Wanted to get people's thoughts on what value ($) is it to my employer to have me sign and seal projects. Apparently, I would be covered by the firm's insurance policy. But are there other risks that I would be personally liable for that i should be compensated for?
Depends on your state. Some states are personal liability states, which means you, as a state-granted license holder, can be sued *personally* for mistakes you make, so your employer's insurance wouldn't cover you. You can be sued for personal property, including your house etc., if it's not jointly held by a spouse etc.
My short answer is do not stamp a drawing unless you are a partner in the corporation, ever. But it really does vary state to state. Best solution is to personally hire a lawyer and find out what law applies to your situation.
Just say No unless you are partner or you go and start your own firm and they pay you real fees (yes you cover your own insurance which will be less than what they are paying now anyway)
If they sign most the jobs and now they ask you on one job, you need to ask why?
Typically you'll only be covered by the firm's insurer as long as you work for that firm. But if you're the architect of record, the liability will still be yours even after you've left. Some states have no statute of repose for architects, so the liability will be yours forever.
I'll echo the above. Don't stamp unless you are a partner, own your own firm, or its a side project and you have your own personal liability insurance.
Why - The person currently sealing projects is leaving. They can't because we are primarily an engineering firm that also provides architectural services. I would become a member of the board of directors. No one has addressed the compensation question...
Talk to the guy who's leaving before he's gone; find out what he was getting. Decide if its enough...
Depending on your state- it may not even be a legal way to practice architecture. Many states identify corporate structures and percentages of ownership, which may practice...
As others mentioned you're liable for the work for a period of time. I'd check the statute of limitations in the states you're sealing in and make sure that the firm will cover insurance costs while you're liable (whether that's compensation in cash or insurance is negotiable). I'd also check out if you'd be personally be liable per Donna's comments.
You should hire a lawyer to look into your personal risk and discuss with the firm's attorney prior to taking on the risk.
A perpetual indemnification clause to all claims arising out of the drawings by the owner of the firm with a clause stating that upon dissolution of the firm, the burden of the indemnification clause falls onto the owner and his successors.
If that is not acceptable, tell them to fuck off or extract whatever payment you think that indemnification is worth.
Depends on the state & corporate structure and saying you are insured is too easy, ask for a copy of the policy naming you as insured…and what if there is a claim, is the deductible yours to pay? Agree with others, too many twists & turns, consult an attorney.
Too many twists and turns, period. Unless you are compensated at a partnership level, just don't do it. If they are engineers who also want to practice architecture, let them acquire a partner who is an architect, or become architects themselves. We are always complaining about poachers, aren't we?
I'm sure your State Board would happily offer you an opinion on whether the method of practicing architecture is legitimate. After all, they will happily discipline you if the SHTF.
After that, decide the liability/compensation question...
As JeromeS said some states require a certain percentage (from a small one to 100%) of firm owners be registered architects for the firm to legally offer architectural services. So if you're not a partner/owner, or if you are too small of a percentage, the firm can't legally offer your stamp, anyway. But again, that varies state to state.
Professional practice: it's not that simple! That's why I taught a lot about ethics in the ProPrac class I taught. A lot of things don't quite feel like they're appropriate, and as an ethical professional you really need to ask yourself (I'm talking generally, skhampton, not specific to you) if certain things pass the smell test. Personally I loooove the hair-splitting nature of these kinds of discussions!
Specific to you, skhampton, talking to an employment lawyer - one who is familiar with architectural practice - for an hour would be worth the cost. The firm should pay for it. Your local AIA probably has law firms who are sponsors; that would be a good place to start to get references.
My son worked for a company that had no license and as they grew they grew over the line and asked him to seal. With my help we found a way…to “seal” his employment. During the last recession they laid the whole department off…everybody…except him…clouds are gathering.
Statue of limitations? It's enough for a client to name you in litigation even if it's 30 years from now and you will lose money regardless if you are still practicing or not.
Had a recruiter connect me with a construction company that had and lost an architect and was looking for a new one, note: they were not looking for an architect - they were looking for a stamp (big difference) - realized this in talking to them - when a GC tells you, "Ah man, I would never do anything to put you or your family in harms way" - RUN. Turned down big bucks.
