Getting paid: understanding security of payment
Security of payment laws give builders and subbies a fast route to recover money owed.
A faster path to payment
Every Australian state and territory has security of payment legislation designed to help those in the construction chain recover progress payments without lengthy court action. It gives a statutory right to claim and a rapid adjudication process.
How it works
Broadly, a claimant serves a payment claim, the respondent may reply with a payment schedule, and unresolved amounts can go to a quick adjudication by an independent adjudicator. The timeframes are deliberately tight to keep cash moving through the industry.
Timeframes are strict
The catch is that the deadlines are short and unforgiving. Miss a step or a date and you can lose the right to use the process for that claim. Knowing your state's rules — or getting advice early — is essential.
Use it as leverage
Even the credible threat of a payment claim often prompts payment. It exists precisely because slow payment is endemic in construction.
