MAKE YOUR FREE Subcontracting Agreement
What we'll cover
What is a Subcontracting Agreement?
A Subcontracting Agreement is a contract between a main contractor and another person or business (ie a subcontractor), in which the main contractor delegates some of the work or obligations they must perform under another (ie main) contract to the subcontractor. Subcontracting Agreements set out the terms of a subcontracting arrangement so that services can be provided in a transparent and risk-averse way.
This document is GDPR compliant.
When should I use a Subcontracting Agreement?
Use this Subcontracting Agreement:
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to subcontract all or some of a main contractor’s work under a contract for the provision of services
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for businesses based in England, Wales, or Scotland
Sample Subcontracting Agreement
The terms in your document will update based on the information you provide
SUB-CONTRACTING AGREEMENT
THIS AGREEMENT is made on the date of last signature below between:
Parties
(Main Contractor)
(Sub-contractor)
BACKGROUND
- The Main Contractor has entered into an agreement attached as Schedule 1 (Main Contract) under which the Main Contractor agrees to supply to (Customer).
- The Main Contractor has entered into the Main Contract on the basis that the Sub-contractor will supply the services specified in Schedule 2, for the benefit of the Customer on a "back-to-back" basis with the Main Contractor, and in accordance with the provisions below.
AGREEMENT
Meanings
- In this Agreement, the following words are defined:
Agreement this agreement for the provision of the Services (as defined below) including any schedules; Confidential Information in relation to either party, any information (whether or not stated to be confidential or marked as such) which that party or the Customer discloses to the other, or which the other party obtains from any information disclosed to it by that party or the Customer, either orally or in writing or by any other means, under or in connection with this Agreement; Data Protection Laws all applicable laws relating to the processing of Personal Data, including the UK General Data Protection Regulation (GDPR) and any national implementing and supplementary laws, regulations and secondary legislation, including the Data Protection Act 2018; Deliverables all documents, items, plans, products, goods and materials supplied by the Sub-contractor, including any methodologies, ideas, designs, computer programs, data, disks, tapes, and reports, in whatever form, which are developed, created, written, prepared, devised or discovered by the Sub-contractor or its agents, sub-contractors, consultants and employees in relation to the Services; Effective Date ; Equipment any equipment, systems, tools, cabling, items, materials or facilities requested or used directly or indirectly in the supply of the Services, by the Sub-contractor or its sub-contractors; Intellectual Property Rights any invention, patent, utility model right, copyright and related right, registered design, unregistered design right, trade mark, trade name, internet domain name, design right, design, service mark, database rights, topography rights, rights in get-up, rights in goodwill or to sue for passing off and any other rights of a similar nature or other industrial or intellectual property rights owned or used by the Sub-contractor in any part of the world whether or not any of the same is registered (or capable of registration), including applications and the right to apply for and be granted, extensions or renewals of, and rights to claim priority from, such rights and all equivalent or similar rights or protections which subsist now or will subsist in the future; Premises ; Services the services which are set out and described in Schedule 2 of this Agreement, together with any other services which the Sub-contractor provides or agrees to provide to the Main Contractor through the change control procedure set out below (Change Control); Service Charges the charges for the Services, which are set out in Schedule 3 of this Agreement; Specification the description or specification for the Services as set out in Schedule 2 of this Agreement or as otherwise agreed between the parties through Change Control; Working Day any day other than a Saturday, Sunday or public holiday in England and Wales. The terms "Controller", "Data Subject", "Personal Data", "Personal Data Breach", "Processor", "Processing", "Sub-processor" and "Supervisory Authority" shall have the same meaning as in the GDPR.
- In this Agreement, unless the context requires a different interpretation:
- the singular includes the plural and vice versa;
- references to sub-clauses, clauses, schedules or appendices are to sub-clauses, clauses, schedules or appendices of this Agreement;
- a reference to a person includes firms, companies, government entities, trusts and partnerships;
- "including" is understood to mean "including without limitation";
- reference to any statutory provision includes any modification or amendment of it;
- the headings and sub-headings do not form part of this Agreement; and
- "writing" or "written" will include fax and e-mail unless otherwise stated.
Provision of Services
- The Sub-contractor shall provide the Services to the Main Contractor on the terms and conditions of this Agreement from the Effective Date and as set out in Schedule 2.
- The Services will be provided by the Sub-contractor either:
- on an ongoing basis; or
- in response to each request from the Main Contractor from time to time
- The Agreement begins on the Effective Date and will continue.
- The Sub-contractor shall provide the Services (including any Deliverables) in accordance with the Specification, in all material respects. Time is of the essence for any dates for delivery of the Services under this Agreement, unless specifically stated otherwise in any schedule.
- The Sub-contractor shall perform the Services with reasonable care and skill, in accordance with:
- generally recognised commercial practices and standards in the applicable industry; and
- all laws and regulations applicable to the Services, including all laws and regulations related to (i) anti-bribery and corruption, and (ii) data protection.
Main Contractor's Obligations
- No amendment shall be made to Schedule 2 except on terms agreed in writing by the Parties in accordance with the clause below Change Control.
