A strong contract is one of the most effective risk-management tools a Michigan builder has. In the Michigan Builders License 3-Hour Continuing Competency Course, instructor Sid Woryn highlights the contract clauses that protect builders from real-world issues: safety violations, payment disputes, supply-chain delays, and even customer pets on the jobsite.
Now is the time to update standard agreements with clauses that reduce liability and create clear expectations. Below are the four essential contract clauses every Michigan builder should consider adding or improving.
Why Strong Contracts Matter for Michigan Builders
Under Michigan law, residential construction contracts must be in writing, include your license number, outline project scope, and clearly state pricing and major terms. Well-structured contracts also protect lien rights, define payment timelines, and help builders comply with Michigan’s home improvement and construction payment requirements.
Once the legal basics are covered, these four clauses address the most common issues Michigan builders face today.
1. Subcontractor MIOSHA Compliance Clause
MIOSHA holds general contractors responsible for maintaining a safe jobsite, even when subcontractors are involved. If a subcontractor ignores fall protection, PPE rules, or other safety standards, the general contractor may still face penalties.
What to include:
- Mandatory subcontractor compliance with MIOSHA Construction Safety & Health standards
- Requirement for subs to follow your written safety program
- Permission to remove sub-employees for repeated violations
- Indemnification for fines or claims caused by subcontractor safety failures (legal review recommended)
Tip: Including MIOSHA-specific language in your contract not only protects your business, but it also reinforces your safety-first professionalism with clients.
2. Final Inspection Payment Clause
Payment delays are one of the biggest challenges for Michigan builders. Under the Michigan Construction Payments Act, the terms of your contract determine when money is owed, so clarity is essential.
A strong payment clause should:
- Break payments into defined milestones
- Require final payment upon:
- Passing the final building inspection, and
- Completing a mutually agreed-upon punch list
- Require all additional work to be approved through written change orders
This protects you from “never-ending projects” where new requests keep pushing back the final payment.
3. Material Shortage & Delay Clause
Supply-chain challenges remain one of the biggest threats to project timelines. Backorders, discontinued materials, transportation issues, and shifting lead times can all cause delays outside a builder’s control.
Clarify in your contract:
- What counts as an excusable delay (e.g., manufacturer shortages, shipping delays, factory shutdowns)
- That you are entitled to a reasonable extension of time
- How substitutions and pricing changes will be handled
- How quickly the homeowner must approve substitute materials
A clear material delay clause helps prevent disputes and sets realistic expectations from day one.
4. Pet Responsibility Clause (a Must-Have)
With more homeowners working from home, pets are frequently present during construction. Michigan’s strict liability rules for dog-related injuries make this a real risk for builders.
Your contract should specify:
- Owners must keep pets and children away from work areas
- Owners are responsible for damage or injuries caused by their pets
- Contractors aren’t liable if pets escape through open doors or gates
- Work may be paused if pets create a safety hazard
This simple clause can prevent costly misunderstandings and emotional disputes.
Putting It All Together
A strong contract doesn’t need to be complicated. It just needs to reflect how Michigan builders actually work. Your next steps:
- Compare your current contract against these four essential clauses.
- Consult a qualified Michigan construction attorney for language refinements.
- Train your team so everyone understands the updated terms.
Sid Woryn covers these topics and more: MIOSHA responsibilities, site safety, contract risks, and documentation best practices, inside our Brand-New 3-Hour Continuing Competency Course. It’s the most practical way to protect your business, your workers, and your customers during the next license renewal cycle.
Learn more: https://www.michiganbuilderslicense.com/continuing-competency-course.
Sources
- Michigan Builders License Blog – “Why Are Contracts Important?”
- Michigan Legislature & guidance on residential construction contract and payment requirements.
- MIOSHA Construction Safety & Health resources and multi-employer worksite guidance.
- Articles on force majeure, material delays, and construction contract drafting.
- Michigan and U.S. resources on pet liability, dog laws, and pet-safety clauses in home improvement contracts.
