What is Subcontractors?

In a subcontracting arrangement, three parties are involved. The client contracts with the main contractor for the full scope of work. The main contractor does not perform all the work itself but engages a subcontractor for part of it. The subcontractor has no direct contractual relationship with the client, but is responsible to the main contractor for the portion of work assigned.

The main contractor remains fully liable to the client, including for defects and failures caused by subcontractors. If a subcontractor makes an error, that is legally the main contractor's error in relation to the client. The main contractor can pursue the subcontractor internally, but the client does not need to concern itself with that relationship.

Many contracts include an approval requirement for subcontracting: the main contractor may not engage subcontractors without the client's prior written consent. This gives the client visibility into who is actually working on the project and the ability to object to specific parties.

In IT contracts, chain subcontracting (where subcontractors engage further subcontractors) is a real risk. Each additional link increases the probability of quality dilution and makes liability harder to trace. Restrict the right to further subcontract explicitly in IT agreements.

In construction, the UAV 2012 (Uniforme Administratieve Voorwaarden) is the standard framework. It regulates the relationship between contractor and subcontractor and sets out the applicable liability rules.

Subcontracting is invisible to the client but increases execution risk. If the main contractor selects a low-cost subcontractor of questionable quality, the client suffers the consequences without having had any say.

Always include an approval clause for subcontracting, require the contractor to flow down the same quality, data protection, and confidentiality obligations to its subcontractors, and ensure you know (as client) who is ultimately doing the work.