Contractor Risks (Lien Waiver, Workers Comp, etc)

[John Lindemann]

I have a contractor who has almost finished up doing some remodel work for us but he has been struggling to complete the checklist.  It has become the job that won't end.  We have paid him 1/2 and he is 95% done and I'm holding the remainder until he is totally finished.  He's becoming impatient and has hinted at charging us more that what we had agreed on in our contract.  We have not discussed or signed any change orders, so those additional charges are irrelevant to me...I will not pay for unauthorized work. 

So...now I am slightly concerned that he may file a lien against us after we pay him by claiming we haven't paid him in full.  I always get a "Paid in Full" receipt from contractors but should I be doing more?

Should I use a lien waiver?  How do these apply to the subcontractors he hired?  What if he doesn't pay his subs?  Can they file lien against me?

What precautions do you take with contractors?  

Do you use a Hold Harmless Agreement for workers comp?  I use this specifically for contractors who may be uninsured or underinsured.

I have never been in a legal situation with a contractor so I'm inexperienced but do not want to be ill-prepared.

Any tips would be greatly appreciated!

[Mike Salisbury]

Yes, the subs can go around your contractor and lien your project. Nothing you can do about this.

As for Lien Waiver- you can have a lien waiver printed on the endorsement part of your checks. By signing the check , they are signing the lien waiver. This is easier than keeping up with a separate form when you have a lot of jobs going.