5 Tips for Complying With Massachusetts Home Improvement Contractor Law
If you’ve lived and worked in Massachusetts for more than a month or two, you’ve probably noticed that the Bay State has more than its fair share of rules and regulations. Unlike our “live free or die” neighbor to the north, Massachusetts has a law for just about everything — and that’s especially true for the trades. Chapter 142A governs home improvement contractors, so if you’re a carpenter, general contractor or anyone involved in a remodel, it’s a good idea to get familiar with these regulations to make sure your business is in compliance.
Fortunately, the Commonwealth has made it a little easier to figure out your responsibilities without having to wade through the legal jargon of the actual law. They’ve gotten into the digital age with some very good YouTube videos. There are five basics to live by when it comes to complying with the law:
You need to register with the Office of Consumer Affairs as a Home Improvement Contractor (HIC) if you perform any type of construction on pre-existing, occupied residential buildings — though there are a few exceptions. There’s a fee, of course, but your registration is good for two years. The state will send you a renewal form when the time comes. If you change your business name or become a corporation, you may have to re-register.
A good contract protects both you and your client in the event of a dispute, and Massachusetts requires them on any job worth over $1,000. Your contract must include your HIC number, business name, the total price, payment terms and a full description of the work to be performed. Your contract must also explain that you are responsible for pulling permits, and you’re limited to just 1/3 of the cost of the project as a deposit unless you special order materials. You also can’t collect the final payment before the job is complete.
All of your ads must include your HIC number, so you have to register before you set out your shingle. In the eyes of the law, advertising includes not only newspaper, radio and TV ads, but also your website, business cards and any flyers or mailers you might use. Even the sign on your truck counts, so make sure you’ve got that HIC number on everything! As for estimates, be very specific in spelling out everything you plan to do — and how much it costs. Don’t underestimate your costs in a rush to be the lowest bidder, because it’s against the law to abandon the project if you wind up in the hole.
There’s more to doing your job than meets the eye! You’ve got to pull the permits, pay your subs and complete the project. Though you can’t abandon the project due to an error in your estimate, you may be able to stop work if the homeowner doesn’t live up to their payment obligations. Make sure the homeowner agrees with you that the project is complete before collecting your final payment. Keep great records to show that you’re living up to your end of the deal, and keep the lines of communication open as you work.
The Office of Consumer Affairs works to make sure that contractors and homeowners are both treated fairly. They offer an arbitration program that you can use if you think a homeowner owes you money but won’t pay up — just make sure you have an arbitration clause in your contract. The Office of Consumer Affairs will also investigate complaints by homeowners, and they can fine you and revoke your HIC registration if they find against you. Heads up — they also keep your disciplinary history online for all to see.
If you follow these five tips, you’re sure to stay on the right side of the law — and you’ll have a long list of happy clients!