Topic: Manager's Side Business Turning Apartments

What is everyone's policy for using a staff member's side business to clean, paint or turn apartments?

There is a manager who has started their own company that is a full-service apartment turn business.

The vacant apartment cleaning service is being used right now.

What do you think about that?

I frown - seems like a conflict of interest to me. I think the Manager should run his/her business and leave the position of Property Manager or be the Property Manager. I can just envision all kinds of problems with this arrangement.

One major point to consider.... if your manager is injured while working their side business, your company may still be liable for the workers comp claim since she is still an employee (although technically off-the-clock) and on property. You may run into other HR and legal issues with this arrangement, as well, but that's the first thing that popped into my head.

Are you requiring your manager/contractor to carry the same insurance & BWC as others contractors?
What is the potential for conflict if the company is slow paying an invoice or not satisfied with work quality? WHO is checking the quality of work...managers are usually responsible for holding contractors to task?

I think it is a bad idea. First of all, it creates the potential for others to see impropriety even when none exists. Also, even if things start smoothly, it would be very hard to end the relationship if they didn't work out.

Brent's reply is on target. In my company, in another area of the state, the services of cleaning and painting go to a vendor that is a long time maintenance person and his wife. The manager in that area, although normally empowered to fire a vendor for poor/non-performance is being blocked from getting rid of them. Add to this the wife doesn't speak English and relies on another employee of the company who has nothing to do with operations or management involved, further contributing to the chaos. Additionally, this maintenance person was taking time from his day, paid by the company, to assist his wife in the units. Most of this got squared away but it still left bad feelings because the maintenance person and his wife refused to understand the separation of maintenance person and cleaning vendor and the need to go by the contract and not their whim of the day.

Brent wrote:

I think it is a bad idea. First of all, it creates the potential for others to see impropriety even when none exists. Also, even if things start smoothly, it would be very hard to end the relationship if they didn't work out.

You are right on it, Brent!

This has created resentment from other staff members who feel the manager is spending too much time on office time taking care of this business.

They do not actually sit in the office with the manager, so it is just how they feel, not reality, and it is causing discord.

It is definitely a conflict of interest!

A lot depends here. I don't think it wise for an employee (manager)(maintenance person) (etc) to start his/her own business outside of the Property Management Company. That does not seem to be in the best interest of the company. Work for the Company, or work for yourself.

However---We ran an apartment complex, yet painted at another five (5) complexes all of the same PMC.
We did not consider it our own business, yet in a way it was. We bid the apartments painting jobs, including maintenance in some cases, and flooring in some cases. We did about 3 a week usually. We DID NOT do any cleaning at all. That was done by the apartment complex manager.

We stayed VERY busy, yet were able to still do a great job on our own apartment complex. The secret was the Professional Paint Sprayer and a well learned routine on the jobs. One paint price for the one bedroom and another for the two bedroom, and three bedroom units. Wall damages extra charge for repair.
All materials were charged out to the PMC for each job.

I would NOT have liked it as having my own company however.

Best Regards
Herb

Great to hear from you! Thanks! We are no longer using the manager's company. We have been instructed to do everything in-house until further notice.

I have to disagree. I think everyone, no matter what their career path, should have a "side hustle," of some sort. It's in their best interest of survival. Trust me, the company they work for isn't in business for the best interest of their employees, but for the owners of the company. I do think it's a bad idea to have a side business as a vendor for the company you work for as an employee. That's definitely a conflict of interest.

But having a side hustle is important, so when the real job slows down or heaven forbid, goes away, at least you have a small source of income while you find your next job.

At my last job, the company I worked for occasionally hired employees to do vendor flat-rate work, but they only paid employees half the vendor rates. Eventually the company stopped allowing it because some employees would do the side projects on hourly paid time and claim the flat rate too.

I have several side jobs. I sell books on Amazon, I sell collectibles on ebay. I am a notary. And occasionally I freelance on my days off to cover vacations for a few landlords I know. I don't have any time for these side projects anymore, but it's nice to know they are there when I need them.

One reason we have avoided having employees contract back is to prevent labor boards from thinking we are avoiding paying overtime, particularly if the employees who contract are hourly.
Another is that in the event of a conflict, you could lose a good employee AND a good contractor.
Have you ever heard, "No man/woman can serve 2 masters?" It would be really difficult to resolve a conflict objectively.
We have a written policy that prohibits it.