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Why Every Contractor Should Create a Qualifier Contingency Plan Part 1

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Obtaining a contractor’s license can be a complex, patience-testing process, which is why so many large construction companies are utilizing several qualifiers to maintain licensure across multi-state territories. There’s no law demanding that contractors only work in their home state, which is why industry leaders like Bechtel and Skanska can be found working on projects all throughout the United States and internationally.

That said, multistate licensing can be problematic without an Orlando construction attorney on your side to help you maintain compliance across an array of construction-related laws that vary from state to state. In this two-part series, the Orlando construction attorneys at Cotney Construction Law will discuss the importance of creating a qualifier contingency plan to help manage multistate licensing.

What Is a Qualifier?

A qualifier is an entity that represents the work of a business. In the construction industry, this simply means a licensed contractor that can perform work in a state under the “umbrella” of your business. This is necessary because only individuals can acquire a contractor’s license. Therefore, companies that want to expand their operations into multiple states must have a qualifier in each state to ensure that they are working legally.

The Problem With Qualifiers

According to Construction Business Owner, “it’s not uncommon for a company to have a single qualifier in a dozen states or more.” This can create pervasive issues for a firm if a qualifier decides to pack up and leave. Typically, you have one or two months to select a licensed replacement. If a licensed professional isn’t available, you may need to elect a new individual from your business to obtain a contractor’s license. Unfortunately, this process can be time-consuming, which means you could lose out on valuable contracting opportunities in the meantime. 

The Solution: a Qualifier Contingency Plan

To help minimize the chaos of a departing qualifier, business owners can employ a qualifier contingency plan — a simple, relatively inexpensive solution that can help you protect your business interests. A qualifier contingency plan will help you build a list of “next-in-line” qualifiers. When a qualifier leaves, it’s like a boat with a leak that needs to be plugged. If you already have the perfect piece in place to plug the leak, you’ll continue to float and your journey will be uninterrupted. In the construction industry, a departing qualifier must be replaced with a new qualifier to ensure projects continue according to the schedule established in the contract.

To learn more about creating your own qualifier contingency plan, read part two.

If you would like to speak with an Orlando construction attorney, please contact us today.

Disclaimer: The information contained in this article is for general educational information only. This information does not constitute legal advice, is not intended to constitute legal advice, nor should it be relied upon as legal advice for your specific factual pattern or situation.