What Constitutes Job Abandonment for Contractors
In the context of contractors, the definition of job abandonment typically hinges on a few widely accepted criteria. The most critical of these is the amount of time in which the contractor must be absent from the job site to constitute "abandonment". Two days is the number of days customarily used amongst the average contractor to define job abandonment. However, if the contractor is working on multiple locations and simply skips a few days at only one location – this does not constitute job abandonment.
Industry standards also play a role in defining job abandonment. A general requirement in the industry is that the general contractor must not allow the worker to remain off the job for more than seven consecutive days. While industry standards are not exact, they do come into play when it is necessary to determine whether job abandonment occurred. Like most areas of the law, where job abandonment is defined by statute, you may also consider the nature of the work, the terms of the contract, or sections of the Michigan Construction Liens Act (MCLA) 570.1101 et seq. including MCLA 570.1110 and MCLA 570.1109. These MCLA sections, in particular, demonstrate strict guidelines regarding the timeframes that owners and general contractors must follow once default by the contractor has occurred .
Additionally, the following have been suggested as elements of evidence that may create a finding of job abandonment: (a) failure or refusal to perform the contract, even after a reasonable time to perform the contract had elapsed; (b) the general contractor had to exert an effort to obtain the performance of the contract from the contractor; (c) the parties had agreed to a specific schedule for performance; (d) the parties had agreed to a specific number of days for completion of the contract; (e) the owner-general contractor had to engage the services of another contractor to replace the original contractor; (f) the general contractor had to take other steps to replace the contractor; (g) another contractor was not able to perform the contract; (h) the general contractor was aware that the contractor did not have the financial ability to perform the contract; (i) the general contractor was aware that the contractor had never met the conditions of the contract; (j) the general contractor was made aware that the contractor was having difficulties with performing the work; (k) the general contractor gave the contractor adequate notice to perform, by telephone or otherwise, before asking the contractor to leave the job; (l) the contractor did not inform the general contractor why the contractor was not performing the work required under the contract; (m) the contractor was able to perform the work and had not stated he was unable to perform the work; (n) the contractor informed the general contractor that he was unable to work on the project; (o) the contractor simply stopped working on a project without discussing his failure to perform with the general contractor; (p) the contractor of a subcontractor left a voicemail message with an unknown number of days passing; (q) the contractor left a voicemail message with the general contractor that he was no longer able to perform the work without further discussion; (r) the contractor left the job site without any notice to the general contractor; (s) the contractor repeatedly failed to attend project meetings; (t) the contractor failed to return calls to the general contractor; (u) the contractor put off discussions concerning performance of the contract on several occasions; (v) the contractor did not plan ahead to procure materials or plan his work; (w) the contractor had to obtain steel, plywood, or other materials without calling the owner; (x) the contractor failed to supply adequate supervision of his employees with respect to the contract; (y) the contractor failed to provide adequate labor and equipment necessary to complete the project within the times the job was scheduled; (z) the contractor failed to give the general contractor adequate notice with respect to the start and completion of a phase of work; and (aa) it was obvious that the contractor intended to forego performance of the contract.
Reasons Behind Contractor Job Abandonment
When a contractor is hired for a project, it is common practice for the contractor to sign a contract containing a specific period of time over which the work will be done. When a contractor does not finish the work in that timeframe, it can be very expensive. One thing we have seen many times is a contractor who just disappears from the job site and never finishes the work. This is often called a "runaway" or "abandonment."
Job abandonment by contractors is different from job abandonment for regular employees. Generally speaking, when a regular employee is missing from the workplace and he/she does not give an explanation for the absence, it is treated as a resignation. But a contractor generally has no obligation to give any reason for their disappearance. In fact, it is likely that many contractors, if asked for an explanation of their behavior, would state that they were not abandoned at all, but that the owner breached the contract first and the contractor had a right to terminate their work.
So why do contractors suddenly disappear? We have spoken to contractors at length regarding this situation, directly from their perspective. The two most common reasons they are gone from the job without notice are personal/family issues and financial trouble. For example, a contractor might be the primary breadwinner in the family. Perhaps he/she has been going through some personal problems and living from paycheck to paycheck. The contractor could have received a bill from their child’s school, and the threat of being turned away at the front desk due to an unpaid balance might have been too much to take. It is not uncommon for a contractor in this situation to take the check from the owner, write a check to the school on the spot, and leave the job without further explanation. The contractor will hope to return to the job later when his/her situation is more stable, at which point he/she/she might complete the work.
