If you’ve handled construction disputes, chances are you’ve interacted with the American Arbitration Association (AAA). As one of the leading forums for alternative dispute resolution in the industry, the AAA is central to how many construction contracts manage conflict. According to a recently AAA announcment, it just got a lot easier to use.

Earlier this week, the AAA officially launched its redesigned website at www.adr.org, and the updates are worth noting, particularly for parties who custimarily deal with arbitration or mediation.

What’s New on the AAA Website?

The new site is faster, more intuitive, and designed to give users quick access to rules, forms, case data, and educational resources. Here are a few key improvements that stand out :

1. AI Tools and Technology Hub
AAA has consolidated its artificial intelligence offerings into a centralized hub. While this will continue to evolve, the emphasis on AI shows the organization’s commitment to streamlining arbitration and making dispute resolution more efficient—something construction pros will appreciate when timelines (and budgets) are tight.

2. Practice Area Resources at Your Fingertips
One of the most practical upgrades is the ability to access clauses, rules, and exclusive AAA data by practice area. For construction, that means faster access to the Construction Industry Arbitration Rules and Mediation Procedures, as well as sample contract clauses and administrative guides. This is a welcome change for anyone looking to draft or interpret ADR clauses quickly.

3. News & Insights Hub
This new section pulls together AAA’s thought leadership, including blog posts, podcasts, and legal updates. It’s a single resource to stay up to date with trends in arbitration and mediation, and may even serve as a helpful training tool for your in-house counsel or project management teams.

4. Featured Panelists
Construction law often hinges on selecting the right neutral. The new Featured Panelists section gives you a better way to learn about the arbitrators and mediators who serve on key AAA panels, including Construction, Judicial, Healthcare, and Mediation Panels.

5. Events Showcase
With arbitration becoming more prominent in construction disputes, education and training are more important than ever. The Events Showcase makes it easier to find and register for AAA-hosted webinars, seminars, and conferences focused on dispute resolution.

6. A Streamlined Experience
Last but not least, the AAA’s redesign is cleaner and easier to navigate. Whether you’re on your desktop or mobile device, the improved layout helps you get to what you need faster. No more digging through outdated pages to find a rule or filing requirement.

As a regular user of AAA website, I am excited to explore in more detail some of these changes. If you have any comments or concerns you want to share with AAA, please let me know. Also, if you have any questions about arbitration provisions or how to effectively resolve a construction dispute, you know where to find me.

When I draft and negotiate construction contracts—whether representing contractors, subcontractors, or owners—there’s always one provision that seems to get special attention: the waiver of consequential damages. For good reason. It can significantly impact both parties’ exposure if things go sideways on a project.

So what are “consequential damages,” and why do they matter? Consequential damages are losses that don’t flow directly from a breach, but arise as a secondary result of it. For an owner, this might include lost profits from project delays, loss of use or lost rental income. For a contractor, it might be loss of bonding capacity, lost business opportunities, or financing issues if the project goes off track.

This is why the AIA contracts and many custom forms include a “waiver of consequential damages” clause. Consider the industry standard provision from AIA A201-2017, Section 15.1.7, which reads:

“The Contractor and Owner waive Claims against each other for consequential damages arising out of or relating to this Contract. This mutual waiver includes: (1) damages incurred by the Owner for rental expenses, for losses of use, income, profit, financing, business and reputation, and for loss of management or employee productivity or of the services of such persons; and (2) damages incurred by the Contractor for principal office expenses including the compensation of personnel stationed there, for losses of financing, business and reputation, and for loss of profit except anticipated profit arising directly from the Work.”

Courts often enforce these waivers strictly, especially when they’re clearly worded. But what happens if your contract says nothing?

A recent New York appellate case, Vermillion v. The Roofing Guys, Inc., drives this point home. The plaintiff, a homeowner, hired a roofer for a simple re-roofing job. During the project, a storm caused significant water damage. The homeowner sued for breach of contract and attempted to introduce expert testimony to support a claim for consequential damages—claiming financing delays, increased mortgage rates, and higher material costs. But the contract said nothing about consequential damages.

The court refused to allow that claim. Why? Because under New York law (like most states), consequential damages can only be recovered if the parties specifically contemplated them at the time of contracting. The court found the agreement was a “bare bones” contract that didn’t mention these types of damages, and there was no evidence the parties ever discussed them. As a result, the homeowner was barred from presenting any evidence or testimony about consequential damages.

