When to use a subcontractor in a construction project?

Subcontractor contracts are most common in construction projects, as the primary contractor will be hired by a company to handle the entire construction project, which includes hiring subcontractors for specific parts of the project. This type of arrangement can be used in any project beyond construction.

When to request a bid from a subcontractor?

Ideally, this is done when first requesting a bid from them. In addition to complying with the project’s necessary milestones, a subcontractor’s knowledge of working times helps contractors develop a complete and accurate project schedule. It’s also important to state these timeframes from a legal perspective.

Can a contractor hire a subcontractor without a Master Agreement?

Before a contractor hires any subcontractors, they should first be sure that the master agreement allows this practice. Sometimes the agreement will simply say that the client must be notified of when hiring subcontractors, while other times it is forbidden.

Can a marketing firm hire a subcontractor?

Once a contractor hires all of their subcontractors and lays out the agreements, the job can begin. Marketing firms use this setup as well. They will bid on a job, and once they get it, they will hire subcontractors to handle the design, writing, and editing.

When to hire a contractor as a subcontractor?

While a contractor might be willing and able to perform a large portion of the work, the client may be asking for things the contractor just can’t do. The contractor doesn’t walk away at this stage – they hire another contractor to do the work they’re not able to do themselves. This additional contractor is now a subcontractor on the project.

How to deal with a non-performing subcontractor?

The important thing is to stay proactive and keep an eye out for any indications that a sub is running into problems. This could be anything from poor time management, late deliveries, decreased workforce or slow payments to lower-tiered subs or suppliers.

What happens if a contractor terminates a subcontractor?

Contractors should also consult their management team before terminating because the consequences of improper termination are severe. Contractors may be liable for lost profits and lose their right to recover payments for work performed by replacement subcontractors, which means you could be paying double to get the work finished.