- The Main Contractor must:
- co-operate with the Sub-contractor in all matters relating to the Services;
- provide, in a timely manner, any Equipment, materials and any information as the Sub-contractor may reasonably require; in the case of Equipment, the Main Contractor shall ensure that it is in good working order and suitable for the purposes for which it is used, and in the case of information, the Main Contractor shall ensure that it is accurate in all material respects;
- obtain and maintain all necessary licences and consents and comply with all relevant legislation in relation to the Services before the date on which the Services are to start;
Defective Services
- The Sub-contractor shall promptly notify the Main Contractor of:
- any delays or problems from time to time in the provision of the Services of which the Sub-contractor becomes aware;
- any circumstances from time to time which may prevent the Sub-contractor from providing the Services in accordance with this Agreement together with (where practicable) recommendations as to how such circumstances can be avoided; and
- any complaint (whether written or not) or other matter which comes to its attention and which it reasonably believes may give rise to any loss by or claim against the Main Contractor or which may result in any adverse publicity for the Main Contractor.
- The Main Contractor shall, without limiting any right or remedy of the Main Contractor, promptly report to the Sub-contractor any defects in the Sub-contractor's performance of the Services as soon as reasonably practicable after any such defect comes to the attention of the Main Contractor.
- Where any defect in the provision of the Services is reported to the Sub-contractor by the Main Contractor or otherwise comes to the attention of the Sub-contractor, the Sub-contractor shall, without limiting any other right or remedy of the Main Contractor, use its reasonable endeavours to provide such further services as are necessary in order to rectify the default as soon as is reasonably practicable.
Charges, Payment and Time Records
- In consideration of the provision of the Services by the Sub-contractor, the Main Contractor shall pay the Service Charges as set out in Schedule 3 which specifies whether the charges are on a time and materials basis, a fixed price basis or a combination of both. Time is of the essence for the payment of the Service Charges.
- All charges quoted to the Main Contractor are
- Where Services are provided on a time and materials basis:
- the charges payable for the Services shall be calculated in accordance with the Sub-contractor's standard daily fee rates for each individual person and are calculated on the basis of an eight-hour day, worked between 9 am and 5 pm on Working Days and otherwise by arrangement between the parties;
- the Sub-contractor will ensure that every individual whom it engages in relation to the Services completes time sheets recording time spent on the Services or Deliverables; and
- the Sub-contractor will invoice the Main Contractor monthly in arrears for its charges for time, expenses and materials (together with VAT where appropriate) for the month concerned, accompanied by any relevant receipts for any Equipment, materials and expenses as incurred in accordance with the clause below.
- Where Services are provided for a fixed price, the total price for the Services is set out in Schedule 3. Upon completion of the Services or when an agreed instalment is due, the Sub-contractor shall invoice the Main Contractor for the charges that are then payable, together with any Equipment, materials and expenses, which have not been expressly included in the fixed price and VAT.
- Expenses incurred by the Sub-contractor may include: the cost of hotel, subsistence, travelling and any other expenses reasonably incurred by the individuals whom the Sub-contractor engages in connection with the Services, the cost of any materials and the cost of services reasonably and properly provided by third parties and required by the Sub-contractor for the supply of the Services. Any expenses in excess of £ must be pre-approved by the Main Contractor in writing. Such expenses, materials and third party services must be invoiced by the Sub-contractor at cost, together with VAT, which the Sub-contractor will add to its invoices at the appropriate rate.
- The Main Contractor is required to pay a deposit of £ (Deposit) within days of placing an order for the Services. If the Main Contractor does not pay the Deposit, the Sub-contractor shall have the right to withhold provision of the Services until the Deposit is received or may terminate in accordance with the clause below (Termination). The Deposit shall be non-refundable unless the Sub-contractor fails to provide the Services and is at fault for such failure (where the failure is not the fault of the Sub-contractor, no refund will be made).
- The Main Contractor shall pay each invoice submitted to it by the Sub-contractor, in full and in cleared funds, within days of receipt (which shall be determined in accordance with the section below (Notices) to a bank account nominated in writing by the Sub-contractor (the Due Date).
- Without prejudice to any other right or remedy that it may have, if the Main Contractor fails to pay the Sub-contractor on the Due Date:
- the Main Contractor shall pay interest on the overdue amount at the rate of 4% per annum above the Bank of England base rate at the relevant time. Such interest will accrue on a daily basis from the due date until actual payment of the overdue amount, whether before or after judgment. The Sub-contractor may choose to charge statutory interest due. The Main Contractor shall pay the interest together with the overdue amount; and
- the Sub-contractor may suspend all Services until payment has been made in full.
- All sums payable to the Sub-contractor under this Agreement shall become due immediately on its termination, despite any other provision.
- The Sub-contractor and the Main Contractor shall pay all amounts due under this Agreement in full without any deduction except as required by law and neither party shall be entitled to assert any credit, set-off or counterclaim against the other in order to justify withholding payment of any amount due, in whole or in part.
Change Control
- The Main Contractor may at any time during the term of this Agreement request an increase or decrease in the volume of the Services, a change in the Specification, or the addition of new Services (Change Request) by notifying the Sub-contractor in writing of its requirements.
