When contractors’ freelance businesses begin to grow, the workload becomes unattainable alone. This is when most contractors are forced to write basic subcontractor agreement forms. As a contractor whose business is currently booming, you need to know the main parts of a basic subcontractor agreement. If you want to hire help legally and with minimum risks, you need to obtain the necessary amount of knowledge to write a detailed contract. Review the critical contract law basics for optimal business protection as well. Continue reading to learn how to write a basic subcontractor agreement form.
Scope Of The Project
A main clause of any basic subcontractor agreement form is the scope of the project. In this section, clearly explain the work the subcontractor is expected to complete. Additionally, this section includes the subcontractor’s responsibilities throughout the project. Write down your expectations for both the amount and kind of work. Include the work that they client expects to see as well. Put any implications for not meeting expectations in this section as well. Then, you will reduce any subcontractor agreement form confusion.
The most detailed subcontractor agreement forms also include termination clauses. In this section, state when the contractor has the right to terminate the deal. For instance, a contractor might write that they have permission to terminate their contract due to defective work and lack of performance. Many contractors also terminate contracts when subcontractors do not follow the policies and procedures. Get as specific as possible in this section to avoid any costly law suits. Read the top employee termination tips to handle bad situations appropriately as well. In doing so, you set yourself up for basic subcontractor agreement form writing success.
Another way to avoid dealing with law suits is to include specific insurance coverage details in the subcontractor agreement form. While you need independent contractor insurance for your business, subcontractors need other policies. State what insurance policies the subcontractor needs while conducting work for their assigned project. Common policies include workers’ compensation, commercial general liability and automobile liability. Add that subcontractors are required to maintain the written amount of insurance until the project is completed. Since insurance coverage directly effects both the subcontractor’s finances and the contractor’s, you need to include this section in your subcontractor agreement form.
Terms Of Payment
Moreover, include a terms of payment clause in your subcontractor agreement form. This should include a detailed outline regarding payment for the project assigned. Consider all of your options for paying your subcontractor. You could pay them in the same way that you get paid for completing jobs. However, many contractors choose to pay their subcontractors through different methods. Determine what the fairest way to compensate them is. Then, describe it in the clause as clearly as possible. Write down when the payments should be made to avoid dealing with an unsatisfied subcontractor. Every basic subcontractor agreement form needs to have a terms of payment section.
Finally, write a project schedule and then insert it into your subcontractor agreement form. To complete a form effectively, meet with your client first. Review the project with them and inquire about the ideal completion dates for various parts of it. Then, provide the finished project schedule to your hired subcontractor. Give it to them early so that they can review it. Subcontractors with schedule issues need to make alterations. When agreement forms include this section, contractors and subcontractors stay on the same page more easily.
If your freelance contracting business is growing, you likely need to hire subcontractors to assist you in completing work on time. If you want to hire help legally, you need to create the form prior to starting the project. Begin by writing the scope of the project, which includes the responsibilities of the subcontractor. Termination clauses give contractors the right to put an end to the contract they have with their subcontractors. Include the minimum insurance coverage a subcontractor needs to perform their work. Outline the terms of payment by listing pay days. In addition, work with your client and your subcontractor to create a project schedule. Follow these steps to write a basic subcontractor agreement form.