SUB-CONTRACTOR AGREEMENT WITH TIME PENALTY

WHEN TO USE THIS DOCUMENT

 A Sub-Contractor’s Agreement is used by a business (the contractor) who wants another person or organisation (the sub-contractor) to provide sub-contractor services to them a over a period of time, as and when they are needed. The services are usually then used by the contractor to provide to their own client or customer so it is important that the Sub-Contractor Agreement reflects this. It does not matter what the services are.

 This agreement contains what you need when the sub-contractor must work to a deadline and there is a penalty / reduction in payment if that is not met.

 This is not any form of employment contract so the sub-contractor must be operating as a separate business, for example they may be a sole trader or operate through a limited company or partnership and the sub-contractor will therefore be responsible for payment of tax on payment etc.

 In this agreement the contractor (the business who uses the services) and the sub-contractor agree the basic terms of what type of services will be provided and how they will deal or “work” with each other. This is particularly important if the services are ultimately being provided to clients or customers of the user. For example, they will agree each other’s main responsibilities and deal with issues such as confidentiality and how the sub-contractor will be paid for their services. This is often referred to as the Master or Main agreement.

 Then, when the contractor needs the services of the sub-contractor for a particular task, they can simply send the sub-contractor a project sheet, which is just a document which outlines what needs to be done and when by etc for that particular task. The sub-contractor can then choose whether to agree or decline provision of those services to the user.

 Doing it in this way is much simpler and means that you do not have to keep repeating the main terms. Instead, you can simply agree the service, price and deadlines etc each time the sub-contractor is used. It can also be used to show that the sub-contractor is not an employee of the contractor.

 You can still choose how long the master agreement runs for (e.g. you can agree it for 2 years) and you can always add on and changes parts of the main agreement if you need to, for example, if you usually pay the sub-contractor on the 30th of each month and you need to change this to every 2 months.

 This document is for the Master agreement. A template project sheet is available separate or both documents are available as a pack with a project sheet that can simply be sent by email to the sub-contractor.

THIS DOCUMENT CONTAINS THE FOLLOWING:

• Definition of the relationship.
• Definition of the type of services  the sub-contractor will supply.
• Sub-contractor’s obligations.
• User’s obligations.
• Payment.
• Conflict of interest.
• Insurance and other liabilities.
• Termination.
• Confidentiality.
• Targets.
• Restrictions on dealings with the user’s clients or customers - the sub-contractor approaching the contractor’s clients or customers to get business directly from them instead of through the  contractor.
• Time Penalty clause (reduction in payment if deadlines are not met which you can customise).

DO NOT USE THIS DOCUMENT

• If you intend to create any form of employment contract.
• If you want to create a website affiliate agreement (for use to click through websites).
• If you need specialist documents for agencies who will act as intermediaries between service providers and clients, such as property letting.

HOW TO USE THIS DOCUMENT

 This is a MS Word document and is easy to use. The document uses blue text to provide extra guidance and notes and green text where you will customise your document to suit the circumstances in which it is used.
 

File Type: Word File