Building and Construction Industry Security of Payment laws have changed

Changes to the Building and Construction Industry Security of Payment Act are now in place for contracts entered into on or after October 21st 2019.

The building and construction industry have set payment requirements that principals, head contractors, subcontractors and suppliers must follow.

All contractors undertaking construction work or providing goods or services under a construction contract, have the right to receive ‘progress payments’ for work delivered.

For new contracts, the entitlement to a progress payment is no longer prompted by a ‘reference date’. Instead, a person is entitled to a progress payment if work has been performed or was undertaken to be performed.

Here are the key changes you need to know about:

• Only one payment claim can be served per month for work carried out (or goods and services supplied) in that month, unless the contract provides otherwise. For example: a claim can be made any time in April for work done in March, but any work already done in April to that date cannot be included in that claim. Another claim for April’s work can be made on the last day of April or any time after.
• A payment claim can be for more than one progress payment and can include an amount from a previous claim. It can also include work that was performed in earlier months but not claimed yet.

Changes apply to all construction contracts from 21 October 2019.