Here’s the lesson: don’t be silent on the issue of consequential damages. Whether you’re an owner or a contractor, address the risk head-on. If you want to preserve the right to recover these types of damages, or if you want to avoid the risk entirely, you need to say so in the contract.

Construction is already risky. Clear contract language can at least ensure you know what risks you’ve agreed to bear. Don’t leave it to the courts to guess.

In a move that’s turning heads on and off the jobsite, a Tennessee contractor has officially served a subcontractor with a default notice—via drone.

VoltaBuild Construction, a regional general contractor, used a DJI drone to deliver a 14-page default notice directly to Delayed Drywall & Finish at the jobsite. The envelope, marked “DEFAULT,” landed next to the subcontractor’s trailer and was promptly picked up by a foreman (who later posted a selfie with the drone on Instagram).

“Our contract said notice must be ‘received,’” said Anna Trane, counsel for VoltaBuild. “We just didn’t say how.”

VoltaBuild says the drone delivery saved over $120 in FedEx costs and shaved nearly two weeks off the dispute process. The decision followed two ignored certified letters and a stalled work schedule.

I recently spoke with Delayed Drywall’s attorney, Saul F. Render of the firm Render & Gone, who issued a fiery statement in response. “Whether it’s delivered by pigeon, drone, or flaming arrow, the real issue is our client wasn’t paid for Change Order #27. We intend to file a counterclaim for breach of contract and wrongful termination.”

Render also noted their client may pursue emotional damages from the “aggressive humming of the drone,” though admitted that part was “mostly for dramatic effect.”

While drone delivery isn’t yet standard practice in construction law, this case may open the door for more creative—and airborne—approaches to notice.

As of April 1, 2025, also known as April Fool’s Day, serving legal documents in the construction industry may officially be up in the air. (Got you! Happy April Fool’s Day!)

“This is the worst-case scenario to prepare for,” said Kristan Lund, a meteorologist with the National Weather Service, when talking about the recent wildfires in Los Angeles and the subsequent heavy rainfall.

The aftermath of debris, mudslides and flooding has left a path of devastation, destroying both commercial and residential properties, displacing thousands of residents, and making the reconstruction efforts challenging. The process of disaster recovery extends beyond immediate relief efforts; it involves the intricate planning, permitting, and execution of reconstruction projects.

Insurance Challenges and Coverage Issues

One of the primary concerns for affected property owners is whether their insurance policies cover post-fire mudslides and flooding. Typically, standard homeowners’ insurance and commercial property policies exclude coverage for floods and earth movement. However, under California’s “efficient proximate cause” doctrine, policyholders may still have a valid claim if the primary cause of the flooding or mudslide is determined to be the wildfire.

While Insurers are required to assess whether a wildfire was the efficient proximate cause of the subsequent damage, proving this connection can be complicated and may require expert assessments.

Debris Removal and Rebuilding Obstacles

In addition to navigating insurance claims, property owners must also address debris removal—a critical step before rebuilding can begin. For example, the Los Angeles County Debris Removal Program offers assistance at no cost to homeowners, ensuring that insurance benefits remain available for rebuilding rather than being exhausted on cleanup expenses. However, property owners who opt for private debris removal risk having these costs deducted from their insurance payout, reducing the funds available for reconstruction.

The challenges of rebuilding extend beyond debris removal. Material shortages, supply chain disruptions, and increased labor costs—compounded by potential new tariffs by the Trump Administration—may significantly drive up the price of reconstruction. Property owners may also need to adhere to updated building codes, which can add further costs. Understanding potential insurance benefits related to building code upgrades is crucial.

10 Steps to Maximize Insurance Recovery

To improve the likelihood of a full recovery, property owners should take the following steps:

