The ABCC will soon be conducting a security of payment audit campaign for employers covered by the Code for the Tendering and Performance of Building Work 2016 (Code). 

In general terms, ‘security of payment’ refers to a building contractor’s right to receive payments that are due as outlined in their contract. For example, a head contractor must pay a subcontractor’s progress payments on time.

Code covered entities must:

  • comply with all applicable laws and other requirements relating to security of payment;
  • ensure that payments which are due and payable are made in a timely manner and are not unreasonably withheld;
  • ensure, as far as practicable, that disputes about payments are resolved in a reasonable, timely and cooperative way; and
  • report any disputed or delayed payments to the ABCC.

Code covered entities are required to report any disputed or delayed progress payments to the ABC Commissioner and the relevant funding entity as soon as practicable after the date or which the payment falls due.

The ABCC”s upcoming audits will focus on code covered entities that have not reported disputed or delayed payments to the ABCC.

Prior to the commencement of the audit campaign, code covered entities should review progress payment claims submitted to them to ensure all payments have been timely and that no claims that are due and payable are outstanding. If code covered entities identify any reportable disputed or delayed payments, they should report the issue to the ABCC via the online reporting form.

When are disputed or delayed payments reportable?

  • When an amount is certified by a Principal (or Superintendent) under a contract and not paid within the contractual timeframe.
  • An amount is specified in a payment schedule/notice of dispute issued under the security of payment laws and not paid by the date prescribed by those laws.
  • Other than in Western Australia and the Northern Territory, no payment schedule/notice of dispute is issued in response to a valid payment claim and the full amount of the payment claim is not paid by the date prescribed by the security of payment laws.
  • An adjudicator makes a determination under the relevant state and territory security of payment legislation and the adjudicated amount is not paid by the date prescribed by the security of payment laws.
  • A third party such as a court, arbitrator, or expert issues a binding determination and the amount determined is not paid in accordance with the determination.

What to do if you believe you are owed money

If you believe you are owed money and have been engaged on a project by a contractor who does Commonwealth funded building work we may be able to help you.

A code covered entity that breaches the Code may be subject to an exclusion sanction imposed by the Minister that would preclude them from tendering for Commonwealth funded building work for a defined period of up to 12 months.

The ABCC’s intervention may assist you as the ABCC can seek that a company in breach of the Code voluntarily rectify its Code breach, which can include making disputed or delayed payments. However, the ABCC cannot order an entity to take any action or make any payments in the same way that a Court can.

If you wish to make a complaint about a disputed or delayed payment, you can submit your complaint here.

 Need more information?

 Contact the ABCC 

For further information and assistance, contact the ABCC via the avenues below: 

ABCC hotline

1800 003 338

ABCC – Security of Payment information

https://www.abcc.gov.au/building-code/contractors/construction-phase/security-payment

ABCC - Presentation ABCC representatives are available to present an information session at your workplace: www.abcc.gov.au/book-presentation

 

 

 

E-Alert
5 December 2019

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