WHAT IS A SUBCONTRACTING AGREEMENT

A Subcontracting agreement is a written contract between the primary contractor and a person or company that has been hired to assist the contractor to ensure the efficient and timely completion of the master contract between the contractor and the company.

WHEN DO YOU NEED A SUBCONTRACTOR AGREEMENT?

A subcontractor agreement is needed whenever a contractor needs to engage the services of another person in order to meet the requirements of the master contract.  The contractor may not have the skills needed to complete a particular task or he or she may not be able to fulfil certain aspects of the contract due to time or venue constraints.

WHAT SHOULD BE INCLUDED IN A SUBCONTRACTING AGREEMENT?

Licensing information is a critical requirement in subcontractor agreements. The subcontractor agreement needs to have specific language stating that the subcontractor must have the required licensure to complete the work to which he will be assigned.

• A statement that explains that the master agreement between the company and the contractor has granted permission for the contractor to engage the services of a subcontractor.

• The names and pertinent information of the contractor, subcontractor and company.

• The terms, conditions and scope of the services to be provided by the subcontractor.

• The amount and frequency of the compensation for the work that the subcontractor will provide.

• Language that either requires or waives the indemnity insurance requirements.

• Specific language regarding confidentiality in particular: non-disclosure and non-compete clauses.

• Information on grounds for termination and dismissal.