Stamp doesn't touch ink - unless you are a % stake holder and fully insured.
skhampton: Nobody can tell you a specific amount of compensation for this - it's a matter of how much risk you're willing to assume. Even if you get an agreement that the firm will provide insurance indefinitely, what happens if that firm eventually goes out of business? What if a claim arises on one of their projects 20 years after they've ceased to exist? How old are you? What do you have to lose, now, and what could you stand to lose in the future?
Personally I wouldn't do it as an employee. Consider that it's not just an issue of a lawsuit arising on a project directly. If you stamp the drawings you become responsible in other ways too - for instance I've been subpoenaed a few times in cases having nothing to do with my work directly at all - for instance in land disputes, sometimes years after I had anything to do with the property, just because I'm the stamp on old drawings that are on record with the town or city or for some other reason are being used as exhibits. Do you want to open the possibility of being involved in that sort of thing long into the future, after you've left this firm? If so you'll need to figure out what that's worth to you.
^ Excellent post. Even if you get what seems like adequate indemnification, anything can happen when you get into litigation. When there's a lawsuit, everybody get an invitation to the party. The problem with you stamping drawings as an employee is that you don't have the independence of an outside professional. Sooner or later you're going to be pressured to sign things you aren't comfortable with under implied threat of losing your job.
You'll be on the board of directors? Then do it. That's part of the gig. Most firms are corporations, which means everyone, including the big boss, is an employee. Yes, you are taking on some risk. AND??? Do you believe sitting on the board means you are just an employee?
Compensation: Stock in the firm since you'll be sharing the risk.
that kind of depends on the specific way the company is set up doesn't it mighty? i'm certainly not an expert on how to structure a business so if i'm off base let me know, but can't you have a neutered board of directors that's a title only, run by one or two people who pretty much sole proprietors?
stock can be a legitimate equity stake of course, and if that's the case then this could be a good deal for the OP
If you are not an owner, then you don't stamp. As was mentioned, many states require a certain percentage of the firm owners to be licensed architects.
How much are they paying you, extra, for the risk of stamping? If the answer is "you'll get your regular salary" I suggest you immediately quit and get a job somewhere else. Plenty of people are hiring. Otherwise, they need to buy you in, at the full partner level, complete with benefits. And, before you agree to that, you need to go over their books, with a professional, to determine if it's worth it to you - you may discover that they are insolvent or have serious risk (lawsuits) that you'll be "buying" into.
^^”How much are they paying you, extra, for the risk of stamping?” That’s what he has been asking without any answers. Evidently no one else is doing it so they don’t know. My son does but made a play for job security as a first step, reasoning that once enough projects are stamped he can better evaluate the value, and then make a play for money if warranted.
If the employer has a corporate veil & pays for the appropriate insurance…what’s the “risk”? The only risk is torts/matters of wrongdoing that are rare and can be easily indemnified by written agreement and if the employer is providing and paying for all that…what is the OP’s “expense”? Tough to put a number on something that theoretically doesn’t cost you anything….think it has obvious value that should be exploited in some form, but I wouldn’t start with money. It isn’t a matter of “risk”; really, it’s more a matter of “value”.
It’s like trying to justify a fee based on “risk” (something that may never happen) vs. justifying it based on “value”, something that people understand and can benefit from.
Carrera, how does your son identify this value, and balance that with the possibility that he may not stay with the firm forever, or that the firm may cease to exist? The firm's insurance doesn't follow the stamp (your son), it follows the firm. Many states have no statute of repose for architects' negligence. What is the value that your son has placed on living with that responsibility?
Aluminate, Well given the size of the company it’s doubtful, but today who knows. Discussed this before and no one seems to be able/willing to wrap their head around it….just don’t own anything/hide the money.
If someone is killed nothing will help, but the chances of that are minuscule. The other 99.999% of the risk is just about money and if you don’t have any you are literally self-insured.
Late in my career I got dragged into law suit on a project that I didn’t even seal when I was at a firm…wasn’t even a partner in the firm, just the lead PM and I did about 50% of the drawings…law suits are like dragnets to give the lawyers license to dig into everybody’s personal affairs just to see who has the most money…they don’t waste their money chasing people with no money…funny thing was, other than the owner, I, at the time, had more money than anybody on the list, but when they realized they couldn’t find it, all of a sudden it was no longer my fault and I was dismissed from the case.