  1. Review Your Policy Coverage – Understand what your homeowner or commercial propertyinsurance covers, particularly regarding post-wildfire flood and mudslide damage.
  2. File Claims Promptly – Insurance policies often have strict deadlines for claim filing. Report losses as soon as possible and document all communications.
  3. Request Advance Payments – Under California law, policyholders are entitled to advance payments for additional living expenses (ALE) and personal property without itemized lists.
  4. Assess Damage Thoroughly – Consider hiring a licensed public adjuster to assist in the preparation of your claim, particularly if you think your insurer’s appointed adjuster has undervalued your claim.
  5. Utilize City and County Debris Removal Programs – Enrolling in these type of programs may prevent debris removal costs from depleting insurance funds designated for rebuilding.
  6. Document Everything – Take photos and videos of all damage, keep receipts for temporary housing, and maintain detailed records of all interactions with insurers.
  7. Check for State and Federal Assistance – FEMA and state programs may offer additional financial aid for uninsured losses.
  8. Understand the Efficient Proximate Cause Doctrine – Work with legal and insurance professionals to consider whether wildfire may be the primary cause of later damage.
  9. Beware of Scams – In the aftermath of disasters, fraudulent contractors and adjusters prey on victims. Verify credentials before signing contracts.
  10. Consider Legal Assistance – If an insurer denies coverage or offers inadequate compensation, consulting a lawyer with experience in construction and insurance disputes may be necessary.

Recovering from the LA wildfires and subsequent mudslides presents a multi-faceted challenge for property owners. From navigating complex insurance claims to addressing debris removal and escalating construction costs, the road to rebuilding is filled with obstacles. By understanding their rights, taking proactive steps, and utilizing available resources, property owners can improve their chances of maximizing insurance recovery and restoring their properties.

*This post is co-authored with my law partner, Heather Wright, who specializes in insurance coverage matters, helping policyholders maximize insurance recovery under a variety of commercial insurance policies, including property, general liability, and professional liability.

I am sure that my kiddos would understand that title, so shoot me an email if you get it!

In a major win for open competition in federal contracting, the United States Court of Federal Claims ruled against the government’s mandate requiring Project Labor Agreements (PLAs) on large-scale federal construction projects. The decision, issued in MVL USA, Inc. et al. v. United States, (January 21, 2025) (pdf), found that the Biden Administration’s executive order forcing contractors to sign PLAs with labor unions violated the statutory principles of full and open competition under the Competition in Contracting Act (CICA).

Background: The PLA Mandate

PLAs have long been a contentious issue in federal construction. Over the last 30 years, executive orders have swung between prohibiting, encouraging, and now mandating their use on federal projects. President Biden’s Executive Order 14063 implemented in 2022 marked an unprecedented shift, requiring PLAs on all federal construction projects exceeding $35 million. This mandate was formally implemented in 2024 by the Federal Acquisition Regulation (FAR) Council, which directed agencies to include PLA requirements in all relevant solicitations—regardless of whether market research supported their use.

The Legal Challenge

A coalition of twelve major construction firms challenged the legality of the PLA mandate, arguing that it stifled competition, increased costs, and lacked statutory authorization. The plaintiffs cited multiple instances where agencies’ own market research had determined that PLAs would be counterproductive—leading to higher prices and reduced contractor interest—yet agencies were still forced to include the PLA requirement due solely to the executive order.

For example:

  • In one project solicitation, initial research found that a PLA would deter contractor participation due to a local skilled labor shortage. Despite this, the agency reversed course and mandated a PLA.
  • In another case, an agency acknowledged that including a PLA requirement would increase project costs, yet moved forward with the requirement anyway.
  • Most strikingly, an agency deleted prior market research concluding that a PLA would reduce competition and inserted a PLA requirement simply because “the policy judgment [that] project labor agreements are generally good” had been made by the administration.

The Court’s Ruling: A Blow to PLA Mandates

The court ruled in favor of the contractors, declaring that the PLA mandate violated the requirement for “full and open competition” under CICA. Judge Holte found that federal agencies had arbitrarily and capriciously imposed PLAs, disregarding their own market analysis in favor of a blanket executive order policy.

So What? Here are some key takeaways from the decision:

  1. Agencies cannot ignore market realities. The decision reaffirmed that procurement regulations require agencies to promote competition and justify any limitations on bidding. The government failed to provide statutory justification for overriding market research that found PLAs would be harmful.
  2. Presidential policy cannot substitute for statutory authority. The ruling emphasized that the President’s executive order alone is not sufficient authority to override competitive bidding laws. If Congress had intended for PLAs to be required, it would have explicitly authorized them in procurement statutes.
  3. The FAR Council’s implementation of the mandate was arbitrary and capricious. By mandating PLAs in all large-scale projects without regard to actual procurement conditions, the government violated administrative law principles.

Implications for Federal Contractors

This decision is a significant victory for general contractors, subcontractors, and open-shop firms that would have been excluded from federal projects due to their unwillingness or inability to enter into union PLAs. It reinforces the importance of open competition and prevents agencies from using executive orders as a blanket justification for anti-competitive procurement policies.

