If your contractor stops making progress or is falling way behind an agreed-upon schedule, it may be time to let them go. Gross mismanagement of time and resources that result in unacceptable delays are contractor faults that may be appropriate reasons to let them go.
If the contractor is not performing, consistent with the contractual obligations and scope of work, you do have the right to fire the contractor. You should examine the contract to determine what procedures if any are outlined regarding termination and make sure those are followed.
Poor performance, breaches of contract, financial issues, changes in project scope, and ethical or legal concerns are all valid reasons for contractor termination.
Yes, you can be sued for breach of contract for taking too long. Many times, this sort of claim is expensive to prove, and expensive to defend. A negotiated solution is far preferable to litigation in most cases like this.
If the contractor failed to work a reasonable amount of time without a valid reason (such as due to an injury or natural disaster), then it may be considered an inexcusable delay.
Not every construction delay is grounds for a lawsuit against a contractor, however. Depending on the cause of the delay, whether a liquidated damages provision exists, and whether the delay is unreasonable, you may have grounds to sue.
Dear [Independent Contractor's Name], I regret to inform you that the services you have been providing to [Company Name] will no longer be required as of [Termination Date]. This decision has been made due to [Reason for Termination], which has been a cause of concern for us.
Fire the Contractor
Then send a return-receipt letter to their business and home address stating that unless the problem is rectified within a specified number of days, they're in breach of contract, and you'll be terminating the contract. The catch: A contractor probably won't refund money you've already paid.
The 2 year contractor rule, also known as the 2 year limit rule, is a regulation that stipulates the maximum duration of time a worker can be employed as a contractor before they must be offered a permanent position or terminated.
An excusable delay is one that allows the contractor an extension of time, compensation, or both. Why? Because these delays are out of the contractor's control. The common excusable delays should be outlined in the construction contract.
Contractor negligence refers to the failure of a contractor or construction professional to meet the expected standard of care and skill in performing their contractual duties.
The Simple Answer Is No
Once that has happened, the contract is complete, and there is no more room for negotiations or changes to the contract. As a contractor, it's your obligation to make sure that all of the applicable charges are on the final invoice.
Create your statement of intent for contract cancellation. It's best to be as specific as possible, citing particular reasons or pertinent dates as appropriate. End with an end date. Explicitly state the date that you intend to halt the contract.
Give adequate notice of at least two weeks, or up to 30 days, when possible (ensuring you follow any notice provisions in your professional services agreement). Gently remind the contractor of any agreement terms regarding intellectual property and works made for hire.
The Answer: It Depends on the Cause
Contractors can only be held responsible for damages caused by delays that they are responsible for. Not every delay is caused by the contractor, and some delays are no one's fault. The key to determining liability is to look at the cause of the delay and who could have prevented it.
Our contractor has been paid in full but didn't finish the work. A civil suit is pointless. They have nothing. The only option now is to pursue criminal charges for felony contractor fraud.
Unreasonable delay refers to a significant and unjustified period of inaction that can negatively impact the rights of a party in legal proceedings.