Sub or Scrub - Why to Keep a Close Eye on Your Subcontractors

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Attorney Jack Garson explains why it is important to get to know your subcontractors before you sign a contract with them.

Jack Garson, Founder of Garson | Claxton LLC

Contractors cannot afford not to stay on top of the affairs of subcontractors.

A business is only as strong as its subcontractors. In his latest article in Huffington Post, “Sub or Scrub, Why to Keep a Close Eye on Subcontractors”, attorney and author Jack Garson shares tips for contractors on how to get to know a sub, and what to include in the subcontract for maximum protection.

For many contractors, profit or loss, or a project’s success or failure, relies heavily on the quality, timeliness and budget consciousness of the work performed by subcontractors. Many general contractors do not recognize that their survival is directly tied to the performance of subs. Contractors cannot afford not to stay on top of the affairs of subcontractors, according to Garson.

He outlines some steps for businesses considering subcontracting work:

  • Know your sub. Ensure that a sub is qualified to perform the required task that he is hired for, and that he is solvent and able to cover his debts. Check references and ask for financial documents. It is also prudent to take a look into the sub’s past and current jobs to assess the quality of his work.
  • Add protection. A few simple, well-written clauses in a subcontract could be the difference between a successful or disastrous project. Require the sub to purchase all necessary insurance, have payment and performance bonds in place, and sign lien waivers to protect the contractor from liability for the sub’s work.
  • Tricks and traps. State law may prohibit certain practices and limit the power of a general contractor. However, there are allowances such as the “pay if paid” provision, which permits a contractor from holding out payment to subcontractors until he is first paid by the client. A well-written clause in a subcontract is a tremendous benefit.

Garson admits that managing subcontractors requires a lot of work, but when your business is on the line, iron-clad contracts, knowledge of the law and discipline are crucial.

To read Jack Garson’s entire article, “Sub or Scrub: Why to Keep a Close Eye on Subcontractors,” visit the Huffington Post.

For media interviews with Jack Garson on this and other business-related topics, please contact Marc Silverstein at 202-716-9123 or at marc(at)onthemarcmedia(dot)com.

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