It’s not a matter of not doing right with people & being responsible, it’s a matter of defense, against the 90% of cases that no amount of insurance or paperwork can protect you against….the goal should be to become a penniless millionaire.
Interesting thread with a lot of good perspectives.
Slightly off-topic, but I think still relevant, I have a three person firm. We don't do any architecture, only concept design for urban design-scale projects. Our clients range from non-profits to neighborhood organizations to developers. Recently a number of our clients have wanted us to do more, including drawings that would require a stamp. I am not licensed and have no interest in licensure.
Recently an acquaintance approached us to join our firm. She is an incredibly talented designer and recently licensed. We don't have the projects currently to pay her a full salary, but if we started taking on a few of these architectural projects, I could bring her on to manage these projects and stamp the drawings, if necessary. (We would pay for all insurance to cover our/her liability.) Problem is while very talented, I don't think she is yet at an ownership level of maturity. She could be, soon even, but still I think it would take a few years. I really hate to miss out on hiring her, because talent like hers doesn't come around often. Any words of advice on how to approach this situation?
FYI our firm is currently set up as a single-member LLC.
It depends what state you're in. In some states architectural services can't be provided by a firm without a certain percentage of architect ownership - in various states the minimum ownership is 50%, 67%, 75%, 100%... sometimes it varies depending on the number of owners. Some states do not allow an LLC to provide architectural services at all.
When you say you'll pay for her insurance to cover your and her liability, are you prepared to continue to pay for her insurance if/when she leaves your firm? In some states her liability continues for the rest of her life. You need to talk to your insurer about whether it's even possible for your coverage to follow her or for you to provide coverage for her when she's not an employee.
If she's doesn't have "ownership maturity", is she mature and experienced enough to be the supervising/decision-making architect in the firm (which she has to be in order to legally stamp the drawings in most states)? In other words, she has to have the authority to make final and overriding decisions on anything she stamps. Are you comfortable with giving her that?
If she's doesn't have "ownership maturity", is she mature and experienced enough to be the supervising/decision-making architect in the firm (which she has to be in order to legally stamp the drawings in most states)?
It's a fair question. The types of projects we've been asked to do at this point are primarily small-scale interiors and renovations. While not licensed myself, I have over 10 years of experience on these (and much larger) types of projects through all phases of design/construction, but your point is well taken; it's a different situation when liability is at stake (part of the reason why I've avoided getting involved with architecture projects in the first place). Beyond my interest in hiring this employee, we are also getting pressure from our clients to do more design work for them. They want us to see projects through to completion. Up to this point, we've simply referred them to other designers, but I may be open to restructuring the practice to take on more. I think that's part of the larger question.
Carrera: I totally agree with what you say about making it as difficult as possible for a plaintiff's lawyer to find and get at your assets. The only caveat (as I'm sure you are well aware) is that if you have assets hidden and fail to disclose them under oath in a deposition, you can be found guilty of perjury. Ditto with moving the assets around in anticipation of a lawsuit, which can be considered a fraudulent conveyance. It's not foolproof. And if someone like your son is putting everything in the spouse's name, he sure better have a solid marriage.
#1 Moving assets in anticipation of an impending event is too late.
#2 The object is to never get to the deposition phase. Lawyers just don’t drill that deep (at first). Just getting things into a trust takes care of 90% of the problem, which isn’t really “hiding” its more “sheltering”.
There's still the issue of having past project come back as time-sucking ghosts. When I mentioned above about being subpoenaed, these have all been land use issues - they have nothing to do with my liability - it's just that I'm the stamp on drawings on file with the municipalities and I'm the one who presented at ancient planning, zoning, or DAC meetings - sometimes more than a decade ago. I get called as a witness in things that have zero to do with those projects directly - they're about new projects on or adjacent to properties where I worked on other projects ages ago. There are depositions and hearings and lawyer prep meetings - all taking time. Some of these things drag on for years. That's the risk one takes as a principal. But if you're an employee I can't see wanting those ties to past projects and firms forever.
Feb 5, 16 3:02 pm ·
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Sealing Drawings for Employer
Wanted to get people's thoughts on what value ($) is it to my employer to have me sign and seal projects. Apparently, I would be covered by the firm's insurance policy. But are there other risks that I would be personally liable for that i should be compensated for?
