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Considering Dual Shop? Proceed Carefully.

September 10, 2010 Written by: Written by Mike Rogers, Chief Compliance Officer

As construction work becomes more and more difficult to find, contractors are looking for strategies that will enable them to stretch into new geographic areas as well as different types of work.  This is one reason contractors set up dual operation shops.

These shops often have common owners.  However that’s where the sharing should end if the contractor wants to avoid the potential for labor issues and hefty fines. While contractors may start out with every intention of keeping the operations separate, the temptation to send an employee from the non-union company to work on a union project – or vice versa – “just this one time” during busy times or when there’s an employee shortage can be great.  But once this line has been crossed, it’s easy to cross it again and that violates the integrity of having a dual shop operation.

Contractors considering this strategy should consult their trade associations for advice, and would be well advised to seek counsel from an attorney who specializes in labor law.