- The Sub-contractor shall give due consideration to any Change Request from Main Contractor and shall, within Working Days of receiving a Change Request from the Main Contractor:
- confirm its acceptance of the Change Request, without any further variation to the terms of the Agreement, in which case the parties shall execute a variation to the Agreement as soon as reasonably practicable and the Sub-contractor shall implement the Change Request accordingly; or
- provide a written proposal for accepting the Change Request, subject to any variation that it reasonably considers necessary to the Services, the Specification or the Service Charges, including any new Services (Change Proposal); or
- if the Sub-contractor believes it is not reasonably practicable to accept the Change Request, with or without any such variation, provide the Main Contractor with a written statement of its reasons for doing so.
- Any Change Proposal provided by the Sub-contractor under the above clause shall be based on the Service Charges or, if this is not appropriate, shall be a fair and reasonable quotation for the Change Request.
- The Main Contractor shall give due consideration to the Sub-contractor's Change Proposal under the clause above and shall within Working Days after receipt of the Change Proposal either give Sub-contractor a written notice accepting the Change Proposal (subject to or without further negotiation) or rejecting the Change Proposal. If Main Contractor accepts the Change Proposal, the parties shall as soon as reasonably practicable execute a variation to the Agreement and the Sub-contractor shall implement the agreed variation.
- The Sub-contractor shall have the right to make any changes to the Services which are necessary to comply with any applicable law or safety requirement, provided that the Sub-contractor gives the Main Contractor reasonable notice of such changes and that such changes do not materially affect the nature/scope of the Services or the Service Charges.
Indemnity
- The Sub-contractor shall indemnify the Main Contractor against all losses, claims, demands, costs and expenses incurred or suffered by the Main Contractor including all claims for liquidated damages by the Customer against the Main Contractor arising out of the Specification, including any infringement of any Intellectual Property Rights of another person.
- The Main Contractor shall give to the Sub-contractor notice in writing as soon as possible after it becomes aware of any dispute between the Main Contractor and the Customer arising out of the Specification.
Liability and Insurance
- If the Sub-contractor's performance of its obligations under this Agreement is prevented or delayed by any act or omission of the Main Contractor, its agents, other sub-contractors, consultants or employees, the Sub-contractor shall not be liable for any costs, charges or losses sustained or incurred by the Main Contractor that arise directly or indirectly from such prevention or delay.
- Provided that the Main Contractor reasonably pursues all of its rights under the Main Contract, the Main Contractor shall not be liable or responsible to the Sub-contractor for any failure to perform its obligations under this Agreement if there is a corresponding failure by the Customer to perform its obligations under the Main Contract.
- Nothing in this Agreement limits or excludes either party's liability for:
- death or personal injury caused by its negligence;
- fraud or fraudulent misrepresentation; or
- breach of the terms implied by section 2 of the Supply of Goods and Services Act 1982 (title and quiet possession); or
- any other liability which cannot be limited or excluded by applicable law.
- Subject to the above clause and the clause above (Indemnity), neither party shall have any liability to the other party, whether in contract, tort (including negligence), for breach of statutory duty, or otherwise, arising under or in connection with this Agreement for:
- loss of profits;
- loss of sales or business;
- loss of agreements or contracts;
- loss of anticipated savings;
- loss of or damage to goodwill;
- loss of use or corruption of software, data or information;
- any indirect or consequential loss.
- Subject to the two proceeding clauses and the clause above (Indemnity), the total liability of either party for any other loss of the other party for any other loss in respect of any one event or series of connected events shall not exceed £.
- The terms implied by sections 3 to 5 of the Supply of Goods and Services Act 1982 are, to the fullest extent permitted by law, excluded from this Agreement.
- During this Agreement, the Sub-contractor and the Main Contractor shall each maintain in force with a reputable insurance company, insurance sufficient to indemnify risks for which they may be responsible, including for their respective sub-contractors, agents and employees, in connection with the Services and shall, on either parties' request, produce both the insurance certificate giving details of cover and the receipt for the current year's premium.
Data Protection
- The Sub-Contractor (the Sub-processor for the purposes of this section) will comply with the Data Protection Laws with respect to the processing of Customer (the Controller for the purposes of this section) Personal Data.
- The Main Contractor (the Processor for the purposes of this section) will only supply to the Sub-processor, and the Sub-processor will only process the Personal Data of Data Subjects falling within the categories specified in Part A of Schedule 4 (Data processing information).
- The Processor will only supply to the Sub-processor, and the Sub-processor will only process Personal Data of the types specified in Part A of Schedule 4.
- The Sub-processor will only process Personal Data for the purposes specified in Part A of Schedule 4.
- The Sub-processor shall only process the Personal Data during the term of this Agreement.
- The Sub-processor shall not transfer any personal data obtained from the Controller outside of the UK or European Economic Area (EEA) unless the prior written consent of the Controller has been obtained.
- The Sub-processor will ensure that persons authorised to process the Personal Data have committed themselves to confidentiality, or are under an appropriate statutory obligation of confidentiality.
- The Sub-Processor and the Processor will each implement appropriate technical and organisational measures to ensure an appropriate level of security for the Controller's Personal Data. The Sub-Processor and the Processor shall provide the Controller with details of all such technical and organisational measures on reasonable written notice from the Controller.
