Can I stamp drawings as a sole proprietor for my full time employer? 6

[GAtowers]

I am a licensed professional engineer in 20+ states. I obtained my licenses at a previous job. My current company is owned by one person who is a construction manager by trade. We are expanding our engineering services into other states but have been stifled in NC and FL by their requirement that registered firms are owned in part by licensed engineers. Can I register as a sole proprietor in those states and continue to sign the drawings under my employer's titleblock? Would I still fall under my employer's liability insurance? Can I claim to be a sole proprietor in this scenario? If I can't, we would pay a sole proprietor to sign our drawings anyway, so why can't that be me?

 

[hokie66]

You can't pretend to be a sole proprietor. That would be fraud. But you don't have to have sole ownership, just part. If you are the only engineer in the company, you need to have some ownership in order for the company to qualify. Another option would be to found your own company, and do the work under contract. Then you would be working for yourself. And don't depend on your employer's liability insurance...it won't be the type insurance you need for professional work.

 

[GAtowers]

Are you saying I could form an LLC but not a sole proprietorship? We have professional liability insurance. We provide these services in other states. And he won't sell me part of the company. I believe in NC he'd have to sell me 2/3. He would never consider that big of a piece and who could blame him.

 

[hokie66]

If the company is an engineering consultancy, then it should be owned by an engineer. Kudos to NC and FL.

 

[GAtowers]

It is one of our services your lordship.

 

[zelgar]

GAtowers, I'm surprised at your last post. You ask in a ETHICS forum if its okay to be UNETHICAL (i.e., committing fraud by claiming ownership in the company where you don't) and you're surprised when you are told NO.

What did you think would be the response????

 

[JAE]

Agree with hokie66.

To your original questions - certainly you can form an LLC or a sole proprietorship. Do the necessary legal things in those states, pay the fees, etc.

The question would be if you are truly being contracted by your company to provide those services as a separate entity. There could be shades of fraud there in that you are posing as an engineering company owned by an engineer but in reality simply acting as an employee of your original company. Seems like getting legal advice here is necessary.

For the insurance, if you do the work as a separate company/firm/LLC then any potential lawsuit could come to your little one man firm.
It might happen this way:

1. Aggrieved client sees his structure have problems/fall down/etc.
2. Aggrieved client sues your employer.
3. Your employer's insurance company sees that the actual contract was with your little one-man firm.
4. Your employer's insurance company sues your little firm.
5. Your little firm has no insurance
6. You lose your house and car and first born child.



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[stevenal]

If I can't, we would pay a sole proprietor to sign our drawings anyway...

Really? Drawings that were not prepared under his/her responsible charge?

 

[CELinOttawa]

Stevenal: This happens. They get thoroughly mocked around here with serious hand-wringing. BUT it seems the associations never have enough time, money, or GUTS to do anything about it....

 

[GAtowers]

Ok. Let me rephrase my question since I've clearly been misunderstood. And please check your attitudes. I'm looking for genuine advice.

I know an engineer with a COA in FL under his own name. He also owns an engineering firm which does not bare his name. So he is able to sign drawings for Florida that don't necessarily bare his company name. He does this when the client has an approved vendor list which he is not on, but the firm who hired him isn't self performing the construction drawings. This may be because they don't have the proper licenses, the job has aspects outside of the vendor's competency, or they are too busy. Can I get something like this to work for us? Is my only option to sever my employment or not accept the work?

 

[glass99]

Why is the construction management company stamping anything? Is the engineering being completed in house?

 

[GAtowers]

Yes. Again, we provide both services, and others.

 

[glass99]

If an engineer has designed a structure and they stamp it themselves I don't see that as an ethical violation, even if the owner of the firm is not an engineer. It may be a violation of the rules though. GATowers: Setting up another business owned by you offering proper engineering services is an option. The independent firm would have to have its own E+O insurance, and you would have to have some agreement in place which gave your little firm indemnification of some sort in case the insurance ever got maxed out.

Paying a sole practitioner $200/sheet to blindly slap a stamp on someone else's drawings is dodgy, even if it is common practice. A construction manager stamping someone else's work which they did not design is equally dodgy. You are supposed to have "supervised" the engineering aspects of the design. I think its reasonable to stamp an out of state engineer's drawings if you give them a serious peer review including completing significant checking calculations. It is not reasonable to slap a stamp on some steel fabricator's shops which were prepared by a detailer just because its convenient.

 

[moltenmetal]

CELinOttawa: the term is "rent-a-stamp"...and yes, there are plenty of rent-a-stamps out there. It's a black eye on our profession, but it's a direct result of the massive oversupply of engineers. The need for people to make a living puts them in an ethical vice sometimes.

In Ontario we have a certificate of authorization so that a corporation can carry out engineering work, as long as it has a signatory professional engineer on staff willing to take professional responsibility for the work done. But there are no practice inspections and no "span of control" limits- one patsy P.Eng. can take "responsibility" for the work of a department of 100 or more non-engineers or unlicensed engineers. And a sole proprietor, working in their own name, who is also a P.Eng., still needs a C of A to carry out engineering work for the public- even though by definition, all professional engineering they do will of course have been done under their responsible charge as P.Eng...The C of A walks and talks like a secondary license, rendering the P.Eng. license itself utterly meaningless. It's a flawed system, but engineers themselves are the ones responsible for it in the first place- "we" wanted to form corporations, which most of the other licensed professions don't permit. Kudos to those states who are refusing to go that route!

It's a far better system than a general exemption from licensure with the regulation of engineering being de-facto carried out by the insurance industry- at least this system TRIES to reduce the harm in the first place rather than merely compensating the victims after the harm is done.

 

[zelgar]

Wouldn't the easiest way be for the owner to sell you a partial interest in the business for $1 to meet the legal requirements of SC and FL? You'd probably need talk to lawyers to determine the extent of ownership needed to meet SC and FL requirements, but this seems like the simplist option unless the owner doesn't want you to be a partial owner in the business.

Also, when talking about attitudes...

It is one of our services your lordship.

 

[EngineeringEric]

The NC law is 66% ownership, My company ran into this as well as 50% was owned by the founder's brother (a non PE).

 

[GAtowers]

Did you find a way around it that didn't involve a change in ownership?

 

[SLTA]

Ummm... this has me flabbergasted. Seriously, this is even a question?

These states have this law for a reason. If you don't want to follow it, then don't work in those states. End of discussion.

Please remember: we're not all guys!