Chapter 8: Daily Reports

Chapter 8 of Quit Getting Screwed

"That is a lie," Chris from Super Everything Subcontractor whispered to me while in trial.

Chris's company had been sued for more than $700,000 for the cost to complete a project they were forced to abandon. The project manager was testifying on how Chris's company had failed to comply with the subcontract because they never turned in any daily reports.

"I did turn in daily reports, but I didn't keep a copy of what I turned in," Chris told me.

No one ever plans to get in a dispute with their general contractor or, even worse, to be sued by them. Having your side of the story written in daily reports, before there was ever an issue, is amazing evidence to have if you ever find yourself in such a situation. Spending the time filling them out daily—and making sure you keep a copy for yourself—is definitely worth it.

One of the most important things about a subcontract (or any contract in general, for that matter) is you do not want to breach it. You especially do not want to be the first to breach it. A breach in the contract is the failure to do one of the things that you agreed you would do in the contract. One of the things you agree to do in a subcontract is to fill out a daily report. The subcontract provisions that require a daily report normally look something like this:

Subcontractor will submit daily work reports to General Contractor, using the "Daily Report" form attached to this Subcontract.

Or they may look something like this:

Subcontractor is required to submit and have an on-site project manager sign daily progress reports. Such reports can be submitted via email or hand delivery at the end of every day.

The daily report describes what went on within the project and also acts as a way to voice any concerns with the project. This is a great tool for both the subcontractor and the general

contractor. For the subcontractor, it creates a detailed timeline of the project. The subcontractor can also raise issues that they see at the project, whether it is related to their scope or not.

The daily report normally includes the following information:

• The project name and address
• The date
• A minor weather report
• The names of the people who were working on the project that day and the number of hours each person worked.
• A record of any of your materials delivered to the project on that date
• A log of the work you performed that day
• A section for notes and comments (This is where you would put in writing any concerns you have.)
• Any required change orders (If something arises at the project that will require a change order, it is a good idea to bring it up here, in this part of the report.)
• Pictures (A good daily report will also include pictures.)

If your subcontract requires daily reports to be submitted, and you do not submit them on time, you are in breach of the subcontract. Take the time to fill out a daily report every day. Also, make sure you keep a copy of the daily report you submit. If you have to turn it in at the end of the day, take a picture with your phone so that you have a copy.

Before you sign the subcontract, request a copy of the daily report form that the general contractor would like you to use. There are also a lot of apps and services that will let you fill out a daily report electronically. If you want to submit electronic daily reports, ask the general contractor if there is a certain service or app they would prefer you to use.

Even if the subcontract does not require a daily report, it is a good idea to complete one for your own records, to prove your side of the story. The daily report will also help reduce disagreements about the amount of work you have completed when you submit your payment application.

If you do not already have a daily report form, you can download one for free at SubcontractorInstitute.com. Feel free to add anything you think is necessary for your company.

I know it is a pain in the ass to do these reports every day, and it's a pain to make copies for yourself. But sitting at a counsel table in a trial when you are being sued for breach of contract due to failure to turn in daily reports or make copies of them is not how you want to learn about their value. Don't make the same mistake Chris did.

Up next: we're tackling pay when paid clauses and how you can change them to be fairer.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.