Surety Bond Guarantee Program

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The Small Business Administration (SBA) Surety Bond Guarantee Program
Presented by: Michael Regan

Did you know that the SBA, the federal organization that assists small businesses, will guarantee bid, performance or payment bonds issued on behalf of a small business by a surety company?

The guarantee program was implemented in an effort to help small construction businesses grow and share in the construction dollars expended by the federal government. However, the progam is not limited to federal work. They will issue guarantees on contracts at the state, municipal and private levels too.

Surety companies are conservative by nature. They want to bond construction companies that they know will be successful. However, there are many good contractors who may have some roadblocks to getting surety bonding. It may be because they are relatively new or lacking in financial capital. In these instances the SBA, after performing their own due diligence, can agree to issue a 90% guarantee to the surety of the bonds they issue.

The SBA also offers a cost neutral effort. The “fees” charged the contractors for the guarantees cover the cost of administering the program and funding the cost of any guarantees that are paid out.

The program has been very helpful to small, inner city contractors who may have limited, if any, access to standard surety.

Pay Equity Law

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On August 1, 2016, Massachusetts Governor Charlie Baker signed legislation (S.B. 2119) aimed at eliminating gender-based pay discrimination.
Pursuant to the law, an employer may not discriminate in any way on the basis of gender in the payment of wages, including benefits or other compensation, or pay any person a salary or wage rate less than the rates paid to employees of a different gender for comparable work; provided, however, that variations in wages, including benefits or other compensation are not prohibited if based upon any of the following:

  • A bona fide system that rewards seniority with the employer (however, time spent on leave due to a pregnancy-related condition and protected parental, family, and medical leave may not reduce seniority).
  • A bona fide merit system.
  • A bona fide system that measures earnings by quantity or quality of production or sales.The geographic location in which a job is performed.
    • Education, training, or experience to the extent such factors are reasonably related to the particular job in question and consistent with business necessity.Travel, if the travel is a regular and necessary condition of the particular job.

Further, it is an unlawful practice for an employer to:

  • Require, as a condition of employment, that an employee refrain from inquiring about, discussing, or disclosing information about either the employee’s own wages, including benefits or other compensation, or about any other employee’s wages.
    • Screen job applicants based on their wage, including benefits or other compensation or salary histories, including by requiring that an applicant’s prior wages, including benefits or other compensation or salary history, satisfy minimum or maximum criteria; or request or require as a condition of being interviewed, or as a condition of continuing to be considered for an offer of employment, that an applicant disclose prior wages or salary history.
  • Seek the salary history of any prospective employee from any current or former employer. However, a prospective employee may provide written authorization to a prospective employer to confirm prior wages, including benefits or other compensation or salary history only after any offer of employment with compensation has been made to the prospective employee;
  • Discharge or in any other manner retaliate against any employee because the employee: ◦Opposed any act or practice made unlawful by this law;
  • Made or is about to make a complaint or has caused or is about to cause to be instituted any proceeding under this law;
    • Testified or is about to testify, assist or participate in any manner in an investigation or proceeding under this law; or
    • Disclosed the employee’s wages, benefits, or other compensation or has inquired about or discussed the wages of any other employee.

An employer may not contract with an employee to subvert the law. However, an employer may prohibit a human resources employee, or any other employee whose job responsibilities require access to other employees’ compensation information, from disclosing such information without prior written consent from the employee whose information is sought or requested, unless the compensation information is a public record.
Employers are required to post a notice in their workplaces notifying employees of their rights under the law.
The law goes into effect on July 1, 2018.

How to Burglar-Proof Your Air Conditioner

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Window air conditioning units can provide quick cooling to any room in a home, but they are also a target for burglars. Instead of just sliding the unit in, homeowners should take extra measures to protect the window. Once applied, the window will be fully operable during seasonal weather when the air conditioner is no longer needed. Some of the extra security measures can still be used on the windows when the air conditioning unit is no longer in place. Moreover, when your air conditioner is not well maintained, its parts become more prone to damage and can easily break with slight pressure. That is why it is critical to schedule AC maintenance on a regular basis. You could also choose to invest in AC maintenance agreements, which are essentially a contract between a homeowner and an HVAC contractor in which the contractor agrees to perform a list of services on your air conditioner a certain number of times (usually once or twice) per year for a set fee.

Other than that, here are a few pointers to keep in mind – Install an air conditioner bracket to the outside of the unit. The bracket not only supports the air conditioner, but it attaches to the bottom of the unit and the house, making it harder to move the air conditioner. Nevertheless, it might be a good idea to install an AC bracket while the AC installation expert (who you might have hired from companies offering AC installation in Port St Lucie, FL) is installing your appliance. This can ensure that both the brackets and the air conditioners are installed properly.
Anyway, if you are installing the bracket by yourself, add a sliding window lock to each side of the window frame. Depending on the type, the locks are bolted or screwed in. They prevent burglars from sliding the window up and down. Attach the lock into the frame just above the window. Tighten it securely.

