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Construction glossary

What are Back Charges?

Back Charges are bills sent to subcontractors or vendors for unforeseen work that a general contractor or project manager had to complete on their behalf within the construction industry. This generally occurs when the subcontractor or vendor fails to complete their work scope to the specified standards, misses deadlines, or omits parts of their contracted responsibilities, and someone else must step in to rectify the issue. Therefore, the party who had to complete or redo the work sends 'back charges' to the original contractor, expecting reimbursement for labor, services, materials, or other costs involved in the completion of the task. They serve as a form of financial protection for the companies against contractual breaches in the construction projects.