Maryland Home Improvement Contractor (MHIC)

Key Concepts

Definitions and Scope (Subtitle 1)

• Home improvement = alteration, remodeling, repair, renovation, or replacement of a building used as a residence, including driveways, fences, porches, garages, and swimming pools. Excludes new construction and work on buildings with more than 4 units.
• The law applies to contractors performing work over $500 on residential property.
• Waiver prohibited: Homeowners cannot waive their rights under the Home Improvement Law — any such waiver is void.

Maryland Home Improvement Commission (Subtitle 2)

• The MHIC is a 9-member commission that licenses contractors, investigates complaints, and administers the Guaranty Fund.
• Commissioners serve staggered 4-year terms; meetings are open to the public.
• Commission has authority to adopt regulations, issue licenses, and impose penalties.

Licensing Requirements (Subtitle 3)

• A license is required before performing or selling home improvement work in Maryland.
• Applicants must demonstrate experience or education, pass an exam, carry general liability insurance (minimum $50,000 per occurrence), and pay required fees.
• Exemptions include: licensed electricians, plumbers, HVAC contractors (when working within their licensed trade), employees working for a licensed contractor, and material suppliers who don't install.
• Salesperson license: Anyone who sells home improvement contracts on behalf of a contractor must be separately licensed as a salesperson. Salespersons act as agents of the licensed contractor — the contractor is responsible for the salesperson's acts.

Key Concepts

Definition of a Door-to-Door Sale A door-to-door sale occurs when a seller solicits and completes a sale of goods or services of $25 or more at a location other than the seller's regular place of business (e.g., the buyer's home). Home improvement contracts sold this way fall under the Act.

Seller's Disclosure Obligations - At the time of initial contact, the seller must clearly identify themselves, the company they represent, and the purpose of the visit — before any sales presentation begins. - During the presentation, the seller must inform the buyer of their right to cancel.

Cancellation Rights and Timeframes - Standard buyer: 3 business days to cancel, beginning the day after the contract is signed. - Buyers age 65 or older: extended cancellation period of 7 business days. - Cancellation must be in writing and sent (postmark counts) within the applicable period.

Notice of Cancellation Form — Required Content The seller must provide two copies of a completed Notice of Cancellation form at the time of sale. The form must include: - The date of the transaction - The seller's name and address - A statement of the buyer's right to cancel - Instructions on how to cancel (send written notice to seller's address) - A statement that the buyer should keep one copy and send the other to cancel

Written Acknowledgment Requirement The buyer must sign a written acknowledgment confirming they received the Notice of Cancellation. This acknowledgment must be part of the contract or attached to it.

Key Concepts

Anti-Discrimination & Prohibited Interview Questions

Federal law (Title VII, ADEA, Equal Pay Act) prohibits discrimination based on race, sex, religion, national origin, age, and disability. Never ask about: age, disabilities, pregnancy, marital status, children, religious affiliation, sexual orientation, or ethnic background. Stick to questions about skills, work history, safety record, and job-related qualifications.

Hiring Minors — Prohibited Hazardous Tasks

The U.S. Department of Labor strictly regulates minors in construction. Prohibited tasks include: - Roofing operations - Excavation operations - Driving motor vehicles / outside helper on vehicles - Manufacturing brick, tile, and related products - Exposure to radioactive substances or ionizing radiation

Penalties for child labor violations: - Up to $11,000 per worker per violation - Up to $50,000 if violation causes death or serious injury - Up to $100,000 if willful/repeated and results in death or serious injury of anyone under 18 (penalty doubled) - Criminal fine up to $10,000 for willful violation; second conviction adds up to 6 months imprisonment

New Hire Reporting

Under PRWORA (1996), all new hires and rehires must be reported to the Maryland New Hire Registry within 20 days of hire, rehire, or return to work. - Penalties: $20 per employee not reported; $500 per offense if failure results from employer-employee conspiracy to withhold or falsify information. - Reporting methods: online (mdnewhire.com), mail, fax, or magnetic media (twice monthly, no more than 16 days apart for electronic filers).

Key Concepts

OSHA Standards Applicable to Construction

Three federal standards govern construction safety: - 29 CFR 1926 – Safety and Health Regulations for the Construction Industry - 29 CFR 1910 – Occupational Safety and Health Standards - 29 CFR 1904 – Recording and Reporting Occupational Injuries and Illnesses

Maryland operates under MOSH (Maryland Occupational Safety and Health), which must adopt standards identical to or "at least as effective as" federal OSHA. MOSH inspectors conduct worksite inspections and issue civil penalties; severe violations can lead to criminal prosecution.

OSHA Recordkeeping (29 CFR 1904)

Three required forms: - Form 300 – Log of Work-Related Injuries and Illnesses (running record throughout the year) - Form 300A – Summary of Work-Related Injuries and Illnesses (posted February 1–April 30 each year) - Form 301 – Injury and Illness Incident Report (completed within 7 days of each recordable incident)

OSHA Penalty Types and Amounts

Safety Data Sheets (SDS) and Hazard Communication

• SDS (formerly MSDS) must be available for all hazardous chemicals on the jobsite
• SDS follow a 16-section standardized format under OSHA's Hazard Communication Standard (HazCom)
• Employees must be trained on how to read and use SDS
• SDS must be readily accessible to employees during their shifts

Key Concepts

Bid Documents & Bid Package Requirements

A complete bid package includes: - Invitation to bid — overview, deadlines, general requirements - Bid instructions — how to complete and submit the bid - Bid forms — bid sheet, bid schedule, bidder's questionnaire, copy of contract - Supplements — property survey, soil analysis, etc.

Submitting incorrect or incomplete documents makes a bid non-responsive. Review all addenda (changes issued before bid due date) — each addendum becomes part of the bid documents and ultimately the contract.

Ethics in Bidding

Three prohibited practices (forbidden by some state statutes on public projects): - Bid Shopping — GC reveals original sub bids and solicits lower offers from other subs - Bid Peddling — Sub approaches GC after award to offer a lower price than originally submitted - Bid Rigging — Contractors collude to fix/predetermine the bid outcome

Estimating Framework

Before calculating costs, build a systematic framework: 1. Define project phases 2. List each task within each phase 3. List materials needed for each task

This structured approach prevents errors and omissions. A good estimate falls within 1%–2% of actual construction costs.

Quantity Take-Off Method

Estimate units of materials and labor for each individual task. After calculating base materials and labor, add: 1. Subcontractor fees 2. Labor burden 3. Project overhead costs 4. Project equipment 5. Contingencies 6. Allowances 7. Company overhead 8. Profit