Subcontractors

A subcontractor is a person or company hired by a contractor to perform part of the work on a project. Subcontractors may specialize in a particular trade or service and can operate across industries such as construction, information technology, manufacturing, and professional services. They typically work under a subcontract agreement with the prime contractor, who has the primary contract with the client.

In most projects, the client contracts with a general or prime contractor who then subcontracts portions of the work to specialists. The subcontractor receives a defined scope of work, schedule, and performance criteria from the prime contractor. Subcontract work is often governed by flow-down clauses that carry forward applicable requirements from the main contract, including safety, quality, and regulatory standards.

Responsibilities include delivering the specified work on time and to quality standards, complying with applicable laws and safety regulations, and maintaining required insurance. Subcontractors typically carry general liability, workers’ compensation, and sometimes professional liability insurance. The prime contractor remains responsible to the client for the overall project and may be liable for the subcontractors’ performance and safety violations.

Payment arrangements vary but usually involve progress payments tied to milestones or completed work, with retainage retained until satisfactory completion. Disputes may arise over scope, delays, or quality. Effective subcontracting relies on clear contracts, defined interfaces, risk management, and communication to align expectations among client, prime contractor, and subcontractor.