How to Review a Subcontractor Progress Claim Before You Approve It

It's the 23rd. Your own progress billing to the owner goes out on the 25th, and the mechanical sub's claim just landed in your inbox as a PDF. It says 62% complete on ductwork. You walked the second floor on Tuesday and it didn't look like 62% of anything. You have two options: approve it because the owner billing is waiting, or push back without much to push back with. Most PMs pick the first one, and that's how a job ends up with a subcontractor who has been paid for work that isn't in place.

Reviewing a progress claim properly doesn't take long if the setup is right. It takes about twenty minutes per sub when the schedule of values is sensible and the field knows what it's looking at. It takes three days of email when neither is true. Here's the review I'd run.

Start before the first claim arrives

The review is only as good as the breakdown the claim is measured against. If a $900,000 subcontract has four lines (mobilization, rough-in, finish, closeout), there's nothing to check. Every percentage is a guess on both sides.

At subcontract award, ask for a schedule of values broken down by area or floor and by activity, with enough lines that no single line is more than about 10% of the contract. Agree on it before any money moves. This is the one negotiation in the whole process where you have leverage, because the sub wants the paperwork done so they can bill.

While you're there, agree on the format. A spreadsheet with the same line numbers every month beats a PDF you have to retype. If you use Procore or a similar platform with a subcontractor billing module, set it up so the sub bills against the lines you agreed, not a fresh breakdown each month.

Check the arithmetic first

This sounds trivial. It isn't. Before you think about progress at all, confirm:

• The contract value on the claim matches your subcontract, plus approved change orders only.
• Previous billed to date matches what you actually certified last month, not what the sub claimed last month.
• This period plus previous equals billed to date, line by line.
• Holdback is calculated at 10% (more on that below).
• GST is on the right base.

The second point is the one that bites. If you cut a line last month and the sub's spreadsheet still carries their original number forward, the error compounds quietly. By month six nobody knows which figure is real.

Review line by line, not in total

A claim that looks right in total can be wrong everywhere underneath. The overall percentage complete can match your gut while one line is overbilled by $40,000 and another is underbilled to hide it.

For each line, ask one question: does the value claimed to date match the work physically in place? Not the work started, not the material ordered. In place.

The practical way to do this is to send the superintendent or field engineer the line items for their area before the claim arrives, with last month's certified percentages, and have them mark up what they'd certify. Then the PM's review is a comparison of two numbers per line, not a site walk from memory. Where the super and the sub disagree by more than a few points, that's the conversation to have. Everything else goes through.

Watch for the usual patterns

Most overbilling isn't dishonest. It's cash flow. Subcontractors carry payroll and material costs for 45 to 60 days before they see money, and billing ahead is how some of them manage it. The patterns are predictable:

Front-loading. Mobilization, general conditions, or the first activity carry far more value than the work is worth. If mobilization is 8% of a contract for a sub who drove one trailer to site, you'll be carrying their overhead for months. Catch this at the schedule of values stage. It's much harder to fix after month two.

Stored materials billed as installed. Material on site, or worse, in the sub's yard, billed as work in place. Many contracts allow payment for stored materials, but usually with conditions: delivered to site, protected, insured, sometimes with invoices attached. Check what your subcontract says and ask for the backup.

Change orders billed before they're approved. A pending change sneaks onto the claim as a new line, or gets folded into an existing line. Only approved changes belong on a progress claim. Pending ones belong on a log you both look at. If the sub is billing pending work, that's usually a sign the change order process is too slow, and that's worth fixing on its own.

Closeout lines billed early. O&M manuals, as-builts, commissioning and training are often billed at 90% when the documents haven't been started. Hold these lines at zero until something arrives.

Get the holdback right

In BC, the Builders Lien Act requires you to retain 10% of the value of work done or the amount paid, whichever is greater, from every progress payment under a contract or subcontract. That holdback isn't yours to spend. It's a protected fund for the people below you in the chain, and the release timing runs from completion, not from whenever it's convenient.

Two things to check every month. First, that holdback is calculated on the full value certified, including approved change orders. Second, that you're tracking it per subcontract, so that when a sub finishes early (say, the earthworks contractor on a building job) you know exactly what's held and when it can be released. A holdback ledger that only exists inside the accounting system at the job level can't tell you that.

BC's Construction Prompt Payment Act received Royal Assent in November 2025 and will come into force once its regulations are made. When it does, the time you have to approve, dispute, or pay a claim will matter a lot more than it does today. A review that takes three weeks of email won't fit. This is a good reason to get the process tight now, while the stakes are lower. If you're unsure how any of this applies to a specific contract, ask a construction lawyer. This post isn't legal advice.

Write down why you cut a line

When you certify less than was claimed, say which lines, by how much, and why, in writing, on the same day. "Line 14, second floor duct, certified 45% vs 62% claimed, insulation not started on east wing per site walk 21 Sept." One line per cut.

This does three things. The sub knows exactly what to finish or document to get paid next month. You have a record if the dispute escalates. And next month's review starts from a clear baseline instead of a memory of a phone call.

Never cut the total without cutting specific lines. A lump "we're approving $180,000 of your $210,000" leaves nobody knowing what the $30,000 was for.

Keep it simple enough to repeat

A hypothetical: a general contractor running twelve subs on a mid-rise job could spend a full day a month on this, or two hours. The difference isn't effort. It's whether the schedule of values was set up properly at award, whether the super marks up the lines before the claim arrives, and whether cuts are written down line by line.

None of that needs new software. A shared spreadsheet per subcontract, with the agreed lines, last month's certified values and a column for the super's markup, gets you most of the way. Platforms help once the process exists. They don't create one.

If your subcontractor billing turns into a monthly scramble, or you're not sure your holdback tracking would survive a lien claim, we can look at how it runs today and where it's losing time. A discovery call is the easiest place to start.