Client unhappy with subcontractor's work

Cianos

A client of ours is unhappy with a subcontractor's work/service and is refusing to pay for the service provided.

From our assessment, the subcontractor carried out the job very well, and we believe payment is deserved.

I'm wondering what's the best way to handle things where you're stuck in between a subcontractor and a client.

As far as I understand it, the subcontractor is due payment from us either way (based on the job being completed as contracted), and then it's up to us whether or not to chase payment from client.

My plan was to contact the client and tell them we've reviewed the project and that we're satisfied that the job was carried out as contracted and that we expect payment.

We also want to keep the subcontractor happy so regardless of what occurs we'll be sorting him out. He has also offered to go back out and do the job again if it helps matters.

Advice appreciated.

pedroeibar1

Fist question is what do your contracts state (if you have them)? Your main contract is with the client – you/your agent provide a service, you get paid if satisfactorily completed. A separate contract is with the subbie and if the contract is completed satisfactorily s/he gets paid. You should have a dispute resolution clause in each contract setting out how disputes are resolved (mediation obligatory in the first instance).

Second question is does the client have the ability to pay? Or is the dispute a delaying tactic and the result of shortage of cash? (A very frequent occurrence in my experience!)

Third question is how important is your client to you? Can you take a hard line with them or do you need to keep them sweet?

Personally I’d arrange a meeting to be attended by all three entities involved. You then should have all that is necessary to see the facts underlying the dispute and hopefully the means to resolve it, leading to payment.

If it gets sour – even if you are right – be aware of possible reputational damage.

Cianos

Thanks for the reply! The amount in question isn't large, so I'm hoping to resolve this quickly and hopefully it isn't just a delaying tactic as well. It's just the first time I've been in between two disputing parties and wanted to ensure I was going about things the right way.

Point taken, not worth taking too hard an approach with them at the risk of reputation damage.

We'll be paying our subcontractor in any case and will seek to resolve the dispute with the client separately. My view would be that if they don't honour the payment on this we wouldn't be too interested in doing any further work with them in the future.

Thanks again

jacksn

I wouldn't introduce the sub-contractor to a client at all, i would be the only point of contact for everything..

Its high risk to introduce a sub for a project, i can see the client been annoyed when they went to you for the job and they have no relationship with the sub, this makes them angry, feel unloved and inevitably they look for something(anything) to complain about.

Are/were there milestones in the project?, review/feedback meetings with client? whats the sign off process for tasks?

I would take ownership and take the sub out of any conversations, offer a solution to meet their needs, mollycoddle them, hand hold them, invoice the job and move on.

Cianos

jacksn wrote: »

I wouldn't introduce the sub-contractor to a client at all, i would be the only point of contact for everything..

Its high risk to introduce a sub for a project, i can see the client been annoyed when they went to you for the job and they have no relationship with the sub, this makes them angry, feel unloved and inevitably they look for something(anything) to complain about.

Are/were there milestones in the project?, review/feedback meetings with client? whats the sign off process for tasks?

I would take ownership and take the sub out of any conversations, offer a solution to meet their needs, mollycoddle them, hand hold them, invoice the job and move on.

Thanks for the reply. The sub isn't a replacement for our services, they provide an auxiliary optional service. The arrangement is explained to the client if they want this additional service and they wouldn't feel that we've fobbed them off to a different provider at all (at least they shouldn't and nobody has expressed same).