpretation of manufacturing and quality service is and I believe that would be one way to assure that I am not stepping on "Professional Engineer's" professional shoe!!

Thanks again!!

 

[phamENG]

TheRealEngineer - good luck to you. A word of warning - make sure you're talking to actual board members. Some states have support staff that answer phones and handle daily tasks while the board members are doing their day jobs at their engineer firms, etc. Some of them may refuse to answer regulation questions, some of them will be a little too willing. A board member will be more likely to tell you how they would act should you be reported for violating a reg.

 

[CWB1]

What's your budget for fighting in court over the use of "engineer"?
It seems like it is safe in the state of Oregon, but other district courts are not bound by this decision.

IMHO that's a non-issue. District courts arent necessarily bound by each other's decisions but they usually do respect them. There is also decades of well-established case law specifically protecting free-use of engineer/engineered/engineering and other single-word titles under the 2nd amendment. Reading a few of the decisions its pretty clear that the courts dont have much patience for arguing the issue ad-nauseum, likely why these cases are rare and lead to quick decisions against the board followed by an appeal, a quick second/supporting decision against, and admonishment of the board.

 

[IRstuff]

OP,

Just note that verbal opinions are often not considered to be "official;" people have gotten burnt by the IRS helpline giving out erroneous information and the user getting stuck with the bill and penalties.

TTFN (ta ta for now)
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