Subcontractor Termination Letter With The Example You Can Implement

If you feel that your subcontractor starts making any loss to your business, then it is the perfect time to end the relationship with your subcontractor. You can notify it whether directly or through a subcontractor termination letter. Start writing your termination letter with the detailed cause and evidence to protect your financial business to keep on the proper way.


What’s The Difference Between The Subcontractor And Contractor?

There is a significant difference between these two, contractor labor for themselves while subcontractor labor and paid by the contractor. The subcontractor has responsible to the contractor to finish certain projects in a period of time is behind the reason why the contractor paid them. These two commonly labor together to finish the specific project of the job for a company or the principal who is the one compensated by the company.

Who Is Responsible For Subcontractors Work?

A subcontractor generally under the sight of the contractor who paid them and provides them a part of the service agreed upon by the principal (owner), contractor, and subcontractor. Subcontractor required if there are many packages project that will complicate the contractor in managing the site project. In addition, the subcontractor also required to:

  • Finish the type of specific project which needs specialization.
  • To make the work projects more efficient.
  • Make the finance output allocated in a proper way.

The presence of the subcontractor is also important to help the contractor because in the site project there are many kinds of aspects of work that will not be able to cope with the only contractor. So, the help of the subcontractor also required.

How To Write A Subcontractor Termination Letter?

The first thing first is to verify the owner’s approval first then confirm the ground for the termination. Make sure to attach all the evidence that already reviewed and enclosed in the letter. Follow the valid procedure for proper termination and do not forget to give the clarification about all the miss in the financial aspect (if there any) and give a clear date/time regarding this in the letter.

An Example Of Subcontractor Termination Letter

Dear Mr. Slammer,

This letter is to inform you, that effective immediately September 15, 2011, the contract between Gates Contracting Services and KL and More is being terminated due to violations of the performance and quality clauses contained in the contract terms. This decision is final with no negotiation. For clarification, I am outlining some of the more serious breaches of our contract below.

On June 5, 2011,———— evidence 1.

On June 15, 2011,———- evidence 2.

In conducting business with your company, our customer service representatives have recorded more than 10 complaints due to workmanship errors, damage to the property where work was being performed, missed appointments, and substandard material installation. I believe that continuing to use KL and More as a subcontractor would seriously damage our company’s reputation and our ability to turn a profit.

I am able to prove all of the claims in this letter with documented evidence. Your company has been paid in full for all finished work. If you have any questions, you may contact me at (123)-1231234 during normal business hours.


Mr. Hill Plumber
General Manager

May this article can be useful for you and help you in understanding this subcontractor termination letter. Feel free to edit the example if required.


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