Managing a Subcontractor on Your Job

Why this matters

When you hire a sub, the customer still sees one company: yours. The sub's no-show is your no-show. The sub's sloppy work is your callback and your reputation. Done right, a sub lets you take work you could not staff and finish jobs faster. Done loose, it exposes you to liability, blown schedules, and a customer who blames you for someone you barely vetted. The management happens before the sub ever shows up.

Vet before you hire

Never put an unvetted sub on a customer's property under your name. At minimum:

• License. Confirm they hold the license the work requires in your jurisdiction.
• Insurance. Get a current certificate of insurance and confirm coverage is active, not lapsed. A sub without coverage means their accident can land on you.
• References and a look at past work. Talk to someone they worked for. See a finished job if you can.
• Scope fit. Make sure they actually do the specific work, not just adjacent work.

Keep these on file and check the insurance expiration so you are not finding out it lapsed after an incident.

Put the agreement in writing

A handshake sub is a dispute waiting to happen. Before work starts, write down:

• Exact scope. What they are doing, and just as important, what they are not.
• Price and how it is calculated. Fixed, hourly, or unit, and what triggers extras.
• Schedule. Start date, expected duration, and what happens if they slip.
• Payment terms. When you pay and on what condition (often on completion and inspection, not before).
• Quality standard. That the work meets code and passes any required inspection.
• Who supplies materials. You, them, or split.

A one-page written scope prevents most sub disputes before they start.

Make ownership of the customer clear

Decide and control how the sub interacts with your customer:

• You own the customer relationship. The customer's questions about price, schedule, and next steps come to you, not the sub.
• Brief the sub on conduct. How to behave on site, what to say and not say, that they represent your company.
• Do not let the sub freelance. A sub quoting the customer side work or badmouthing your pricing can cost you the account.

Manage the work, do not just dispatch it

Hiring a sub is not the same as forgetting the job exists. Stay involved:

1. Set expectations up front, in person if you can. Walk the scope on site.
2. Check in during the work, not just at the end. Catching a problem at the rough-in stage is cheap; catching it after the wall closes is not.
3. Inspect before you pay and before the customer signs off. Your eyes on the finished work are your last line of defense against a callback.
4. Confirm cleanup and the customer is satisfied before you consider it done.

Pay the right way

Protect yourself on payment:

• Tie payment to completed, inspected work. Avoid paying in full before the job is finished and verified.
• Do not overpay ahead. A sub fully paid before completion has no incentive to come back and fix anything.
• Keep records of what you paid, for what, and when. You may need them at tax time and in any dispute.
• Understand the paperwork. Subs are not employees; the tax treatment and reporting differ. Confirm your obligations for paying an independent contractor.

Common mistakes

• Skipping the insurance check because the sub "seems solid." Solid people still have accidents, and an uninsured one is your liability.
• No written scope, so every gray area becomes an argument.
• Disappearing once they start. The customer hired you; absent management reads as you not caring.
• Paying in full too early and losing all leverage to get problems fixed.

A sub managed like this extends your capacity safely. A sub turned loose is a risk you took on without realizing it.

References

• IRS guidance on independent contractors versus employees
• OSHA: contractor and multi-employer worksite safety responsibilities
• U.S. Small Business Administration: subcontracting and risk-management guidance
• See related: The Sub Who Does Bad Work Decision Tree