I have an ethical question about a really large project I’m working on in the firm I work for. It's Design-Build working for the contractor. Project is ~50 million over budget due to a piss-poor cost estimate submitted by the contractor to their client at Design Development submittal, meaning that the contractor was approved to proceed with a design that was vastly more expensive than the client would otherwise have approved. Now the contractor's client has CDs and a cost for CDs that can’t be accounted for by any change that happened after DD. The contractor’s client is justifiably demanding that the cost be accounted for and they aren’t willing to pick up the truly massive change between DD and CDs that can’t be reasonably accounted for.
A major issue is that the project lead for the contractor didn’t originally price some really major items that have to be paid for to complete the work. One of these is an engineering discipline. The only qualified provider of this discipline they’ve spoken with gave them an astronomical sum. The contractors then asked us if we could provide this service and can perform it for any less. Our principals told them no.
It occurs to me that I could, on my own time and outside of my capacity for the firm, talk with some providers of this professional service who would gladly furnish me with the cost of a nice home as a finder’s fee were I to put them in contact with the contractor and they should get the work. This would benefit not only the provider of said professional service, but also the contractor, their client, and be mostly neutral for our firm but with the benefit that we are likely to actually see the project built, which we’d all like.
Is this ethically questionable? Our firm's code of conduct prohibits outside work that competes with the firm, and I don’t believe this meets that criteria. Nevertheless, it seems like if I was running a firm and found out that one of my employees did that without telling me it would creep me out a bit. I can't figure out who would actually be hurt by it, yet it feels a bit weird. Is this ethically wrong or is it just that, like many architects, I have a natural fear of actually making money?
I’d Especially love to hear from those who run their own practice. I truly value my job and my employers and would hate to do wrong by them.
Non Sequitur
Aug 3, 16 6:13 am
Where is this project located?
Volunteer
Aug 3, 16 6:52 am
You cannot be this stupid. What if the building develops a severe flaw because of the work the firm you recommended was substandard? They get sued, and because you recommended them and were paid for it, you get sued. And because you work for your firm that you like so much, your firm get sued as well. All parties to this goat screw of a project should be aware of any fees or charges. If there is a fee paid it should go to your firm to apportion fairly as they see fit.
Josh Mings
Aug 3, 16 8:45 am
If an estimate is wrong by $50 million, I wouldn't work with that contractor ever. Unless this is a billion dollar project, that is way outside the margin of error you'd want.
Donna Sink
Aug 3, 16 9:11 am
It's not a fear of making money. It's a realistic understanding of the liabilities and risks and potential nightmare that could come further down the road if you pursue this. You're not stupid to have concerns, you're smart.
You can suggest alternate engineers to your bosses, but don't pursue them on your own. As Josh said, this project sounds too far gone for it to be fixed without SOMEBODY getting screwed. Keep yourself as far from that screwing as possible!
If you can do so and maintain anonymity, it would be great and educational to hear updates on this project.
geezertect
Aug 3, 16 10:05 am
this project sounds too far gone for it to be fixed without SOMEBODY getting screwed
Exactly. This will undoubtedly end in litigation and somebody is going to get a real big hickey. You will end up not getting a dime of your finder's fee. Stay out of it.
mightyaa
Aug 3, 16 10:58 am
First things first. I also agree that what you are thinking isn't competing with your firm. They turned it away. (note; they did this for a reason because they may be trying to back away forseeing problems looming down the road).
You can definitely make introductions. I seriously doubt you'll get a large finders fee since that (at least around here) isn't how business is done. So I'm guessing all it will do is strengthen your network and get you invites to the club level seats for a game or two. Think of it this way; engineers will run about 1-2% of the construction cost and probably shoot for a 20% profit margin. If you think that is "house money" they'll toss your way, you are sadly mistaken.
Another.... if you ask for money to make introductions, you are going to be seen as a slimeball. That will negatively affect your network and you are hardly a business leader; just some employee. I'd recommend you put together a list of names, gauge their interest and pass them up to your boss. It'd be better to show leadership skills in your place of employment and make the impression there; it will pay off better in the long game since both the consultants you know and the folks signing your check will have a positive view of you.
Liability? Pretty much non-existent... this is marketing. Hard as hell to sue someone for introducing you to someone else. Where you might have it is if you represent this third party and misrepresent them; then problems occur. So avoid saying things like "they'll be able to get us back on budget" and so forth making promises you have zero control over.
mightyaa
Aug 3, 16 11:01 am
Oh.. and btw. Where you CAN get yourself into big trouble is distribution of a drawing set. You do not own those drawings at all. So never ever send out the drawings without getting authorization.
JeromeS
Aug 3, 16 11:24 am
From the NJ Statute
b) An architect shall not accept compensation for his or her services from more than one party on a project unless the circumstances are fully disclosed and agreed to in writing by all interested parties.
