Im not sure if that is the right term, so I will explain the situation.
I have an attached garage addition job coming up, and I was looking for a sub-contractor to do the foundation and slab. A friend referred me to a guy to do the work and said he is reliable and trustworthy.
I have heard of the guy so I called him to look at the job, and he gave me a price which I agreed to and we set up the starting date.
Three days before the starting date he called and said he was real busy, so he is going to have his “partner” do the job.
Well his “partner” called yesterday and says he has his own company and he is subcontracting the job from the other guy. In the meantime he stopped at the job and gave the homeowner one of his business cards, and told him he will be doing the cement work.
The homeowner called and said another contractor is subbing the work, not the one I told him was going to do the work. I stopped by the job and smoothed out the situation with the homeowner and all seems OK now.
The 2nd contractor says the other guy is a bricklayer and doesnt do foundations or blockwork. He is subbing the job to him.
I have never had this happen before, but it is not something I want to do again. I dont like the idea of a sub-sub- contractor. The guy who is going to do the work seems trustworthy and if it goes well I will hire him again, but I will never call the first guy again. Anyone here ever have this happen?
Its a first for me and hopefully last.
Replies
If the guy is qualified to do the job I see no problems.
I sub to a contractor who subs to a GC often. But the GC knows his sub is supplying quality workers to do the job. I could also hire a sub to work with me, As LONG as he/she is cleared by my contractor.
I think it is all about open communication, and everyone reading the same page.
Parolee # 40835
I've had this happen with a painting sub and there were numerous hassles. First the scope af work agreed between me and the first sub included items that were not communicated to the second sub (window scraping and touch up) and he refused to do them. That we worked out but the bigger issue was that the first sub had general liability insurance and the second sub had workers comp but neither had both. I wrote the checks to "name first sub" and "name second sub" and required both to sign the checks at the bank. That way the insurance hassle was cleared up. I never hired them again.
Now I have an issue where my painter was involved in a very serious car accident in latin america and we're helping his lead guy shut down the old company and transfer the contract to a new company that we are funding the start up costs for out of advances on work contracted to be completed in the NEXT thirty days, all handled through a translator. Talk about your leap of faith!
Good luck with this, you can make it work but I agree that you need to never hire this sub again especially the talking to the homeowner and giving him his card before starting the job, that alone is a worth firing him for.
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"You cannot work hard enough to make up for a sloppy estimate."
The good news is that the first guy called three days beofree starting and said he was subbing it out. I don't have a problem with that, and I would consider calling the fiorst guy again in the future.
Now if the firsdt guy subbed it out and didn't tell you, that's a hole nutter story.
It's kinda like when I call commwercial gc's and subs to do work, and if they are upfront and say they are too busy this time, or wrong kind of work, or too small, etc, I will call them again for the next one. At least they are upfront and honest.
"Put your creed in your deed." Emerson
"When asked if you can do something, tell'em "Why certainly I can", then get busy and find a way to do it." T. Roosevelt
Edited 5/12/2007 2:10 pm ET by FastEddie
FWIW.... as a sub I wouldn't even consider subbing out a job I was hired to do without consulting with the GC first. And as far as contact with the HO goes... I try to avoid that as much as possible unless they're the one's paying me. I like to get my directions and instructions from the one paying me directly. In a job that is run correctly (in a perfect world) I wouldn't need to have any contact at all with a homeowner.
Although if sub2 just stopped by to look at the job and the homeowner was around, I could see how the cat could be let out of the bag easily enough. Even still... he shouldn't have even been looking at the job until you, as the GC, had been made aware and approved of the situation.
I have been a sub to a cabinet company that was a sub to a GC. Never any problem. Seems most flooring places around here also sub their installs, so they would be sub-subs too.
Quite a few siding companies do the same.
Bowz
I see all sorts of troubles coming from this sort of arrangement- bad manners notwithstanding.
Let's get back to square one: WHO is the customer?