The ruling could lead to further legal challenges against similar executive orders and procurement regulations that limit competition without clear statutory authority. For now, federal agencies will have to reconsider their approach to PLAs. And, as my kids would say, “No cap! … It is likely that we will see further litigation or legislative efforts on this issue.”

On January 21, 2025, President Trump signed an executive order titled “Ending Illegal Discrimination and Restoring Merit-Based Opportunity.” This sweeping action revoked Executive Order 11246, a policy that had guided federal contractors on affirmative action and anti-discrimination measures since 1965. The new directive eliminates requirements for federal contractors to maintain affirmative action programs, reshaping the landscape for companies working with the federal government.

The changes bring both challenges and opportunities, requiring contractors to act swiftly to remain compliant. There are actionable steps for federal contractors to take now and over the next 90 days, which can easily be understood by looking at the change in policy.

What Has Changed?

Under Executive Order 11246, federal contractors were required to: (1) prohibit discrimination based on race, color, religion, sex, sexual orientation, gender identity, or national origin; (2) implement affirmative action plans to address underrepresentation and promote workplace diversity; and (3) comply with audits conducted by the Office of Federal Contract Compliance Programs (OFCCP).

President Trump’s order eliminates these obligations and prohibits federal contractors from maintaining diversity, equity, and inclusion (DEI) programs that may be seen as violating anti-discrimination laws. Moving forward, federal contractors must:

  1. Certify compliance with all federal anti-discrimination laws.
  2. Remove DEI-related programs from their contracts and operations.
  3. Cease any efforts to balance workforce representation based on protected characteristics.

The changes will officially take effect on April 21, 2025, providing contractors a 90-day window to adjust their policies and practices.

Immediate Steps for Federal Contractors

Federal contractors need to act now to ensure compliance with the new regulations. Here’s a roadmap for navigating this transitional period, which includes a comprehensive policy audit and evalution of workforce roles:

  1. Review Affirmative Action Plans: Assess current affirmative action and DEI programs to identify elements that may violate the new directive.
  2. Update Employment Policies: Ensure hiring, promotion, and pay practices align strictly with anti-discrimination laws without referencing affirmative action goals.
  3. Remove DEI References: Eliminate references to DEI initiatives from internal and external communications, including contracts, employee handbooks, and training materials.
  4. Reassess DEI Roles: If your organization employs diversity officers or teams, redefine their roles to focus on broader compliance rather than DEI-specific objectives.
  5. Train HR and Legal Teams: Ensure HR and legal teams understand the new requirements and are equipped to handle questions or challenges related to the changes.

Tasks to Complete Within 90 Days

As the April 21, 2025 compliance deadline approaches, contractors should focus on these critical tasks:

  1. Impelement Policy Changes: Finalize updates to workplace policies and procedures to eliminate affirmative action-related elements. Communicate changes clearly to employees, ensuring they understand the rationale and new expectations.
  2. Update Contract Documents: Review and revise contracts with federal agencies to certify compliance with the new executive order. Remove clauses related to affirmative action and DEI from active contracts and proposals.
  3. Audit Workforce Data: Conduct a review of workforce demographics and historical affirmative action datae. Ensure no policies inadvertently create the appearance of DEI-related preferences or quotas.

Preparing for the Future of Federal Contracting

The revocation of Executive Order 11246 is a significant policy shift, but it may not be the final word on affirmative action and DEI requirements. Contractors should remain vigilant for potential legal challenges or further policy changes under future administrations. Some states maintain their own affirmative action or DEI requirements. Contractors operating in multiple jurisdictions should monitor state-level policies to avoid conflicts or non-compliance.

Construction contractors often have to deal with classification of employees, particularly those who work in the home office. Today’s guest post by Alexandra Shulman and Leah Lively addresses a recent court decision affecting the wage protection of employees under the the Fair Labor Standards Act (FLSA).

On November 15, 2024, a federal court in Texas vacated a U.S. Department of Labor (DOL) rule (the “2024 Rule”) that increased the minimum salary threshold for employees classified as exempt from overtime and minimum wage protections under the FLSA. The Texas court’s decision nullifies the 2024 Rule nationwide, effective immediately.

