Hiring a Contractor

At some time most homeowners will hire someone for repairs or renovations. Even a homeowner experienced in home repairs may have to hire a contractor or renovator because of the size or level of difficulty of the job. This fact sheet will help you choose a contractor and work effectively and fairly with the contractor to achieve the results you desire.

Know Who to Hire

The contractor you hire should have the technical, business and interpersonal skills, the tools and the experience needed to do the job you want done. All these contractors can be found in the directory on KWContractor.com. Hire a contractor who has experience with projects similar to yours. This contractor will know what materials and techniques are needed for your work, and about problems with similar work including solutions. For large renovation projects you can hire a renovator to take charge of the whole job since many renovation contracting companies are set up to handle both design and renovation work. You may hire an architect or a designer to prepare your project's plans ready for permit application and then invite contractors or renovators to submit a quotation based on these plans. These professionals may also provide their services to oversee your project including obtaining all necessary permits, hiring a contractor(s) and the supervision of the work.

Discuss your project with a few potential contractors to get their advice and suggestions on how they would do the work. At the first meeting, some may give you a rough estimate of costs, depending on the project's scope and complexity. The first meeting is usually more to get to know the contractor and the contractor's work. Unless you have been able to check out the contractor ahead of time you should not sign anything or pay anything at this stage.

Questions to Ask

You want to find out as much as you can, so ask a lot of questions, such as:

• How long have you been in business?
• What work are you, or your subcontractors, licensed to do, e.g., electrical, plumbing?
• What kind of work do you specialize in?
• Have you done a similar job before?
• Will you use your own crew for the work or will you subcontract all or part of the job?
• How would you handle a specific problem related to this project (e.g. installing kitchen cabinets on your sloping floor)?
• How will you deal with the health and energy efficiency aspects of the job?
• How and when do you clean up, particularly fine dust?
• What work schedule will you follow?
• What kind of warranty do you offer and what does it cover?
• Do you carry workers' compensation and liability insurance?
• Will you provide a written contract?
• Will you take out all required permits (e.g., building, plumbing, electrical)?

If a contractor doesn't seem to know much about the technical details of the job or doesn't want to talk about them, you may have the wrong contractor. Likewise, if the contractor plans to do the whole job alone, make sure he or she has all the necessary skills and qualifications. (Use the checklist below as a guide)

Be sure you can get along with the contractor. If you cannot communicate effectively with the contractor things can get very tense in a lengthy project. You want a contractor who will explain what's going on as the project takes shape, who will discuss problems reasonably and who will work with you to make the result as good as it can be. You also want someone who's willing and able to help you refine your plans where possible, resulting in a more desirable and cost-effective project. A contractor who is knowledgeable about the type of work you're doing should be able to suggest ways to get what you want and meet your budget.

The best proof of quality is satisfied customers. The contractors you decide to meet with should have references from at least three previous clients who have had similar work done. Don't accept the references at face value. Phone them and ask about their experience with the contractor and their trades' people and ask them if they were: satisfied with the quality of the work, if there were any problems, how informative the contractor was, how clean did they keep the work site, if the work was done on schedule, and if they would they hire the contractor again or recommend the company to friends or family.

Getting Estimates or Proposals

There are no hard and fast rules for the number of estimates you should get. Some consumers prefer to get a number of bids before making a decision. Others find that after the interview process, there is one contractor they strongly prefer and only ask that contractor to submit a formal written estimate or proposal. What matters is that you feel comfortable you have enough adequate information to make the right choice of contractor.

As a general rule, with the proper drawings and specifications, three estimates will usually provide sufficient information for you to make a decision. For a large project, it can take two to three weeks for a contractor to prepare an estimate. Ask the contractor to submit it in person so you can discuss the estimate with them. Compare the estimate carefully and make sure that everything you ask for is in the estimate. It should include everything that the contractor will have to do to complete the job.

Assume that anything not listed is not included in the price. Make sure the contractor provides you with a construction schedule.

Do not automatically choose the contractor who gives the lowest estimate. It may be unrealistically low. The contractor may not have understood the project, may be underestimating what it will take to complete the work, or simply trying to get a price advantage over the competitors. In any case, you could risk unexpected and additional costs, or you may end up with a job that leaves you unsatisfied.

In some cases, a contractor will give you a "fixed price" quotes. A fixed price includes all the materials, labour, equipment and fees, plus contingencies, overhead and profit. In some cases allowances are established for items, which you have yet to select, e.g., flooring, and light fixtures. If it is difficult to estimate just how much the job will cost for example, for an old house that might need extra work, you can use the "cost-plus method" for contracts. In a cost-plus contract, you pay the contractor the actual cost for labour, materials, equipment and a percentage for overhead and profit. Cost-plus contracts leave costs open-ended, so it's best to set a limit so costs don't get out of hand.

Working with your Contractor

Once the job is under way, you'll see a lot of your contractor and the crew. The job will go much better if there is mutual respect and you co-operate with them. Talk with the contractor, so you know what's going on and what might be needed from you.

In spite of a clear, detailed contract, disputes can, and occasionally do, arise for any number of reasons. Good communication can go a long way in settling any disagreements between you and your contractor. As a first step, you should sit down together to discuss the problem calmly and seek a solution that you both can live with comfortably. This is usually the fastest, least expensive and ultimately, most satisfactory approach.

Try to be reasonable. Don't overreact if something is wrong. Allow sufficient time for a response. As well, things the contractor can't control, like bad weather and backordered components, can delay the job, so leave a little leeway in your schedule for them.

As a last resort, and in cases where things are going so badly that the project seems unworkable, you have the option of canceling the contract. This is why it is wise to put a termination clause in the contract. You will likely have to pay to get out of the deal, so it is best to agree on the cancellation penalty before you start.

If you think that some of the work is not up to local building standards, report it in writing to the appropriate inspection department, with a copy to your contractor. If the work doesn't meet building code requirements, the contractor should have to correct it at his or her expense.

Consumer Protection Laws

There are several laws protecting consumers. Provincial and territorial consumer affairs or consumer relations departments usually administer consumer protection laws. They can help you resolve problems between you and your contractor. Sometimes a phone call is enough, but a letter outlining the problem (giving names, dates, addresses and details) is often required before any action can be taken.

The consumer protection authority may send a building inspector to examine the work. The inspector's report may be enough to settle the dispute. If not, the consumer protection office may provide mediation. The power of a government consumer protection office is a strong incentive for settlement. If it isn't and legal action is required, the consumer protection office will give you further advice and assistance.

The Better Business Bureau, a monitoring agency maintained by the business community, will also handle consumer complaints and mediate disputes and try to get a fair settlement.

If legal action is necessary, you may be able to take the contractor to small claims court without having to hire a lawyer or the complications and delays of a formal court case. Although small claims court is relaxed and informal, its decisions are binding. The size of the claim you can make depends on the province or territory where you live. Your local city hall can give you this information and direct you to the office that handles small claims cases.

About Insurance

It is important to make sure the contractor has workers' compensation and third-party liability insurance for all the people on the job and damage they may cause. Your local Home Builders' Association is a good source of information for what is standard in your area. Don't just take the contractor's word, ask to see a certificate and check to make sure it's current. Do not accept or assume any liability for the contractor or trades people.

As for your liability, your homeowner's insurance policy may cover you during a project done by a renovator but you should always advise your insurance provider of any renovation work ahead of time. However, if you're acting as your own general contractor and employing trades people, your policy won't automatically cover you. You'll have to ask your insurance company for temporary coverage, which will likely involve a small extra premium. Again, make sure any trades people you hire have their own insurance.