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Subcontractor Agreement and Contracting Agreement?

Los Angeles, CA |

I am starting an LLC for office cleaning services. I plan to do all the marketing, sales, customer service, and project management work while subcontracting out all the actual labor to a fully licensed cleaning business. I have a good idea of all the documents and procedures required to set up the LLC and will hire payroll services and an accountant. What I don't know is the type of contracts I need between (1) my LLC and the subcontractors, AND (2) my LLC and potential customers.

What are important issues to consider under such a business arrangement?

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Attorney answers 3

Best Answer

You will most likely need an Independent Contractor Agreement between you and your contractors and a Services Agreement between your company and your customers. Here are some of the points that an Independent Contractor Agreement should include: (1) the services your contractors will provide, (2) how and when you are going to pay them, (3) what types of insurance they are required to have, (4) how your liability is limited, (5) that they contractor is a contractor and not an employee (and why), (6) termination and (7) confidentiality/non-circumvention/non-solicitation of your clients. These are the big-picture points that should be included, but a lawyer will draft an agreement to make sure that you are protected as much as possible under these agreements and also that the deal between you and your clients/contracts is clearly defined.


You will need agreements that are specific to your business. You really need to consult with a local business attorney.


Ms. Olmon has provided excellent information and Mr. Spiritos' advice is also excellent. You should consult a business attorney on these issues.
Since you are using a separate and fully licensed business to perform the work, you should not have any difficulty with the independent contractor status and payments, as opposed to hiring workers as independent contractors to perform the work, but you will also be viewed by the customer as performing all of the work even though you are using an independent contractor, unless you disclose that you are brokering the work out.

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