Security of payment laws

Everyone deserves to be paid for their work but this hasn’t always happened, particularly in the building and construction industry, but times have changed. The Queensland Government has introduced new payment laws to make the building industry fairer. 

From 17 December 2018 elements of the Building Industry Fairness (Security of Payment) Act 2017 (BIF Act) and amendments to the QBCC Act commence.

What does this mean for you?

The BIF Act introduces changes to progress payments, adjudication and subcontractors charges. There are new requirements for payment claims (your regular invoices, progress payments or requests for payment) and payment schedules. This means that: 

  1. Every invoice that you issue may be a payment claim under the BIF Act - There is no longer an endorsement required for an invoice to be considered a payment claim. 
  2. Pay or provide a payment scheduleYou are required to respond to all payment claims received within 15 business days (or earlier if your contract provides) if you do not intend to pay in full by the due date for payment. There are significant consequences for non-compliance.  
  3. Quicker and easier adjudication processThe adjudication process has been simplified so that you can apply for adjudication sooner and you have more time to do so. The changes also introduce new policies for registered adjudicators.
  4. Modernised subcontractor charges provisions - Subcontractors' charges has been modernised and new offences introduced for not complying with the requirements.
  5. Stronger offences and increased activity by QBCC - Not getting paid for the work you do has a flow on effect to industry and the community. With an increase of offences and tougher penalties for those who fail to meet their obligations, the QBCC will be taking a proactive approach to ensure that the new laws are adhered to.
  6. Changes to retentions and the defects liability period -  These changes are included as amendments to the QBCC Act and mean that:  
  • Retention amounts or security held under a contract must be released.
  • There is an automatic 12 month defects liability period if the contract is silent or doesn’t provide one.
  • Contractors are required to provide notice of the end of the defects liability period.

More information on each of these changes can be found at our Legislation Blog.