Staffing Contract Language - State of Michigan 1

[Badger2003]

Hello all -

First I'd like to apologize... I made the mistake of posting some questions about a new business in multiple forums due to placing them in the wrong section. I should have deleted reposts, but it looks like an admin deleted all of them. Totally my bad, and understandably annoying...

I'm hoping to write language into a contract similar to what a staffing company like Kelly Services or Aerotek would use in the state of Michigan, where the industrial exemption allows the use of unlicensed employees for engineering services in the automotive industry. I drafted the following declaration, and am wondering if the statement is appropriate, or if a standard statement already exists. In this case, my company is the Supplier, a UK staffing firm is the Company, and an automotive OEM is the Client.

Any engineering services provided by the supplier or affiliates will be performed pursuant to State of Michigan statue. Supplier may, at its discretion, utilize non-licensed employees to perform engineering services under state of Michigan industrial exemption 339.2012, exempting license requirement for "A designer of a manufactured product,if the manufacturer of the product assumes responsibility for the quality of the product". Company bears responsibility to verify that, as relating to this Agreement, Client assumes responsibility for the quality of the product, and that provided services meet the requirements of any contracts or agreements with Client.

Regarding this, are there any thoughts regarding a hold harmless clause, since as stated above, the OEM bears the responsibility for the quality of the product? Under my interpretation, this would preclude the need for E&O coverage?

Thanks in advance!

 

[zdas04]

Talk to a lawyer. Talk to a lawyer. Don't use the information of a bunch of engineers to try to circumvent the law.

If I understand what you're trying to do, then the staffing company would be "holding itself out to offer engineering services" and they would have to have a PE on the board. It doesn't matter that the work does not necessarily have to be done by a PE, it only matters that you are offering engineering services outside of your own firm without a license.

David

 

[Badger2003]

I talked to the Michigan engineering licensing department this morning, and the gentleman I spoke with saw no issue with the venture I was proposing. That said, I certainly understand the value of speaking with a lawyer.

Any chance there are any independent engineers here in Michigan that could recommend a lawyer with experience with small startups?

 

[Badger2003]

Maybe a better question to ask is how a staffing company can place unlicensed employees to fill engineering positions? That seems to be exactly what I'm trying to do, and companies like Kelly and Aerotek seem to do it all the time?

 

[JAE]

Your statement:

"Company bears responsibility to verify that..."

brought to mind a question - would you need to have some sort of written response from Company stating that they indeed did fulfill their responsibility?

 

[TheTick]

Better talk to a tax accountant. There are some federal tax laws that could cause trouble. IRS frowns upon the one-man-company-serving-one-customer model. There are specific regulations against this, thanks to Microsoft's abuse of this modus operandi.

 

[TheTick]

<

http://www.irs.gov/businesses/small/article/0,,id=99921,00.html>

Looks like Form SS-8 is the main determinant.

I think you're better off going through an agency. That way you'll be eligible for unemployment when you're done. I would not recommend any that you listed, though.