OH&S and Repairs & Maint to Common Areas

1. Hi Dudley 

OHS certificates 

I think Whale has answered this however I would like to reiterate the fact that your Strata Manager is required by law to ensure the trades they engage do meet the OHS requirements and have the required certifications. 

Whist it is not your responsibility to be checking tradesmen’s credentials, it is definitely a worthwhile means of checking that those who are responsible, are doing what they are supposed to be doing.  When you see someone working on common property, you can also contact the Strata Manager (SM) and ask them to confirm that a particular tradesman is appropriately qualified if you are unable to approach the tradesmen directly yourself.

Strata manager’s vs home tradesmen prices 

I also agree with Whales comments, however if I could phrase it is a bit differently, this might add to your understanding of the differences between strata and personal and give you some suggestions on the areas to focus on to improve things.  

The reason/s for SM’s trade’s prices often being higher than your personal trade’s prices can mainly be due one or more of the following:

1.Quality of Tradesman

SM’s prefer to use those with a higher quality level not only in their standard of workmanship but also in other areas such as OHS compliance, reliability, they need less supervision, higher technical expertise, speed of work, taking care not to interfere with the occupants or damage property, etc.  Bear in mind that SMs are spending other people’s money and this greater accountability on them.  If something goes wrong, the SM wears the responsibility. In the home situation, you are more in control and more likely to take a risk for a cost saving.  As with most things, a higher quality means a higher price as staff and overhead cost more. 

2. Competition for the work

I can’t make judgments for the whole strata management industry, but I have observed instances where some SM’s tend to minimise the practice of obtaining competitive quotation for maintenance work or, if they do, they use a limited pool of quoters.  There could be various reasons for this however, in defence of SMs, obtaining quotes does take time and with SMs usually under pressure to keep their fees down, they may not have allowed enough in their fee agreement for the level of quoting desirable.  For small jobs, the cost of quotations could exceed the savings therefore it might not be warranted.  For large jobs, net savings will be assured if quoted.  Note that these are generalizations and there would be many SMs who are providing an adequate level of competitive quotations for their maintenance work.

3.Corruption and concealed commissions

Any payments to SMs or tradesmen for favored treatment and that are concealed from the owners constitutes corrupt behavior and is illegal.  I suspect it occurs, however over the last 10 years being involved in Executive Committees, I have not witnessed it.  If it does occur, it will lead to higher prices as it all gets added onto the bill.

My suggestions to reduce trades’ prices are as follow:

• It is not worth trying to use a lower quality tradesman as in the long run it will cost you far more when things go wrong;
• It would be worthwhile pushing for greater amount of work that is quoted and from a broader pool of tradesmen.  I suggest your EC and SM agree on a procedure depending on the size of the jobs eg less than $1K – single quote; $1K to $5K – three quotes; more than $5K – three quotes with a written scope of work.  Ask to view their list of tradesmen and suggest others be included who you have had good experiences with.  Be aware though that the SM might request additional fees if not in the current agreement and this could be justified.
• The only way you can be sure there is no corrupt behavior is to be able to fully trust your SM and the best way initially is to ask if any concealed commissions are involved. Their answer and the way they answer it will give you an indication.  You might also be able to judge based on responses to questions about using other tradesmen and quoting.  If there is any suspicion, consider changing the SM as soon as you can and agree on a quoting procedure up front with the new SM. 

Make no mistake, if you are going to make improvements, it will involve time and effort on the EC’s part, so in some ways it is “hard”, but I do believe it is worth it. 

I would be interested in your feedback if the above information has been of help to you. 

Regards,

Rob T

Hi Dudley,

Being involved in several schemes over the past 20 years there is no problems with you arranging your own quotes and tradespeople. The strata manager usually checks the contractor’s details like licences and insurances I get them to write it all on the quote.

Unlike Rob T, I usually find that most Strata contractors are around 30 -50% more expensive and usually do low quality work. I was a builder so I have some knowledge.

Also strata contractors tend to ignore you once they have the job preferring to deal with the SM as they want to get in and out as quickly as possible, do the least amount of work possible and charge you as much as possible for the job.

Some advice for you before you gets quotes;

Have a very good and accurate job specification/requirement ready in writing. THIS WILL SAVE YOUR BACON IF PROBLEMS ARISE.

Check with an estimator how much you should be paying for the work.

For example recently i had a quote from the strata roofer to re-point our ridge capping. The quote was around $4000 . The going rate for re-pointing is around $25 l/m. I got the job done for $1600 and the work is exceptional.

Lastly and the most important thing to consider;

Never expect any thanks from other owners even if you save them heaps and get better work done.

Hi Dudley,

Regretfully in this game your Strata Manager is either your friend or foe. I have been through 2 block upgrades (all of which i initiated and managed)and although the outcomes are great, values and rents have increased dramatically, I get more praise from our neighbors than the owners!

In relation to the S/M gently let the strata manager know that you are the boss and pay his fees and if he makes your life difficult threaten to change him. Of course, you need to build your case with the other owners so they support you if push comes to shove but you must be aggressive to get this done. Some S/M’s tend to be quite salty and hard to crack.

If you can’t get his support then just starting making your own decisions and blame the SM if the others don’t like it. That way they will more happy to get rid of him when the time comes. Strata is a strategic game and you need to know how to play it to get results.

The S/M has no right to force you to use his contractors exclusively, but you need to understand that if the contractor you select goes pear shaped on you he will get the blame for “allowing” you to use your own contractor which is why many S/M’s don’t like it.

The other possibility is that he is getting some kind of “reward program” from his contractors, which can range from a case of beer to extensions on his  house. It is difficult to trace but it does go on.

Your SM will most likely use a service called Trade Monitor to verify the contractors licenses and insurances so you don’t need to do that yourself. Verification is around $80 per contractor and once verified you can keep using them.

Note that all jobs over $1000 in NSW now require a 2 page contract which you can download from Fair Trading.

Just remember, engaing your own contractors means you take all the risk and if your contractor turns out to be a moron, you will have to yell and scream at him and nobody else will give a damn or support you (infact they will blame you), so my advice is that unless you are saving several thousands or you know the contractor is reliable and good, don’t bother with it. It may not be worth the hassle and you wont get paid a dime for your efforts!