Exempt Employee Background
To be exempt from the FLSA minimum wage and overtime requirements an employee must generally meet the following three tests: (1) the salary basis test (the employee is paid a predetermined and fixed amount that is not subject to reduction because of variations in the amount of worked performed); (2) the salary level test (the amount of salary paid to the employee meets a minimum specified amount); and (3) the duties test (the employee must perform executive, administrative, or professional duties).

Under the 2024 Rule, the salary threshold for professional, administrative, and executive exemptions was set to increase from $684 per week ($35,568 annually) to $844 per week ($43,888 annually) on July 1, 2024. A second increase would have raised the salary amount to $1,128 per week ($58,656 annually) on January 1, 2025. Employers were faced with reclassifying exempt employees who did not meet the new minimum salary threshold or increasing their salaries to meet the new threshold.

The 2024 Rule also would increase the salary threshold for highly compensated employees (HCEs) as of July 1, 2024, from $107,432 (with at least $684 per week, paid on a salary or fee basis) to $132,964 (with at least $844 per week, paid on a salary or fee basis). A second increase would have raised the amount to $151,164 (including at least $1,128 per week, paid on a salary or fee basis) on January 1, 2025.

The Texas Lawsuit
In June 2024, following a legal challenge by the state of Texas, a federal district court in Texas temporarily blocked the 2024 Rule from taking effect for Texas state employees. Several business groups joined the lawsuit, seeking to vacate the 2024 Rule nationwide. The court consolidated these challenges and issued its decision setting aside and vacating the 2024 Rule—nationwide—on November 15, 2024.

In reaching its decision, the court determined that the DOL exceeded its authority, stating that the agency “does not have the authority to effectively displace the duties test with such a predominant salary-level test.” It added that this reasoning applied equally to the highly compensated employee exemption and the associated increases to the minimum compensation thresholds.

The court further concluded that the DOL lacked the authority to implement automatic adjustments to the required salary levels for executive, administrative, and professional employees, as well as the HCEs’ compensation amounts, on a three-year cycle.
What This Means for Employers

The Texas court’s decision vacates the 2024 Rule in its entirety. As a result, the compensation threshold will not increase on January 1, 2025, as planned, and the July 1, 2024, increases are invalidated. Effective immediately, the salary level test amount for executive, administrative and professional employees returns to $684 per week ($35,568 annually), and $107,432 annually (including at least $684 per week, paid on a salary or fee basis) for HCEs.

The DOL may choose to appeal the court’s decision, and an appeals court could either uphold or overturn the lower court’s ruling. This process could take place before President-Elect Trump assumes office. If the appeal is unresolved when President-Elect Trump takes office on January 20, 2025, the incoming administration is expected to withdraw the appeal, as the 2024 Rule is considered anti-business.

Employers who have already reclassified employees or increased employee compensation in response to the 2024 Rule may be contemplating whether to revert employee classifications or reduce salaries to align with prior DOL requirements. If you are considering reclassifying employees, lowering compensation, or deciding not to implement previously announced increases, it is advisable to consult with legal counsel to carefully evaluate your strategy and the potential legal implications.

Reminder of State Laws
Several states have their own criteria for determining exempt status, which may be more stringent or have their own salary threshold requirements—e.g., Alaska, California, Colorado, Maine, New York, and Washington. Employers must evaluate exempt status under both state and federal (and sometimes local) tests to ensure compliance with wage and hour laws.

If you have questions about the impact of this decision, make sure to contact Alexandra or Leah.

As a single dad of seven, resolving daily disputes is a common occurrence in my house. Whether it’s whose turn it is to pick the next Netflix stream or who gets the last Crumbl cookie, disagreements are inevitable. Fortunately for my kids, they don’t need to go to an arbitrator or judge to resolve these battles. Instead, they have me, their dad, as the sole decision-maker—immediate, fair (at least in my mind), and no legal costs involved! But for construction industry players, the resolution process isn’t as simple.

In the world of construction, disputes often arise and the language in the parties’ contract makes all the difference. A common challenge is to decide whether disputes between the parties will be resolved by litigation or arbitration. As one contractor recently learned in a New Mexico Court of Appeals decision, the words matter!

In Atlas Electrical Construction Inc. v. Flintco LLC, a dispute arose between a subcontractor (Atlas) and a general contractor (Flintco) over work performed on a large renovation project at the Albuquerque International Sunport. The subcontract included a dispute resolution clause that gave Flintco the sole discretion to choose whether any disputes would be resolved through arbitration or litigation. When Atlas filed a breach of contract claim in court, Flintco invoked this clause and successfully moved to compel arbitration.

