Definition of Terms:• Contracting or Subcontracting – refers to an arrangement whereby the principal agrees to farm out a job, work or service to a contractor/subcontractor within a definite period of time regardless whether the job is completed within or outside the premises of the principal.

What are examples of subcontractors?

Project developers subcontract electricians, plumbers, carpenters, drywallers, carpet layers, painters, landscapers, roofers, and flooring specialists to do most of the work. The project company acts as the main contractor, or hires a general contractor to hire the subs.

Is 174 labor-only contracting?

Under DO 174, labor-only contracting refers to the following arrangements: the contractor or subcontractor does not exercise the right to control over the performance of the work of the employee, then it is also considered labor-only contracting under DO 173-14.

How does sub contracting work in the construction industry?

Sub-contracting is the performance of a contractual obligation where (a)The main contractor normally enters into a direct contract with sub contractors, (b)Subcontractor may let sublet their work to sub contractors and (c)The main contractor retain contractual responsibility for the sub contractors work.

Can a main contractor appoint a subcontractor?

Main contractor can appoint a sub-contractor for (a) Supply & installation Works or (b) Installation only. Conditions of contract require the main contractor to notify the engineer (consultant) of the extent of work to be subcontracted and the names and address of each subcontractor.

Can a marketing firm hire a subcontractor?

Once a contractor hires all of their subcontractors and lays out the agreements, the job can begin. Marketing firms use this setup as well. They will bid on a job, and once they get it, they will hire subcontractors to handle the design, writing, and editing.

When to hire a subcontractor in South Africa?

Subcontractors are hired by the project’s general contractor, who continues to have overall responsibility for project completion and execution within its stipulated parameters and deadlines. It is very important to know that in South Africa there are one major rule when it comes to subcontracting if awarded a government tender.