Thursday, November 18, 2010

Subcontractors - Manage Your Debtors

Understand the Correct Process for Handling Variations Under Your Contract - If you are working for a builder or head contractor make sure you know how a variation may be requested, accepted and approved. Find out who is authorised to issue instructions to you, who is responsible for agreeing to any variations you request due to latent conditions or other unexpected costs and who is responsible for paying for the variations. Make sure you comply with any time frames and other strict requirements under your contract and don't take any short cuts.

  1. Know What Paperwork Must be Completed - If the other party doesn't have anything, you need a document of your own. Make sure your document with a homeowner complies with your legal obligations under the Domestic Building Contracts Act 2000.(Contact Ledger Guard for a practical 1 page Variation to Original Quote/Contract Form).
  2. Nothing Verbal, Everything in Writing - Insist that the customer/ builder/head contractor put their request for additional work or changes to the original quote/contract in writing. Despite a good relationship at the start of the project, verbal instructions can be forgotten or denied when it comes to payment time and cashflow is tight. Under the QBSA Act your builder or head contractor is legally required to give you a direction in writing within 3 days of your request so don't feel pressured to start the variation work without instructions in writing. Take a note of any conversations in regard to a variation whether requested by you or the other party so you can verify what was said, by whom, on what date and at what time. You can't rely on your word against the other party.
  3. Claim for any Variation Work in the month it is completed or within the timeframe stipulated in your contract. Don't wait until the end of the job or your variation claim may not be valid. Dealing with variations promptly will also reduce the possibility of forgetting any details of the work and what needs to be claimed.
  4. Keep Copies of Everything and make sure your paperwork and site records are accurate and up to date. It pays to be more thorough than you think you need to be in case a dispute goes to arbitration or you need to take legal action.
    Courtesy of Ledger Guard - Ledger Guard is a licensed debt collection agency specialising in recovering business to business debt.
    Excellent advice - but sometimes it is not so simple to achieve. Thepowertool takes the pain out of payment and keeps track of site issues with no disruption to your work.

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