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When searching for a janitorial or hospitality provider, there are multiple decision factors businesses consider. Service costs are always at the forefront of the decision-making process. Companies concerned with the cheapest janitorial provider are likely to overlook the long-term costs of an uninsured provider.
Service providers will cut their costs by foregoing proper business insurance. This allows them to offer a more competitive price to prospective companies. Although illegal, this is a common practice in the commercial cleaning industry. However, skipping proper business insurance has grave consequences.
This blog will explore the dangerous, yet common, practice of partnering with an uninsured, illegal janitorial provider. Additionally, we will explore how businesses can select a properly insured service provider to safeguard their business in 2024.
1. The Financial Strain of Partnering with an Uninsured Janitorial Provider
Janitorial providers must have workers' compensation insurance to offer medical benefits to team members injured in work-related incidents. If your provider does not have proper insurance coverage, then your business could be responsible for covering the costs.
This presents a significant financial strain on your business's bottom line. Handling the stress of such costs will cause other operations of your business to suffer. This costly mistake does not even consider the potential legal consequences your business could suffer.
2. The Legal Liabilities of Partnering with the Wrong Provider
When selecting a janitorial provider, checking for proper insurance should be the first item on your checklist. Any provider that cannot affirmatively answer this question is a provider you do not want to partner with. Doing so will have legal repercussions.
California law requires all businesses to have workers' compensation liability insurance. Section 3700.5 of the California Labor Code makes failing to have workers' compensation coverage a criminal offense. Safeguard your business by partnering with a fully insured service provider.
A fully insured provider will shield your business from facing legal scrutiny. Additionally, it will allow you to remain focused on the key operations of your establishment.
3. Protecting Employee Welfare
Service providers operating illegally without workers' comp are deliberately neglecting the well-being of their employees. These same providers may be cutting corners in other areas such as employee wages and benefits. This increases the potential for employee rights and workplace safety issues.
Partnering with an illegal company makes the work environment less than ideal. This results in low employee satisfaction and high turnover. This directly puts your own business at risk of having unreliable services due to dissatisfied staff. If a service provider cannot care for its employees, how can you expect it to care for your property?
4. Preserving the Reputation of Your Business
When selecting your provider it's essential to conduct thorough due diligence before entering into any partnership. Getting involved with uninsured service providers comes with serious ethical and financial burdens. Knowingly partnering with an uninsured provider conveys a lack of integrity, thus damaging your reputation.
Selecting a fully insured janitorial service provider is the smart choice. You not only protect your business but also contribute to a better workplace environment.
5. Partnering with the Right Service Provider
