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Resources/Templates/Subcontractor agreement

Free template

Free subcontractor agreement template

A plain-English agreement between you and a sub: scope, price and payment terms, schedule, change orders, insurance and lien waivers, safety, warranty, termination and independent contractor status.

This is a starting point, not legal advice. Rules on payment timing, retainage, lien rights and waivers, indemnity, insurance and worker classification differ by state and change over time. Check your state’s rules in our license guides and have a local attorney review this agreement before you use it.
Preview

Subcontractor agreement

[Your company name] · Agreement # [Number]

Before you use this agreement: it’s a starting point, not legal advice. Check your state’s rules and have a local attorney review it.

1. The parties

Contractor
[Your company name] · License # [License #]
Subcontractor
[Subcontractor company name] · License # [License #]

4. Price

Fixed price, unit prices, or time and materials with a not-to-exceed amount.

5. Payment terms

Payment
Due when
Amount
Progress payment
[Milestone]
$
Final payment
When the Work is complete and accepted
$

Retainage of [__]% until [the Work is complete and accepted]. Lien waivers with each payment.

14. Independent contractor

Subcontractor controls its own workers, tools and methods, and pays its own payroll taxes and workers’ comp.

What’s in it

What’s in the subcontractor contract

Parties and project

Your company and the sub with license numbers, the project, owner and address, and the owner-contract terms that apply.

Scope, price and payment

Work included and excluded, a fixed price, unit prices or time and materials, a payment schedule, invoice terms and retainage.

Lien waivers and change orders

Conditional and unconditional waivers with each payment and at the end, and changes only by signed change order.

Schedule, insurance and safety

Start and completion dates, delay notice, minimum insurance with additional insured, and safety duties including OSHA rules.

Licenses, warranty and cleanup

Trade licenses and permits, a workmanship warranty with your term, and cleanup and protection of finished work.

Independent contractor, termination and signatures

Independent contractor status, termination with notice, placeholders for your attorney’s indemnity and dispute language, and signatures.

How to fill it in

How to write a subcontractor agreement, step by step

  1. Check your state first.Look up your state in our license guides. Note any rules on payment deadlines, retainage, lien waivers and licensing before you fill anything in.
  2. Describe the scope exactly.Name the trade, areas, quantities and materials, and who supplies what. Attach the scope of work, drawings and specs.
  3. Set the price and payments.Pick fixed price, unit prices or time and materials. Tie progress payments to milestones and fill in the retainage, within any limits your state sets.
  4. Collect insurance and a W-9 before work starts.Get the sub’s certificates of insurance showing the limits you require, and a completed IRS Form W-9.
  5. Collect lien waivers with every payment.Conditional with the payment request, unconditional once paid. Use your state’s forms where required, or our lien waiver template where there’s no state form.
  6. Have your attorney finish it.Your attorney should write the indemnity and dispute sections and review the rest. Then both of you sign and keep a copy.

FAQ

Subcontract agreement questions

What should a subcontractor agreement include?

At least the parties, the scope of work, price and payment terms, schedule, change orders, insurance, lien waivers, safety, warranty, termination, independent contractor status and signatures. Your attorney may add indemnity and dispute language for your state.

What is retainage?

Part of each payment held back until the work is complete, so punch list items get done. Some states limit how much can be held and how soon it must be paid out. See retainage in the glossary.

What is a pay-when-paid or pay-if-paid clause?

Wording that ties paying the sub to the owner paying the general contractor. Some states limit these clauses or won’t enforce them, and the exact wording matters. Ask your attorney before you use one.

Does this agreement make the sub an independent contractor?

Not by itself. Whether a worker counts as an independent contractor depends on how the work is actually done, and federal and state tests differ. The agreement records what you both intend; how you work together has to match it.

Do I need a new agreement for every job?

Some contractors sign one master agreement with each sub and a short scope for each job. Others sign a new agreement per project. Either way, put the scope, price and schedule for each job in writing and get it signed.

What is a subcontractor agreement?

A subcontractor agreement is the contract between a general contractor and a sub that sets the sub’s scope, price, payment terms, schedule, insurance, lien waivers and how changes and disputes are handled. It sits under your contract with the owner and should line up with it. This template is a starting point, not legal advice; rules vary by state, so check your state’s license guide and an attorney.

Can a subcontractor file a lien without a contract?

Often a sub can still have lien rights without a signed written contract, but the rules differ a lot by state: many require notices sent early in the job, all set deadlines, and some limit subs’ liens on homes. This isn’t legal advice; ask a local attorney. A signed subcontractor agreement plus lien waivers with every payment keeps everyone’s rights and payments clear.

Is there a sample subcontractor agreement I can review?

Yes. The preview at the top of this page shows sample sections: the parties with license numbers, price options, a payment table with retainage and lien waivers, and independent contractor terms. The free download is a three-page PDF plus a Word file to adapt with your attorney. In ECHOPS, you can send the finished agreement for e-signature, and subs see their scope, change orders and payments on their portal sheet.

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