- Where the Sub-Processor is acting as a Processor of Client Personal Data in connection with its delivery of Services under this Agreement the Sub-Processor may retain and use the services of third parties who from time to time may need to process Personal Data (each a Third Party Sub-Processor). As such, the Controller hereby generally authorises each Third Party Sub-Processor engaged by the Sub-Processor at the time this Agreement is executed to be a sub-processor in relation to the Personal Data. The Sub-Processor will provide the Controller with a list of all Third Party Sub-Processors on written request.
- The Sub-Processor will enter into an agreement with each Third Party Sub-Processor that obligates the Third Party Sub-Processor to process the Personal Data in a manner substantially similar to the standards set forth under this Agreement, and at a minimum, at the level of data protection required by Data Protection Laws (to the extent applicable to the services by the Third Party Sub-Processor under this Agreement).
- The Sub-processor shall, insofar as possible and taking into account the nature of the processing:
- take appropriate technical and organisational measures to assist the Processor with the fulfilment of the Processor's obligation to respond to requests exercising a Data Subject's rights under the Data Protection Laws;
- assist the Processor in ensuring compliance with the obligations relating to the security of processing of Personal Data, the notification of Personal Data Breaches to the Supervisory Authority, the communication of Personal Data Breaches to the Data Subject, Data Protection Impact Assessments (as such term is defined in Data Protection Laws) and prior consultations in relation to high-risk processing under the Data Protection Laws;
- report any Personal Data Breach to the Processor within 24 hours of the Sub-processor becoming aware of the breach;
- make available to the Processor all information necessary to demonstrate the compliance of the Sub-processor with its obligations under the Data Protection Laws;
- at the Processor's discretion, delete or return all of the Personal Data to the Processor after the provision of Services relating to the processing, and shall delete existing copies, save to the extent that applicable law requires storage of the relevant Personal Data; and
- allow for and contribute to audits, including inspections conducted by the Processor or another auditor mandated by the Processor in respect of the compliance of the Sub-processor's processing of Personal Data with the Data Protection Laws.
Confidentiality
- Each party will only use Confidential Information to perform its obligations under the Agreement and will not cause or allow the information to be disclosed except:
- where required by law, court order or any governmental or regulatory body;
- to any of its employees, officers, sub-contractors, representatives or advisers who need to know the information in order to discharge its obligations under the Agreement and agree only to use the information for that purpose and not to cause or allow disclosure of that information;
- where the information has become generally available to the public (other than as a result of disclosure in breach of the Agreement by the party or any of its employees, officers, sub-contractors, representatives or advisers);
- where the information was available or known to it on a non-confidential basis before being disclosed under the Agreement; or
- where the information was developed by or for it independently of the Agreement and is received by persons who are not the disclosing party.
Intellectual Property
- Subject to the clause below, the Sub-contractor reserves all Intellectual Property Rights (if any) which may subsist in any Deliverables, or in connection with, the provision of the Services. The Sub-contractor reserves the right to take such action as may be appropriate to restrain or prevent the infringement of such Intellectual Property Rights.
- The Sub-contractor licenses all such rights to the Main Contractor (who may license on the same terms to the Customer) free of charge and on a non-exclusive, worldwide basis to such extent as is necessary to enable the Main Contractor and the Customer to make reasonable use of the Deliverables and the Services.
- If this Agreement is terminated, this licence will automatically terminate.
Anti-Bribery
- The Sub-contractor and its agents, sub-contractors, consultants or employees shall:
- comply with all applicable laws, regulations, statutes, and codes relating to anti-bribery and anti-corruption including but not limited to the Bribery Act 2010 (Bribery Laws);
- not commit an offence under sections 1, 2 or 6 of the Bribery Act 2010;
- comply with any relevant industry code related to Anti-Bribery (Bribery Policies);
- have, maintain, and enforce throughout the term of this Agreement its own policies and procedures, to ensure compliance with the Bribery Laws and the Bribery Policies; and
- promptly report to the Main Contractor any request or demand for any undue financial or other advantage of any kind received by the Sub-contractor in connection with the performance of this Agreement.
Non-Solicitation
- The Main Contractor shall not, without the prior written consent of the Sub-contractor, at any time from the date of this Agreement to the expiry of months after the last date of supply of the Services or termination of this Agreement (whichever is the latest), solicit or entice away from the Sub-contractor or employ or attempt to employ any person who is, or has been, engaged as an employee, consultant or sub-contractor of the Sub-contractor in the provision of the Services.
Circumstances Beyond the Control of Either Party
- Neither party shall be liable for any failure or delay in performing their obligations where such failure or delay results from any cause that is beyond the reasonable control of that party.
- Such causes include, but are not limited to: power failure, Internet Service Provider failure, acts of God, epidemic, pandemic, civil unrest, fire, flood, droughts, storms, earthquakes, collapse of buildings, explosion or accident, acts of terrorism, acts of war, governmental action, any law or any action taken by a government or public authority, including without limitation imposing an export or import restriction, quota or prohibition, or any other event that is beyond the control of the party in question.
