Professional Liability/Risk Management Brief: Protecting Against Improper Reuse of Documents
Protecting Against Improper Reuse of Documents
Experience has taught us that it is important to protect design professionals against the improper use or reuse of documents by clients or other parties. We routinely recommend that ownership and use of documents issues be addressed in the professional services agreement. Most clients and design professionals do not understand the many property rights that exist in the instruments of service of a design professional. There are many possibilities that can be negotiated, including the transfer of copyrights, transfer of ownership of the instruments of service, and the creation of a license giving the client the right to use the documents for specific purposes.
There are many issues involved in allowing a client to reuse documents. Documents, as instruments of the design professional’s service, are not products. Allowing reuse on an uncontrolled basis may cause the documents to be treated as products generated by the design professional, and may cause product liability exposures to the original design professional. No design professional is insured against such product liability risks. Thus, it may also be necessary for disclaimer language to prevent the possibility of the application of product warranties or guarantees, such as the warranty of fitness for use or merchantability.
The concerns of design professionals over the ownership, use, and transfer of instruments of professional service seem to have intensified. Now, design professionals are faced with issues such as:
The use by contractors of CADD information never intended for contractor use;
The integration of CADD-based instruments of service into facilities management programs; and
The reuse of an electronic form of design documentation far beyond its original purpose or time of service.
The electronic transfer of information complicates the practice management considerations of a firm interested in both protecting its intellectual property and managing its professional liability risks. Special protections are appropriate when ever information is transferred, but it is especially important when CADD files are involved. It might be worthwhile to include a note on the documents or in the electronic information such as the following:
The delivery of this drawing should not be construed to provide an express warranty or guarantee to anyone that all dimensions and details are exact or to indicate that the use of this drawing implies the review and approval by the Design Professional of any future use. Any use of this information is at the sole risk and liability of the user.
We also suggest that when instruments of service are transferred, design professionals reserve the right to remove the professional seal and title block.
Design professionals provide their services within a business context. To a certain extent, that business context can be managed, and in many cases can become the basis for additional services. In the case of CADD files, for instance, such additional services may involve “delayering” the information, using the CADD information as the basis for a record set of documents, or otherwise adapting the information to meet the facilities management needs of a client.
While professional service firms see CADD as a tool to enhance the design process through better coordination of interprofessional services and through minimizing design conflicts, clients often see CADD simply as a way to produce documents that are fast, cheap, accurate, and reusable. Unrealistic client expectations have always been a problem; CADD use seems to exacerbate this and provide a whole new area of unknown risks.
© 2009, Victor O. Schinnerer & Company, Inc. Statements concerning legal matters should be understood to be general observations based solely on our experience as risk consultants and may not be relied upon as legal advice, which we are not authorized to provide. All such matters should be reviewed with a qualified advisor. Victor O. Schinnerer & Company Inc. is managing underwriter for the CNA/Schinnerer Professional Liability Insurance Program, commended by NSPE/PEPP since 1957.
Top 12 Steps Your Firm Should Take After Staff Reductions
Herbert M. Cannon, President of AEC Management Solutions Inc.
1. Reassure the Staff
The remaining staff is understandably upset and angry that their coworkers have been let go. Of course, they are also relieved that it didn’t happen to them. What they need right now is some reassurance that the reductions were not made with malice but with an eye toward preserving jobs and the company for the long-term. Younger staff who have experienced nothing but good times will need special attention.
2. Ask Employees for Cost-Saving Ideas
When business is good, overhead expenses tend to grow and fly under the radar of accountability. Your staff knows where the money is being wasted, so ask for their help. You might be surprised at their ideas and the sacrifices they are willing to make.
3. Change the Voice Mail
Make sure to immediately change the voice mail password of all terminated employees. On more than one occasion, I have connected to voice mails that said something along the lines of “I can't take your call because I have been laid-off.” Sometimes the voice mail was not that polite. Don’t let this happen to you.
4. Cancel the Cell Phone
If your employees have company cell phones, be sure to get them returned and cancel the plan. Even if there is a termination fee, you will generally save money in the long run by canceling.
