Is Doing Side Work Illegal? Why Doing Side Work is a Bad Idea

is doing side work illegal?

Is it okay to do side work if I’m employed by someone in that field already? Let’s talk about what side work is, if it’s illegal, and when it might be okay to do it.

Intro

In California, it’s illegal to perform your normal blue-collar construction jobs on the side.  This means jobs like plumbing, electrical, HVAC, carpentry, windows, roofing, and other handyman type jobs.  Performing those on the side is illegal if you’re collecting more than $500.  If you were looking for the answer to whether or not that side work is illegal, it is.

Building a Reputation

Just like so many other people who entered the trades, I thrived on any knowledge I could gain in my field to be as good as I could be.  I was just appreciative of having a job I could dependably go to and have work on a steady basis.  All I wanted to do was earn the respect of my peers and be considered someone customers would ask for, and managers would send to the tough jobs.

As people settle into their jobs though, they become complacent.  They start getting itchy and looking for more.  “I can do this!  I can change out that part on this air conditioner for less money than the company I work for and make way more than my hourly pay for doing it.”

What is Side Work?

Here’s what side work is.  Once, I was on a residential call and quoted the customer $275 for a part that only cost about $25 online.  They asked me if they bought the part, would I come back out after hours and install it for $100.

I’ve always been one who considers right and wrong.  I not only let the customer know I wouldn’t do it, but I let my boss know, so he could either address it with the customer himself or just leave it alone and chalk it up to knowing that there are people out there who will always try to get the cheapest deal.

It’s funny because that person knows it’s wrong to ask me to do the side work.  If he didn’t, do you think he’d call my boss up and ask him if it was okay for me to come back out after hours and install the part he found online for cheaper?  Probably not.

Thinking Ethically

Entering a world of doing side work on your own while you save enough to start your own business cuts your own throat, to an extent. It’s like tradesmen who knowingly buy stolen tools to use on their job site instead of going to the store or going online and paying legitimate prices for legitimate tools.  If you do this, don’t get angry when you start your own company someday and discover lowballers are undercutting your prices now that you have more expenses than they do.

Contractors have substantially more expenses than technicians who wait until they get off work to come back and do a job the customer didn’t want to pay for when they were on the clock.  A person doing this kind of side work, whether legitimately or not, has the same risks as a real contractor… not getting paid, fire, injury, lawsuit, warranty, etc.

Expenses

Contractors have many bills.  We have to carry general liability insurance.  My company has a $1,000,000 policy we must pay each month.  Before starting as a licensed contractor, I had to write the state license board a check for $15,000 for a bond.  Although we’re a small-to-mid-sized HVAC company, our monthly bills, including paying employees, top out in the tens of thousands of dollars. This is why we charge the prices we do.

Follow me for a second.   A very experienced contractor who sends their guys out into the field, on average, bills out their service techs for less than 50% of the actual time they’re on the clock.  The rest includes rent, payroll, administrative costs, attorneys, drive time, stocking up the warehouse, paperwork, weekly training sessions, running for parts, return visits that aren’t even charged to the customer, and a myriad of other expenses.

Consider the $30,000 service van you’re driving around in that’s only going to last five years and maybe be worth $5000 when the company goes to trade it in for your next van. It’s shocking if you think about how much it costs to roll a van to a service call or an installation.  There are even business owners themselves who don’t entirely understand that cost.

Common Decency

But getting back to it, I’m not saying doing a little work for family and close friends isn’t right, because no one is going to turn down family. Everyone’s got someone they know who can do the work; a buddy who’s a mechanic, an aunt who’s a seamstress, an uncle who’s a roofer. That’s not a person running some underground business. That’s just common decency.

I’ve gone over to my next-door neighbor’s house when I worked for someone else and replaced a bad capacitor on their AC.  Was that wrong?  Some would say yes, but as a contractor myself, I would say no. But there’s always going to be some line you shouldn’t cross.

But I will say this.  If you’re going to do side work, don’t use my tools, my parts, my equipment, my van, or my name and reputation.

Technically, if there’s any legal requirement to be a ‘contractor’ in your area and you don’t meet those requirements, there’s no legal requirement that a customer pays you for your work, even if you’ve completed it to their satisfaction.

Crossing the Line

Even if you have a contract signed by both parties, you’ll lose any legal attempt to collect. Take the customer to court? The court will simply deny your claim, as the courts can’t rule on an illegal act.  And operating without any of the required licenses, insurance, bonds, registration, etc. is also an illegal act.

That’s the line you’re crossing when you decide to take on that side work.

I know I’m not going to change the minds of the masses of side-jobbers out there.  Many think lowballing their bosses for one reason or another is okay. I’m all for healthy competition and real contractors keeping each other in check with pricing.

Weighing the Odds

Good contractors don’t suffer from a lack of work because of all the people doing side work. It’s simply the principle.  Contractors have worked for years building up their business.  Years spent finding employable technicians who can be insured and who carry out their duties safely, precisely, and professionally.

My point is to think about what you’re doing before you take on that side job.  Is it worth your job if you’re caught and fired?  Probably not.  Is it worth doing a little bit of side work while you’re waiting for your state license to process?  Or while you’re building savings to even get started?  Probably not.

Your Turn

Let me know what you think about his topic in the comments below.  Do you think it’s harmless, or are you not willing to cross that line to keep things legit?

Thanks for stopping by, and we’ll see you on the next blog post.

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