Another possibility is that the contractor’s business is experiencing trouble. A contractor who provides shoddy work and does not show up on time, will likely struggle to get clients. In some situations, we have seen that the behavior of other workers on the job leads to a hostile environment for the contractor. The contractor might even say "I’m done," or "I quit" when leaving a job, but that does not mean the contractor has resigned. It could be a simple statement of frustration. Now, why wouldn’t the contractor call to inform the homeowner that he/she is leaving? There could be many reasons; many contractors simply shy away from confrontation and face-to-face discussion. Some contractors might assume the termination is clear by their actions, without the need to make a statement of explanation.
Regardless of the reasons why your contractor is gone, the reality is that you must move quickly to protect your interests. If the contractor has no intention of ever returning to finish the job, then you might have to consider starting a lawsuit for breach of contract. At the very least, you might have to consult with a lawyer to see what kind of claims and potential remedies you have available.
Indicators of Contractor Job Abandonment
What you and your project manager will typically start noticing are signs that the contractor has abandoned the job before telling you. The following are some of the signs of job abandonment that you as an employer or prime contractor should be aware of: Missed deadlines. One of the most obvious signs of job abandonment is missed deadlines. If your contractor has repeatedly missed deadlines for deliverables, whether they’re related to project milestones or on an hourly basis, this is a red flag that you can’t afford to ignore. Lack of communication. All construction projects require clear communication of timelines, expectations, responsibilities and work completed. If your contractor stops communicating with you or fails to respond in a timely manner, then it may be time to consider other contractors. Likewise, if you fail to reach your contractor and they’ve missed a deadline, you should be concerned, especially if there’s no reasonable explanation for the missed deadline. Unexplained absences. If your contractor is skipping work without giving you any reason why, this could indicate an issue that needs to be addressed. Unexplained absences that disrupt the workflow on the project must be taken seriously, as this could result in delays and increase your costs. Subcontractor issues. If your contractor disappears for a week but you later find out that they’re still working at jobs sites in other areas, that could indicate that your project is not their priority. If you’re not being prioritized, it might be time to explore hiring a new contractor. Specialty equipment issues. Sometimes contractors bid on jobs that require specialty tools that they don’t have, so they must rent tools to complete the job. If your contractor unexpectedly returns equipment from the project, that may indicate that they’re finishing a milestone and moving on from the project. This may also indicate either a lack of experience or equipment investment on the contractor’s part. Behavioral changes. If your contractor is consistently taking hours to respond to emails, missing meetings or dropping the ball on their responsibilities, it may indicate that they’re struggling with the job, and that they could be abandoning the work just as you discover the problems. Whether the contractor simply isn’t qualified for the job or they’re overworked on other projects, missing meetings and delivering poor quality work could be a sign that your contractor is abandoning the job site without your knowledge.
Legal Ramifications of Contractor Job Abandonment
Contractual terms will also tend to dictate the ultimate sanctions to be imposed for job abandonment. In addition to the contractual terms themselves, the company may have a legally binding contract with its collective bargaining representatives, which again will dictate the result. As in other non-workers comp cases, the ultimate sanction that may be applied may be nothing more than the forfeiture of wages.
In Spiers v Concrete Construction Co (1956), 122 NJL 579, 6 A2d 807, the court addressed the issue of whether the employer was in a position of offering an employee out of union jurisdiction would be appropriate. The offer to operate equipment, which was hired by the owner to perform work on the premises of another contractor, was properly rejected by the plaintiff union members. The court held that in doing so, the members had effectively abandoned their employment and were not entitled to any wages therefrom.
The refusal to work is a conscious act, and as such, is thus treated as an act of commission. The Supreme Court noted that "negligent [conduct] of an employee in quitting his job… involves an element of personal volition which does not warrant assistance from an injured worker’s compensation fund". /Embrey/ v Fremont G. Hungerford, Ltd (1864) EWHC J6.
It is important to note that the refusal to perform work is not always limited to a single refusal to perform a specific task. For instance, a refusal to cross a picket line may constitute a course of action that effectively constitutes voluntary abandonment, in the context of a union shop. John R. Hayes & Son v Sullivan, 413 F Supp. 455, 460 (E.D. Pa. 1976).
Job abandonment is an act which can be a simply willful refusal to work. A offer by a contractor to perform work for the owner may, if rejected by the employee for no good reason, constitute a voluntary act of abandonment.
Contractor Job Abandonment Remedies for Employers
Contracting parties are most likely to be able to reduce problems related to contractor job abandonment if they consider, from the outset, the most effective contract terms for achieving this aim. Contract provisions which require job progress reporting, and which allow for the imposition of contractual penalties or increased supervision (including visits to the work site) in the event of work progress falling behind schedule, may result in fewer jobs being abandoned. Similarly, contracts which allow for termination (and the contractor to lose its returnable security) if the contractor does not achieve a milestone or complete a stage of the work within a prescribed time frame also may reduce the risk of contractor job abandonment.