5. Sell/Donate or Recycle
I am not sure if there is a market for used smart phones, but if there is, you can try to sell them. In the alternative, they can be donated to a worthy cause or at least recycled. Don’t let them sit there gathering dust.
6. Handle the Paperwork
Be sure to handle all of the paperwork immediately. Whether it is responding to an unemployment insurance claim or coordinating COBRA insurance, do it quickly and accurately. The departing employees have enough stress dealing being out of work. Do your best to make the transition as easy as possible.
7. Sell the Computers
Now that you have less staff, you are left with the question of what to do with all of the unused computer equipment. All too often, the computers stay where they are gathering dust or are relegated to the storage area only to be discarded several years later when they have no useful value. If there is no market to sell them, donate them to a worthy cause and take a tax deduction. Whether you sell or donate them, don’t forget to reformat the hard drive and remove all of the software applications.
8. Change the Passwords
It seems obvious that employee computer passwords need to be changed, but it is too important not too state it here. I know of several firms who did not handle this promptly and paid the price of missing files and other problems.
9. Reduce your Telephone Landlines
If your 50-person firm had 25 landlines and your staff has been reduced to 35, do you really need 25 landlines? Probably not—but it can be one of those hidden costs that is easily overlooked. Some firms can go on for years paying for lines that are not needed and never used.
10. Change the Locks and Alarm Codes
Once again, it seems obvious, but make sure you get it done. In the age of electronics, locks codes can be changed every day if need be. Key cards can be activated and deactivated at will.
11. Reduce your Software Subscriptions
Are your paying an annual subscription fee based in the number of licenses or employees? Many software firms have switched to this model in recent years. Now that you have fewer employees, you may be entitled to a reduced rate or need fewer licenses.
12. Reconfigure your Office and Sublease Space
During the boom years, many firms tried to squeeze 10 pounds of talent into 5 pounds of space. This overcrowding led to less a less than optimum working environment for many employees. Now that the layoffs have taken place, this is a great opportunity to reconfigure your seating assignments and provide a more pleasant and productive working environment for your remaining employees. You can also make desk space available for rental to freelancers and aspiring entrepreneurs.
Herbert M. Cannon, president of AEC Management Solutions Inc. and publisher of AEC Managing Partner newsletter, is a management consultant, seminar provider, and speaker exclusive to the A/E industry. He is available to speak at company meetings and conferences. For more information, contact Herb via e-mail or visit his Web site. [ return to top ]
Nominations Due April 30 for PEPP Awards
2009 Annual PEPP Awards
Has an engineering firm you know or work for faithfully stepped up to the plate, taking on positive initiatives to serve the public? Are you privy to an individual contributing significant energy, time, and hours, working hard to advance the engineering profession? If so, recognition for such heroic efforts is monumental, and it's not too late!
2009 PEPP Professional Development Award
Since 1960, NSPE has used this award to recognize engineering employers who have made significant contributions to the advancement and improvement of engineering practices. If you feel your firm, or a firm you are familiar with, is worthy of such recognition, please visit our Web site for an application and important information. SELF-NOMINATIONS ARE ENCOURAGED. Please consider this opportunity to recognize your firm's professional development. The deadline to submit nominations is April 30.
2008 PEPP Award
The PEPP Award is given annually to an individual who has made an outstanding contribution to the advancement and recognition of the role of private practice in serving the public interest. Any individual, other than a current PEPP officer or PEPP Awards Committee member, is eligible. Nominations for the PEPP Award may be made yourself or through your PEPP regional vice chair, state chair, or national staff. The deadline for nomination is April 30. Nomination forms can be downloaded here.
2009 PEPP Merit Award
The PEPP Merit Award is presented to PEPP committee members or chairs, PEPP members serving in liaison functions or on joint activities or, to any other PEPP member who has made significant contributions to the interest group. In addition, the employer of a PEPP Merit Award recipient is recognized for the support the consulting engineering firm has given to the profession through the activities of the PEPP Merit Award recipient. The PEPP Awards Committee, with the concurrence of the PEPP chair, may name as many PEPP Merit Award recipients as it feels are deserving of the honor. Nominations for the PEPP Merit Award may be made yourself or through your PEPP regional vice chair, state chair, or national staff. The deadline for nomination is April 30. Nomination forms can be downloaded here.
