How to Find a Great Contractor to Work With
Communication and respect are the basis for any prosperous relationship; the relationship between the General Contractor and the Subcontractor is no exception. Communication should start with the contract and continue throughout the entire process should any changes occur. Respect is also an ongoing process that is reflected in the provisions of the contract and how business is handled by both parties throughout the project. Given that the relationship between the general contractor and subcontractor is solely contract based, the contract is the best place to start. The contract is a legally binding document that sets the tone for the entire project, ensures that the subcontractor gets paid, and lays out clearly the responsibilities of both parties. It is vital that these contracts are thorough and fair for both parties.
In order to ensure that the subcontractor creates a good working relationship with any general contractor, here are some tips for finding a GC and negotiating the contract:
Have a written contract
No work should ever be done on the part of the subcontractor that is not laid out in writing. This is asking for problems down the road when disagreements arise over what was the intended scope of the work.
Read the contract carefully
A contract is a binding legal document that should be carefully crafted and read before either parties sign. The subcontractor must thoroughly read the contract provided, ensure that liabilities are spread equally between both parties. If this is not the case, the subcontractor should try to revise the contract. If the general contractor does not agree to revise, it may be best for the subcontractor to pass on this project rather than signing a contract that will put them at risk of liability.
Include payment specifications in the contract
Sometimes general contractors will include “Pay-When-Paid” or “Pay-If-Paid” provisions in the contracts with subcontractors. “Pay-When-Paid” means that the GC is not responsible for paying the subcontractor until the owner pays him. “Pay-If-Paid” means that the GC may never pay the subcontractor if the owner never pays the GC. “Pay-if-Paid” provisions should be avoided at all costs. Rather, the contract should specify an exact number of days that the subcontractor must receive payment by.
Beware of indemnification clauses
Indemnification clauses hold the subcontractor liable for the mistakes and negligence of the general contractor or of other third parties that the subcontractor has no control over. Subcontractors should avoid these clauses and only assume liability for themselves and their team who they have control over.
The subcontractor should submit change orders promptly in order to receive fast feedback from the GC. In turn, the sub should not perform any additional work until it is laid out in writing. This will avoid disagreements down the road about the scope of the work and what the subcontractor will get paid for.
The relationship between the subcontractor and the general contractor does not have to be difficult. Some communication efforts and some mutual respect from both parties can go a long way and make projects a whole lot easier by avoiding disagreements and miscommunications.