Flow-down clauses are a ubiquitous part of the agreement between prime contractors and subcontractors, to the point that parties often sign them without giving them a careful read.
But they’re not always as effective as they could be, especially when misunderstood or under-explained, according to attorneys.
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Some clauses might not seem relevant to the job at hand, but they are still required, said attorney Merle DeLancey, partner at Blank Rome based in Washington, D.C.
For example, one clause requires privacy training for contractors performing private security functions outside of the United States, which is included even on jobs happening within the country.
“That’s a mandatory flow-down and it will have nothing to do with your job,” Delancey said. But if a GC and its subs (and their subs) want to do government work, they need to agree to it.
GCs can make sure their subs understand that such clauses are mandatory even if they will never affect their jobs — and that the GC can’t negotiate with the prime, because the prime is the U.S. government.
“You have to read those pretty closely because you may have just bought yourself some compliance obligations that you normally wouldn’t have,” Delancey said.
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"What GCs Should Know About Flow-down Clause," by Jen A. Miller was published in Construction Dive on March 25, 2025.
