Changes to payment laws
The Building Industry Fairness (Security of Payment) Act 2017 ensures everyone in the building and construction industry has a right to get paid and can access payment dispute options if they are not paid.
The Building Industry Fairness (Security of Payment) and other Legislation Amendment Act 2020 (BIFOLA) introduced some important changes to these payment laws to increase payment protections for contractors. These include:
- new obligation to provide supporting statement – head contractors need to provide a supporting statement to the principal with every payment claim to advise if all subcontractors have been paid, and if they have not all been paid, the reasons for this. A new penalty applies for failing to give a supporting statement or providing false or misleading information in a supporting statement
- new penalty – for any contractor who responds to a payment claim by giving a payment schedule, but does not pay the amount they agreed to pay in that schedule, by the due date
- the offence for failing to release a retention amount has been expanded so that it will also be an offence for failing to release other securities such as bank guarantees
- notification of payment of adjudicated amount – following an adjudication decision, the party required to pay (known as the respondent) must notify the Adjudication Registry when they pay and provide proof of payment
- two new options to help secure payment of an adjudicated amount is available to contractors:
- a claimant, including a head contractor, is able to give a payment withholding request to the higher party if they are not paid an adjudicated amount by the respondent – if a head contractor is owed an adjudication amount by a principal, the head contractor is now able to give a withholding request to a financier
- a head contractor is now able to place a charge on property, when they are not paid an adjudicated amount, if the respondent, or a related entity of the respondent, owns the property on which the building work took place.
When do these changes commence?
The new payment laws commenced from 1 October 2020.
The QBCC will continually update information available on our website in line with these changes.
For more information
Further information about the new reforms can be found on the Queensland Government’s website.