How to stop overpaying subcontractors: 6 controls that work

Overbilling and duplicate payments are easy to miss when subcontracts, change orders and invoices live in different places. These controls keep payments inside what is actually owed.

The core rule

A subcontractor should never be paid more than the contract value plus approved changes, less retainage, for work that is actually in place. Every control below supports that rule.

Six controls

1. One record per subcontract. Keep contract value, approved change orders, billed to date and paid to date in one place.
2. Check every invoice against the contract and PO before it is approved for payment, not after.
3. Compare billed percentage with actual progress in the field to catch front-loaded billing.
4. Issue subcontract change orders whenever the prime contract changes, so scope and dollars stay aligned.
5. Apply retainage consistently as the contract requires.
6. Collect lien waivers and current certificates of insurance before releasing payment.

Signs you may be overpaying

• Total billed to date approaches or exceeds the contract value early in the job
• Invoices reference work not yet in your daily reports
• The same invoice number appears twice
• Change orders were paid but never approved by the owner

Make it routine

Run the invoice check weekly and review committed cost against budget monthly. Stratacore’s accounting team checks sub and vendor invoices against contracts and POs before they are approved for payment, and tracks lien waivers and COIs on the dashboard.