As well, contractors should be selected for their experience and reputation in the industry, and their financial capacity, particularly where the job is of a high value . Contractors with a poor reputation in the industry, or poor work history, pose a higher risk. As well, prospective contractors should be asked to demonstrate their financial capacity in an effort to ensure that the contract will be completed. If low bids are received from only those contractors who have a substantially lower level of experience, this should be a red flag and the contractor should be closely scrutinized. Even experienced contractors, with significant capacity, should be asked for a plan showing how they will tackle the work. Adequate cash flow and experience need to be demonstrated and a proper selection process, which is fair and objective, will go a long way to screening out those contractors who are at risk of abandoning the work.
Actions to Consider if a Contractor Abandons Their Job
After reasonable attempts have been made to contact a contractor about their absence, and the employer has concluded that it is indeed a case of job abandonment, it is important to proceed carefully. The first critical step is to prepare documentation of all of the employer’s attempts to reach the employee. Of course, the documentation should be accurate and true, rather than bolstered or fabricated. Second, the employer should consider leaving a voicemail message, paper trail, or email at the end of five days of absences stating that the employee has been considered to have abandoned the job, subject to the employee contacting the company within one week to show proof that the employee had a legitimate reason for the absences which prevented attendance or gave appropriate notice to the company.
The employer should then consult with an attorney regarding the right to terminate the employee in the circumstances. Again, the key is to avoid unnecessary liability over the dispute as to the reason for the employee’s absences. Cases have been won where the employer could not prove the specific nature of the illness or circumstance that was discussed with the employee. Before termination, an employer should at least consult with an attorney his or her own views of the employee’s circumstances, and after that review there may be no way to avoid the dispute other than simply proceeding to termination. Unfortunately, however, the Contractor may have legitimate defenses to the termination, which could include (but are not limited to) retaliation or wrongful termination theories.
Contractor Job Abandonment Case Studies
Case Study 1: Miller & Associates v. Manders
In the case of Miller & Associates v. Manders, we see an example of job abandonment that’s fairly common in the industry. Manders was notified by Miller that his employment would terminate on June 30th, and he was told to return home early from the project because of a 3-day weekend. He was told to return when work permits came in. He never returned to work. Miller claimed that he was not able to get in touch with Manders for nearly two years, although they were able to send a notice of nonpayment to his address because of its highly unusual nature, and make contact with him using an old cell phone number. The dispute went to trial and the outcome was in favor of Manders, who had submitted evidence that the work permits were delayed. The lesson here is: If you intend to terminate employment, be clear and give an exact termination date. An open-ended "when work becomes available" policy may backfire, as courts may view that as an acquiescence to continued employment. This case also demonstrates the importance of preserving proof of attempts to reach former employees. A notice of nonpayment under Labor Code sections 201 and 202 requires the filing of a lawsuit. Therefore, it is highly unlikely that any company, anywhere provides notice of nonpayment beyond the filing of a lawsuit, and even if such notice is provided, the document will likely not contain references to prior collections efforts and attempts to reach the former employee.
Case Study 2: Kimble v. Starbucks
In the matter of Kimble v. Starbucks, the employee alleged that he was terminated without notice after returning from personal leave . At trial, the employee testified that he was unaware of Starbucks’ attendance policy. Starbucks argued that they had attempted to give the employee a copy of their policy prior to terminating him, but for some reason, his copy had gotten lost in the mail. The jury ruled in favor of Kimble. Although the verdict was overturned on appeal, the case was sent back to the trial court for the case to be retried in conformity with the appellate decision. The lesson here is: Always give employees manuals, notices, updates, etc. Anything that is given must be confirmed via an acknowledgment of receipt signed by the employee.
Case Study 3: Mr. W Firewood
A recent matter involved a long-time employee whose whereabouts were known for many years, but he ultimately left his position and never returned. After more than 18 years of employment, this contractor’s foreman left work one day without notice. He was gone for four years. He returned with a written document claiming restoration of icon as a contractor was his remedy for unlawful termination. The key here is that this contractor did not have written documentation of his attempts to reach the employee, notified the employee of the need to turn in materials and other items, and the employee was informed that if he returned and brought the account current, he could keep his account. Ultimately, the employee returned the materials and brought his account current, but unexpectedly, the company was found liable for intentional infliction of emotional distress, primarily because of the company’s failure to give notice to the employee of the needed accounts review and for the unprofessional and inflammatory behavior of their store manager.