Depends on your state. Some states are personal liability states, which means you, as a state-granted license holder, can be sued *personally* for mistakes you make, so your employer's insurance wouldn't cover you. You can be sued for personal property, including your house etc., if it's not jointly held by a spouse etc.
My short answer is do not stamp a drawing unless you are a partner in the corporation, ever. But it really does vary state to state. Best solution is to personally hire a lawyer and find out what law applies to your situation.
Just say No unless you are partner or you go and start your own firm and they pay you real fees (yes you cover your own insurance which will be less than what they are paying now anyway)
If they sign most the jobs and now they ask you on one job, you need to ask why?
Typically you'll only be covered by the firm's insurer as long as you work for that firm. But if you're the architect of record, the liability will still be yours even after you've left. Some states have no statute of repose for architects, so the liability will be yours forever.
You haven't said why your employer wants you to stamp it. Why can't they do it? I wouldn't do it without a damned good reason.
Why - The person currently sealing projects is leaving. They can't because we are primarily an engineering firm that also provides architectural services. I would become a member of the board of directors. No one has addressed the compensation question...
Talk to the guy who's leaving before he's gone; find out what he was getting. Decide if its enough...
Depending on your state- it may not even be a legal way to practice architecture. Many states identify corporate structures and percentages of ownership, which may practice...
As others mentioned you're liable for the work for a period of time. I'd check the statute of limitations in the states you're sealing in and make sure that the firm will cover insurance costs while you're liable (whether that's compensation in cash or insurance is negotiable). I'd also check out if you'd be personally be liable per Donna's comments.
You should hire a lawyer to look into your personal risk and discuss with the firm's attorney prior to taking on the risk.
A perpetual indemnification clause to all claims arising out of the drawings by the owner of the firm with a clause stating that upon dissolution of the firm, the burden of the indemnification clause falls onto the owner and his successors.
If that is not acceptable, tell them to fuck off or extract whatever payment you think that indemnification is worth.
Depends on the state & corporate structure and saying you are insured is too easy, ask for a copy of the policy naming you as insured…and what if there is a claim, is the deductible yours to pay? Agree with others, too many twists & turns, consult an attorney.
too many twists & turns, consult an attorney
Too many twists and turns, period. Unless you are compensated at a partnership level, just don't do it. If they are engineers who also want to practice architecture, let them acquire a partner who is an architect, or become architects themselves. We are always complaining about poachers, aren't we?
I'm sure your State Board would happily offer you an opinion on whether the method of practicing architecture is legitimate. After all, they will happily discipline you if the SHTF.
After that, decide the liability/compensation question...
As JeromeS said some states require a certain percentage (from a small one to 100%) of firm owners be registered architects for the firm to legally offer architectural services. So if you're not a partner/owner, or if you are too small of a percentage, the firm can't legally offer your stamp, anyway. But again, that varies state to state.
Professional practice: it's not that simple! That's why I taught a lot about ethics in the ProPrac class I taught. A lot of things don't quite feel like they're appropriate, and as an ethical professional you really need to ask yourself (I'm talking generally, skhampton, not specific to you) if certain things pass the smell test. Personally I loooove the hair-splitting nature of these kinds of discussions!
Specific to you, skhampton, talking to an employment lawyer - one who is familiar with architectural practice - for an hour would be worth the cost. The firm should pay for it. Your local AIA probably has law firms who are sponsors; that would be a good place to start to get references.
On the other hand….
My son worked for a company that had no license and as they grew they grew over the line and asked him to seal. With my help we found a way…to “seal” his employment. During the last recession they laid the whole department off…everybody…except him…clouds are gathering.
Statue of limitations? It's enough for a client to name you in litigation even if it's 30 years from now and you will lose money regardless if you are still practicing or not.
equal ownership to liability, nothing less.
Had a recruiter connect me with a construction company that had and lost an architect and was looking for a new one, note: they were not looking for an architect - they were looking for a stamp (big difference) - realized this in talking to them - when a GC tells you, "Ah man, I would never do anything to put you or your family in harms way" - RUN. Turned down big bucks.
