To sign or not to sign. That really is the question for many operators, wondering whether to work under a written contract with customers.
The advantages for the contractor are obvious: job scope and safety parameters are clarified, payment terms spelled out, and the document is legally binding, just in case. For the customer, the document becomes a written guarantee of service and something of a security blanket for containing costs.
But in an industry where a person’s word and a handshake have long been considered enough to seal a deal, is there really a need for all the legal mumbo-jumbo of written contracts?
These three contractors think so, and the watchword seems to be “protection,” for their companies and their customers. In a litigious society, legal liability becomes more and more important, no matter what line of work you’re in. For operators dealing with potentially polluting substances, repeatedly entering private property, and driving heavy equipment, that’s no small concern.
A small piece of paper, though it may add a bit of time to business negotiations, can provide substantial protection, legally and ethically. Both sides appreciate the peace of mind that goes with a contract.
Kobi Andersen is office manager for Andersen Sewer Service, which she owns with her husband, Stuart. They’ve been in business for 25 years, jetting sewers, pumping septic systems and cleaning grease traps. The company also provides water trucks for fire service in Yellowstone National Park through the U.S. Forest Service.
“We don’t use written contracts on smaller jobs, but we have standing maintenance agreements with local truck stops and restaurants to provide grease trap cleaning,” Andersen says. “We often just use standard contracts provided by the customer, but we have a boilerplate document we start from, and we customize it for each job as needed.” Government work always comes with a government contract.
Andersen says contracts are a good idea for her business and its customers, “You know where you stand if you have some paper backing you up,” she observes. “Everyone knows what to expect, and that means no awkward situations or surprises when it’s time to get paid. Job terms have already been agreed upon.”
Contracts also help the company allocate its human and equipment resources more efficiently. Andersen schedules on a day-by-day basis, slotting smaller jobs in around standing contract work and emergencies. The contracts help her get a handle on the bulk of most days’ assignments. That helps her anticipate what will be needed when.
And there is no discounting the value of that piece of paper in settling disputes. “We’ve been glad to have that contract when Stuart had to back up a system inspection when the system later developed problems,” Andersen says. “The contract clearly states that it’s not a guarantee of performance, only an educated professional opinion. “We stand by our work, but there are always things you just can’t see, and that was one of those jobs. The contract protected us.”
Bob Earl has been in business for 25 years, cleaning septic systems and providing portable restrooms and trailer service to long-term construction sites through his company, Enviro-Clean.
“We use contracts all the time for our commercial accounts,” he says. “There’s more money at stake with those jobs, and both parties want to feel protected. Written agreements define the job scope, and let the customer know what they’re entitled to and responsible for.
“They also protect us when a customer calls claiming lack of service. That’s usually about something they didn’t check, and we can point to the contract, which says what we will and won’t pump, such as we don’t take grease, chemicals or hazardous materials. That’s especially important for commercial building protection and who carries what liability.”
Earl says Enviro-Clean’s contract has evolved. It now explains the company’s 28-day billing cycle policy. With a tight definition of the payment policy, the company can keep a better handle on receivables and cash flow.
Written contracts also work well for Giovanni Torreschico, owner of Red Lilly Sewer and Drain Service. Torreschico has run the 82-year-old company for two years. “Lots of our customers are commercial interests, upscale restaurants and places where movie stars hang out,” he says. “When we work in Hollywood, we’re sometimes in those stars’ homes, and nobody goes in there without signing something.”
Whether the company is cleaning or replacing drain pipes or performing system inspections, the employees work under a three-page carbon form that was drawn up and is occasionally updated by the firm’s attorney.
“It contains all the legal language about the work agreement, including any waivers and all project parameters,” Torreschico says. “From our point of view, it proves we’re an honest, honorable company, which is very important to our clients who are very protective of their privacy. For them, the contract provides peace of mind, knowing they’re working with professionals who are there to get the job done, then leave them alone. They don’t have time for hassles.”