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NSPE Education for You and Your Firm
NSPE has put together an impressive series of Web seminars that will help professional engineers to expand their knowledge base and fulfill state registration board PDH requirements for PE license renewal. Don't Let Green Design Cause Red Ink (1.0 PDH)
Pricing is per site—the more individuals at a site, the lower your per person cost.
April 28, 12:30 p.m. – 1:30 p.m. (Eastern)
Speaker: Nahom Gebre, P.E., Risk Management Attorney, Victor O. Schinnerer & Co.
Description: Engineers must respond to society’s need for projects that meet present needs without compromising the ability of future generations to meet their own needs. But with increasing public emphasis on green design, engineers face significant exposures that challenge their professionalism and profitability. This session focuses on a realistic appraisal of emerging risks and discusses skills to manage them. Quiz provided at the end. Download registration information.
Ethics Forum (Part 3)
Meeting Ethical Challenges in Difficult Times—Keeping Financing and Marketing on Course in a Downturn (1.0 PDH)
May 6, Noon – 1:00 p.m. (Eastern) Download registration information.
A Sustainable Approach to Planning and Design (1.0 PDH)
May 13, 1:00 p.m. – 2:00 p.m. (Eastern)
Speakers: Michael Simpson, P.E., Senior Engineer, City of Los Angeles Department of Public Works; Paul Horton, Director of Sustainability, David Evans and Associates Inc.
Description: Have you been wondering how to make your projects more sustainable? Have your clients been asking for more sustainable planning and design? Paul Horton will provide an overview of the critical elements necessary to achieve a higher level of sustainability in projects. While we won't be able to make every project super green, we should nonetheless have a clear strategy (or approach) and a set of tools to allow us to make meaningful sustainable advances or improvements based on the specific situation and the current client conditions. Michael Simpson will discuss how the Los Angeles Unified School District practices integrating sustainability into new school construction. This presentation outlines a logical, sequential “approach” to integrating sustainability into projects. Quiz provided at the end. Download registration information.
Recruitment and Selection During Uncertain Times—Developing a Successful Strategy as an Employer (1.0 PDH)
May 20, Noon – 1:00 p.m. (Eastern)
Speaker: Barbara Irwin, Principal, HR Advisors Group LLC
Description: Participants attending this Web seminar will understand how to develop a successful strategy in determining the need to hire. Sourcing and screening, as well as the interviewing and selection process, will be discussed during this lively session. Download registration information.
Registration is now open for the Stevens-WebCampus Summer 2009 session. Choose from over 120 sections in project management, information systems, financial engineering, computer science, engineering, technology management, telecommunications management, pharmaceutical manufacturing, and more. Stevens is also very proud to announce the launch of a new online program in Service Management. You can view the list of courses available for Summer 2009 here.
Register now for the Summer 2009 WebCampus semester!
Classes start the week of May 18, 2009.
With over 120 instructor-led courses, the WebCampus program offers you a convenient and flexible way to earn an MBA in Technology Management or any of 17 Masters Degrees or over 50 Graduate Certificates completely online.
Offering maximum flexibility for professionals, you can access your WebCampus courses from home or while traveling, anytime, day or night. Online courses offer you the perfect balance of convenience and academic rigor, as they cover the same material and are conducted by the same faculty as Stevens conventional courses.
Detailed course and program descriptions, as well as admission information can be obtained at the WebCampus home page.
Students who are members of NSPE receive a 10% discount when they enroll in WebCampus courses.Students do not have to be accepted into a program in order to take graduate classes at Stevens. It is possible to take up to three (3) classes as a non-matriculating student while your application is under review. For more on this and if you have any further questions, please do not hesitate to contact the WebCampus Division at email@example.com or at 1-800-496-4935.
