Create a Subcontract (Legacy)

Subcontracts can be awarded during both the preconstruction and construction phases of a project and are typically created and tracked in Procore by project management. After a prime contract award, the project manager creates purchase orders and subcontracts for specific trades to secure materials and subcontractor services for a project.

• Required User Permissions:

  • To create a subcontract and see/enter data on the Schedule of Values (SOV) tab, users must have one of the following permissions levels:

    • 'Admin' level permissions on the project's Commitments tool.

    • 'Standard' level permissions on the project's Commitments tool and the 'Allow Users to See SOV Items' setting must be enabled and your name must be selected in the 'Select a Person' drop-down list

  • To create a subcontract only, 'Read Only' or 'Standard' level permissions on the project's Commitments tool with the 'Create Work Order Contract' granular permission enabled on your permissions template.

• Additional Information:

  • An alternative way to create a subcontract is to award a winning bid and convert it into a subcontract. See Award a Winning Bid and Convert it into a Subcontract.

  • To set the accounting method for the subcontract, see How do I set the accounting method for a contract or funding?

  • For companies using the ERP Integrations tool: Prerequisites, requirements, limitations, and considerations might apply depending on the ERP system your Procore account is integrated with.

• Configure Advanced Settings: Commitments

• To use the Procore + DocuSign® integration to request signatures on a contract, see Enable or Disable the DocuSign® Integration on a Procore Project.

• Step 1: Create a Subcontract

• Step 2: Enter the Schedule of Values (SOV)

Step 1: Create a Subcontract

1. Navigate to the project's Commitments tool.

2. Click +Create and select Subcontract from the drop-down menu.
   

3. In the 'General' tab under 'General Information', do the following:
   

   • Sign with DocuSign®
     If you have enabled the Procore + DocuSign® integration (see Enable or Disable the DocuSign® Integration on a Procore Project), a checkmark appears in this box by default. If you do NOT want to collect signatures with DocuSign®, remove the mark.

      Tip

     How do you collect signatures with DocuSign? After the data entry for the item is complete, Procore recommends changing the item's status to 'Out for Signature' before clicking the Complete with DocuSign button to launch the DocuSign® application. If you have not previously signed in, you will be prompted to Log In to DocuSign®. Once you are signed in, you can prepare the DocuSign_®_ envelope for signatures. After the signature process is complete, Procore automatically changes the status of the item to 'Approved' and marks the item as 'Executed'. To learn more, see DocuSign®.

   • Number #
     Accept the default number, enter a new number, or create a custom numbering scheme.

     For companies using the ERP Integrations tool:

     • In order to send the commitment to the ERP Integrations tool to be accepted for export by an accounting approver:

       • Your integrated ERP system may impose a maximum character limit.

       • Prerequisites, limitations, and considerations might apply depending on the ERP system your Procore account is integrated with. Visit Things to Know about your ERP Integration for details.

   • Title
     Enter a descriptive title for the subcontract.

   • Contract Company
     Select the company responsible for completing the work on the subcontract (for example, American Construction Co.).
     Notes:

     • To appear in this list as a selection, add the company to the Project Directory.

     • You must select a contract company before you can name an invoice contact.

   • Invoice Contacts
     Select one (1) or more employees of the 'Contract Company' to designate as the invoice contact(s). After saving the subcontract, any users added here will be added to the 'Private' list. You must select a 'Contract Company' before you can select invoice contacts.

   • Status
     Assign a status to the subcontract.

   • Executed. Mark this checkbox to denote that the subcontract was fully signed and executed.

      Notes

     • Many Procore users choose to place a checkmark in the Executed box when placing the commitment into the 'Approved' or 'Complete' status.

     • The time at which your project team places a checkmark in the Executed box should always be aligned with your project's unique business process

• Private
  Mark the checkboxes and choose any project users or collaborators from the 'Select a Person' list. To learn more about the privacy options, see Change the Privacy Settings for a Commitment.

  • Make this visible to only administrators and the following users
    Mark this checkbox to limit the visibility of the purchase order to users with 'Admin' on the project's Commitments tool and users specified in the 'Select a Person' drop-down list.

  • Allow these users to see SOV items
    Mark this checkbox in this box to limit the visibility of the Schedule of Values (SOV) items on the purchase order to users with 'Admin' on the project's Commitments tool and users specified in the 'Select a Person' drop-down list.

1. Default Retainage
   Specify the percentage amount of Retention to withhold on the first subcontractor invoice. For example, it is a common practice to enter 5 or 10% in this field.

    Notes

   • The 'Default Retainage' amount set on the subcontract will only affect the amount on the first subcontractor invoice.

   • Editing this value after creating the first subcontractor invoice will NOT affect the retainage amount on subsequent invoices.

   • In order to set or release the retainage amount on a subsequent invoice, complete the steps in Enable Retainage on a Commitment. Next, use one of these Procore tools to set or release retainage on that invoice:

     • Commitments. Set or Release Retainage on a Subcontractor Invoice.