Sure, the homeowner is the ultimate customer, but he hired YOU. You are the guy he's paying. If you're the general contractor, it's all on your license, your bond ... and you're the only guy the homeowner pays. You control the scheduling, the clean-up, the follow-through. Everything goes through you.
You agree with "Joe" that Joe will do the work. Presumably, you have checked "Joe" out for licenses and insurance, and are sticking your neck out for him. Sure, you expect "Joe" to have employees, and to have suppliers make deliveries .. but that's as far as it goes.
You know nothing about Joe's friend "Bob." If Joe couldn't do it, he should have told you so. You know nothing about "Bob." Moreover, "Joe" isn't the general ... you are.
The proper thing would have been for Joe to introduce you to Bob.
Now, I encounter this situation on a fairly regular basis. The customer will ask, as I work on his pumps, "I hired XYZ Plumbing ... why does your truck say ABC Electric?" I will explain that I often work for the plumber, taking care of the electrical work. I explain that he will not see a bill from me, that the plumber is still in charge. I supply the customer with my license information, and pull the necessary permits for any electrical work. This is all assuming that the plumber isn't there to speak for me.
What if I can't help the plumber that day? Well, I say so. It's up to him to find a replacement ... not me. I might suggest that he call a particular competitor (or specialist), but that's the plumbers' call to make- not mine.
You have two choices.
You can cross your fingers, hope all works out, and never use these guys again; or,
You can step in right now, stop the job, and make other arrangements.
I'd say that 90% of the time, these casual relationships work reasonably well. The other 10% are true nightmares, with liens, litigation, and the 'gypsy hustle' taking place. Some folks deliberately want to seize control from you, for their own ends.
Do you have a contract with the homeowner? Do you have a contract with the first sub?
Does either contract have an assignment clause in them?
Ideally, there is nothing wrong with the situation you mention. Your agreement is with the first sub and his agreement is with the second sub. You just have to be careful to communicate with the first sub and hold him responsible for the terms of your agreement.
The last thing you want/need is to start talking directly to the second sub and let the first get out of the loop. Ultimately, you have no power over the second other than the fact that he is on your job. Make sure you don't get in to a position where you're expecting the second to fulfill something that the first is not aware of.
This situation really happens all the time. Depending on the size of the project, it would not be rare to have a third level sub (meaning there are two complete levels between him and the GC). Take for instance a drywall contractor. It would be not unlikely for a GC to hire a drywall guy, who hires a finisher, who hires a guy to do his sanding. I'm working on a commercial job with 900 sheets of drywall and this arrangement would not surprise me at all.
I do think it's tacky that the second sub gave a business card to the HO, but that's you call on whether that's OK with you.
Jon Blakemore
RappahannockINC.com Fredericksburg, VA
Yes, I have a written contract with the homeowner and just a verbal agreement with the first sub. There was no assignment clause in the contract. There is going to be some radiant floor heating installed in the slab and the homeowner is hiring that contractor. I gave him the number of the first sub so they could coordinate their schedules, and that has been arranged. The other thing was the first sub was starting on Tuesday and the new guy is starting on Monday, The homeowner wasnt happy about that because he will have to clear out his garage before Monday and he was just getting ready to go out of town for the weekend. I agreed to get there early Monday and help him move things out of the way. It seems I will be working with the second sub directly which might be simpler and he does seemto be reliable, he has already scheduled the footing inspection for Tuesday morning. I think it will all work out OK, I just dont like the communication hassles when there are three partys involved. Thanks for all the good input. I will keep my fingers crossed on this one.
I noticed most of the response from people that say sub-sub contracting is common is a much different sitsuation than yours.There they are doing one specialized sub-tasking. Often the installation.And the orginal sub was not only in the loop, but direct involved in such as supplying material and schudeling the installation.Much different than your situation. Here is sounded like the orignal sub just transfered the WHOLE job and left you in the midle with coordination, etc..
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A-holes. Hey every group has to have one. And I have been elected to be the one. I should make that my tagline.
