payment, and compliance
risk assessment

Overall Score
🚀 Project kickoff
🛠 Progress billing
💸 Progress payments
✅ Project closeout

Project Kickoff

Kicking off a project is where you can set the stage from how the project will go forward.

Subcontracts signed before work starts: Having signed subcontracts in place before work begins ensures that all parties involved in the project are on the same page in terms of scope of work, timeline, and budget. This helps to reduce the risk of misunderstandings or disputes down the road.

Certificate of insurance (COI) collected before work begins: Collecting a COI from each subcontractor before work begins ensures that they have the necessary insurance coverage in place to protect themselves and your company from potential liabilities.

Limits checked on COIs before work begins: It's important to review the limits on each COI to ensure that they meet the requirements set forth in the subcontract. This can help to protect your company from potential gaps in coverage.

Licenses reviewed before work begins: Reviewing licenses ensures that each subcontractor has the necessary credentials to perform the work required on the project. This helps to ensure that the work is performed safely and in compliance with all applicable regulations.

Safety plan reviewed before work begins: Reviewing the safety plan ensures that all parties involved in the project understand the potential hazards and have a plan in place to mitigate those risks. This helps to minimize the risk of accidents and injuries on the job site.

Schedule of values reviewed & approved by project manager before first invoice: Reviewing and approving a schedule of values ensures that the invoicing process is accurate and transparent. This helps to ensure that subcontractors are compensated in a timely and fair manner and helps to avoid payment disputes.

Progress Billing

The name of the game in progress billing is getting all the documents in the right place, at the right time and then having the time to review them all.

Documents that should ALWAYS be required for a subcontractor to submit for payment:

  • Standardized payment application (pay app)
  • Partial conditional lien waiver
  • Statutory lien waiver based on project location

Documents that should be required if your subcontractors are using lower tier subcontractors and vendors:

  • A list of lower-tier vendors
  • Sworn statements

If any change orders have been issued, they must be signed and approved by all parties before the subcontractor can bill for the work on the change order. If you allow them to bill for the work before it is approved by the project owner, you could be on the hook for paying the difference.

Progress Payments

Progress payments are the riskiest part of the whole subcontractor billing cycle. You have to:

  1. Make sure that payment information is up-to-date, secure, and has not been compromised.
  2. Make sure that all compliance items, unconditional waivers, and other holds are addressed before sending payment.
  3. Release payments through a secure channel. ACH is the most way to send payments while checks remain the most time consuming and risky.

Project Closeout

This is where the whole project comes together and it is imperative that all the boxes are checked here or you and your client could cause headaches for years to come.

Things you need from everyone that worked on the project:

  • Final conditional lien waivers
  • Final unconditional lien waivers
  • Warranty forms and close-out documents
  • Final retainage releases and waivers

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