Your State may have something similar.
shellarchitect
Aug 3, 16 12:08 pm
agree with mightyaa, but quick question, engineers are generally not hard to find.... i assume there has to be a reason they aren't looking themselves? Is it a very specific and high risk project (tunneling?)
geezertect
Aug 3, 16 12:24 pm
One person's "finders fee" can sound like another person's bribe. Anywhere there are lawyers circling is a place to stay away from.
Non Sequitur
Aug 3, 16 12:54 pm
I am pretty sure I've seen fine print in my contracts against bribes.
David Cole, AIA
Aug 3, 16 12:54 pm
What others have said, especially JeromeS, Donna, and mightaa. This "finders fee" scenario sounds like the premise of a Coen Brothers movie.
geezertect
Aug 3, 16 1:56 pm
I always try to classify my bribes as "speaker's fees". It certainly has worked well for one prominent American political family.
chigurh
Aug 3, 16 2:44 pm
A consultant is going to give you a kick back of "the cost of a nice home" for a referral? Get the hell out of here - you will be lucky to get a jelly of the month club for Christmas.
proto
Aug 3, 16 2:55 pm
you people are lame!
garbage forcefield, you should totatlly go for it!
but you have to give a full accounting of it here afterwards. i'm eagerly awaiting your report of the outcome, and i'm sure it will give us much more to talk about than this speculative-dip-your-toe in bullshit
"shit or get off the pot!" I say
bowling_ball
Aug 4, 16 12:56 am
Kickbacks beyond a box seat at the local sports match, or a free yearly inspection of your air conditioner? GTFO. We're architects, not business people.
geezertect
Aug 4, 16 7:48 am
We're architects, not business people.
The understatement of the century.
gwharton
Aug 4, 16 1:07 pm
Sounds like the project is definitely headed for a lawsuit, so a hot potato. But I don't otherwise see a problem with getting a finders fee for putting together two groups who can help one another.
gruen
Aug 6, 16 10:53 am
Hard to believe that someone hasn't thought about getting a different consultant in for the job.
gruen
Aug 6, 16 10:53 am
Hard to believe that someone hasn't thought about getting a different consultant in for the job.
gruen
Aug 6, 16 10:53 am
Hard to believe that someone hasn't thought about getting a different consultant in for the job.
Aug 6, 16 2:16 pm
Anywhere there are lawyers circling is a place to stay away from.
Geezertect, that pretty much means all things architecture. (exempt & non-exempt)
geezertect
Aug 6, 16 7:19 pm
^ It pretty much means all things, period. Lawyers, like cockroaches, are a fact of life, but it's generally a good idea to stay away when a situation is obviously going south fast.
shellarchitect
Aug 7, 16 5:49 pm
Hard to believe indeed, I'm convinced that there is finding else going on. after all it's just not that hard to find a consultant. They tend to have websites.....
accesskb
Aug 7, 16 6:31 pm
Yeah.. Come on Archinect out of all places for advice. Should've hired an experienced and reliable cost consultant to start with.
I have an ethical question about a really large project I’m working on in the firm I work for. It's Design-Build working for the contractor. Project is ~50 million over budget due to a piss-poor cost estimate submitted by the contractor to their client at Design Development submittal, meaning that the contractor was approved to proceed with a design that was vastly more expensive than the client would otherwise have approved. Now the contractor's client has CDs and a cost for CDs that can’t be accounted for by any change that happened after DD. The contractor’s client is justifiably demanding that the cost be accounted for and they aren’t willing to pick up the truly massive change between DD and CDs that can’t be reasonably accounted for.
A major issue is that the project lead for the contractor didn’t originally price some really major items that have to be paid for to complete the work. One of these is an engineering discipline. The only qualified provider of this discipline they’ve spoken with gave them an astronomical sum. The contractors then asked us if we could provide this service and can perform it for any less. Our principals told them no.
It occurs to me that I could, on my own time and outside of my capacity for the firm, talk with some providers of this professional service who would gladly furnish me with the cost of a nice home as a finder’s fee were I to put them in contact with the contractor and they should get the work. This would benefit not only the provider of said professional service, but also the contractor, their client, and be mostly neutral for our firm but with the benefit that we are likely to actually see the project built, which we’d all like.
Is this ethically questionable? Our firm's code of conduct prohibits outside work that competes with the firm, and I don’t believe this meets that criteria. Nevertheless, it seems like if I was running a firm and found out that one of my employees did that without telling me it would creep me out a bit. I can't figure out who would actually be hurt by it, yet it feels a bit weird. Is this ethically wrong or is it just that, like many architects, I have a natural fear of actually making money?
I’d Especially love to hear from those who run their own practice. I truly value my job and my employers and would hate to do wrong by them.
