Subcontractor Agreement: Essential Clauses
A handshake isn’t a contract. Every subcontractor engagement needs a written agreement. Here are the clauses that protect both parties.
Must-Have Clauses
Scope of work: Detailed description including drawings, specifications, and exclusions. Price: Lump sum, schedule of rates, or cost-plus. Include or exclude GST. Payment terms: Progress claims, payment timeline (7-14 days is fair), retention percentage. Timeline: Start date, completion date, liquidated damages for delays. Variations: Process for requesting and approving variations. Must be in writing before work proceeds. Insurance: Minimum public liability ($10-$20M), workers comp, professional indemnity if applicable. Defects: Defects liability period (typically 12 months), process for rectification. Dispute resolution: Mediation before litigation. Building Commission WA adjudication for payment disputes.
Protecting Yourself
Always use a written agreement — even for small jobs. Document variations in writing. Take photos at each stage. Keep copies of all correspondence.