Contracts are supposed to be fair. The Australian Standards templates however are not written for the sole benefit of the commercial contractor.
My view is Australian Standards contracts are too difficult to comply with. If you are a commercial contractor wanting to build a successful and sustainable business, I highly recommend either getting advice from a lawyer or investing in compliant building and construction software. In the meantime, here are my tips for Commercial Contractors to help manage Australian Standards Contracts.
Australian Standards Contracts Tips for Commercial Contractors
1. Exercise Due Diligence
You must know who you are sleeping with. Investigate the business or person you are about to engage in business with, prior to signing a contract. This is probably the most commonly overlooked step when you are excitedly awarded a large contract from a new client. Hold off on estimating those profits and find out who you are really dealing with.
2. Implement Compliant Systems That Add Value
Your systems need to be contractually compliant with Australian Standards so that you are not in breach of your contractual obligations. However, the systems you implement should be adding value to your business, not simply be in place to “tick a box”. It is better that the systems that you implement for compliance with Australian Standards contracts also add value to your business’s bottom line.
For example, by implementing best practice systems that help you comply with your contractual obligations under Australian Standards contracts, you can experience increased efficiency and quality in your work. Whilst at the same time reducing double handling and costly errors.
3. Surround Yourself With Experts
You are great at what you do. You’re an expert but when the differences in opinion come about, as they often do with project work, then you better be sure you have excellent paperwork. So when negotiating the contract terms, surround yourself with experts in commercial contract administration.
4. Complete Your Site Diaries
All staff must complete a site diary. This is the best way to track the life of the project. They can also be a powerful tool for future work and disputes. Site Diaries are excellent for tracking your costs to complete, assist with future estimating, providing evidence for allegations with disputes, and more. This is a simple but effective measure any commercial contractor can do.
5. Be Prepared to Walk Away
Walk away from the contract if you don’t feel good about it. We have so many insolvencies in our industry. Be prepared to walk away.
6. Communicate, Collaborate
Australian Standards contracts are detailed yes, but the single best thing I think any commercial contractor can do is communicate both verbally and in writing.
As a Building and Construction Lawyer, I have experienced firsthand what it’s like to be on the commercial contractors’ end of an Australian Standards contract. Believe me, diligence in both your actual work and in your paperwork is how you will stay winning.
If you have any further questions about Australian Standards contracts please call us on: 02 8096 8576. We’d be happy to help.