Atlas argued that the clause was unfair because it was one-sided—Flintco, the general contractor, had all the power to decide the method of dispute resolution, while Atlas, the subcontractor, had none. The appellate court agreed with Atlas, finding that the arbitration provision was “substantively unconscionable.” The court ruled that the clause was so one-sided it was unfair and unenforceable. The subcontractor had no say in whether a dispute would go to court or arbitration, and this imbalance tipped the scales too far in Flintco’s favor.

So what?  Here is the primary lesson learned from the Atlas decision—whether you are an owner/developer, contractor, subcontractor or supplier, take the time to review every provision of the contract.  Don’t skimp. Don’t get lazy. Don’t assume things will work out.  You see, words matter!

Even if you believe that the contract negotiation has gone your way, understand that a decision-make might come to a different conclusion down the road.  While I, as a father, can make quick decisions to keep the peace in my house of teenagers, construction industry players don’t always have that luxury. This recent court decision is a reminder of how important it is to carefully review and negotiate the terms of your contracts.

I recently blogged about the use of AI and ChatGBT in the construction industry. Today’s guest post by Alexandra Shulman and Leah Lively addresses the recent guidance by the USDOL on the issue of using AI when hiring in recruitment, which is applicable to those constructions who use AI in the recruitment process.

AI in hiring: About 80% of U.S. and almost all Fortune 500 companies use AI-powered hiring software. AI may be used to target online advertising for job opportunities and to match candidates to jobs on employment platforms (e.g., LinkedIn, Indeed). AI may also be used to reject or rank applicants using automated resume screening and chatbots based on knockout questions, keyword requirements, or specific qualifications or characteristics.

With the growing use of AI comes a growing concern by the government (and argument by plaintiffs) that AI tools present a risk of worsening workplace discrimination based on race, gender, disability, and other protected characteristics. AI tools are trained on vast amounts of data and make predictions based on patterns and correlations within that data. However, many of the tools used by employers are trained on data from the employer’s own workforce and previous hiring practices, which, it is argued, may reflect institutional and systemic biases already present in the organization.

The Department of Labor responds to AI: If your company uses (or is thinking of using) AI in hiring, you need to be aware of the U.S. Department of Labor’s (“DOL”) recently issued “AI & Inclusive Hiring Framework.” The Framework is designed to “help organizations advance their inclusive hiring policies and programs, specifically for people with disabilities, while managing the risks associated with deploying AI hiring technology.” The Framework was published by the Partnership on Employment & Accessible Technology, which is funded by the DOL’s Office of Disability Employment Policy.

The AI Framework includes ten focus areas designed to address five overarching themes:

  1. Advertising employment opportunities and recruiting inclusively. Employers utilizing AI in hiring should continue to consider the rights and user experiences of job seekers with disabilities and members of other protected classes.
  2. Impact of procuring AI hiring technology. Employers utilizing AI in hiring technology should consider its impact on their DEIA (diversity, equity, inclusion, and accessibility) initiatives.
  3. Providing reasonable accommodations to job seekers. Employers must continue to provide reasonable accommodations to applicants and employees.
  4. Selecting candidates and making employment offers responsibly. Utilizing AI in hiring does not absolve employers of the responsibility of ensuring that they are complying with applicable federal, state, and local laws in hiring.
  5. Incorporating human assistance and minimizing risk. Employers should develop human oversight policies to address possible AI errors.

What this means for employers. Employers must continue to be mindful of anti-discrimination laws as they begin to integrate AI into the workplace. Employers should take the time to evaluate their AI practices and ensure that proper safeguards are in place to identify and rectify any discriminatory impact. This can be done through:

  • Conducting AI audits. Employers need to know when and how AI is used in the hiring process. Employers should audit the AI tools and algorithms they use in hiring to identify potential bias or discrimination. This can be achieved by having third-party experts, like employment counsel, evaluate the data inputs and outputs.
  • Ongoing monitoring. AI hiring bias compliance cannot be a one-time effort. Companies must implement ongoing monitoring programs to regularly reassess their tools as models are updated and new data is incorporated. To ensure full transparency, feedback loops that provide detailed hiring outcomes are essential.
  • Do not forget the human factor. AI should not be allowed to make final hiring decisions autonomously, as its effectiveness depends on the quality of the data it processes. We recommend that companies equip their HR teams/hiring managers with technical knowledge of AI systems to better manage and evaluate their use.

