Back to back contract provisions
Most of the main contractors include a back-to-back clause in their subcontract agreements with their subcontractors. These back-to back-clauses ensure that the main contractor will not be liable to pay the subcontractor payments, unless the main contractor receives the equivalent payment from the employer. Back-to-back contracts are here to stay with contractors believing this is the best way to protect or transfer their risks and obligations to maximise their interests. While main contractors should beware of the opportunities afforded to subcontractors through back-to-back contracts, subcontractors need to be fully aware of the opportunities they have through such contracts.