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How To Protect Yourself When Hiring A Subcontractor?

Rhino Trade Insurance 16 February 2022

In the fast, hustle-bustle business of contracting trade workers, you may be wondering what's the best way to find the best subcontractors. Do you look online, do you ring around your contacts, or do you go old-school and whip out the yellow pages? 

Rhino Trade Insurance has as a few tricks up our sleeves for finding the best people, and we want to share with you what to look out for. Getting the right subcontractors on your project could be a make-or-break moment when it comes to your insurance. 

Education on hiring a subcontractor

When you manage a project that relies on different trades, you will most likely be hiring a handful of subcontractors. First off, this is different to hiring a standard employee and, as you guessed, comes with different types of risks attached. With that said, subcontractors are fantastic! They carry various benefits from helping you open up your business to new skill sets, lighten to loads of work on-site and offering flexibility that you otherwise wouldn't have with a permanent employee. 

Types of Subcontractors

Labour-only subcontractors

Anyone working as a trade contractor will find two distinct types of subcontractors. A labour-only subcontractor could go down as being very similar to an employee. On a daily basis, they will work under your guidance and use any equipment, tools, or materials you have provided. As you are the project manager, you will determine their hours of work, the location of their work and how they do the job. 

When you have this Subcontractor, you will need Employers' Liability Insurance. This type of insurance policy is put into place to protect you if a claim arises from a member of your staff. If they are injured, die or cause damage whilst undertaking work for you, then a claim could be heading your way. Having this type of insurance is like a safety net and is needed by law for anybody in the UK who hires workers. At Rhino Trade Insurance, you can find our Employer's Liability Insurance starting from just £72.80 a year!

Bonafide subcontractors 

You may have heard of Bonafide Subcontractors. These are the chaps who are more independent and set their own work hours. They will invoice you for any work done and expect to be paid. A few bonuses when it comes to Bonafide Subcontractors is that they will not need any supervision when working. You can stay calm and know that they are getting the work done to a high standard. Also, they will bring their own tools, materials and any equipment they need. 

One thing they will need is their Public Liability Insurance. This is in case they come on-site and cause any damage or injure someone because of their work. What's more, if they have any staff, you will have to make sure they have all the relevant insurance needed. At Rhino Trade Insurance, our Public Liability Insurance costs just £6.07 a month. 

Sign a Contract

When you iron out the details with your Subcontractor, you should make sure that everything discussed is in the contract. That means, should anything go pear-shaped, you will have evidence of accountability and ownership written down. 

Things to include could be:

  • What the work agreed upon is
  • The time that is expected to take to complete the work
  • The rate of pay to the Subcontractor
  • The Subcontractor is independent, and no tax deductions fall to your doorstep
  • The cost of any expenses or materials needed to do the work
  • Reasons for terminating the contract
  • Confidential Information
  • A non-compete clause
  • A dispute clause 
  • A risk transfer agreement 

This may seem like jargon, but all are essential elements to a contract when hiring a Subcontractor. You want to be sure from the outset what is agreed and who will potentially take the blame should something unexpected happen. 

Communicate clearly with your Subcontractor

It may seem obvious, but having good communication skills is vital when handling subcontractors as the main contractor. You want to be as open and transparent as possible because that will ultimately help you garner the best trades around. If word spreads that you are a straight-down-the-line contractor, with no messing around and delivering on your word, then more subcontractors will want to work for you. 

On the client-side. Communication is vital as you want to make sure that they are happy having a sub-contractor on-site and doing the desired work. Clear communication and open channels of dialogue are a must here. If anything needs discussing, have an open and frank conversation with everybody involved. 

For anybody looking for information on Subcontractor Insurance or who has any questions about the trade, Rhino Trade Insurance are happy to help. Give us a call now on 0116 243 7904.

Risks when hiring a subcontractor

There are a few factors to consider when hiring a Subcontractor. Here are the three main concerns: 

Time Management

As with the communication section above, you need to be clear and set out from the start what your expectations are with the Subcontractor so that they can give you a precise quote back. This will include whether they can get the job done in the time you set and on budget. One thing that can help with this part is having them come to the site and have a walk-through. 


The most important. Make sure they are sufficiently insured and protected should something go wrong. Having spent over 20years in the trade insurance game, we understand how easy it is for something to go wrong. In an industry that's full of risks and hazards, you'd be foolish to gamble your business and livelihood on an uninsured tradesperson. 

Quality Control

This depends on whether or not you know the Subcontractor in question. If you do, then it's all hunky-dory. However, hiring someone, you don't know or is recommended still carries some doubt. You can ask for references or past examples of work. The most important aspect is to make sure they are skilled and experienced in what you need and ask yourself: "Does the quality they offer match the quality that you guarantee?". 

Get In Touch With Rhino Today

Our UK-based team is on-hand six days a week to get you sorted if you have any questions. Whether that's questions on specific policies or finding out the right level of cover for you, we are here to help. 

Get one now via our handy online form if you want a quick and easy quote. 

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