Subcontractor

What is a Subcontractor?

A subcontractor (or "sub") is a specialized contractor hired by a general contractor to perform specific portions of a construction project. They bring expertise in particular trades while the general contractor maintains overall project responsibility.

Subcontractors work under contract to the general contractor, not directly with the property owner.

Common Types of Subcontractors

Structural Trades

• Concrete contractors
• Framing carpenters
• Roofers
• Siding installers

Mechanical Trades

• Plumbers
• Electricians
• HVAC technicians
• Low-voltage installers

Finish Trades

• Drywall contractors
• Painters
• Flooring installers
• Cabinet makers

Specialty Services

• Excavation contractors
• Landscapers
• Insulation installers
• Waterproofing specialists

Benefits of Using Subcontractors

For General Contractors

Specialized Expertise: Access to skilled tradespeople in specific areas.

Flexible Workforce: Scale labor up or down based on project needs.

Reduced Liability: Subcontractors carry their own insurance and licensing.

Cost Efficiency: No need to employ full-time specialists year-round.

For Property Owners

Quality Work: Specialists focused on their area of expertise.

Competitive Pricing: Subcontractors compete for work, driving down costs.

Faster Completion: Multiple trades can work simultaneously.

Warranty Coverage: Individual warranties from each specialty contractor.

Subcontractor Requirements

Proper Licensing: Valid licenses for their specific trade and location.

Insurance Coverage: General liability and workers' compensation insurance.

Bonding: Performance bonds for larger projects.

Tax Compliance: Current with tax obligations and worker classification.

Managing Subcontractors

Selection Process

• Verify licenses and insurance
• Check references from recent projects
• Evaluate work quality and reliability
• Compare pricing and schedules

Contract Essentials

• Clear scope of work definition
• Payment terms and schedule
• Timeline and completion dates
• Change order procedures
• Quality and safety standards

Payment Practices

Progress Payments: Pay based on completed work milestones.

Lien Waivers: Obtain waivers before releasing payments.

Retainage: Hold final 5-10% until project completion.

Documentation: Maintain records of all payments and work performed.

Common Challenges

Scheduling Conflicts: Coordinating multiple trades on tight timelines.

Quality Issues: Ensuring all work meets project standards.

Payment Disputes: Managing cash flow and payment timing.

Communication: Keeping all parties informed of changes and progress.