Clause library
Assignment and subcontracting clause, explained
An assignment and subcontracting clause controls whether either party can hand the contract, or the work, to someone else.
What does an assignment and subcontracting clause do?
Assignment means transferring rights under the contract, such as the right to be paid, to another person. Subcontracting means getting someone else to do some of the work while the original party stays responsible for it. Many clauses require the other party's written consent before either can happen, so each side knows who it is dealing with. Common exceptions allow transfer to a company in the same group or to a buyer of the business. Where subcontracting is allowed, the clause usually says the original party remains responsible for the subcontractor's work.
Example wording
Example · our own drafting
Neither party may assign or transfer this agreement without the other's prior written consent, which will not be unreasonably withheld. The Supplier may subcontract any part of the Services with the Client's written consent, but remains responsible for the acts and omissions of its subcontractors as if they were its own.
In Plain English
Neither side can hand this contract to someone else without the other's written agreement, and that agreement cannot be refused without good reason. The supplier can bring in a subcontractor if the client agrees in writing, but the supplier stays responsible for the subcontractor's work as if it had done it.
What do people negotiate in an assignment and subcontracting clause?
- Whether consent is needed, and whether it can be refused unreasonably.
- Exceptions for group companies or a sale of the business.
- Whether named subcontractors are pre-approved.
- Whether subcontractors have to sign matching confidentiality and IP terms.
Which contracts include it?
Lex includes this clause in, among others:
- Subcontractor agreement
- Mutual NDA
- Statement of work
Draft a subcontractor agreement with this clause
Free for the other sideLex drafts it in Plain English beside the legal wording. Share one link; both sides agree and sign.
Frequently asked questions
What is the difference between assignment and subcontracting?
Assignment transfers rights under the contract to someone else. Subcontracting means another person does some of the work, while the original party stays responsible to the client.
Can a freelancer subcontract work?
It depends on the contract. Many contracts require the client's written consent first, and say the freelancer stays responsible for the subcontractor's work.
What does "consent not to be unreasonably withheld" mean?
It means the other party can refuse consent only for a good reason. It is a common middle ground between free transfer and a flat ban.