Getting paid on a construction project is one of these things where the details really matter, and one of these details that matters a great deal is the role that the party in question has on the project. How the GC Definition Affects Getting Paid When it comes to getting paid, this distinction is very important as we’ll discuss in the next section. There are many, many examples of construction companies that serve as the general contractor on some projects and jobs (when they are hired directly by the owner), while they are subcontractors on other jobs (when they are hired by someone other than the owner). On the other hand, if the project is commercial, new construction and the roofer is hired by the general contractor that’s overseeing the entire project, then the roofer would probably be a subcontractor in that case.
In this case, that roofer would be the direct (general) contractor. Often when an existing roof needs to be repaired or replaced, a roofing company might be hired directly by the property owner to do the work. To illustrate this point, let’s take roofers as an example. However, not all direct contractors necessarily see themselves as “general” contractors. To put it another way: if your construction company is working on a project or job, and you were hired directly by the property owner, then that makes you the direct or prime contractor. The general contractor is always going to be a direct contractor. This is determined by who the agreement is with, and not the nature of the work, the name of the company in question, or any other factor. Another name for this is the PRIME contractor.
We’ll explain why by first explaining what is meant by using the terms “direct” and “prime.” A DIRECT contractor is a party who contracts with and is hired directly by the owner of the property. The general contractor is sometimes known as the direct contractor, and this is very important when it comes to getting paid. Here’s the best general contractor definition for the construction industry: A general contractor is a party with the responsibility to oversee a construction project and who enters into the prime contract with the property owner. GCs Have 3 Big Challenges when it Comes to Payments.Is Preliminary Notice Required from GCs?.Your Project Role is Determined by who Hired you to Work on the Project.How the GC Definition Affects Getting Paid.
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