Georgia Business & Law Exam (Residential and General Contractors)

Georgia Business & Law Exam (Residential and General Contractors)

Key Concepts

License classifications and scope (§ 43-41-2) - A contractor's license is required when the total value of the work or activity, or the compensation to be received, exceeds $2,500.00 (§ 43-41-2(9)). - Residential-basic contractor: contractor work relative to detached one-family and two-family residences and one-family townhouses not over three stories in height and their accessory buildings and structures (§ 43-41-2(10)). - Residential-light commercial contractor: all residential-basic work, plus multifamily and multiuse light commercial buildings and structures less than four stories in height and less than 25,000 square feet in aggregate interior floor space, except as otherwise provided; or preengineered steel buildings not exceeding 50,000 square feet of interior floor space (§ 43-41-2(11); Appendix E, Page E-3). - General contractor: services unlimited as to type of work, subject to financial limitations imposed by a subclassification created under § 43-41-5(b)(8) (§ 43-41-2(5)). - **General contractor…

Georgia Business & Law Exam

Key Concepts

Bid Documents (Page 7-1) - A competitive bid package often includes: an invitation to bid (brief overview, deadlines, general requirements); bid instructions; bid forms (bid sheet, bid schedule, bidder's questionnaire on experience/financial responsibility and capability, copy of the contract); and supplements (e.g., property survey, soil analysis). - A bidder can be found unresponsive if information is incorrectly submitted or omitted altogether. - If changes are made to a bid package before it is due, an addendum is issued. The addendum becomes part of the bid documents and, ultimately, part of the contract when awarded. Review all addenda to evaluate the impact on your bid. - If the bid is accepted, construction drawings and specifications become part of the contract package. If specifications conflict with applicable codes, follow the stricter of the two; codes are minimum requirements by law.

Georgia Business & Law Exam (Residential and General Contractors)

Key Concepts

Sole Proprietorship — Simplest ownership form; the owner bears personal liability for all actions undertaken in the name of the business. Disadvantages include unlimited personal liability, less available capital, and dissolution of the business upon the owner's death. Formation document: Doing Business As (DBA) filing. (Ch. 2 — Sole Proprietorships; Summary of Business Legal Structures)

Partnerships — "All owners in a general partnership have personal and unlimited liability for all actions undertaken in the name of the business, including all debts. Each partner is responsible for the acts of other partners when they act in the name of the business." Limited partners have no personal liability and are liable only for the previously agreed-upon contribution or investment. "If a general partner leaves the partnership or dies, the partnership dissolves and the assets of the partnership must be sold or distributed to first…

Key Concepts

Employer Identification Number (Page 15-1). The EIN is a 9-digit IRS number formatted 00-0000000, used on all items sent to the IRS and SSA. Obtain it by calling the Business and Specialty Tax Line at (800) 829-4933, faxing or mailing Form SS-4, or applying online at www.irs.gov. Only two entities do not need an EIN: sole proprietorships with no employees that file no excise or pension tax returns, and LLCs with a single owner where the owner will file employment tax returns — these owners use their Social Security Number as the taxpayer identification number. All other entities, including partnerships, must obtain an EIN.

Forms by entity type (Page 15-2). Sole proprietor: 1040 and Schedule C, 1040 and Schedule SE, 1040-ES, 941, 940 or 940-EZ. Partnership: 1065 (annual return of income). Partner (individual): 1040 and Schedule E, 1040 and Schedule SE, 1040-ES. Corporation: 1120 or 1120-A; S corporation: 1120S; 1120-W for estimated…

Georgia Business & Law Exam (Residential and General Contractors) — Labor Laws

Key Concepts

Fair Labor Standards Act (FLSA) — NASCLA Contractors Guide, Employee Management (Ch. 11) — FLSA section - Prescribes basic minimum wage and overtime pay standards; applies to employers with one or more employees. - Federal minimum wage increased to $7.25 per hour effective July 24, 2009. If a state rate differs from the federal rate, the employer must pay the higher of the two. - Minors under 20 years of age may be paid not less than $4.25 per hour during the first 90 consecutive calendar days of employment. Employers may not displace an employee to hire someone at the youth minimum wage. - A workweek is 168 hours during seven consecutive 24-hour periods. - Overtime: one-and-one-half times the regular rate after 40 hours in a workweek. Each workweek stands alone; an employer may not average two or more workweeks.…

Key Concepts

Scheduling process elements (Ch. 9 — Scheduling Process; Float Time) - Activity duration depends on size of the project, labor hours estimated, and length of time dedicated to the task each day. The guide's example: a task estimated at four hours with only two hours per day available = two working days. - Free float time = the amount of time an activity can be delayed without impacting the early start of the next activity. Total float time = the leeway in starting or completing an activity without delaying the project completion date. Activities with "zero float" are critical activities. - Contingency time is a buffer between tasks: more for tasks subject to weather delays, more for limited-access areas, less for standard work than custom work.

Key Concepts

Four required elements (Ch. 8, Required Contract Elements): offer and acceptance, consideration, competent parties, legal purpose. All four must be in effect to make a contract binding.

• Offer and acceptance (Ch. 8, Offer and Acceptance / Acceptance): A submitted estimate or bid is an offer. The time frame for acceptance "is typically 30 days, but it should be stated in the offer"; if no deadline is stated, the offer expires in a "reasonable time," which is up to court interpretation. Acceptance generally occurs by signing the offer. "A counteroffer is not considered acceptance. It is only when both parties agree to the contract terms that you obtain acceptance."
• Consideration (Ch. 8, Consideration): Both parties must give up something of value — typically the contractor provides services and the owner provides monetary compensation.
• Competent parties (Ch. 8, Competent Parties): Parties must be of sound mind. Courts may rule someone incompetent…

Key Concepts

• Risk assessment requires determining the probability of loss occurring and the consequences if the loss occurs (Page 4-1, Managing Risk chapter).
• All-risk builders' risk covers direct loss by perils not specifically excluded by the policy; construction must be in progress for coverage to exist. Named peril policies are narrower and specify the perils covered (typically fire and lightning) — Managing Risk chapter, Insurance section.
• AIA and AGC standard documents require purchase of all-risk coverage and replacement cost coverage, which replaces damaged property without any allowances or deductions, such as depreciation (Insurance section).
• Equipment floater is a type of inland marine insurance covering direct physical loss to mobile equipment while stored on premises, in transit, or at temporary locations or jobsites; normal wear and tear is generally not covered (Page 4-3).
• CGL covers four injury types: bodily injury "for individuals who are not employees," damage to property not…

Key Concepts

OSHA recordkeeping (Jobsite Safety and Environmental Factors chapter — OSHA Recordkeeping; GA 3rd ed., Ch. 12). - Every employer covered by OSHA with more than 10 employees must maintain three records: Form 300 (injury/illness log), Form 300A (annual summary), Form 301 (individual incident report). - Form 300A must be conspicuously posted by February 1 and kept in place until at least April 30 following the year covered by the form. - A work-related fatality must be reported orally to the nearest OSHA Area Office within eight (8) hours. (Under 29 CFR 1904.39, in-patient hospitalizations, amputations, or loss of an eye are reported within 24 hours.) - Exposure records (employee exposure to toxic substances and harmful physical agents): 30 years. Medical records: duration of employment plus 30 years.