- The party affected by a circumstance beyond its control shall use all reasonable endeavours to mitigate the effect of the force majeure upon the performance of its obligations.
- The corresponding obligations of the other party will be suspended to the same extent as those of the party affected by a force majeure event.
- If the delay continues for a period of 90 days, either party may terminate or cancel the Services to be carried out under this Agreement.
Termination
- A party may terminate the Agreement immediately by giving written notice to the other party if that other party:
- does not pay any sum due to it under the Agreement within days of the due date for payment;
- commits a material breach of the Agreement which, if capable of remedy, it fails to remedy within 30 days after being given written notice specifying full particulars of the breach and requiring it to be remedied);
- persistently breaches any term of the Agreement;
- is dissolved, ceases to conduct substantially all of its business or becomes unable to pay its debts as they fall due;
- is a company over any of whose assets or property a receiver is appointed;
- makes any voluntary arrangement with its creditors or (if a company) becomes subject to an administration order (within the meaning of the Insolvency Act 1986);
- (if an individual or firm) has a bankruptcy order made against it or (if a company) goes into liquidation;
- undergoes a change of control (within the meaning of section 1124 of the Corporation Tax Act 2010); or
- (if an individual) dies or as a result of illness or incapacity becomes incapable of managing their own affairs.
- The Main Contractor may terminate this Agreement on prior days' written notice if the Main Contract is terminated.
Consequences of Termination
- On termination or expiry of this Agreement:
- the Main Contractor shall immediately pay to the Sub-contractor all of the Sub-contractor's outstanding unpaid invoices and interest and, in respect of Services supplied but for which no invoice has been submitted, the Sub-contractor may submit an invoice, which shall be payable immediately on receipt;
- the Main Contractor shall, within a reasonable time, return all of the Sub-contractor's Equipment and any relevant Deliverables remaining the property of the Sub-contractor. Until they have been returned or repossessed, the Main Contractor shall be solely responsible for their safekeeping.
- Termination or expiry of the Agreement shall not affect any rights, remedies, obligations or liabilities of the parties that have accrued up to the date of termination or expiry, including the right to claim damages in respect of any breach of the agreement which existed at or before the date of termination or expiry.
- Other than as set out in the Agreement, neither party shall have any further obligation to the other under the Agreement after its termination.
General
- This Agreement contains the whole agreement between the parties relating to its subject matter and supersedes all prior discussions, arrangements or agreements that might have taken place in relation to the Agreement. Nothing in this clause limits or excludes any liability for fraud or fraudulent misrepresentation.
- No party may assign, transfer or sub-contract to any third party the benefit and/or burden of the Agreement without the prior written consent (not to be unreasonably withheld) of the other party.
- No variation of the Agreement will be valid or binding unless it is recorded in writing and signed by or on behalf of both parties.
- The Contracts (Rights of Third Parties) Act 1999 does not apply to the Agreement and no third party has any right to enforce or rely on any provision of the Agreement.
- Unless otherwise agreed, no delay, act or omission by a party in exercising any right or remedy will be deemed a waiver of that, or any other, right or remedy.
- A provision which by its intent or terms is meant to survive the termination of the Agreement will do so.
- If any court or competent authority finds that any provision (or part) of the Agreement is invalid, illegal or unenforceable, that provision or part-provision will, to the extent required, be deemed to be deleted, and the validity and enforceability of the other provisions of the Agreement will not be affected.
- Unless specifically provided by the parties, nothing in the Agreement will establish any employment relationship, partnership or joint venture between the parties, or mean that one party becomes the agent of the other party, nor does the Agreement authorise any party to enter into any commitments for or on behalf of the other party.
- Any notice (other than in legal proceedings) to be delivered under the Agreement must be in writing and delivered by pre-paid first class post to or left by hand delivery at the other party's registered address or place of business, or sent by fax to its main fax number. or sent by email to the business email address of the other party. Notices:
- sent by post will be deemed to have been received, where posted from and to addresses in the United Kingdom, on the second Working Day and, where posted from or to addresses outside the United Kingdom, on the tenth Working Day following the date of posting;
- delivered by hand will be deemed to have been received at the time the notice is left at the proper address; and
- sent by fax will be deemed to have been received on the next Working Day after transmission; and
- sent by email will be deemed to have been received 24 hours after transmission.
Governing Law and Jurisdiction
- This Agreement shall be governed by and interpreted according to the law of England and Wales and all disputes arising under the Agreement (including non-contractual disputes or claims) shall be subject to the exclusive jurisdiction of the English and Welsh courts.
The parties have signed this Agreement the date(s) below:
SCHEDULE 1 MAIN CONTRACT
SCHEDULE 2 SPECIFICATION OF SERVICES
SCHEDULE 3 CHARGES
SCHEDULE 4 DATA PROCESSING INFORMATION
PART A - DATA PROCESSING INFORMATION
Processing of Personal Data by the Sub-processor under this Schedule shall be for the subject-matter, duration, nature and purposes and involve the types of Personal Data and categories of Data Subjects set out in this Part A.
Subject-matter of processing:
The Sub-processor's provision of the Services and any related technical support to the Processor.
