HVAC Residential Market / Training & Education

Working to Curb Unlicensed HVAC Contracting

Credibility of Evolving Industry Affected by Unlicensed Activity

June 16, 2014
Trans

While hiring an unlicensed HVAC contractor may present itself as a money-saving deal upfront, many homeowners experience a bevy of bad fortune through crooked craftsmanship, untrustworthy diagnosis, unreliable repairs, and more. These actions, and a number of other concerns, may quickly convert preconceived cash savings into an invaluable hassle.

“Individuals who work outside the laws and regulations are a scourge to this industry,” said Charlie McCrudden, senior vice president, government relations, ACCA. “They take advantage of lax enforcement of permitting rules, licensing requirements, and the Clean Air Act. Unfortunately, we’ll never know how pervasive the problem is, since it’s so difficult to keep track of how many individuals are posing as professional HVAC technicians.”

Contractor Impact

In a trade where reputation is everything, reputable contractors and associations are continuing to stress the importance of contractor licensing to homeowners and those operating without the proper licensing.

Rocco DiBenedetto, owner, All Air of South Dade, Homestead, Florida, is on the forefront of the issue. Since 2009, Miami-Dade County has ceased enforcement of code requirements for contractors. In response, DiBenedetto formed the Miami-Dade Contractors Alliance, which works to regain enforcement in a region where unlicensed workers are running amok.

“It’s destroyed our ability to be honest contractors,” DiBenedetto said. “We’re still honest and ethical, but we go to houses and they tell us we’re price gougers. We’re not, but nobody else charges the real price.”

DiBenedetto said it’s frequent to hear advertisements offering air conditioning systems for $1,800. “In Broward County, 20 minutes north of us, they have an active task force and issue hundreds of citations a month for unlicensed activity,” DiBenedetto said.

Although not every state requires a license, it’s critical for the overall credibility of contractors to gain one in states where licensing is required.

“The issue of state licensing re-
quires someone to show capability, to show experience,” said Paul Wadsworth, president, P.K. Wadsworth Heating and Cooling, Solon, Ohio. “To have a state license is important. It shows the individual has studied his craft and knows something. It’s not just some guy who decided he was going to slap a magnet on the side of a pickup truck and all of a sudden he’s a contractor.”

Steve Lauten, president, Total Air and Heat Co., Plano, Texas, said when he took the state licensing exam many years ago, he felt the questions were valid. “Now they’re being told to write questions so the person with the worst skill set can answer them. It seems they’re trying to make the playing field the same for everybody,” he said.

Lauten pointed out that licensing, though, isn’t the end-all, be-all to being considered an ethical, quality contractor. “I think consumers are getting smarter, but the thing I’d mention is that just because your guy has a license, it doesn’t mean he’s going to do the job the way it should be done,” he said. “In Texas, we’re required to pull permits any time we’re within an incorporated city. And I would say on 90 percent of the jobs we bid, our state’s licensed competitors aren’t pulling permits.”

Evolution is a Mystery

As the HVAC industry continues to evolve beyond heating and air and into things such as IAQ and home-performance improvements, the role of a licensed, knowledgeable contractor is becoming even more important, said Wade Mayfield, president, Thermal Services Inc., Omaha, Nebraska, and chairman of the board of North American Technician Excellence (NATE).

“Technicians don’t just deal with heating and or cooling, they manage people’s livelihoods,” Mayfield said. “Properly licensed and trained technicians not only service and clean the units, they mitigate health hazards that exist in the home from IAQ problems, such as mold, toxins, carbon monoxide, etc. We also must realize that heating and air systems account for 30-40 percent of a home’s energy usage, so properly trained technicians have the skill set necessary to properly install and service the units in a way that optimizes energy efficiency.”

As the industry works to get its message across to consumers, some are taking notice, McCrudden said.

“Consumers are savvier about contractors, thanks to online review sites and media ‘sting’ operations that single out the bad actors,” McCrudden said. “As a result, their expectations are higher. And homeowners no longer call a contractor just when there’s a problem. The energy-saving improvement programs that incentivize an energy audit or pay rebates for upgrades have more homeowners thinking about ways to increase their system performance while saving money.”

In areas such as where DiBenedetto operates, though, it’s becoming tougher and tougher for the consumer to figure out who is licensed and insured as each day goes by without enforcement.

“If you decided you wanted to eat organic apples and you see there’s one that’s $5 and another that’s $2, how the hell do you distinguish between what’s organic and what’s not?” asked DiBenedetto. “There are tons of trucks running around with fake numbers on them. Those might as well be lottery numbers. The police don’t even know what’s real and what’s not. That’s how bad it is.”

Mayfield noted the issue of enforcement can often be a Catch-22 for contractors, as the only path to combat unlicensed contractors is through regulation, he said.

“It’s really a double-edged sword for contractors,” Mayfield said. “Contractors resist regulation, but need regulation matched with enforcement to offset unlicensed contractors. Done correctly, regulation in this context will protect the health and wellbeing of the public and allow licensed contractors to serve their customers at a high level.”

Importance of Licensing

As the industry continues to evolve, the credibility of hiring a licensed contractor is of the utmost importance, Wadsworth said, noting consumers really have a lot of due diligence to do these days.

“When I entered this trade 40 years ago, it was a much simpler business,” Wadsworth said. “The equipment was much simpler, much more straightforward. But, today, you have to know building science, sophisticated controls techniques, and so much more. That comes with requirements. You have to know how to correctly apply the latest technologies.”

DiBenedetto said his integrity and desire to adequately serve the customer will keep him from following in the footsteps of his Miami-Dade peers. “I’m not going to ask a guy to come in and do a great job for a customer and then tell him I’m going to 1099 him and ask him to work under shady conditions,” he said.

McCrudden referred to those working without a license in areas when licensing is required as bottom feeders, stating they drag down the image of upstanding contractors who follow industry-recognized standards.

Lauten said adequate licensing and following proper protocol is a key component to retaining the industry’s credibility with consumers.

“You’ll hear a lot of people say licensing doesn’t mean anything. I disagree. If plumbers and electricians have to be licensed, then air conditioning contractors should be licensed, too. There should be something that holds contractors accountable to doing jobs the way they should be done.”

Publication date: 6/16/2014 

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