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I N D U S T R Y I N S I G H T / J E R R Y M A V E L L I A A N D L O U I S S A L E R N O , E S Q .
Property Preservation Business Owners (PPBO)
hire independent contractors for a large percentage
of field services performed for government and
commercial contracts. ese contracts have strict
performance standards, which PPBOs must adhere
to in order to be deemed "in compliance." National
PPBOs service assets countrywide, therefore, it is
impossible for them to rely only on employees to
fulfill obligations under their contracts.
Invariably, conflict arises between PPBOs
and their independent contractors about
compensation, scheduling, the scope of work,
and efficiency of effort. It is not unheard of for
independent contractors to have opinions about
the way they are treated in the industry, and a
strong belief that the PPBOs are getting rich
on the backs of their work.
e Department of Labor, the IRS, and
state workforce agencies have been cracking
down on businesses that are believed to be
misclassifying employees as independent
contractors. e housing market is cyclical,
as evidenced during 2007–2009. As the crash
worsened and foreclosures increased tenfold,
PPBOs were flooded with work, requiring a
commitment to extraordinary measures just
to keep up with demand. During the crisis,
there was an explosion of new players in the
field, but this has since settled down with
consolidation and attrition in the industry.
As the inventory of foreclosed assets
have decreased, PPBOs have ventured into
new areas of revenue generation. Much has
changed in the area of property preservation
for PPBOs to survive in this new environment,
and we need to take our heads out of the sand
e gig economy is forcing the property
preservation industry to reexamine
regulations about independent contractors.
