Glossary of Construction Industry Acronyms - Part I: AI Through GMP
The construction industry continues to experience a fast rate of change, having to adopt new technologies, different project delivery methods, emerging management techniques and more. Many of these changes seem to come with new acronyms…and that can lead to acronym overload.
In theory, a quick Google search would clear up any confusion. However, construction isn't the only industry that's become fond of acronyms, so finding a definition that doesn't pertain to an entirely different vertical can sometimes be challenging.
To help owners and other team members tasked with the construction of manufacturing and process facilities, here's a glossary of the most common acronyms used during project planning and development.
AI: ARTIFICIAL INTELLIGENCE
AI applications use computer algorithms that improve automatically—or "learn"—through experience. They consist of a range of items that support basic functions in business, including machine learning, deep learning and computer vision. AI will continue to gain traction in the construction industry, especially in design, safety, testing, estimating, robotics and equipment/machine operation. Investments in AI are already paying dividends for contractors in the form of improved efficiency, safety and quality.
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Angry like a boss: how to be ticked off at work and stay professional
There’s a fine art to showing anger in the workplace. Too much can get you fired. Not enough can lead to stalemate solutions—and more anger if the issues continue. Anger is a hard emotion to control and perhaps that’s why most of us try to avoid it entirely at work.
But being pissed off in the office is an inevitable reality. We are only human, after all. It’s simply a matter of time before a beloved coworker crosses your anger threshold. Instead of bottling up your hostility and willing it not to explode, learn how to restrain your emotions, direct your passion, and
use anger as a catalyst for change
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New Tax Law Tools to Add to Contractors’ Tool Belts
The first major tax overhaul in decades is now a reality and its provisions will impact the construction industry in positive and negative ways. Construction industry leaders need to work with their tax advisers to fully understand the law, assess their unique situations and make decisions in response that position their businesses for long-term success.
TAX CHANGES AND INCENTIVES FOR CAPITAL INVESTMENTS PRESENT OPPORTUNITIES
The law lowers the corporate tax rate from graduated rates of up to 35 percent to a flat rate of 21 percent. This rate also applies to personal service corporations such as architecture and engineering firms, which previously faced a 35 percent tax rate. Additionally, C corporations will no longer be subject to alternative minimum tax.
Many construction companies are pass-through entities—either S corporations or partnerships/LLCs. These companies will benefit from the new 20 percent deduction for qualified business income. This deduction impacts taxable income rather than adjusted gross income. Calculating the deduction is complicated, but the bottom line is that this provision does provide tax relief for many small businesses, as it lowers the effective top tax rate on business income from 39.6 percent to 29.6 percent.
Further, the law allows companies to expense 100 percent of the cost of new or used qualified property. This bonus depreciation will be phased out between 2023 and 2026. Additionally, Section 179 property can now be expensed up to $1 million. This deduction starts to phase out when capital expenditures exceed $2.5 million. Subject to limitations on certain types of property, contractors should be able to take a 100 percent deduction for capital investments between these two tax incentives, allowing them to immediately write off the costs of equipment and qualified building improvements.
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A Strong Company Foundation Starts With Employee Engagement
When people are asked to picture construction employees, what often comes to mind are hardworking, clock-in and clock-out, push-through-the-day professionals. Their level of dedication to and passion for their work are not typically considered.
However, a recent report by Quantum Workplace, “Engaging AEC Employees,” found nearly 73 percent of construction professionals identified as engaged—almost 7 percent more than the national average. As it turns out, the majority of construction employees have strong mental and emotional connections with their workplaces.
Employee engagement is a phrase frequently thrown around in the professional world, stemming from a variety of influencing factors. This, in turn, positively affects a company’s profitability, revenue, client experience, turnover rate, talent acquisition, employer brand and even workplace safety.
Although a high level of engagement should be celebrated, construction industry leaders also must proactively address threats, including the rapid shrinkage in the number of skilled workers, the overhaul of contract and building processes, and workers’ changing expectations.
The good news is that these obstacles are surmountable if construction leaders understand exactly what motivates their teams.
Following are three drivers of employee engagement in construction that need to be put into practice.
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Debunking Top Construction Employment Law Myths
Owning and operating a successful construction company requires general contractors and subcontractors to comply with many employment laws and become aware of many employment law myths, particularly relating to overtime and minimum wage laws. While failure to comply can be expensive, there are steps contractors can take to avoid repercussions.
