Avoiding Common Problems in Subcontracting
Provided by HG.org
Subcontracting business to another individual or agency is important for small businesses and certain contractors for various tasks. However, it is important that the common and significant problems are avoided as much as possible to ensure the contracting or small business companies are free from complications and other issues.
Subcontracting jobs could entail various problems that affect the main project and payment with the client. These common problems are what lead to severe difficulty in finalizing the details, continued work and additional contracts. The word of a subcontractor saying he or she will adhere to certain rules is not enough with business interactions. Even these individuals and agencies should sign a contractual agreement to certain terms. It is critical to have everything in writing with contractors, subcontractors and any other individual employees that are tasked with outside work. Documentation could become the redeeming feature of a company in the face of various legal matters.
Common Problems Explained
Undocumented change orders often cause severe problems for the primary company when applied to subcontractors. This occurs when the client requests an alteration from the originally agreed work or conditions. Before anything is accomplished, these changes require documentation for verification and confirmation. These are legally binding paperwork. Verbal agreement is often not enough. Other changes could affect what materials must change, where to acquire resources and which location the project affects. It is imperative that the business affirm these issues and ensure the subcontractor is assigning and completing the paperwork as well. Legal battles are fought over these problems.
Subcontractors could become the middlemen in business situations. This could lead to these agencies or individuals paying for disputes. Disagreements occur often, and because construction companies and subcontractors are lower in the business level than the primary corporation or company, they may need to pay for various issues. These persons are unable to communicate with the client that hired services. Because of this, the subcontractor may make additional mistakes that could have a remedy. The general contractor is generally the go between in contact and with details. This could require the primary business with the project explaining how to deal with these problems if they occur.
Scope of Work
Another common problem subcontractors deal with is what required work is part of the project. Sometimes, these individuals or companies receive only pieces of the project. These situations do not provide enough information to know if any adjustments are necessary based on the circumstances. The primary plans and specifications may only remain with the contractor or business. Mistakes often occur when these plans change. Design flaws and other problems could also affect the work completed. Scope of work could exceed what the subcontractor completes. Any information outside of what has been sent to the subcontracting agency or person is out of sight.
Communication in the scope of work for a subcontractor is often one of the worst problems that exists. The possession of plans for the project usually are held by the contractor or the primary business attached to the job. This could lead to mistakes when the plan is unknown by attached subcontractors. Unattached jobs may only require the tools, equipment and resources available. However, any substitution or change to the plan could affect used materials to complete the job. Project modifications and new specifications are not generally part of the information that subcontractors receive. Additional conditions may not exist in the planning and implementation of the smaller jobs.
Out of Scope Problems
Pricing matters involve out of scope parameters or jobs. When the client is not willing to permit a price increase but wants the work completed by the deadline, these problems may occur. The amount and time then become a dispute with the client and business attached. Some of these are trickled down to the subcontractor and may stall any work from completion. Documentation is critical in progressing through the work. If this is not present, the job should not proceed. These issues may harm the company and contractors. Defects, substitutions, different sites and various similar problems could arise when subcontractors have only part of the plans.
Business Lawyer in Subcontracting Problems
When a problem arises where the entire project could end up scrapped, a lawyer may need to interfere. The legal representative is usually part of the process and hired by the primary business. He or she is there to ensure the interests of the company may remain protected throughout the project. He or she may also need to impart certain information to the subcontractors.
Disclaimer: While every effort has been made to ensure the accuracy of this publication, it is not intended to provide legal advice as individual situations will differ and should be discussed with an expert and/or lawyer.