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Subcontractor Not Getting Paid:
What To Do When Contractor Doesn’t Pay You

Everything will be alright, mate! Contracts Specialist can help you get the money you rightfully deserve.

What You Need to Know:
What are Subcontractor Payment Rights?

Stop worrying and let’s do something about it now. Here are your basic legal rights as a subcontractor.

  • Right to make a payment claim
  • Right to suspend works or supply of goods
  • Right to apply for adjudication
  • Right to enter a judgment in court

NSW Laws Protecting Independent Contractors

  • Security of Payment Act
    This Act helps ensure that any person who carries out construction work or supplies related goods and services under a construction contract gets paid.
  • Contractors Debt Act
    This Act is for the recovery of debts owed to persons for work carried out or materials supplied.

How Long Does a Contractor Have to Pay a Subcontractor?

Under the Building and Construction Industry Security of Payment Act 1999 No. 46:

A progress payment to be made to a subcontractor under a construction contract becomes due and payable on:

  • the date occurring 30 business days after a payment claim is made; or
  • an earlier date when stated in the contract.

The maximum period for a subcontractor to get paid is 30 business days once a payment claim has been made. However, head contractors are required to pay earlier than the 30 business days when the contract specified a date.

If your contractor refuses to pay you as subcontractor in your building project, you can do the following:

  • For construction contracts in connection to exempt residential construction contracts: date specified in the contract or if no express provision, the due date for payment of payment claims is within 10 business days.
  • Head contractors are required to give a ‘Supporting Statement’ to the principal when serving a payment claim. Declaring they have paid their subcontractors the amounts that are due is the purpose of the statement.

Reminder

Your head contractor may face a fine of up to $22,000 if he does not provide or has provided a false Supporting Statement.

How long have you been waiting for payment? Get expert advice from a construction lawyer now. You have the right to get paid!

Steps to Take When a Contractor Refuses to Pay Subcontractors

When things have go wrong, you should use the dispute resolution stated in your existing subcontractor agreement contract.

Adjudication is a procedure for resolving disputes without resorting to lengthy and expensive court procedure. You have the right to apply for this.

Are they still not paying you? Send a withholding payment request.

You can serve a withholding payment request on a principal contractor. After you applied for adjudication, you should:

  • Send the forms and a copy of the adjudication application to the principal contractor

If the situation is still not resolved by adjudication, you can take a legal action. But to warn you, this is a long and costly process.

Building Disputes Solicitor Sydney - John Dela Cruz Photo | Contracts Specialist

Need a construction lawyer to help you get your rightful payment?

 Call John Dela Cruz of Contracts Specialists now! He will help you get paid. John will help defend and enforce your legal rights. He can assist you with your payment claim preparation and adjudication application under the Security of Payments Act.

With his extensive knowledge and experience dealing with construction matters for more than 10 years, you can be confident you are getting the right advice. 

You can be confident that you are getting the right legal advice.

Contracts Specialist is a Sydney-based construction law firm that deals with Building DisputesConstruction Contracts, Debt Recovery, and Security of Payment. With Contracts Specialist, you are ensured that you are in good hands.

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