Regarding your project, I can't give you a sound opinion until I have read and reviewed the project contract and understood its implementation mechanisms. However, I am aware of the confidentiality of the data and the content of the contract pertaining to your project, and based on that, I will try to answer your question according to the FIDIC form of contract only.
In my humble opinion and Under normal circumstances with Standard FIDIC Rules, when an Employer makes direct payment to a subcontractor that was supposed to have been made by the main contractor, the Employer can usually only recover from the Contractor exactly what the Employer paid to the subcontractor. The Employer cannot recover the Contractor's overheads; nor their Profit Mark-up; nor any of the Employer's internal administration charges. FIDIC's "Employer Claim" Clause (2.5), as well as other employer claims clauses contained within the FIDIC Contract suite, are all intended to place the Employer back into a position where he has received the full value of his loss, rather than to punish the Contractor and/or charge him additional fees. Adding these extras to a claim will probably be rejected during a dispute.
Before issuing a deduction for the amount of monies owed to your subcontractor by your main contractor, obtain an agreement in writing from the main contractor authorizing the deduction (from either their next payment or their final payment). If the main contractor will not agree to this, issue a formal letter and make direct payment to your subcontractor in order to ensure the work continues. At the same time as making a direct payment to your subcontractor, deduct only the principal amount from the main contractor's next certification. The focus should be on keeping the project progressing rather than dealing with each administration fee. Keep documentation of all communications with both contractors. Deal with the issues regarding performance of the contract with the main contractor at a later date. This is the best approach if you want to minimize conflict.
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Ahmed ElGuinedy
Commercial and Contracts Manager
Cairo
ahmed.m.elguinedy@gmail.com------------------------------
Original Message:
Sent: 05-19-2026 04:00 PM
From: Salem Abdelazim Salem
Subject: Main Contractor has failed to pay a highly critical and influential Subcontractor
I would appreciate hearing professional opinions from contract and claims specialists, particularly those with experience in FIDIC-based projects.
In a project scenario, the Main Contractor has failed to pay a highly critical and influential Subcontractor whose work directly impacts the project's progress and continuity. Due to the risk of disruption and potential delay to the project, the Employer decided to make a direct payment to the Subcontractor and recover the amount from the Main Contractor.
From a contractual and standard practice perspective - especially under FIDIC and similar forms of contract - should the Employer's recovery from the Main Contractor be limited only to the actual amount paid to the Subcontractor?
Or would it also be acceptable to recover additional amounts such as Main Contractor overheads, profit markup، administrative costs, other indirect costs.
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Salem Abdelazim Salem
Jones Lang LaSalle
Kfr Eldawar
salim.abdelazeem@gmail.com
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