A subcontractor agreement that actually protects you on the jobsite
Built for WA-state GCs and trades who pay subs on a 1099. Locks down scope, payment, retainage, insurance certs, and IC classification so an L&I audit or a lien doesn't land on your truck.
What's inside the agreement
- Scope of work section with deliverables, materials, and exclusions written in plain English
- Payment schedule with progress draws, milestone triggers, and net-15 default terms
- 10% retainage clause held until punch-list signoff and final lien releases
- Insurance certificate requirements: $1M general liability, auto, and proof of WA L&I account in good standing
- Independent contractor classification language built around the 6-part WA L&I test (avoid 1099-to-W-2 reclassification)
- 12-month workmanship warranty with cure-and-repair process before any chargeback
- Conditional and unconditional lien waiver exhibits tied to each progress payment
- Change order procedure with written approval requirement and labor/markup rates
- Mutual indemnification and hold-harmless clause covering subs, sub-subs, and their crews
- Jobsite safety acknowledgement: PPE, fall protection, hot work, and L&I citation pass-through
- Dispute resolution: King County mediation first, then binding arbitration under WA law
- Termination, default, and right-to-cure provisions with 7-day notice standard
Who this is for
- General contractors in WA, OR, or ID running residential or light commercial work with 1099 subs
- Painting, concrete, drywall, and roofing crews who flex up with helpers in busy season
- Electrical and plumbing GCs who hire 1099 service techs for overflow or rough-in work
- Landscape, tree, and excavation outfits running owner-operator subs on equipment
- Any service business that pays a sub more than $600 in a year and needs a real paper trail
Insurance + L&I clause preview
Subcontractor shall maintain, at its sole cost, commercial general liability of not less than $1,000,000 per occurrence, automobile liability covering owned and hired vehicles, and a Washington Department of Labor & Industries account in current good standing for itself and any worker on site. A current ACORD certificate naming Contractor as additional insured, and a printed L&I account verification dated within 30 days, must be delivered before any work begins or payment is released.
FAQ
What if my sub doesn't have insurance?+
Don't put them on the job. The agreement makes the certificate of insurance and current L&I verification a condition of payment, not a nice-to-have. If they get hurt or damage a customer's home with no coverage, your policy and your bond pay for it. Use the template's insurance addendum to require they cure within 7 days or the contract terminates with no penalty to you.
Does this prevent misclassification?+
It dramatically reduces the risk, but no contract makes a 1099 audit-proof on its own. The agreement is built around the WA L&I 6-part test (separate business, own tools, own crew, control over how work is done, ability to lose money, and a real UBI). If you treat the sub like an employee in practice (set hours, supply tools, train them, pay hourly), an auditor can still reclassify them. The contract gives you the paper side of the defense; your operations have to match.
Can I use it in OR or ID?+
Yes, with edits. Oregon uses CCB licensing and a different IC test, and Idaho leans on a federal-style 20-factor test. The template is WA-first but the scope, payment, retainage, and warranty sections work in any state. Swap the L&I references for CCB or Idaho IC paperwork and have a local attorney glance at the governing law clause before you use it cross-border.
Multiple subs same job?+
Use one signed agreement per sub. The template supports that cleanly with a per-sub scope exhibit so each crew has their own deliverables, payment schedule, and retainage line. Don't try to staple a single contract across three trades, that's how indemnity gets ugly when one of them damages another's work.
Retainage?+
Default is 10% held back from each progress payment, released after punch-list signoff and a final unconditional lien waiver. You can drop it to 5% for trusted subs or raise it to 15% on a risky scope, the clause is editable. WA's prompt pay statute caps how long you can sit on retainage after substantial completion, so don't get cute, the template defaults to 30 days.
Can my sub modify it?+
Of course, and they probably will. A real sub will redline indemnity, the warranty period, and the dispute clause. That's healthy. The Word version has tracked-changes ready to go. What you don't want to give up: the insurance/L&I certificate requirement, the retainage, and the IC classification language, those three are what protect you.
Often bought together
Service Agreement
General-purpose client service contract. Pair it with the sub agreement so the paper flows both directions on a job.
See detailsSafety Manual
OSHA-aligned manual that backs up the jobsite safety clause and gives L&I something to look at if they show up.
See detailsLLC Formation Kit
If your sub is supposed to be a real business, they need a real entity. This is what you hand them on day one.
See detailsDon't let a sub leave you on the hook
Pricing is being finalized — get on the list and we'll let you know the moment it launches. One uninsured slip, one L&I reclassification, one mechanic's lien from a sub you paid in full, and the margin on the whole job is gone.
This is a template, not legal advice. Washington L&I rules, IC classification standards, and lien laws change. Have a licensed WA construction attorney review the final document before you use it on a paying job.