Bill, I agree with your outlook on this sub-sub arrangement. The original sub led me to believe he was going to do the job. From what I know so far, he isnt providing any materials or labor. I will find out more when the job gets underway. To me it seems like sub 1 is just setting up the job and then marking up the price and to get a cut of the pie, and not doing much of anything else. If that is the case, I wont use him again or refer him to anyone else, and think of it as a learned lesson. I would rather have had him be up front about the situation rather than wait till the job is about to start, and then change the plan. Thanks everyone for the input.
wood4rd,
I agree with Bill.
If the second tier sub wants to pay a "finders fee" to the original sub that may be his business, but you have no obligation to the original sub given the conditions he has played this out under. He should have told you he couldn't do the work and let you decide what to do from that point on.
I would talk to both of them , together if possible, and straighten this out.
This is a whole different ball game than the flooring companies subbing to installers.
I have been on both sides of this situation in the past and for myself if I cannot do the work "in House" then I simply turn who ever is requesting the work be done on to the individual that will do the work and I step aside.
I have no responsibility as your first tier sub will have and therefore should not earn any profit off the job.
"Poor is not the person who has too little, but the person who craves more."...Seneca
i've often wound up having a third or fourth tier sub on my job......
usually with flooring installers
worst thing is getting the insurance certificates
and then there are the subs who have all Independent Contractors as "employees"
so who can unravel that chain?
Mike Smith Rhode Island : Design / Build / Repair / Restore
I found this thread to be again telling about the "business of construction and contracting".
It seems like anytime a carpenter or tradesman, trys to make a pittance on anything other than his own hands, the idea gets shot down and made to sound dirty. I've watched my SIL get his high tech automotive design job get subbed to a sub to a sub every day and no one bats an eye. He's often jumped to different companies without ever leaving his tube (workstation). Its not unusual at all for him to change companies several times a year and sometimes multiple times for the same "employer".
Personally, when I'm the purchaser, I don't care how the job gets done....as long as it meets specs. If a sub can find a chain of subs and take five cuts...I don't care...just get my job done, when you say your going to and I'm happy. If I wanted a specific person for some specific reason, thats how I would have structured the buy. If I'm buying a slab of concrete, I really don't care who lays it and how much he got paid....I'm only concerned about the person I contracted with and he and I will be talking if there is a problem. He's ultimatly responsible, he's the money man, he's the go to guy. I don't care that he's used someone else...that's his business.
Summed up, I'm all for double or triple subbing, either buying or selling. It's done every day in many other businesses. As long as it wasn't misrepresented in the sales process, it really doesn't matter.
blue"...
keep looking for customers who want to hire YOU.. all the rest are looking for commodities.. are you a commodity ?... if you get sucked into "free estimates" and "soliciting bids"... then you are a commodity... if your operation is set up to compete as a commodity, then have at it..... but be prepared to keep your margins low and your overhead high...."
From the best of TauntonU.
On the whole I agree with Blue, especially the final proviso: "As long as it wasn't misrepresented in the sales process, it really doesn't matter". It seems to me that initially there wasn't good communication up front in the case being discussed. Of course, the first sub's lack of info is just asking to be cut out of the loop on the next job (provided sub2's work was satisfactory).
There is one issue that needs to be clarified, no matter how many subs are in the chain: insurance. Most contractor insurance will have a no-sub clause that limits liability to the insured party only. A separate business being used as a sub must carry its own liability cover. If there was a claim against the GC on work provided by a sub, most insurers won't pay on that work. The sub needs to be covered by their own insurance. That situation carries on down the chain through multiple levels of subs, even to individual workers, which should give pause to those that like to pay employees as contractors. Be careful, as you're most likely not covered. Obviously everyone's insurance policies will be a bit different but the no-sub thing seemed to be pretty standard when I was shopping around - all the sales people I spoke to made a point of clarifying that to me up front.Lignum est bonum.
