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Standard Subcontract Agreement: What You Should Know

PASSAGE 1. All contractor items or services must be obtained in conformity with all applicable Federal, State, and Municipal Laws, ordinances, rules, regulations, codes, standards, orders, and codes applicable to the work performed. 2. Each subcontractor shall comply with all state, city, county, federal, and local environmental laws and regulations. 3. All contracts shall provide for payment of the contractor's cost plus time for the work to be performed at rates consistent with the rate of payment established in the Contract or its amendment and unless otherwise determined by the Agency, shall contain the following: a. The total amount of compensation to be paid to a subcontractor under the terms of the contract or amendment, expressed as a percentage of the total cost of construction to be charged to the Contractor. b. Where no Contract, amendment or subcontract may exceed the total amount of compensation to be paid: (i) Where payment in respect of the total cost of construction provided for the Contracted Part of the Contract to be paid to two or more Subcontractors that may be performed entirely by one Contractor, the payment of the subcontractors shall be so divided that no single subcontractor is paid less than the total amount of compensation paid to the subcontractors as determined under a, and (ii) Where pay of a single subcontractor cannot be divided into two or more payments of a proportional amount such payment shall not exceed the proportionate value of the total cost provided for the Contracted Part. c. Where more than one Contractor enters into one or more contracts with the same Subcontractor. Each Contractor shall pay to the other by the Due Date his proportionate share of the total cost of construction provided for the Contracted Part. All payments should be made as part of the separate payment, and separate account, and the Due Date that should be received for each of the Contractors to be paid under an agreement. d. Each Contractor shall keep complete records of the payments received from any one Subcontractor or Contractor, and shall provide them to the Contractor. e. Each Contractor providing services shall provide to the Subcontractor sufficient detail such that the Subcontractor may know where the supplies are located, what are the functions performed, and who will perform the services. f. The Contractor shall provide the Subcontractor with proper records of work performed on the Project.

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