Subcontractor Agreement

Subcontractor agreements govern the majority of hydrovac work, as hydrovac companies typically work as subcontractors to general contractors, engineering firms, or utility companies rather than as prime contractors. The agreement typically incorporates the scope of work, pricing and payment terms, insurance requirements, safety obligations, schedule requirements, change order procedures, and dispute resolution mechanisms.

Key provisions that hydrovac contractors should review carefully include pay-when-paid or pay-if-paid clauses that tie the subcontractor's payment to the general contractor receiving payment from the owner, indemnification provisions that may require the hydrovac contractor to assume liability beyond its control, flow-down clauses that bind the subcontractor to all terms of the prime contract, and liquidated damages provisions that may impose penalties for schedule delays.

Hydrovac contractors should have subcontractor agreements reviewed by qualified legal counsel before signing, particularly for large or complex projects. Unfavorable contract terms can expose the hydrovac company to significant financial and legal risk. Negotiating fair terms upfront is far easier than resolving disputes after the work has been performed.