<If I'm buying a slab of concrete, I really don't care who lays it and how much he got paid....I'm only concerned about the person I contracted with and he and I will be talking if there is a problem. He's ultimatly responsible, he's the money man, he's the go to guy. I don't care that he's used someone else...that's his business.>That is so wrong, in so many ways! Especially with concrete...LOL. I do care who actually works on my jobs, and it's part of the reason I get some jobs. I call subs that I want to work with...if there is a change in plans, I'd expect them to tell me so that I can make the call.I know a lot of subs that I wouldn't hire for any reason, why have a job held up, or go backwards, because someone bit off more than they could chew?...jeeze, I've already done that, ha!...and, I don't know when I've ever seen a "fix" that was as good as doing it right the first time...except at my own house, at least that's what I tell Mrs 'Snort<G> Outside of the gates the trucks were unloadin',
The weather was hot, a-nearly 90 degrees.
The man standin' next to me, his head was exploding,
Well, I was prayin' the pieces wouldn't fall on me.
You neglect to consider public policy in your argument.The state where I live has a mechanics' and materialmen's lien law that states that labor and materials shall be furnished in one of two ways: First, at the instance of the property owner who contracts directly with mechanics and materialmen; Or, second, at the instance of the property owner's agent. All contractors and subcontractors are expressly deemed as agents of the property owner.Our state's contractor licensing laws state that no contractor or subcontractor shall act as an agent without a license.The term "agent" has a well understood meaning in the law.The contractor licensing laws state that all work done through agents (contractors and subcontractors) is on a cost-plus basis. Our contractor licensing statutes require the contractor or subcontractor to obtain labor and material bills from mechanics and materialmen to prove the actual costs of construction.Under our law (public policy) when a contractor hires a subcontractor the property owner owes the subcontractor since the contractor is the property owner's agent. Similarly, if a subcontractor hires mechanics and materialmen to furnish labor and materials, then the property owner owes the mechanics and materialmen employed.Since public policy as expressed in the lien laws states that labor and materials shall be furnished at the instance of the property owner or his agent, it necessarily means that if one is neither the property owner or his agent then such person shall not be asking others to perform labor or to furnish materials.I will bet that your state has similar laws (public policy).
Its a first for me and hopefully last.
I think the first and last should be the Sub-Sub talking to the customer about it.
In new construction sub-subbing is pretty common. Least ways round here it is.
If I'm the builder, I call the XYZ roofing, flooring, stair company. They come measure, schedule, deliver material and guarantee the work. But the guy actually doing the work is a sub contractor to them.
When all I did was install stairs and rails I was a sub for several different shops. Three or four at any one given time.
My truck had no lettering on it. I didn't wear company shirts or hats, my outgoing message on my cell as very generic. When a shop sent me to a job, as far as anyone there knew I worked "For" the shop. I never let on any different. I also never took any additional work from those customers. EVER. It's the "No Fishing in my pond"rule.
As long as everyoen is a legitimate business, no harm-no foul............................
Except for............if you like this guys work and wish to continue the arrangment for another job.................I would talk to the sub about the " No Fishing in my pond" rule and make sure he doesn't do that to you again.
Sounds like a lasagna, layer after layer.
Subing to subs of subs is common and after getting burned once we all have learned to be very specific about who is actually doing the work.
Drywall is worse and it wouldn't surprise me at all if the following are all different subs: project management sub, the sub actually managing the project, delivery, hanging, taping, prime, tape touch up, texture, reprime, touchup and punchlist items.
Beer was created so carpenters wouldn't rule the world.
I dont have a problem with the Sub-sub if they are up front about it from the start. But if I tell the homeowner that Joe from ABC cement is doing the work and starting on Tuesday, and Bob from XYZ Cement shows up and says he is starting on Monday, it immediatley effects my credibility. As it turns out the Sub 2 guy ended up doing the entire job. He had a good crew and I must say they did an excellent job. He is fully insured and has all topnotch equipment. I will definatley use them again and would recommend them too. Sub 1 never stopped by the job and really didnt contribute anything, other than some confusion and an inflated price. I guess I do have a problem with that, especially when I am trying to be competitive with other bids and trying to make a profit. Do I really need a middle man to hire my subs for me? I think its time to streamline the operation as they say in the business.