Measure the length from the side of the unit to the wall. Purchase and attach a steel corner brace to each side of the air conditioner. Connect the other end to a secure section of the wall. Use screws or bolts to secure the brackets in place. This prevents thieves from pushing the air conditioner in or pulling it out. However, if you are not an expert in installing an AC bracket over a window air-conditioner, you may want to consider other options like a mini-split A/C system (learn more here “why you should consider installing a ductless mini-split“).

Coming back to brackets installation, screw-in plastic vent flaps directly to the window frame. If the air conditioner is smaller than the window, plastic vent flaps need to be pulled tightly to cover up the holes. This is a vulnerable spot for burglars. Use three or more screws to attach it directly to the window frame.

Install a small window sensor alarm. Magnetic controls set above the air conditioner will go off if the unit is moved or the window is opened. The high-pitched noise will alert anyone in the home and likely scare the burglar away.

Burglars will most often take the path of least resistance. It is important to add measures to prevent home break-ins and protect of your home.

Trusts Can Help Your Legacy Live On

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Discussing death with anyone is never a pleasant aspect of financial planning, but it’s certainly one of the most important. While no one likes to discuss his or her own mortality, many wonder how they’ll be remembered. Perhaps you want your legacy to live on through the work of a charity, or desire to bypass the probate that is associated with a will. Whatever the reason, a trust may be an excellent option to consider.

Trusts, simply put, are a way to transfer assets and property into one legal entity. One of the biggest benefits to a trust is that when properly established, probate court and legal costs associated with a will can be avoided. A trust provides greater protection than a will against legal action from anyone who is unhappy with the distribution of assets and decides to challenge it. Also, a will is a matter of public record, while a trust, when established properly, is not.

Many important uses of trusts do exist. Trusts can minimize possible conflict between heirs when an estate is being settled, set out how assets are distributed to beneficiaries, who inherits property, as well as who has the right to use it and under what conditions, and how and when money is disbursed for children or grandchildren’s educational expenses. A charitable trust is a popular way to transfer assets such as money, real estate, or art, and designate that they eventually be given to a specific organization. Trusts can also help manage your clients’ affairs if they become unable to do so. Many set up trusts to prepare for the possibility that they may become disabled or ill before their death, and thus unable to manage their assets properly.

Aside from a will, trusts provide additional options for making certain that a legacy lives on. Trusts can help manage property and assets and make sure they are distributed after death according to your wishes.

(Re)Gaining Employee Loyalty

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Position yourself for future growth

As the economy continues to improve, employee loyalty is on the decline. According to the recently released MetLife 9th Annual Study of Employee Benefits Trends, employee loyalty has declined year-over-year and how now reached a three-year low. Yet many employers may be caught unaware by this downward trend. Employer responses show they assume employees feel as loyal today as they did three years ago.

While employers of all sizes saw productivity gains over the past 12 months, proving that many were able to “do more with less,” this short-term gain may have come at the expense of employee loyalty. More than one-third (36%) of employees hope to work for a different employer in the next 12 months.

“Worker loyalty has been slowly ebbing over the last several years, and it is important that employers take action to turn the tide around. The short-term gains employers realized from greater productivity appear to be short-lived and now pose bottom-line challenges as key talent considers other employment opportunities that have arisen as a result of the improving economy,” said Anthony Nugent, executive vice president, U.S. Business, MetLife. “There is no doubt that the rebounding economy will bring more opportunities for employees, especially the high performers. A well-architected benefits offering will play an increasingly important role in retaining employees and positioning organizations for future growth.”

Benefits Build Loyalty

The Study found that employers’ top benefits objectives remain the same as last year: 1) controlling health and welfare benefit costs 2) retaining employees and 3) increasing employee productivity. However, declining employee loyalty indicates that, without careful evaluation, steps to achieve one objective may negate efforts in another area.

Helping your clients understand the factors motivating employee loyalty is key. While employers recognize that salary and wages are one of the most important drivers of employee loyalty, there is a significant lack of awareness of how other benefits are also driving loyalty. For example, 59% of surveyed employees said non-medical benefits such as dental, disability and life insurance are extremely important loyalty drivers, while only 37% of surveyed employers say the same.