Where is this project located?
You cannot be this stupid. What if the building develops a severe flaw because of the work the firm you recommended was substandard? They get sued, and because you recommended them and were paid for it, you get sued. And because you work for your firm that you like so much, your firm get sued as well. All parties to this goat screw of a project should be aware of any fees or charges. If there is a fee paid it should go to your firm to apportion fairly as they see fit.
If an estimate is wrong by $50 million, I wouldn't work with that contractor ever. Unless this is a billion dollar project, that is way outside the margin of error you'd want.
It's not a fear of making money. It's a realistic understanding of the liabilities and risks and potential nightmare that could come further down the road if you pursue this. You're not stupid to have concerns, you're smart.
You can suggest alternate engineers to your bosses, but don't pursue them on your own. As Josh said, this project sounds too far gone for it to be fixed without SOMEBODY getting screwed. Keep yourself as far from that screwing as possible!
If you can do so and maintain anonymity, it would be great and educational to hear updates on this project.
this project sounds too far gone for it to be fixed without SOMEBODY getting screwed
Exactly. This will undoubtedly end in litigation and somebody is going to get a real big hickey. You will end up not getting a dime of your finder's fee. Stay out of it.
First things first. I also agree that what you are thinking isn't competing with your firm. They turned it away. (note; they did this for a reason because they may be trying to back away forseeing problems looming down the road).
You can definitely make introductions. I seriously doubt you'll get a large finders fee since that (at least around here) isn't how business is done. So I'm guessing all it will do is strengthen your network and get you invites to the club level seats for a game or two. Think of it this way; engineers will run about 1-2% of the construction cost and probably shoot for a 20% profit margin. If you think that is "house money" they'll toss your way, you are sadly mistaken.
Another.... if you ask for money to make introductions, you are going to be seen as a slimeball. That will negatively affect your network and you are hardly a business leader; just some employee. I'd recommend you put together a list of names, gauge their interest and pass them up to your boss. It'd be better to show leadership skills in your place of employment and make the impression there; it will pay off better in the long game since both the consultants you know and the folks signing your check will have a positive view of you.
Liability? Pretty much non-existent... this is marketing. Hard as hell to sue someone for introducing you to someone else. Where you might have it is if you represent this third party and misrepresent them; then problems occur. So avoid saying things like "they'll be able to get us back on budget" and so forth making promises you have zero control over.
Oh.. and btw. Where you CAN get yourself into big trouble is distribution of a drawing set. You do not own those drawings at all. So never ever send out the drawings without getting authorization.
From the NJ Statute
b) An architect shall not accept compensation for his or her services from more than one party on a project unless the circumstances are fully disclosed and agreed to in writing by all interested parties.
Your State may have something similar.
agree with mightyaa, but quick question, engineers are generally not hard to find.... i assume there has to be a reason they aren't looking themselves? Is it a very specific and high risk project (tunneling?)
One person's "finders fee" can sound like another person's bribe. Anywhere there are lawyers circling is a place to stay away from.
I am pretty sure I've seen fine print in my contracts against bribes.
What others have said, especially JeromeS, Donna, and mightaa. This "finders fee" scenario sounds like the premise of a Coen Brothers movie.
I always try to classify my bribes as "speaker's fees". It certainly has worked well for one prominent American political family.
A consultant is going to give you a kick back of "the cost of a nice home" for a referral? Get the hell out of here - you will be lucky to get a jelly of the month club for Christmas.
you people are lame!
garbage forcefield, you should totatlly go for it!
but you have to give a full accounting of it here afterwards. i'm eagerly awaiting your report of the outcome, and i'm sure it will give us much more to talk about than this speculative-dip-your-toe in bullshit
"shit or get off the pot!" I say
Kickbacks beyond a box seat at the local sports match, or a free yearly inspection of your air conditioner? GTFO. We're architects, not business people.
We're architects, not business people.
The understatement of the century.
Sounds like the project is definitely headed for a lawsuit, so a hot potato. But I don't otherwise see a problem with getting a finders fee for putting together two groups who can help one another.
Hard to believe that someone hasn't thought about getting a different consultant in for the job.
Hard to believe that someone hasn't thought about getting a different consultant in for the job.
Hard to believe that someone hasn't thought about getting a different consultant in for the job.
Anywhere there are lawyers circling is a place to stay away from.
Geezertect, that pretty much means all things architecture. (exempt & non-exempt)
^ It pretty much means all things, period. Lawyers, like cockroaches, are a fact of life, but it's generally a good idea to stay away when a situation is obviously going south fast.
Hard to believe indeed, I'm convinced that there is finding else going on. after all it's just not that hard to find a consultant. They tend to have websites.....
Yeah.. Come on Archinect out of all places for advice. Should've hired an experienced and reliable cost consultant to start with.