REGISTRATION IS OPEN! ENROLL NOW! STEVENS ONLINE CLASSES START THE WEEK OF May 18, 2009.
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HR Strategies for Difficult Economic Times
Barbara H. Irwin and Cara Bobchek, HR Advisors Group, LLC
In today’s economy, when many firms in the architecture and engineering fields are facing declining workloads, fewer prospects, and the reality of cost-cutting measures, firm leaders face difficult decisions. They want to know what their firms need to do and what they can reasonably ask and expect of their employees in order to make it through the tough times and best position their firms to capitalize on future opportunities, which may be limited compared to in days past. Here are some simple—and inexpensive—HR strategies that your firm can undertake
It’s always a challenge to keep employee morale and motivation high during difficult times, but it’s important to do so. This requires big-picture thinking, sensitivity, and empathy to the needs, wants, and concerns of your employees. When you must make a decision that will have a negative impact on employees—one, some, or all—be sure that you are doing so within a fully-informed context. For example, you might want to reconsider distributing bonuses in the short term if your firm is also facing layoffs. It’s important for employees to perceive that the leadership’s priorities are not in conflict; otherwise, employees could be confused by what they will surely see as a dichotomy and probably resent it. On the other hand, if you are able to reward employees, by all means do so. Don’t use the economy as an excuse to hold back—a small gesture is better than no gesture at all.
The recent example of the “Big Three” auto makers’ leaders traveling by private jet to ask the government for bailout money is a particularly egregious example of why perception is so important in this environment. If sacrifices need to be made, then they must be made at all levels, so that all employees feel that the firm’s management and staff are “in it together,” rather than an “us vs. them” attitude. Employees in consulting firms of all sizes tell us often that they value the “family” feeling of their firms’ culture. You want your employees to feel a part of that culture during good times as well as hard times.
Assess Your Position and Make a Plan to Move Forward
Some years ago, an industry study showed that firms that participate in strategic planning do better than firms that don’t—regardless of whether they carry through with their plans. If you haven’t been doing this regularly, your firm should take time now to evaluate your HR and employee management activities and identify where you could improve and be more effective or efficient. Then you can set goals for the future so that you can continue to move forward. For example, your incentive compensation plan may be due for revamping, or it may be time to have a key technical employee take on a training role for other employees.
Reevaluate Your “Needs” and “Wants”
Economic challenges don’t necessarily mean that you must or even should postpone expenditures for items or initiatives that you may otherwise have considered “nice to have” but not “necessary.” For example, you may have put off hiring a director of marketing because times were pretty good. You knew it would be a good idea to have a targeted and effective marketing program, but who had the time to worry about it? You were busy. Well, you may decide today that you must now expedite this hire—it’s no longer a “want,” but a necessity.
Similarly, now may be the time to provide or sponsor specific training for certain employees that will help your firm become more competitive in your current or desired markets, such as LEED accreditation or building information modeling.
Transform Sacrifices into Benefits
Although they are making great strides in this area, engineering and architecture firms have lagged behind other industries in finding beneficial ways to implement flexible schedules, telecommuting, and alternative employment arrangements. As attractive as these may be to various staff populations, it’s been difficult and, in some cases, simply not necessary to make these scenarios work for consulting firms. However, you may find that these kinds of flexible workplace arrangements may be exactly what your firm needs now in order to retain key employees, improve efficiency and productivity, and keep overhead expenses in check.
Instituting flexible workplace policies can be a win for the firm and for the employees, who will see this opportunity as a benefit, and having such a policy will set your firm apart from firms that don’t have one, which will help you in recruiting and retaining talent. In addition, it doesn’t have to be costly to put such a program into place. If you do so, you may find that this is one of the measures that your firm takes to cope with challenging times that ends up being a lasting and beneficial policy in the future.
Turn up the Dial on Ingenuity
You worked hard to recruit and retain your employees, and you’ve built a great team. Now more than ever, you need to tap their abilities to be creative and innovative and ask them for their best ideas on how to cut costs and be more efficient in the organization, improve service to clients, and provide more effective and sustainable—and therefore cost-effective—solutions.
