So here’s a question; Does someone have their eyes on YOUR RETENTION?. Well here at the home of Ad Valorem, we would not be particularly surprised to have a Sub Contractor, express a concern to us, that (some not all) Employers may be acting as though this is upon their agenda. Granted many SME & Sub Contractor Business Owners, shall regular complain of how Retention is a total Pain in the Neck, but in general this is mainly as a consequence of the delay, that is regularly experienced by most in having to wait for what is genuinely due and owed to them and being paid by Main Contractors & House Builders !.

And here is probably what is the hard bit to hear, but can be the brutal truth and reality: some Sub Contractors attitude towards Retention & their Retention Management, can actually give the impression to Main Contractors & House Builders, that the recovery and payment of their Retention Account is not really important to them, and therefore could well be easy pickings and up for grabs !.

Your Retention may not be as safe as you may be thinking ?

Here are the top 5 most regular moans and groans from Sub Contractors about seeking the payment of retention and the how it directly impacts upon their business with un-necessary, un-productive, abortive management time.

one; the quantity surveyor working on the project account has left the business.

two: no one in accounts knows anything about the job.

three: the only person who speaks to me is from customer care and they say it is not due.

four: when someone finally spoke to me they needed to check the account.

five: customer care sent an email and are going to charge me if i don’t attend to some snagging.

What you should keep to hand and need to know to help recover YOUR Retention:

Keep a copy of your Sub Contract Documentation Terms & Conditions Keep a record of your Payment Certificates Keep a record of your Statement of Final Account Keep a record of the Date of the actual Completion of YOUR Works Keep a record of the Main Contract Completion Date

It is in Black & White

The First Step in sensible and prudent Professional Retention Management begins with the question and understanding what is actually written in black & white ? – that is to say the Sub Contract Terms & Conditions ?

Thereafter: 3 things you MUST know from the outset about retention release:

  1. when is retention due for release
  2. how are you obliged to apply for retention release
  3. when can you expect to receive payment of retention release

It is not uncommon for Main Contractors & House Builders to attempt to amend standard terms & conditions, you should therefore have someone read and check the proposed terms and conditions, if you are uncertain yourself, and before you sign any new sub contract, whether it is an existing or new Employer.

This practice shall then at least enable you to make an informed decision as to the level of Contractual & Commercial Risk you are being obliged to undertake.

In any event, any Certified release of Retention and Payment is no different to any other Application by virtue of the fact that the process and time scales must be set out in the Sub Contract Documentation:

  1. The Release & Payment of Retention should be included within the Sub Contract Payment Schedule.
  2. The Application for Retention should be like and in accordance with any other Application for Payment.
  3. The Payment of Retention should be like and in accordance with any other Application

CAUTION! – the catch will come at any point during the Defects Liability Period therefore and in brief the main things to watch out for MUST be:

  1. Any Notice of Defective Works (Snagging) must be issued in Writing from the Employer to You
  2. Acknowledge and Respond in writing to any Notice of Reported Defective Works as issued by the Employer
  3. If there is a genuine defect, always attend to it promptly and responsibly.

IGNORE any of the above AT YOUR PERIL

You are putting yourself at RISK when:

Please be aware, that if you fail to attend to any of the above, then you shall be in all probability vulnerable to the deduction of any cost directly incurred as a result of the rectification of any making good of defective works by others along with any reasonable management costs incurred by the Employer FROM YOUR RETENTION POT.

This is when YOUR RETENTION is at RISK legitimately.

Beware, there maybe also a darker side, but that is for a conversation between us directly.

There is much, much, more about ensuring the recovery of all your Retention and without having to resort to adjudication or legal proceedings, every Sub Contractor in UK Construction has a powerful case for the recovery of due payment, Ad Valorem can deliver this expertise and service to you. It costs nothing to Call Us – only your time.

Don’t Forget our Saturday Morning Surgery Free & Without Obligation advice *every Saturday between 9:45 & 11:45am

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