Stamp doesn't touch ink - unless you are a % stake holder and fully insured.
skhampton: Nobody can tell you a specific amount of compensation for this - it's a matter of how much risk you're willing to assume. Even if you get an agreement that the firm will provide insurance indefinitely, what happens if that firm eventually goes out of business? What if a claim arises on one of their projects 20 years after they've ceased to exist? How old are you? What do you have to lose, now, and what could you stand to lose in the future?
Personally I wouldn't do it as an employee. Consider that it's not just an issue of a lawsuit arising on a project directly. If you stamp the drawings you become responsible in other ways too - for instance I've been subpoenaed a few times in cases having nothing to do with my work directly at all - for instance in land disputes, sometimes years after I had anything to do with the property, just because I'm the stamp on old drawings that are on record with the town or city or for some other reason are being used as exhibits. Do you want to open the possibility of being involved in that sort of thing long into the future, after you've left this firm? If so you'll need to figure out what that's worth to you.
^ Excellent post. Even if you get what seems like adequate indemnification, anything can happen when you get into litigation. When there's a lawsuit, everybody get an invitation to the party. The problem with you stamping drawings as an employee is that you don't have the independence of an outside professional. Sooner or later you're going to be pressured to sign things you aren't comfortable with under implied threat of losing your job.
I use Krylon workable fixative to seal drawings.
does anyone know how this is handled at Ea firms?
You'll be on the board of directors? Then do it. That's part of the gig. Most firms are corporations, which means everyone, including the big boss, is an employee. Yes, you are taking on some risk. AND??? Do you believe sitting on the board means you are just an employee?
Compensation: Stock in the firm since you'll be sharing the risk.
that kind of depends on the specific way the company is set up doesn't it mighty? i'm certainly not an expert on how to structure a business so if i'm off base let me know, but can't you have a neutered board of directors that's a title only, run by one or two people who pretty much sole proprietors?
stock can be a legitimate equity stake of course, and if that's the case then this could be a good deal for the OP
If you are not an owner, then you don't stamp. As was mentioned, many states require a certain percentage of the firm owners to be licensed architects.
How much are they paying you, extra, for the risk of stamping? If the answer is "you'll get your regular salary" I suggest you immediately quit and get a job somewhere else. Plenty of people are hiring. Otherwise, they need to buy you in, at the full partner level, complete with benefits. And, before you agree to that, you need to go over their books, with a professional, to determine if it's worth it to you - you may discover that they are insolvent or have serious risk (lawsuits) that you'll be "buying" into.
I agree with gruen. Do you really know how well this business is run?
^^”How much are they paying you, extra, for the risk of stamping?” That’s what he has been asking without any answers. Evidently no one else is doing it so they don’t know. My son does but made a play for job security as a first step, reasoning that once enough projects are stamped he can better evaluate the value, and then make a play for money if warranted.
If the employer has a corporate veil & pays for the appropriate insurance…what’s the “risk”? The only risk is torts/matters of wrongdoing that are rare and can be easily indemnified by written agreement and if the employer is providing and paying for all that…what is the OP’s “expense”? Tough to put a number on something that theoretically doesn’t cost you anything….think it has obvious value that should be exploited in some form, but I wouldn’t start with money. It isn’t a matter of “risk”; really, it’s more a matter of “value”.
It’s like trying to justify a fee based on “risk” (something that may never happen) vs. justifying it based on “value”, something that people understand and can benefit from.
Carrera, how does your son identify this value, and balance that with the possibility that he may not stay with the firm forever, or that the firm may cease to exist? The firm's insurance doesn't follow the stamp (your son), it follows the firm. Many states have no statute of repose for architects' negligence. What is the value that your son has placed on living with that responsibility?
Aluminate, Well given the size of the company it’s doubtful, but today who knows. Discussed this before and no one seems to be able/willing to wrap their head around it….just don’t own anything/hide the money.
If someone is killed nothing will help, but the chances of that are minuscule. The other 99.999% of the risk is just about money and if you don’t have any you are literally self-insured.
Late in my career I got dragged into law suit on a project that I didn’t even seal when I was at a firm…wasn’t even a partner in the firm, just the lead PM and I did about 50% of the drawings…law suits are like dragnets to give the lawyers license to dig into everybody’s personal affairs just to see who has the most money…they don’t waste their money chasing people with no money…funny thing was, other than the owner, I, at the time, had more money than anybody on the list, but when they realized they couldn’t find it, all of a sudden it was no longer my fault and I was dismissed from the case.