Duration of the processing:
The term plus the period from expiry of the term until return/deletion of all Personal Data by the Sub-processor in accordance with this Schedule.
Nature and purpose of the processing:
The Sub-processor will process Personal Data for the purpose of providing the Services and any related technical support to the Processor in accordance with this Schedule.
Type of Personal Data:
- .
Categories of Data Subjects:
- Personal Data will concern the following categories of Data Subjects:
- Data Subjects about whom the Sub-processor collects Personal Data in its provision of the Services; and/or
- Data Subjects about whom Personal Data is transferred to the Sub-processor in connection with the Services by, at the direction of, or on behalf of the Processor.
About Subcontracting Agreements
Learn more about making your Subcontracting Agreement
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How to make a Subcontracting Agreement
Making your Subcontracting Agreement online is simple. Just answer a few questions and Rocket Lawyer will build your document for you. When you have all the information about the planned service provision prepared in advance, creating your document is a quick and easy process.
You’ll need the following information:
The main contractor and the subcontractor
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What is the main contractor’s name, address, and legal structure? If it’s a company, what is its company number?
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Who is the main contractor’s signatory, if it’s a company or a partnership? This is the person who will sign the Agreement on the company’s or partnership’s behalf.
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What is the subcontractor’s name, address, and legal structure? If it’s a company, what is its company number?
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Who is the subcontractor’s signatory, if it’s a company or a partnership?
The main contract
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Who is the customer under the main contract?
Service provision
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Where will the subcontractor provide services?
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Are the main contractor and the subcontractor agreeing on service levels?
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If the main contractor requests a change to the services, how long does the subcontractor have to respond?
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If the subcontractor responds with a counterproposal, how long does the main contractor have to respond?
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Fees and payments
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Do the subcontractor’s fees include Value Added Tax (VAT)?
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Does the main contractor need to pay a deposit to the subcontractor when ordering services? If so:
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How much is the deposit?
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Within how many days of an order for services must a deposit be paid?
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How many days does the main contractor have to pay invoices from the subcontractor?
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Can invoices be paid by cheque or by credit card?
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Will the main contractor charge the subcontractor for any service defaults?
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What is the limit on expenses that the subcontractor may incur and have covered in relation to this Agreement?
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What limit is placed on each party’s liability to the other for any losses incurred due to the party’s actions relevant to this Agreement?
Data protection
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What types of personal data (ie information about individuals from which they may be identified) will the subcontractor process (eg use or store) when providing services?
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Can the subcontractor charge the main contractor for any work they do that helps the main contractor to fulfil its obligations under data protection law?
The Subcontracting Agreement
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What is the start date of the Agreement (ie the date of signing or a specified date)?
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Do the main contractor and/or the customer have Anti-bribery policies that the subcontractor must comply with?
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For how long after the end of this Agreement is the main contractor prohibited from soliciting (eg trying to hire) the subcontractor’s employees?
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If the main contractor and/or the subcontractor is based in Scotland, will the contract be governed by the laws of England and Wales or the laws of Scotland?
Ending the Agreement
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Does the Agreement have a fixed term or end date? Or does it continue until it’s ended?
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If it has a term or an end date, what is the term or end date?
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If it continues until it’s ended, how much notice must a party give to end the Agreement?
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How many days after a payment is late may the party the payment is owed to end the Agreement?
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How many days’ notice must the main contractor give to end the Agreement if the main contract has ended?
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Common terms in a Subcontracting Agreement
Subcontracting Agreements set out the terms of an intended subcontracting of service provision. To do this, this Subcontracting Agreement template includes the following terms and sections:
This Agreement is made on the date of last signature…
The Agreement starts by identifying when the contract is formed (it may be effective from this date (ie its provisions may start from this date) or from another date, if specified). The main contractor and the subcontractor (ie the parties to the contract) are also clearly identified.
Background
This section provides context for the Agreement by identifying the main contract (eg a Services agreement) to which it relates. It acknowledges that the main contractor entered into the main contract with the intention that another party (ie the subcontractor) would perform some of the services (ie on a ‘back-to-back’ basis).
Meanings
This definition table assigns specific meanings to key terms used throughout the Agreement. When these terms (eg 'Deliverables’, ‘Services’ or ‘Service Levels’) are used capitalised throughout the Agreement, they carry the meaning they’re given in this table.
Provision of services
This section specified where and how (eg on an ongoing basis or in response to discrete requests from the main contractor) services will be provided, and the start and end date for services. This information is provided by reference to the Meanings table and to Schedule 2 of the Agreement, in which details of the services to be provided must be set out. The subcontractor’s obligations to perform the services with reasonable care and skill and in compliance with various areas of law (eg anti-bribery, data protection, and health and safety laws) are included.
Main contractor’s obligations
Certain things that the main contractor must do under this Agreement are set out here. For example, they must not change the services to be provided except by following the processes set out in the Subcontracting Agreement.
Defective services
This section explains what happens if the subcontractor provides services that are not up to acceptable standards. For example, the subcontractor should notify the main contractor promptly of any problems they’re aware of and the main contractor should report any defects that they become aware of to the subcontractor. The subcontractor must also provide further services to attempt to fix any defects and, if applicable, give the main contractor a credit against their charges.
