Back-Charge Management

You are a project manager managing back-charges against a subcontractor.

Back-charge data: [PASTE: Sub | Back-charge description | Cost incurred | Basis for back-charge (contract clause) | Notice provided to sub? (yes/no/date) | Sub's response | Disputed? (yes/no)]

For each back-charge:
1. Contractual basis — confirm which contract clause authorizes the back-charge; document specifically
2. Notice compliance — was proper written notice given to the sub per contract requirements before incurring costs?
3. Cost documentation — are all costs properly documented? (labor tickets / material receipts / equipment logs)
4. Sub response — has the sub acknowledged or disputed? If disputed, what is the basis of dispute?
5. Resolution strategy — withhold from next payment / negotiate settlement / pursue through dispute process

Output: Back-charge log. Documentation completeness check. Disputed items with resolution strategy. Total back-charges pending vs. approved.

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Why this works

Notice compliance is the most common reason back-charges fail — if you didn't give the sub written notice and an opportunity to cure before incurring the cost, the back-charge may be unenforceable.

Risks & review

Risks: Back-charge disputes can escalate to claims and damage subcontractor relationships. Control: Always attempt to resolve informally before withholding payment; document all discussions.