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Letter of Intent to Hire a Subcontractor

A subcontractor letter of intent is used to show proof that a subcontractor intends to perform work for a general contractor (a.k.a. “principal contractor” or “prime contractor”). The document typically serves as a preliminary agreement between the two parties which would later be followed by the signing of a subcontractor agreement. Although the letter is merely a summarized version of a formal contract, it still incorporates several key aspects relevant to the work such as payment information, the subcontractor’s responsibilities, the service location, and the start/completion dates of the proposed project.

Subcontractor Agreement – Legally binding agreement between a contractor and subcontractor.

What is a Subcontractor?

A subcontractor is an individual or business hired by a principal contractor to assist in completing part of an existing contract. Subcontractors often provide advanced knowledge that focuses on one specific field or area of expertise. As a result, they are likely able to perform their duties more efficiently and with greater skill than if completed by a general contractor. Hiring a subcontractor is also a more cost-effective measure than employing new staff as the subcontractor is not entitled to any benefits or legal protections reserved for employees.

While subcontractors are usually associated with construction work, they can also operate in consulting, interior decorating, service repair, and any other independent work performed without an “employee” status. Some common fields of subcontracting are as follows:

  • Electrical
  • Plumbing
  • Carpentry
  • Roofing
  • Flooring
  • Framing
  • Drywall
  • Painting
  • Air Conditioning/Heating

Subcontractor Letter of Intent – Sample

SUBCONTRACTOR LETTER OF INTENT

Effective Date: April 19, 2019

RE: Intent to Perform Work as a Subcontractor

This subcontractor letter of intent (the “Letter of Intent”) represents the basic terms agreed upon by the Subcontractor and Contractor. After this Letter of Intent has been made, a formal agreement may be constructed to the benefit of the Parties involved.

I. The Subcontractor: John Plumber (“Subcontractor”).

II. The Contractor: Smith Construction and Demolition, LLC (“Contractor”).

III. Services Provided: Subcontractor agrees to provide the following services: Proper installation of toilets, sinks, and showers found within the primary service Location described in section VI below (“Services”).

IV. Payment: Contractor shall pay the Subcontractor $2000 for the Services (“Payment”).

V. Payment Method: Payment shall be made by the Contractor to the Subcontractor immediately upon complete performance of the Services.

VI. Location: The primary location for the Services performed by the Subcontractor shall be 4321 Crescent Avenue, Richmond, Virginia 23173.

VII. Commencement Date: Subcontractor shall be permitted to commence the Services on April 25, 2019 (“Commencement Date”).

VIII. Completion Date: Subcontractor will be required, unless otherwise stated under the terms of a future agreement between the parties, to complete the Services by the specific date of June 12, 2019.

X. Binding Effect: This Letter of Intent shall be considered non-binding. Therefore, the parties acknowledge that this Letter of Intent is not enforceable by any Party. The terms outlined herein are solely for the purposes of reaching a later agreement in the future, of which, Subcontractor and Contractor are not bound.

XI. Currency: All mentions of money or the usage of the “$” icon shall be known as referring to the US Dollar.

XII. Governing Law: This Letter of Intent shall be governed under the laws by the State of Virginia.

XIII. Acceptance: If you are agreeable to the aforementioned terms, please sign and return a duplicate copy of this Letter of Intent by no later than April 22, 2019.

SUBCONTRACTOR

Subcontractor’s Signature ______________________ Date ______________________

Print Name ______________________ 

CONTRACTOR

Contractor’s Signature ______________________ Date ______________________

Print Name ______________________


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