Using contractors and subcontractors

Get the most from contractors and subcontractors

Think about how to get the most out of contractors and subcontractors from the point of engagement through to completion of the contracted work.

Consult your staff
Using a contractor can be successful where there is co-operation and co-ordination between your permanent staff and the contractor.

Get your staff to understand the advantages of using a contractor by setting out any benefits for them, eg they can get on with the core business.

Exercise care when hiring
Take up references and talk to others to determine a contractor's competence.

Check qualifications, skills, membership of relevant trade or professional bodies, quality standards and accreditations.

Find out their policies for health and safety, selecting subcontractors and employee consultation.

Have a written agreement
Agree in writing:

• the contractor's responsibilities
• the objectives, scope of the work and key deliverables (goals), eg in a project schedule with milestones
• resources if the contractor needs access to equipment and/or staff
• fees and a payment schedule - you may wish to consider penalty or incentive schemes for under-performance or over-performance
• a procedure for resolving disputes, eg review or termination
• confidentiality agreements

You have responsibilities when you engage contractors/subcontractors and you should agree a contract for services that will help you to discharge those duties.

For information see the page in this guide on other legal points to consider when employing contractors.

Manage the work
You should manage and supervise the contractor's work, seek evidence of work done and check that contractual obligations are met. Raise any issues at the earliest opportunity.

You can download advice on the health and safety of contractors from the HSE website (PDF). You can also download guidance on contractor management from the Institution of Electrical Engineers website (PDF).

Download guidance on using a consultant from the Institute of Directors website (PDF).

Subjects covered in this guide

• Introduction
• Contractors and subcontractors - the difference
• Pros and cons of using a contractor or subcontractor to provide staff
• Employment status - implications for tax and worker rights
• Health and safety requirements for employing contractors
• Other legal points to consider when employing contractors
• Get the most from contractors and subcontractors
• Protect your business from rogue contractors
• Here's how the use of a short-term contractor added value to a project

 Print This Page

Source - Business Link; Crown Copyright.