Getting paid on construction projects can be challenging. First of all, getting paid in construction takes forever. One study ranks construction dead last in the time it takes to get paid compared to all other industries. According to another industry estimate, it takes a contractor an average of 73 days to get paid after they’ve submitted their payment application or invoice. And that’s just the average!
There is hope, however. Construction industry participants have access to powerful, legal tools that were created just to help them get paid the money they’ve earned for their work. These “tools” are actually rights – the right to file either a mechanics lien or a bond claim to remedy a payment issue on a construction project.
Unfortunately, these tools don’t universally apply to every participant, in every circumstance, in every state. Because these legal rights are so powerful, they are regulated by an almost countless number of rules and regulations that determine who has access to the rights, and when they can be used.
In this post, we wanted to take a closer look at one type of service business that’s somewhat related to the construction industry – furniture assemblers and installers – and answer the question of whether they have access to these rights if they have a payment issue.
Is the Install On a Construction Project?
Not to be funny or flippant, but for me, putting together furniture is it’s own special kind of hell. I hate it. Every miserable second of it. So, my hat goes off to the brave folks that have decided to make this grueling task their chosen line of work. I sleep a little better at night just knowing you’re out there!
But back to the task at hand…
While it’s true that mechanics liens and bond claims are universally available in all 50 states, in order to access these rights, you must be working on a construction project. More specifically, you must furnish labor, materials, or services that are used to construct, alter, repair, or improve an immovable structure during the course of a construction project.
So what does that mean for furniture installers? Well, there’s good and bad news. Let’s dispense with the bad news first.
The Bad News
If you order furniture for your office online and then hire a furniture installer to come put it together for you, that furniture installer will almost certainly not have a mechanics lien right. That’s because the install was not a part of a construction project. The office furniture is not a permanent improvement – it’s actually quite movable, and if you moved out of that office and into another, you could take the newly purchased office furniture with you. So, while your office may look a whole lot better with the new furniture, it’s not necessarily going to look better permanently. Hence, no lien rights for the installers that put it together.
The Good News
Now for the good news: let’s say that instead of office furniture, you convinced your office landlord to order a brand new IKEA kitchen. And rather than do the installation himself, the landlord hired an IKEA installer to do it instead. In this scenario, I think the installer would be more likely to have lien rights. Installations of kitchen cabinets, counter tops and appliances are fixed to the building such that most states will consider the installation work eligible for mechanics lien rights. That’s because they become a permanent improvement to the property itself.
Free Resource to Help You Get Paid
Successfully navigating all of the rules, requirements, and deadlines associated with lien rights can be quite challenging. That’s why we’ve made our comprehensive collection of construction payment resources freely available to any and all construction participants since our earliest days in business.
If you have any questions or issues, please check out that ‘resources’ link above. Chances are you’ll find the answers you need. And if you need more help you can always talk to us. We’re here to help you get paid.