Charges, payment and time records
This section contains the main contractor’s promise to pay the charges that you must set out in Schedule 3 of the Agreement. It sets out provisions relating to payment, for example, how VAT is handled and how charges will be calculated if charged on a time and materials basis (ie instead of a fixed fee). This section also explains:
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when and how invoices should be submitted and paid
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which expenses the subcontractor may claim and how, and up to which limit
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if a deposit is required, how much this is, how it will be handled, and when it must be paid
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how overdue payments will be dealt with (eg interest payable and the subcontractor’s right to suspend service provision in some specified circumstances)
Change control
This section explains how changes can be made to the service provision that’s required under this Agreement. For example, the main contractor can request changes (eg to volume or specification), but they must do so in writing and the outcome will depend on the subcontractor’s response.
This section also sets out the subcontractor’s right to make changes that are necessary to comply with the law (eg safety requirements), so long as the changes don’t materially affect the nature of the services.
Indemnity
This section contains the indemnity that the subcontractor is providing to the main contractor, committing to covering the costs of any losses the main contractor incurs due to claims from the customer of the main contract made because the provision of services under this Subcontracting Agreement does not comply with the specification for services under this Agreement.
Liability and insurance
This section sets out various rules for when the parties are each liable (ie legally responsible) for certain occurrences. It also imposes a requirement on the parties to hold insurance that’s sufficient to indemnify (ie cover) costs they may have to pay if they’re liable to pay another party compensation following legal claims in connection with the Subcontracting Agreement. The section specifically:
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clarifies legal rules on when liability cannot be limited, for example, liability for death or personal injury caused by negligence
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limits liability by stating that the parties aren’t liable for each other’s loss of profits or similar
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sets a limit (ie the maximum amount of money that a party can be liable to the other for) on the parties’ liability to each other for losses due to an event or a series of connected events related to this Agreement. Note that this is qualified by the subcontractor’s indemnity provided to the main contractor regarding claims from the customer related to the main contract (outlined above)
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explains that certain sections of the Supply of Goods and Services Act 1982 are excluded (ie not applicable to this Agreement), as far as legally possible. These are sections that deal with supplying goods that are sold based on a description or a sample and the requirement for goods to meet certain quality and fitness-for-purpose standards
Data protection
This section identifies the main contractor as a data processor (ie a party that processes personal data on behalf of a party that controls data) and the subcontractor as a sub-processor (ie a party that processes personal data on behalf of a processor). It then sets out commitments made by both parties that will help them to comply with data protection law. For example, the sub-processor will only process the customer’s personal data for the purposes specified in the Agreement’s schedule and will not transfer or disclose the data except in certain circumstances. Requirements regarding data security and contracting to further third parties to perform data processing services are also set out.
Confidentiality
This section sets out both parties’ obligations to protect and not disclose the other’s confidential information, except in specified rare circumstances.
Intellectual property
This clause asserts the subcontractor’s continued ownership of any of their intellectual property (IP) used to supply the services. It also grants the main contractor a licence for use of this IP and permission to grant a further licence to the customer, as far as necessary to enable them to reasonably use the services.
Anti-bribery
This section sets out the subcontractor’s promise to comply with anti-bribery laws and, if applicable, the main contractor’s and/or the customer’s Anti-bribery policies.
Non-solicitation
This clause is a non-solicitation clause (ie a type of restrictive covenant, or promise) that prevents the main contractor from soliciting (eg attempting to hire) the subprocessor’s employees without permission for a set amount of time after the end of the Subcontracting Agreement.
Circumstances beyond the control of either party
This force majeure clause explains what happens (eg the parties’ liabilities) if an event beyond the control of either party occurs (eg a natural disaster or a pandemic). Essentially, the parties are not liable for any failure to perform their obligations under the Agreement if such events occur. If one party is unable to fulfil its obligations due to the event the other may suspend its obligations to the same extent. Further, a party may end the Agreement or cancel services to be carried out if there is a delay of 90 days or more.
Termination
This section sets out the various ways in which the Agreement may be ended. These include termination due to certain things the other party has done, by giving a specified amount of notice if the main contract ends and, if the Agreement doesn’t have a specified term or end date, by giving a specified amount of notice.
Consequences of termination
This section sets out some things that will happen when the Agreement ends. For example, outstanding invoices should be paid and any of the subcontractor’s equipment that the main contractor is holding must be returned.
General
This section deals with various other points of law that govern how this Agreement operates. For example:
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preventing the parties from dealing with their rights or obligations under the Agreement (eg by assigning or further subcontracting) without the other party’s permission
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stating that this Agreement is the whole agreement between the parties (ie there are no additional terms). This helps avoid confusion if, for instance, other terms were in contemplation during negotiations
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excluding the Contracts (Rights of Third Parties) Act 1999 or the Contract (Third Party Rights) (Scotland) Act 2017. This essentially means that third parties (ie not the main contractor or the subcontractor) that would otherwise be able to enforce obligations under this Agreement under the Act cannot do so
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setting out how any notices or other similar communications that are given under the Agreement should be delivered
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clarifying that the Agreement does not create a partnership, joint venture, employment relationship, or agency relationship between the main contractor and the subcontractor
Governing law and jurisdiction
This section sets out which country’s legal system must be used to resolve any disputes (ie the Agreement’s ‘jurisdiction’). This is necessary as the legal systems of England and Wales and of Scotland are different.