OVERTIME
The federal overtime law applies to employers regardless of the number of employees. Moreover, employees cannot waive their right to overtime. In the unlikely event that a laborer, for example, signs a contract agreeing that he or she will not be paid overtime, that person can still sue for the unpaid overtime. In fact, employees sue employers for unpaid overtime or minimum wage violations more often than any other reason.
Many construction business owners wrongly assume that if an employee works overtime without advance approval, in violation of a written policy, they do not have to pay for it. This is not the case. If the company knows or has reason to know that the employee is working overtime, it is liable and must pay for that overtime. Disciplining the employee for violating the policy may be in order, but not paying is not an option.
In the overtime context, it is the employer’s obligation to keep and maintain accurate time records (a work schedule does not constitute an accurate time record). If any employee sues for overtime and the contractor does not have accurate time records, the law allows the employee to merely estimate the number of hours worked in the event of a lawsuit. Given how weather conditions alter crew schedules, it can be difficult to pin down the exact number. The law allows an employee to then simply state that he worked an average of “X” number of hours per week.
Moreover, if the employee recovers even one penny in unpaid overtime, the company more than likely will be required to pay double that amount as a penalty. The overtime law also requires the employer to pay the employee’s reasonable attorney’s fees if the employee wins. If the employer wins, those fees cannot be recouped.
Moreover, whether or not they are owners, individuals who have the authority to hire, fire, and set pay rates and/or work schedules can be held liable for unpaid overtime and minimum wages. Additionally, successor companies are often substituted in after the fact. So closing down the company or bankrupting it is not an effective solution.
MISCLASSIFICATION
Another problem area is misclassifying employees as exempt from the overtime laws, an issue that is not uncommon among the construction industry. Classifying employees as exempt does not guarantee that the law will see them as such. Paying an employee a salary or giving him the title of project manager does not mean the employee is not entitled to overtime. Being paid a salary simply changes how to calculate the overtime rate. The same goes for paying employees on a day rate. The fact that an employer pays a laborer a set amount per day or for a set number of hours has nothing to do with whether that employee is entitled to be paid overtime.
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Project BEST Construction Awards Gala
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Construction Job & Career Fair
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I
nteract with industry professionals
• Experience various trades in a hands-on setting
• Learn about the booming labor industry
• Explore opportunities for successful and lucrative careers
• Understand educational opportunities, including apprenticeship programs and local college courses
• Gain information regarding construction trades career options, entrance requirements, & wage progressions
WesBanco Arena 8:00am - 4:00pm
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Dust in the Wind: The Threat of Airborne Lead From Construction Sites
Of the many laws that surround the construction industry, one of the most problematic is not codified anywhere. It is the law of “Unintended Consequences.”
As the U.S. economy steams forward, urban renewal and construction are at the forefront of that recovery. Unfortunately, when old and dormant areas of cities and suburbs are demolished and cleared to make way for new projects, they often spread toxic contaminants contained within those old structures and existing soil. Chief among those hazards is lead. Thus, the noble objective of replacing blighted structures or fallow fields with new buildings can instead result in exposing surrounding neighborhoods to lead dust. Contractors should be aware of the growing threat and ways to minimize the liability exposure to construction companies and others.
Lead poisoning in humans is difficult to identify with regard to its origin, but in cities like Detroit, Chicago and New York, the rates of lead found in children is rising after several years of decline. Some studies link these elevated rates to demolition of old buildings in densely packed neighborhoods of these large urban areas. The culprit is often the lead paint that was widely used in the U.S. until the late 1970s. When older homes are demolished, the resulting dust may be distributed as far as 600 feet from the jobsite. Critics charge that “blight removal” programs funded by the federal government and several states are actually encouraging these aggressive demolition projects and the resulting contamination, but have failed to put in place proper safeguards.
In Portland, Ore., residents are so concerned about lead dust from construction sites that proposed legislation is working through Oregon’s statehouse to address perceived “loopholes” in demolition protocols. Specifically, while most state and federal regulations have procedures for remodeling older dwellings, there are no such regulations addressing the total demolition of existing sites. Thus, if one wanted to repaint an older home or replace the windows it could trigger federal lead exposure requirements, but demolishing that same home does not.
The same is not true for asbestos, which has strict protocols for total demolition projects in nearly every jurisdiction. Even if contractors followed the specific requirements of most cities perfectly, some studies suggest methods would still cause lead dust to spread from the site. Stated differently, it’s not that municipalities and their contractors are failing to do things “by the book” with regard to lead dust, there simply is no book to follow.
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Ohio Valley Construction Employers Council
Ginny Favede, Executive Director
21 Armory Drive Wheeling West Virginia 26003
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