Subcontracting
Subcontracting lets the holder of a UK public contract pass part of the work to another firm. Naming subcontractors, payment rules and protections.
Updated on September 5, 2026
Subcontracting is the arrangement by which the holder of a public contract gives part of the work to another company, under its own responsibility. The main contractor alone is liable to the buyer; the subcontractor has a contract only with the main contractor. Unlike France, the United Kingdom gives subcontractors no right to be paid directly by the public buyer, so the protections come from the construction payment legislation and from the contract itself.
How it works
Subcontracting is normal in works and services, and buyers assume it. The Procurement Act 2023 touches it in several places: section 25 on sub-contracting specifications, section 28 which lets an authority exclude a supplier by reference to its sub-contractors, and section 73, which implies a 30-day payment term into every sub-contract in a public contract supply chain, running from receipt of a valid invoice (verified 2026-09-05). That 30-day term flows all the way down the chain, not just to the first tier.
Tender documents usually ask bidders to name the subcontractors they intend to use for key parts of the work, describe what each will do, and confirm that none of them is caught by the exclusion grounds. The buyer can require its consent before a named subcontractor is changed, and can check the replacement in the same way. Nothing stops it requiring that the main contractor keep a stated share of the work itself.
For construction, the Housing Grants, Construction and Regeneration Act 1996 gives subcontractors the machinery that matters in practice: staged payments, payment and pay less notices, the right to suspend for non-payment, and adjudication of a payment dispute at any time. On some public works, particularly in Scotland and Wales, a project bank account ring-fences money due to the supply chain. Ireland has an equivalent regime under the Construction Contracts Act 2013.
Do not confuse subcontracting with a consortium bid, where each member is a party to the contract with the buyer and the members are usually jointly and severally liable.
What it means for a bidder
For a main contractor, subcontracting lets you bid for work wider than your own trades, or absorb a peak. Name your subcontractors in the bid where you already know them: it makes your method statement credible and avoids an approval request mid-contract. Check their insurance, accreditations and tax position, because you carry the risk of their failures.
For a subcontractor, it is the easiest way into public work without owning the bid. Ask to be named in the tender, keep your own written contract, and make sure it does not try to exclude the payment rights the legislation gives you, since terms that conflict with them are ineffective. Watch your invoicing dates so the 30-day clock is on your side.
Prices matter too. If a package looks unrealistically cheap, the buyer can ask the main contractor to justify it as an abnormally low tender, so price your part properly rather than buying the work.
Example
A main contractor wins the refurbishment of a leisure centre for a borough council, worth £850,000. It subcontracts the electrical package, £95,000, to a local firm named in its bid and approved by the council. The electrician invoices the main contractor, is paid within 30 days under the implied term, and would be able to suspend work or adjudicate if payment stopped.
Frequently asked questions
Can the buyer refuse a subcontractor?
Yes, where the contract requires approval, and in particular if the subcontractor is subject to an exclusion ground or lacks the capability required. The reasons should be given.
Can a subcontractor subcontract in turn?
Yes, subject to the main contract terms. The implied 30-day payment obligation continues down the chain, but there is still no direct payment by the buyer.
Am I paid directly by the public body?
No. Payment comes from the party that engaged you, which is why the payment notices, suspension rights and adjudication under the construction legislation matter so much.