It’s not a matter of not doing right with people & being responsible, it’s a matter of defense, against the 90% of cases that no amount of insurance or paperwork can protect you against….the goal should be to become a penniless millionaire.
Interesting thread with a lot of good perspectives.
Slightly off-topic, but I think still relevant, I have a three person firm. We don't do any architecture, only concept design for urban design-scale projects. Our clients range from non-profits to neighborhood organizations to developers. Recently a number of our clients have wanted us to do more, including drawings that would require a stamp. I am not licensed and have no interest in licensure.
Recently an acquaintance approached us to join our firm. She is an incredibly talented designer and recently licensed. We don't have the projects currently to pay her a full salary, but if we started taking on a few of these architectural projects, I could bring her on to manage these projects and stamp the drawings, if necessary. (We would pay for all insurance to cover our/her liability.) Problem is while very talented, I don't think she is yet at an ownership level of maturity. She could be, soon even, but still I think it would take a few years. I really hate to miss out on hiring her, because talent like hers doesn't come around often. Any words of advice on how to approach this situation?
FYI our firm is currently set up as a single-member LLC.
It depends what state you're in. In some states architectural services can't be provided by a firm without a certain percentage of architect ownership - in various states the minimum ownership is 50%, 67%, 75%, 100%... sometimes it varies depending on the number of owners. Some states do not allow an LLC to provide architectural services at all.
When you say you'll pay for her insurance to cover your and her liability, are you prepared to continue to pay for her insurance if/when she leaves your firm? In some states her liability continues for the rest of her life. You need to talk to your insurer about whether it's even possible for your coverage to follow her or for you to provide coverage for her when she's not an employee.
If she's doesn't have "ownership maturity", is she mature and experienced enough to be the supervising/decision-making architect in the firm (which she has to be in order to legally stamp the drawings in most states)? In other words, she has to have the authority to make final and overriding decisions on anything she stamps. Are you comfortable with giving her that?
If she's doesn't have "ownership maturity", is she mature and experienced enough to be the supervising/decision-making architect in the firm (which she has to be in order to legally stamp the drawings in most states)?
It's a fair question. The types of projects we've been asked to do at this point are primarily small-scale interiors and renovations. While not licensed myself, I have over 10 years of experience on these (and much larger) types of projects through all phases of design/construction, but your point is well taken; it's a different situation when liability is at stake (part of the reason why I've avoided getting involved with architecture projects in the first place). Beyond my interest in hiring this employee, we are also getting pressure from our clients to do more design work for them. They want us to see projects through to completion. Up to this point, we've simply referred them to other designers, but I may be open to restructuring the practice to take on more. I think that's part of the larger question.
Carrera: I totally agree with what you say about making it as difficult as possible for a plaintiff's lawyer to find and get at your assets. The only caveat (as I'm sure you are well aware) is that if you have assets hidden and fail to disclose them under oath in a deposition, you can be found guilty of perjury. Ditto with moving the assets around in anticipation of a lawsuit, which can be considered a fraudulent conveyance. It's not foolproof. And if someone like your son is putting everything in the spouse's name, he sure better have a solid marriage.
^
#1 Moving assets in anticipation of an impending event is too late.
#2 The object is to never get to the deposition phase. Lawyers just don’t drill that deep (at first). Just getting things into a trust takes care of 90% of the problem, which isn’t really “hiding” its more “sheltering”.
There's still the issue of having past project come back as time-sucking ghosts. When I mentioned above about being subpoenaed, these have all been land use issues - they have nothing to do with my liability - it's just that I'm the stamp on drawings on file with the municipalities and I'm the one who presented at ancient planning, zoning, or DAC meetings - sometimes more than a decade ago. I get called as a witness in things that have zero to do with those projects directly - they're about new projects on or adjacent to properties where I worked on other projects ages ago. There are depositions and hearings and lawyer prep meetings - all taking time. Some of these things drag on for years. That's the risk one takes as a principal. But if you're an employee I can't see wanting those ties to past projects and firms forever.
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