From a business perspective, it is extremely important you select qualified subcontractors, as the snow clearing and deicing services provided by your subcontractors is a direct reflection of your company, and will directly affect the ability of your company to keep your customer happy, and keep your customer as a client. From a legal perspective, it is extremely important that you do not exert a sufficient level of control over the activities of your subcontractor to impose potential liability upon your company for actions of the subcontractor, and to have the subcontractor potentially declared an employee of your business.
Your subcontractor must be responsible for the work assigned and for the conduct of all employees hired by the subcontractor. The subcontractor must provide adequate supervision of all employees, and ensure all work is provided in a good and workmanlike fashion in accordance with the standards established by your company. All services should be subject to your right of inspection and must meet with your approval, but you should require the subcontractor perform the final inspection before leaving the job location. You should also expressly note that the subcontractor will not rely upon any inspection by your company.
You should require the subcontractor self-perform all services under the agreement. If the subcontractor intends to hire its own subcontractor, you should require your written approval. You will want contact information for the second tier contractor, including phone numbers to reach principals of the company at any time.
You should require your subcontractor not engage in direct communication with any of your clients. All communications should be through you, and in the event your subcontractor is contracted directly by your client, the subcontractor should advise you of same.
You subcontractor should provide all labor, equipment, fuel and materials to promptly and efficiently perform the job for which it is hired. The subcontractor should replace any equipment not properly functioning. You can supply ice melt product or equipment to your subcontractor if needed, but the subcontractor should not rely upon you, unless part of your agreement.
Your agreement with your subcontractor should note the subcontractor is engaged as an independent contractor and will not be considered an employee of your company. Your subcontractor must provide proof of insurance coverage, including worker’s compensation coverage. You should require certificates of insurance, and your company should be identified as an additional insured on the certificates of insurance. I suggest you require insurance coverage be primary and non-contributory.
In the event your subcontractor fails to properly staff any job location or fails to properly perform work to your satisfaction, your company should have the right to perform the necessary work, and bill your subcontractor for any associated costs.
You should have a noncompete clause in your contract with the subcontractor. You are giving your subcontractor access to one of your most valuable resources, your clients, and the subcontractor must not be permitted to take any action to independently compete with you for the business.
You should require your subcontractor comply with all state and federal laws when hiring employees. You do not want to take over the task of screening your subcontractor’s employees, but you must make the subcontractor aware you require compliance with appropriate laws.
Your contract with the subcontractor should note that your subcontractor is engaged as an independent contractor. You want there to be no question or any ambiguity; your subcontractor must at all times be considered a subcontractor, and not your employee.
You should visit the site with your subcontractor in advance of the season, and make sure your subcontractor is aware of any special characteristics necessitating any unusual or unique now clearing activity, such as areas where to plow snow to avoid run-off and melt and freeze. You are permitted to discuss special characteristics of this site with your subcontractor and make sure your subcontractor understands the expectations of your client. Brief training of your subcontractor’s employees to make sure they understand job requirements will not result in the employees being classified as your employees but you do not want to take complete control over snow clearing operations, as this may result in a blurring of the line between the status of your subcontractor as an independent contractor and the status of your subcontractor as your employee.