Stormy waters: Issues when paying subcontractors directly

By Sarah Leaver 2019-07-18T05:00:00

Sarah Leaver on a boatbuilding case that highlights problems in paying subcontractors directly

Employers can sometimes find themselves wishing to make direct payments to subcontractors engaged by their contractor. This could be, for instance, if a payment dispute arises at subcontract level or if the main contractor suffers cash flow difficulties. Subcontractors may threaten to terminate or suspend work and the employer may feel that direct payments are necessary to keep the project afloat.

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