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Refunding over payment / Service work under PO
October 14, 2019

Webinar notice
Title:    Subcontractor v Employee and Consequences of Misclassification
When:  October 17, 2019 12-1 PM EST
Who Should Attend: Alarm owners, managers and CFOs
Presenter: Michael Foster, Esq. and Ken Kirschenbaum, Esq.
More information: Proper classification and consequences of misclassification of independent contractors and employee s; 1099 v W2; California's new law and how it impacts other states.
Register here:
Notice:  New K&K Concierge Program perk.  Concierge clients will be credited half hour each month for subscriber contract review.  This credit does not carry over to next month; it’s $250 value each month.  Use it or lose it.  This perk adds up to $3000 value to the Concierge Program.  To learn more and sign up for the Concierge Program click here:
Refunding over payment
            I always enjoy your newsletters. My bookkeeper ask me a question: if a customer cancels there monitoring after their contract has ended but they have pre-paid for the balance of a year. Are we legally required to refund them there unused monitoring funds? Do your contracts address refunds?
   Yours Truly
            Let’s say you invoice quarter annually; every 3 months.  Your original term on the contract has expired and the renewal is month to month.  During renewal you invoice for 3 months, but the subscriber cancels in month one, effective end of month two.  You owe a refund for month three.  Being honest has its own rewards.
Service work under PO
            More and more we are seeing national fire alarm companies attempting to have us do service work for them under their PO. We have everybody sign our K&K service agreement for any work, unfortunately it appears this is not standard practice in the industry. I think the industry needs to rally together, and not perform service work without an agreement for these national providers who are potentially shifting Risk to the small alarm companies around the country. That is not fair- pass this on in your forum if you would like.
            Thank you,
            The problem any subcontractor has is that the subcontractor almost never has a contract with the subscriber.  That means that the subcontractor relies on the contractor hiring the subcontractor to have a proper contract with the subscriber, usually the owner, especially if it’s a fire alarm system.  
            Start with the premise that you should do no fire or security alarm work without a contract.  Of course the subcontract is not the contract I refer to because that subcontract more than likely imposes more liability and risk, rather than reduce it.  That’s because as the subcontractor you are probably being asked to indemnify the contractor hiring you, and often the owner and architect as well.  
            If a fire alarm company has a Fire All in One with the owner and then hires the subcontractor to do work, and that includes installation, service, inspection and monitoring, the subcontractor will be protected.  But rarely will the subcontractor ask to see the contract with the subscriber.  You should for your protection.  
            You are also right that national companies rely on subcontractors.  Subcontractors have more bargaining strength than they may think and they should start thinking about potential liability instead of just landing the job and getting some cash flow.  

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Ken Kirschenbaum,Esq
Kirschenbaum & Kirschenbaum PC
Attorneys at Law
200 Garden City Plaza
Garden City, NY 11530
516 747 6700 x 301