* Flexibility and Choice: While nearly all workers were impacted by the recession, they were at different ages and stages of life when it hit. This is translating into workers having different priorities and views about what their benefits should include. Voluntary benefits can help address the diverse employee needs and increase the perceived value of the company’s benefits program. Flexibility and choice through voluntary benefits are a way to deliver personalized and customized benefits to drive loyalty while still managing the bottom line. Perhaps surprisingly, employees across the board highly value these benefits – in fact, nearly two-thirds (61%) of employees report that they value them as a way to obtain benefits that meet their personal needs.

* Communications and the Generations: While a third of employers in the Study said that changing employee communications is not a current priority, communicating effectively is related to improved benefits satisfaction. Among employees who said that their employer improved communications over the past year, 65% felt their employer was loyal to them, compared to 33% of employees overall. Leveraging social media and providing benefits information on mobile devices is one strategy for improving communications for younger employees. While employers seem slow in adoption, the Study found that 42% of Gen Y employees and 38% of Gen X employees would be interested in accessing and receiving benefits information through social networking sites. Similar percentages of Gen Y and Gen X employees are interested in having information available through mobile devices.

* Holistic Health/Financial Wellness: Since employee lifestyle choices contribute significantly to health care costs, disability costs and productivity, it is not surprising that the number of employers offering wellness programs continues to grow. Taking a holistic approach to employee health is a way to address financial health as well. The Study shows that employees who say they are not in control of their finances are more likely to report poor health. Employees are clamoring for help – 52% report being interested in receiving financial advice and guidance through the workplace, and this increases to 81% among those who acknowledge that financial concerns have impacted their workplace attendance or productivity.

* Retirement – Employees Need a Map and Directions: When it comes to retirement planning, both now and in the future, employees need both guidance and access to protection. Over 60% of Baby Boomers indicate they are behind in saving for retirement. The Study also found that approximately half of employees who are behind in saving for retirement are interested in their employer automatically enrolling them in a savings program such as 401(k). In addition, employees have expressed an interest in receiving some, or all, of their retirement income in the form of guaranteed income. However, only 15% of employers said they currently offer annuities.

Am I Protected from Identity Theft?

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Identity theft is a serious crime, and one that is increasing at an alarming rate. Victims should have some way of recovering their financial losses when it happens, but this type of theft is not covered by a basic homeowner’s insurance policy.

Identity theft coverage is available in most states as an optional endorsement on a homeowner’s insurance policy, and it is important to understand the benefit of purchasing this extra coverage.

Identity theft is the taking and using of your name and other personal information, including your home address, date of birth, credit card, and bank account details. If this information is stolen, a criminal can use your personal details to take out a bank loan, to withdraw money from your bank account, or to use your credit card.

More than three million Americans have recently experienced illegal use of their credit cards, according to a recent survey compiled by the US Federal Trade Commission.

Many victims of identity theft have seen unauthorized withdrawals from their personal bank account.

You may think your identity is secure if you shred all your bank statements and credit card receipts, and you take care never to reveal passwords or banking information, but it is relatively easy for a fraudster to obtain enough information about you to steal your identity, using the internet and offline.

Almost fifty percent of personal information used by identity thieves is taken from stolen laptops, lost memory sticks or other portable devices used to store data. A stolen passport, a driver’s license, or any personal documentation obtained by theft can be sold on, or used for fraudulent purposes.

Confidential information may also be gathered by fraudsters by making deceptive telephone calls or from establishing personal contact, by sending out fake emails, or using spyware that can be downloaded onto a computer when someone downloads a file, or opens an attachment in an email.

When your identity has been used fraudulently, it can take a lot of time and trouble for you
to prove that you are not personally responsible for any loans, debts, large financial transactions or serious crimes carried out by someone else using your identity.

While the fraud is being investigated, you will experience difficulties in obtaining a loan, getting a new credit card, or applying for a mortgage, until it is resolved.

There may be legal costs to be paid, or a loan may be necessary to cover your legal defense, and there will be additional expenses involved in replacing important documents. You may need to take unpaid leave from work during this process, resulting in further loss of earnings.

Having an identity theft endorsement on your Homeowners policy ensures that you and your family will be covered up to $15,000 for expenses incurred as the direct result of identity fraud.

Every year more people are becoming victims of identity theft, so it is well worth considering the benefits of paying the additional cost for identity theft coverage, as an endorsement on your homeowner’s insurance policy.

Homesite Home Insurance. (2009, March 5). Does My Homeowners Insurance Protect Me in the Case of Idenity Theft?

Concerned about your personal insurance coverage? At Cleary, our experienced Personal Lines department will work with you to evaluate your insurance needs, identify exposures, and create a customized insurance portfolio. Give us a call today at 617-723-0700

Insta-Brite Mobile Washing, Inc.

