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Community and Q&A

Is construction contracting a bait and switch?

Steve Knapp CZ 3A Georgia | Posted in General Questions on

I noticed this issue with my last house and also with the one that is currently under construction. It seems that few of the contractors who bid for my projects actually do any of the hands-on work. Moreover, it is seldom done by contractor employees either. Instead, the contractor (who is typically licensed and insured) subcontracts the work to other “professionals.” On my current project, I’ve talked to the builder about this practice of jobbing projects and then handing them off, and he says that’s just the way things are done nowadays.

So is that the case in the rest of the country, or is this another peculiar practice limited to the Deep South?

This just seems like a bait and switch to me. A reputable front secures the work and then hands off your project to another team. On a few occasions, I’ve arrived onsite to find these workers doing the wrong thing, sometimes with the wrong materials, and the contractor no where to be seen. The whole thing seems exploitative.

Straighten me out if I don’t have the complete picture.

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  1. Dan Kolbert | | #1

    There is a huge labor shortage in the trades. Young people are not entering in anywhere near the numbers we need. As a building contractor I am increasingly reliant on subs. And that does require a higher degree of organization, supervision and communication.

    OTOH, there's nothing wrong with it in theory, and in fact can lead to a higher quality, faster, cheaper job if the subs are good "specialists" and are being organized by someone with a deep understanding of the big picture.

  2. David Meiland | | #2

    Some contractors sub out all the work, including carpentry, and I don't think it's necessarily good or bad. It can reduce costs, because the carpenters are moving around from place to place, going where the work is, instead of expecting the same 40 hours from the same employer every week. It can be really tough to have the right amount of manpower every day, because some days you need a lot and some days you don't. Subbing makes that part easier. Frankly, if there were good carpentry subs in my market, I might do more subbing. but there aren't, so I have carpenter employees (and we often do other types of work in-house too). As a result, I spend a lot of time figuring out who goes where and does what every single day, in addition to all the other hats I wear.

    You can get unsupervised employees with the wrong materials on your jobs just as easily as subs. It all comes down to finding the right contractor to deal with, and asking up front who does what and who is responsible for what. I just started a job for an attorney and he did an impeccable job asking questions about how I operate, who would be doing the work, what I would be doing, and so on. Almost no one does that.

  3. GBA Editor
    Martin Holladay | | #3

    The type of contractor you are describing is known as a general contractor (GC). If you've chosen a good GC, he or she will be aware of the scope of work and the specifications, and will have a legal responsibility to fulfill them. He or she will also provide you with a warranty. If anything goes wrong, the GC is responsible.

    If you are a responsible client, you will protect yourself with contract documents. The contract documents will spell out the scope of work and the specifications, so that when you find "workers doing the wrong thing," you have documents to back up your understanding of the work.

    Some GCs have employees, and some GCs hire subcontractors. You can get good or bad work with either system. Just because a GC has employees doesn't mean they are competent. And just because a GC hires subcontractors, doesn't mean that the work won't be done well.

  4. Steve Knapp CZ 3A Georgia | | #4

    Thanks, Martin:

    I understand what to expect from a GC and have a strong contract in place to protect my investment. What is curious to me is how many of the subs are really just brokers for the work. They win a project and then contract it out to a second layer of subs. I understand that most subs are using what amounts to day labor to meet their project requirements. The relationships endure as long as there is work.

    Since I'm contracting to build a home, I don't inhabit this industry the way you and the other professionals on this discussion board do. But I've noticed that I usually receive superior project performance when the primary subcontractor is actually onsite and helping to complete the work. When I can, I always ask if the person I'm talking to will be performing or at least supervising the work (as David Meiland suggested). The assurance I receive are not always realized when work gets underway, however.

    Perhaps part of the problem is that my GC takes a very hands off approach to most aspects of the project. He typically addresses issues at the end of the process and requires rework where necessary. My preference would be to make sure the workers understand the project specifications and goals from the start and to correct problems as they arise. But that's just me.

    The whole way that home construction is done seems incredibly inefficient. I suppose that is a particular issue with custom homes. My wife and I have already decided that our next home, if we ever build it, will be modular. After two custom home builds, we just can't stand the general ineptitude of the traditional process if you are trying to build a green and healthy home.

  5. Dan Kolbert | | #5

    I would address poor work immediately. And I agree - the higher your energy efficiency goals, the more supervision required of subs - it's very easy to screw things up. Take a lot of progress shots. And if you haven't already identified critical details, do so before it's too late to make them right.

  6. David Meiland | | #6

    >>Perhaps part of the problem is that my GC takes a very hands off approach to most aspects of the project. He typically addresses issues at the end of the process and requires rework where necessary.

    Yuck. Sounds like he wants the most money for the least effort. What value is he providing? I would hire someone who actually comes to the jobsite every day and manages the work.

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