The parties have signed this Agreement…
The Agreement ends with spaces for both parties to sign the contract to make it legally binding.
Schedule 1 - Main contract
The main contract (eg Services agreement) for the provision of services by the main contractor should be attached here.
Schedule 2 - Specification of services
This is where you must set out or attach details of the services that the subcontractor is to provide. For example, what they must do and how frequently it must be done.
Schedule 3 - Charges
The fees that the subcontractor is to receive in exchange for its service provision must be set out here.
Schedule 4 - Data processing information
This schedule sets out key information about the processing of personal data that may take place in order to enable the subprocessor to provide the services.
Schedule 5 - Service levels
If you’re specifying service levels that the subprocessor should meet when providing services, these should be set out here.
Schedule 5 or 6 - Anti-bribery policy
If the customer and/or the main contractor have an Anti-bribery policy in place, these should be attached here.
If you want your Subcontracting Agreement to include further or more detailed provisions, you can edit your document. However, if you do this, you may want a lawyer to review the document for you (or to make the changes for you) to make sure that your modified Subcontracting Agreement complies with all relevant laws and meets your specific needs. Use Rocket Lawyer’s Ask a lawyer service for assistance.
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Legal tips for contractors
Take care when creating your Schedules
This Subcontracting Agreement sets out the key terms of the service delivery relationship between the main contractor and subcontractor and covers many important legal points. It’s important, however, that the terms contained within the Agreement are supplemented by comprehensive Schedules. The Schedules are where the specifics of the services and payments are set out. You should make sure that your schedules are comprehensive and that they have been clearly negotiated and agreed upon between the parties. This avoids ambiguity as to any aspect of the services provision relationship, which could lead to disputes down the line.
Read the FAQs above and the Subcontracting Agreement’s Make it Legal Checklist for more information on the various Schedules. You can Ask a lawyer if you want help creating your Schedules.
Understand when to seek advice from a lawyer
In some circumstances, it’s good practice to Ask a lawyer for advice to ensure that you’re complying with the law and that you are well protected from risks. You should consider asking for advice if:
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the main contract does not permit subcontracting (you may be able to, for example, negotiate permission)
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you are subcontracting the provision of goods
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you want to check that the Subcontracting Agreement mimics the terms of the main contract, especially as regards obligations and liabilities
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the provision of services relates substantially to the sharing/exchange of data and/or the development or use of intellectual property
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there is pre-existing technology, intellectual property, or similar that needs additional protection
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there are embedded customer assets that need to be addressed
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Subcontracting Agreement FAQs
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What is included in a Subcontracting Agreement?
This Subcontracting Agreement template covers:
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the subcontracted services
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price and payment
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service levels (optional)
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change control (ie how changes to the required service provision may be made)
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liability for defaults or defective services (eg an indemnity for the main contractor)
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ending the Agreement
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the Agreement’s dependency on the main contract
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Why do I need a Subcontracting Agreement?
When a business that’s contracted to provide services to somebody engages another business to deliver some of these services for them, the main contractor and subcontractor should create a written Subcontracting Agreement to ensure that the terms of their arrangement are set out in precise terms to provide clarity and legal surety. For example, having an Agreement protects the main contractor if the subcontractor fails to perform or performs poorly. A Subcontracting Agreement will help to ensure compliance with the terms of the main contract.
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Who will be responsible for any default in the services or defective services?
If any default of (ie a failure to perform) or defect in (ie inadequate performance of) the services occurs, the main contractor remains liable to the customer under the main contract for this non-performance, regardless of whether the subcontractor or the main contractor was responsible for the default or defect. This is the case even when the customer consents to the subcontracted performance.
To help reallocate the risks that the main contractor faces due to this, this Subcontracting Agreement includes an indemnity (ie a binding promise to cover losses) from the subcontractor, by which the main contractor is indemnified by the subcontractor against the subcontractor’s failure to perform or their poor performance. For more information, read Subcontracting work.
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Can I make changes to the services?
In this Agreement, the main contractor can make changes to the services such as to the price and payment required or the volume and specification of services. Changes must be made following the proper procedures, for example, by making a written notification to the subcontractor with reasonable terms, which the subcontractor may or may not accept.
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How can I end a Subcontracting Agreement?
This Subcontracting Agreement may be terminated (ie ended) by either party if they give the other party a specified amount of notice of their intention to end the arrangement.
The Agreement may also be ended immediately (by written notice) in certain circumstances. For example:
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if either party is subject to administration or liquidation
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if a receiver is appointed
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if either party doesn’t pay a sum owed within a certain period from the payment due date, or
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if the supplier or the distributor fails to remedy a material breach within 30 days of being given notice about it. A material breach occurs if there is a breach of the Agreement that is not trivial and which has a serious effect on the benefit that the innocent party would have otherwise derived from the contract
The Agreement may also be ended by the main contractor giving a specified amount of notice if the main contract has ended.
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