Running the Business · Part 2
Subbing to general contractors: how to get on the list, what they check, and the four clauses in the subcontract that matter
Subcontracting to general contractors is the steadiest early work a C-36 can get and the easiest to lose money on. The GC will check your license, your insurance, and your references before you get on the list, and then hand you a subcontract written by their lawyer. This lesson explains what the GC is actually checking, how to get onto the bid list, and the four clauses in every subcontract to read before signing: payment timing, which California law already regulates in your favor; retention; indemnity, which the law limits on residential work; and scope, which the law does not protect you from at all.
What the full lesson covers
- Before a GC puts you on the list they verify the license on CSLB's lookup, demand a certificate of insurance with additional-insured and waiver endorsements, and call two references. Have all three ready before the first conversation.
- Payment: B&P 7108.5 requires the GC to pay you within seven days of receiving each progress payment, with a 2 percent per month penalty and attorney's fees if they do not, and lets them withhold only 150 percent of a genuinely disputed amount. A "pay-if-paid" clause that makes owner payment a condition of yours is unenforceable in California.
- Retention of 5 to 10 percent held to the end of the whole project is normal on commercial work; price it, and know when the GC must release it.
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More lessons in Getting Work
- 1Where the first ten jobs actually come from
- 2Supply-house relationships and credit: the account, the terms, the personal guarantee, and the notice your supplier sends your customer
- 3Subbing to general contractors: how to get on the list, what they check, and the four clauses in the subcontract that matterYou are here
- 4Property managers, home-warranty companies, and realtors: volume vs. margin, and the paperwork each one lives on
- 5Google Business Profile, reviews, and referrals: the only marketing that matters in year one, and the two laws that govern reviews