A subcontractor agreement defines the working relationship between a contractor and a subcontractor, especially when part of a larger project is outsourced. This agreement serves as a roadmap, laying out the tasks, deadlines, and performance standards expected from the subcontractor. Additionally, the subcontractor agreement includes clauses on payment terms, confidentiality, and dispute resolution. It ensures that all parties have a mutual understanding, which reduces risk and promotes efficiency. For example, in a construction project, a contractor might use a subcontractor agreement to assign electrical work to a specialist. The document would spell out the materials used, work hours, safety measures, and deadlines. A properly drafted subcontractor agreement reduces the chances of legal challenges, missed deadlines, or cost overruns, offering peace of mind to both parties.