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Client Spotlight

Spring is the perfect time of the year to spotlight one of our long-term clients, Insta-Brite Mobile Washing, Inc.

For over 40 years, Insta-Brite Mobile Washing, Inc. has been distinguished as the premier provider of pressure washing and related cleaning services. They are focused on meeting their customers’ needs, including reliability, responsiveness, and consistent quality. Their clients highly recommend Insta-Brite and all agree on their exceptional service!

They are located in Whitman, Massachusetts, and operate a fleet of 16 mobile units which are operated by professionals dedicated to solving each of their customers’ unique facility, residential, kitchen, and fleet cleaning challenges.

Ocean Marine Insurance

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Presented by Michael Regan

The cousin to “inland” marine insurance is “ocean” marine insurance; which is insurance that protects goods and vessels in waterways and oceans around the world.

The following are examples of available coverages:

  • Hull insurance to cover loss to the vessel itself
  • Freight insurance to cover loss to cargo
  • Protection & Indemnity (P&I) which provides owners of vessels liability coverage for damage to property of others or bodily injury to others

Bluewater coverage is for ocean going risks and brown water coverage is for risks on lakes and rivers.

Some examples of commercial ocean marine risks are: cargo vessels, tug boats, marinas, and offshore drilling rigs.

An example of personal ocean marine risk is personal watercraft, including sailboats, yachts and wave runners.

Ocean marine insurance is an integral part of international trade. It is believed that the insuring of vessels and cargo began back with the Phoenicians around 100 BC.

The term “underwriter” began at a London coffehouse owned by Edward Lloyd. Individuals willing to insure vessels and cargo would write their names under the vessel’s name.
At Cleary, we will evaluate your business exposures and work with you to develop a comprehensive plan to safeguard your business. Give us a call today at 617-723-0700.

Fidelity Bond (ERISA) Vs. Fiduciary Liability Insurance

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Fidelity Bond (ERISA)

A fidelity bond protects a business against theft of its assets as a result of dishonest actions by employees. It does not cover the assets within a company’s retirement plan because plan assets are not the property of the company, but of the plan beneficiaries.

The Employment Retirement Income Security Act (ERISA) was put into place to safeguard employee retirement plans. Among other things, it requires the posting of an ERISA fidelity bond to protect the retirement plan from losses caused by fraudulent or dishonest acts by persons who handle the plan.

A plan must be bonded for no less than 10% of the amount of the plan funds. In most cases, the maximum ERISA bond required is $500,000 per plan, however higher limits are available. They are issued on a “blanket” basis, so everyone who handles the plan is covered.

Fiduciary Liability Insurance

Fiduciary liability insurance provides coverage for breaches of duty by ERISA plan fiduciaries. Fiduciaries are those responsible for operating and administering a retirement plan under ERISA. Some of these duties include: authority and management over plan assets, making high-quality prudent decisions, documenting and rendering investment advice over the plan’s assets. Unlike the fidelity bond, fiduciary liability insurance also offers fiduciaries protection of personal assets. Fiduciaries who breach their duties may be personally liable to make the plan whole for any losses caused by their breach, including lost opportunity and litigation costs. Fiduciary liability insurance can be purchased as part of an organizations management liability insurance program or on a stand-alone basis.

At Cleary, we will evaluate your business exposures and work with you to develop a comprehensive plan to safeguard your business. Give us a call today at 617-723-0700.

Planning for Aging Parents

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Watching a parent becoming increasingly dependent on others for the normal activities of daily life can be difficult. It can be even harder for the parent to admit needing help. Creating a plan for how your parent(s), family and parents’ medical professionals will handle that possible scenario can alleviate misunderstanding and confusion when a crisis arises.

Here are 5 tips to prepare for parents’ aging:

  1. Decide on a point of contact – one sibling/close relative should be in charge of communicating with doctors. This person should have a health care proxy for the parent.
  2. Find a family-friendly primary care physician. An elderly parent may receive care from multiple specialists. With your parents, decide on one doctor to be the primary medical resource. Make sure reports from specialists are sent to the primary care physician.
  3. Create a central storage place for vital documents, including medical records, Social Security number and health insurance policy information. Hard copies should be duplicated and stored in at least 2 fire- and water-proof locations. Digital imaging/storage services offer a convenient place to access files remotely.
  4. Nursing home costs continue to rise faster than inflation and can quickly deplete the parents’ assets. If the parents qualify for underwriting, purchasing a policy can help safe-guard your savings from the parents’ health-care expenses in the future.
  5. Discuss finances – the point of contact relative, or another relative equipped to deal with financial matters, should have a durable power of attorney. This person should know the location of key accounts and policies, and the names and phone numbers for key advisors.