The Building and Construction Industry (Security of Payment) Act 2021 (the Act) commenced in a staged approach from 1 August 2022. The Act introduces industry wide laws to enhance payment protections for contractors (including subcontractors and suppliers), and introduces reform in four areas:
- New security of payment laws to create more structure and transparency to payment rights under contracts and a more effective means for contractors to recover payments owed;
- A retention trust scheme to better protect subcontractor retention money in the event of insolvency or dispute on a project;
- Excluded contractors – expanding the powers of the Building Services Board to take action against registered builders and other providers who fail to pay debts to subcontractors and to remove those with a history of financial failure; and
- Fairer contracting practices to rebalance the allocation of contractual risk in the industry.
Building and Energy cannot assist you with preparing documents required under the Act. If you are unsure how to proceed under the Act, refer to the information available on the Building and Energy’s website, or seek professional advice.
You can find further information about when the Act applies and how it may assist you in a series of animated videos and factsheets below. For an overview of the Act please refer to topic 1 factsheet and video.