If you have questions about using AI in the employment process, or would like additional information about compliance with the DOL’s new Framework, make sure to contact Alexandra or Leah.

Alexandra Shulman
    Leah Lively

    When Hurricane Helene struck North Carolina, it caused severe disruptions to construction projects across the state. Baxter International’s North Cove facility in Marion, N.C., was completely shut down after floodwaters damaged the site and bridges leading to it. Elsewhere, landslides and floods wiped out large sections of Interstate 40, making transportation of materials and equipment nearly impossible. Many contractors in western North Carolina found their projects halted, and their schedules thrown off by this force majeure event.

    In situations like these, contractors and subcontractor need a plan to mitigate the impact of such natural disasters on their projects. Here are five practical tips to help you secure time extensions and/or compensation for delays:

    1. Include a Robust Force Majeure Clause in Your Contract

    When disaster strikes, your contract is your first line of defense. A well-drafted force majeure clause can make the difference between bearing the costs yourself and getting an extension or compensation. The clause should clearly list specific events such as hurricanes, floods, and road closures as qualifying force majeure events.

    Make sure the clause also specifies what type of relief you are entitled to—whether it’s an extension of time, compensation for additional costs, or both. Without this clarity, owners may argue that delays due to weather or other external events don’t qualify for relief. As we saw with Hurricane Helene, road closures and site flooding can bring construction to a complete halt. A strong force majeure clause can help shift the risk of these delays from the contractor to the owner, ensuring you don’t suffer financially for something out of your control​.

    2. Provide Immediate Notice to the Owner

    When a force majeure event occurs, time is of the essence. Many contracts have a requirement for the contractor or subcontractor to give prompt notice to the owner as soon as it becomes clear that the event will impact the project timeline. This is often a strict requirement, and failure to provide timely notice can void your claim for additional time or costs.

    For example, if Hurricane Helene causes road closures that delay the delivery of materials, you need to inform the owner right away. This notice should be in writing and include as much detail as possible about how the event will affect your project. Timely notification not only keeps the project owner informed, but also helps to preserve your rights under the contract to seek an extension or compensation later on​.

    3. Keep Detailed Documentation

    After a force majeure event, the burden is often on the contractor to prove that the event caused the delays and that the contractor took reasonable steps to mitigate the impact. Documentation is key to making this case.

    Start by keeping detailed records of how the event affected your project. Take photos of the site conditions before and after the storm, save emails from subcontractors and suppliers about delayed shipments, and keep copies of any official announcements about road closures or weather conditions. This documentation will provide the evidence you need to support your claim for additional time or costs​.

    In addition to documenting external factors, make sure you also track your own efforts to minimize delays. For example, if you rerouted materials or brought in additional labor to catch up, keep a record of these actions. This will show the owner that you took reasonable steps to mitigate the delay, further strengthening your claim.

    4. Coordinate with Local Authorities and Agencies

    In major disasters like Hurricane Helene, local and state authorities often have critical information that can help you manage the impact on your project. For example, www.driveNC.gov provides lived updated information on road closures affected by the storms.

    Staying informed can help you plan around obstacles and demonstrate to the project owner that you are taking the necessary steps to minimize delays. In addition, these updates may provide you with valuable documentation to support your claim. For example, if road closures prevent the delivery of materials, documentation from the state and local agencies can help validate your request for additional time​.

    5. Consider Insurance Options

    While a well-drafted force majeure clause can help protect you from financial loss, depending on the size of the project and whether the owner/developer is foreign, there may be insurance coverage in some limited instances. According to IRMI, force majeure insurance is a type of insurance that can cover certain losses that occur when a project is delayed or halted due to an unforeseen event (i.e., fire, earthquake, war, revolution, flood, and epidemics).

    Force majeure insurance typically covers the costs of restarting a project after a natural disaster, as well as any losses resulting from the delay. In some cases, it may even provide coverage for increased material costs caused by supply chain disruptions—something that was a major issue after Hurricane Helene. In this is part of your insurance program, you can further protect your business from the financial impacts of a disaster​.

    By following these five tips, you can be better prepared to handle force majeure events and protect your construction projects from the financial consequences of delays. Whether it’s including a strong force majeure clause in your contracts or ensuring you have the right insurance, these steps will help you navigate the challenges that come with natural disasters like Hurricane Helene.