Blog. Comments Off on Retentions

To an increasing extent we are outsourcing project work – maybe our entire project or at least part of the work is given over to a contractor to complete who in turn may contract out packages of their work to subcontractors or subbies as we call them.  Thus contracts between the client and the principal contractor and between the principal contractor and their subcontractors are commonplace.  A practice, particularly in the construction industry, is for the client or principal contractor to have a provision in their standard contract that allows them to retain a portion of payments until both parties agree that the work is properly completed.  So retention or retainage in this sense has nothing to do with improving customer loyalty, reducing customer defections or even a medical complaint, but everything to do with creating an incentive to retain … Read More »


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