     • Invoicing. Set or Release Retainage on a Subcontractor Invoice.

   • If you would like to set up retention rules that automatically adjust withheld amounts on your subcontractor invoices, see Enable Sliding Scale Retention Rules on a Commitment's Invoices.

2. Description
   Provide additional information, as necessary.

3. Attachments. Attach any related materials such as pricing quotes, receipts, signed purchase orders, and so on. You may attach files that have been uploaded to your project or drag and drop files from your local computer.

4. Scroll to the Contract Dates section and enter the following:
   

   • Start Date. Select the date when the scope of work will begin on the job site.

   • Estimated Completion Date. Select the estimated date of when the scope of work will be finished.

   • Signed Contract Received Date. Select the date when the subcontract was officially signed.

   • Actual Completion Date. Select the date when the scope of work was deemed complete.

5. Scroll to the Additional Information section and enter the following:
   

   • Inclusions. Disclose any inclusions that may not be clearly stated in the related contract documents.

   • Exclusions. Disclose any exclusions that may not be clearly stated in the related contract documents.

6. Click one (1) of these buttons:

   • Create. Click this button to save the new subcontract and return to the 'General' tab in view mode.

   • Create & Enter SOV. Click this button to save the new subcontract and jump to the 'Schedule of Values' tab in edit mode. Continue by entering the SOV.

   • Complete with DocuSign®. Click this button to complete the subcontract with the DocuSign® integration. See Complete a Commitment Contract with DocuSign®.

Step 2: Enter the Schedule of Values (SOV)

There are two ways to enter the Schedule of Values (SOV) on a subcontract:

• Import SOV Line Items from a CSV File

• Add Line Items to the SOV

Import SOV Line Items from a CSV

If you want to import multiple line items to an SOV, the Commitments tool provides users with a CSV template that you can download, complete, and then upload to Procore. For instructions, see Import Commitment SOV Line Items from a CSV File.

Add Line Items to the SOV

1. Navigate to the project's Commitments tool.

2. Under the Contracts tab, locate the commitment to update. Then click Edit.

3. Click Schedule of Values.

4. Click Add Line.

    Note

   If the 'Enable Always Editable Schedule of Values' setting is turned ON in the Commitments tool, users with the required user permission to Edit a Commitment can modify the Schedule of Values while a commitment is in any status.

5. Follow the appropriate steps depending on whether your accounting method is Amount Based or Unit/Quantity Based:

    Note

   To edit your accounting method before adding SOV line items, see Edit the Advanced Settings Tab on a Commitment. To learn more, see How do I set the accounting method for a contract or funding?

   1. For contracts using the Amount Based accounting method:

      1. #
         Automatically enters a line item number in sequential order.

      2. Change Event Line Item
         If you have change events enabled, you can select a change event line item if the commitment needs to be linked to a change event.

      3. Budget Code
         Select a budget code from the list or click Create Budget Code to create a new one.

      4. Description
         Enter a description for the line item. For example, type: Monthly Service Fee

      5. Amount
         Enter the amount of the cost.

      6. Billed to Date
         The system automatically calculates the amount billed on the commitment up to the current date.

      7. Amount Remaining
         Enter the amount that has NOT been billed to the current date.

      8. Tax Code
         Enter a tax code to use for this line item. This field only appears if you have enabled the tax codes feature.

   2. For contracts using the Unit/Quantity Based accounting method:

      1. #
         Automatically enters a line item number in sequential order.

      2. Change Event Line Item
         If you have change events enabled, you can select a change event line item if the commitment needs to be linked to a change event.

      3. Budget Code
         Select a budget code from the list or click Create Budget Code to create a new one.

      4. Description
         Enter a description for the line item. For example, type: Monthly Service Fee

      5. Qty
         Enter the number of units.

      6. UOM
         Enter the Unit of Measure (UOM).

      7. Unit Cost
         Enter the Unit Cost in the box provided.

      8. Amount
         The system automatically calculates the subtotal for you, based on the Qty, UOM, and Unit Cost entries.

      9. Billed to Date
         The system automatically calculates the amount billed on the commitment up to the current date.

      10. Amount Remaining
          Enter the amount that has NOT been billed to the current date.

      11. Tax Code
          Enter a tax code to use for this line item. This field only appears if you have enabled the tax codes feature.

6. Choose one of these options:

   • Save. Click this button to save the changes to the SOV.

   • Save & Email. Click this button to save the change to the SOV and email the updates to the invoice contact.

• If your subcontract is configured for 1-Tier Change Orders. Continue with Create a Commitment Change Order.

• If your subcontract is configured for 2-Tier Change Orders. Ensure the subcontract is in the 'Approved' status and continue with Create a Commitment Potential Change Order from a Change Event.

• If your subcontract is configured for 3-Tier Change Orders. Ensure the subcontract is in the 'Approved' status and continue with Create a Commitment Potential Change Order from a Change Event.