New Laws to Protect Subcontractors

Are you a Subcontractor in the Building and Construction Industry and have concerns about being paid?  Have you had the stressful and devastating experience of a head contractor becoming insolvent and you not being paid for the work that you completed?

To combat the problems with subcontractors not being paid for work done by them including the social, emotional and family issues that come with it, the Queensland Government is proposing a number of changes to improve security of payment for subcontractors.  These changes include:-

1. Project Bank Accounts – these will apply to all Government projects valued between $1 million and $10 million from 1 January 2018.  If that roll out is successful, they will be required in private sector projects over $1 million from January 2019.  A project bank account is proposed to be set up as a trust account to ensure that if a head contractor goes insolvent that any contractors who contracted with the head contractor can still be paid.  It is also envisaged that this will increase the speed of payment.

2. Amendments to the Building and Construction Industry Payments Act 2004 (BCIPA) – proposed amendments include improvements to the claims process and enhanced independence of the Adjudication Registry.  One such proposed improvement is the removal of the need to state that the payment claim is being made under the BCIPA in order to benefit from the provisions of the Act.

3. Redrafting the Subcontractors Charges Act 1974 – the redrafting will update the language used throughout the Act.

4. Education programs for QBCC licensees – these programs will be focused around financial management, business skills, the Personal Properties Securities Register (PPSR) and BCIPA.

5. Combining legislation into a ‘one stop shop’ – at present there are three different pieces of legislation in Queensland dealing with security of payment and it is proposed to roll these into one for ease of use.

The proposed changes have not yet come into effect and the Government is still conducting consultation sessions throughout regional centres, including Mackay on 21 March 2017.

We will keep you updated on any changes in our region and when they come into force, as it will be important that as a subcontractor you are aware of your obligations and rights to ensure that you are paid in full and on time.

In the meantime, if you are a subcontractor and are having issues being paid or require advice on the BCIPA adjudication process please contact our office.