Remember that sometimes the best ideas come from unexpected sources. Consider holding a contest at your firm, inviting all individuals or small teams to submit proposals for improvements or enhancements to any aspect of the firm’s business or practice. Invite one or two clients to sit with some of your technical and administrative leadership on a “jury” to evaluate these proposals, and reward the first-, second-, and third-place winners and a few honorable mentions for their good ideas. Then implement those good ideas.
Keep the Conversation Going
No matter what is going on with your firm and your markets, in good times and in difficult times, your employees want to know where they stand. As stressed as your managers may be with their responsibilities, make sure that they are continuing to take time to meet with their individual employees and staff groups regularly to discuss goals and performance issues, and don’t let your performance evaluation process languish, even if you won’t be increasing salaries during this period. It’s simply too important to sacrifice.
It’s also important to keep the conversation going in both directions. If you’re not sure about employees’ concerns, perceptions of new policies, issues related to workplace and projects, or just general morale, then ask them, and listen closely to and consider their responses. If your firm conducts regular firm-wide employee surveys, this will continue to be a great vehicle for feedback—although you’ll want to review and tweak the questions to make sure they are relevant. If you haven’t done such a survey, either ever or in awhile, now would be a great time to try one. You’ll learn a lot, and your employees will appreciate the forum.
If your firm is looking for ways to economize, chances are there are other firms that you know who are doing the exact same thing. You may find that it’s worth getting in touch with firms that are your partners, subconsultants, prime consultants, or peers to discuss ways in which you might share costs in order to, for example, bring in an important training module for both firms’ employees, such as in project management or leadership skills, or to be visible at a key industry event.
It’s simply a fact that no matter how difficult our circumstances may be, someone else is facing worse ones. You already know that building a strong community is conducive to building a strong firm, and you are probably involved in any number of opportunities to “give back” to the communities in which you live and work. Community service is more important now than ever, so be sure to encourage all of your employees to get involved and provide them opportunities to do so. Some firms set aside a certain number of hours per month for their employees to participate in community service activities.
There’s no way around it: Some good things and some unpleasant things will happen at your firm—and at all firms—in the coming months. Experts predict that the economy will continue to struggle and that engineering and architecture firms are likely to feel the effects of the downturn. One of the best things that you can do for and with your employees now is to be as candid as possible about what’s happening, why, and when.
For example, your firm may experience turnover due to some employees’ dissatisfaction with new policies or initiatives. When you are making such changes, you may wish to acknowledge that some may decide to leave the firm as a result. What is certain is that if the leadership of the firm asks employees for their help and effort through the tough times, employees are more willing to stay and fight for the success of the company.
It’s perfectly ok—and in fact a great idea—to ask your employees to be patient as the firm makes necessary changes. As a firm leader, you have the right to expect their patience and cooperation as long as you’ve been candid with them about what’s going on.
Each of us can look both within and outside of our organizations for great ideas to improve competitiveness. Your HR department or professional can and should play a key role in enhancing the positive impact of strategies such as these to position your firm to succeed today and in the future.
HR Advisors Group, LLC is a human resources consulting firm providing customized strategic solutions to HR needs in the Architectural, Engineering, Construction industry and in Nonprofit Organizations. Their professionals have worked with domestic, multi-national and international companies as well as with Nonprofit Foundations and Associations. With extensive experience as senior-level human resources executives, they have the background to meet the needs of organizations ranging from large established companies to small emerging businesses.[ return to top ]
EJCDC Documents Recorded Web Seminar Free for Members for a Limited-Time Only
Justin L. Weisberg, attorney at law, Arnstein & Lehr LLP, explains the standard form agreements for the popular EJCDC contract documents used in design and construction. Attendees will learn about the engineering and construction documents and review the traditional design–bid–build process relating to the engineering agreement, as well as the construction contract. Also discussed is the usefulness of these documents over other contract documents in the market places and some of the current uses of these documents in government and private practice.
Download the seminar.
PEC Members will receive an addition 10% discount on EJCDC documents through April 30. Use the discount code 0409PEMG.
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