Sub Contract Work Agreement Template for Philippines

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Sub Contract Work Agreement

"I need a Sub Contract Work Agreement for a software development project in Manila, where we'll be subcontracting a local tech firm to develop specific modules of our banking application, with work commencing in March 2025 and including strict data security provisions."

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What is a Sub Contract Work Agreement?

The Sub Contract Work Agreement is a vital document used in the Philippine business environment when a main contractor needs to delegate specific portions of a project or ongoing work to a specialized subcontractor. This agreement is particularly important given the strict regulatory framework in the Philippines regarding contracting and subcontracting arrangements, especially under Department Order No. 174-17 and the Labor Code. The document typically outlines detailed work specifications, payment terms, compliance requirements, and risk allocation between parties. It's essential for projects requiring specialized expertise, additional workforce capacity, or specific technical capabilities that the main contractor may not possess internally. The agreement must carefully address local labor law compliance, social security requirements, and worker protection measures to ensure legitimate subcontracting arrangements under Philippine regulations.

What sections should be included in a Sub Contract Work Agreement?

1. Parties: Identification and details of the main contractor and subcontractor, including their legal business names, registration numbers, and registered addresses

2. Background: Context of the agreement, including reference to the main contract and the basis for subcontracting

3. Definitions: Definitions of key terms used throughout the agreement

4. Scope of Work: Detailed description of the work to be performed by the subcontractor, including specific deliverables and requirements

5. Term and Timeline: Duration of the agreement and key project milestones

6. Payment Terms: Compensation, payment schedule, and invoicing requirements

7. Obligations of the Subcontractor: Specific duties, responsibilities, and performance standards expected from the subcontractor

8. Obligations of the Main Contractor: Responsibilities of the main contractor, including provision of necessary information and materials

9. Compliance with Laws: Requirements for compliance with Philippine labor laws, safety regulations, and other relevant legislation

10. Insurance and Liability: Insurance requirements and allocation of risks between parties

11. Confidentiality: Protection of confidential information and trade secrets

12. Termination: Conditions and procedures for terminating the agreement

13. Dispute Resolution: Process for resolving disputes, including jurisdiction and governing law

14. General Provisions: Standard legal provisions including notices, amendments, and severability

What sections are optional to include in a Sub Contract Work Agreement?

1. Intellectual Property Rights: Section defining ownership and usage rights of any intellectual property created during the project, used when the work involves creation of IP

2. Equipment and Materials: Section specifying responsibility for providing and maintaining equipment and materials, used when significant equipment or materials are involved

3. Performance Bond: Requirements for performance security, used for high-value or high-risk projects

4. Force Majeure: Provisions for handling unforeseen circumstances, particularly relevant in long-term or complex projects

5. Non-Competition: Restrictions on competitive activities, used when protecting business interests is crucial

6. Employee Welfare and Benefits: Specific provisions for employee benefits and welfare, used when subcontractor's employees work primarily on-site

7. Environmental Compliance: Environmental protection requirements, used for projects with environmental impact

8. Quality Control: Specific quality standards and inspection procedures, used for technical or specialized work

What schedules should be included in a Sub Contract Work Agreement?

1. Schedule A - Scope of Work: Detailed technical specifications and requirements of the work to be performed

2. Schedule B - Payment Schedule: Detailed breakdown of payment terms, milestones, and rates

3. Schedule C - Project Timeline: Detailed project schedule including milestones and deadlines

4. Schedule D - Key Personnel: List of key personnel from both parties involved in the project

5. Schedule E - Safety Requirements: Specific safety protocols and requirements

6. Appendix 1 - Required Permits and Licenses: List of necessary permits and licenses to be maintained

7. Appendix 2 - Insurance Requirements: Detailed insurance coverage requirements and minimum limits

8. Appendix 3 - Quality Standards: Specific quality standards, metrics, and acceptance criteria

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

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Construction

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Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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