Security of payment
To assist contractors, subcontractors and suppliers in getting paid on time for construction work or the supply of related goods and services, and to enable fast resolution of disputes, there are two pieces of legislation in Western Australia which may help.
On 1 August 2022, Stage 1 of the State Government’s 3-year Action Plan for Reform (outlined below) for the implementation of the Building and Construction Industry (Security of Payment) Act 2021 (Act) commenced.
The substantive provisions of the Act – which involve new rights to payment under construction contracts, as well as means for contractors to recover payments owed through a process of rapid adjudication, apply to construction contracts entered into on or after 1 August 2022.
The ‘old’ Construction Contracts Act 2004 – which on 1 August 2022 became the Construction Contracts (Former Provisions) Act 2004, continues to apply to construction contracts entered into before 1 August 2022.
To find the most relevant information concerning how these laws may apply to your construction contract, please click on the relevant link below.
- I signed or entered into my construction contract before 1 August 2022 Click here - Construction Contracts (former provisions) Act 2004
- I signed or entered into my construction contract on or after 1 August 2022 Click here – Building and Construction Industry (Security of Payment) Act 2021
Action Plan for Reform
An Action Plan for reform to introduce better payment protections for all participants in the Western Australian building and construction industry was released by the Minister for Commerce in September 2021.
What does the Action Plan do?
The Action Plan sets out a clear roadmap for how the important reforms in the Building and Construction Industry (Security of Payment) Act 2021 (the Act) will be implemented.
What’s in the Action Plan?
The Action Plan gives an outline of the major changes in the Act, who will be affected, brief guidance on what the reforms will mean for various businesses.
The Action Plan contains a three-stage implementation roadmap for the various part of the Act –
- Stage 1 (1 August 2022) – implementation of the new security of payment laws.
- Stage 2 (1 February 2023) – implementation of the first phase of the retention trust scheme and the new Regulator powers.
- Stage 3 (1 February 2024) – implementation of the second phase of the retention trust scheme and fairer contracting practices.
Each stage will be supported by industry education initiatives to assist businesses understand and adapt to the changes.
Applying for authorisation as a nominating authority
The Building Commissioner is accepting applications from interested persons for authorisation as a nominating authority.
Authorised nominating authorities will perform a vital role in relation to the security of payment laws under the Act.
The authorisation of a person as a nominating authority will entitle them to receive adjudication and adjudication review applications, and to nominate an adjudicator or review adjudicator to determine an adjudication application or adjudication review application.
An application for authorisation as a nominating authority must be made using Form 2 Authorisation – Nominating Authorities
Training course requirements: registration as a provisional adjudicator, adjudicator or review adjudicator under the Act
The Building Commissioner Policy – Approval of adjudicator training courses sets out the Building Commissioner's content and form requirements of training courses for the purposes of adjudicators being registered under the Act, together with the manner in which applications can be made to the Building Commissioner for approval of an adjudicator training course.
Security of payment laws reinforce subcontractor protections (1 August 2022)
Building on payment protections for subcontractors (1 February 2023)
Share this page: