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Approved answer (verified by Tanit)
Here's the idea.
I give you a contract to build a house for me. You give Fred a contract to do the roof, and Mary a contract to do the walls.
You are the main contractor. You work for me.
Fred and Mary are subcontractors. They work for you.
The prefix 'sub' means 'under'. Fred and Mary work 'under' you, ie 'under' your contract.
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