New legislation introduced in British Columbia aims to ensure timely and fair payment for contractors, subcontractors, and workers in the construction industry.
Chronic delays in payments have created financial hardship for many businesses in the industry, particularly small and medium-sized contractors. The new prompt-payment legislation will set clear timelines for payment on construction projects, establish a fast-track adjudication process to resolve payment-related disputes, and improve cash flow and stability across the construction industry.
The proposed system is based on models used in other Canadian jurisdictions, such as Ontario and Alberta.
The new adjudication process will allow disputes to be resolved quickly by an independent adjudicator, which provides an alternative to court proceedings.
“This legislation is about fairness. Getting paid on time shouldn’t be a struggle,” said Niki Sharma, attorney general. “When contractors and workers are paid fairly and on time, projects stay on track and on budget, small businesses are stronger and jobs are more secure. By setting clear rules for payment and providing an efficient way to resolve disputes, we are supporting jobs and helping B.C.’s economy grow.”
Industry groups in B.C. have strongly supported bringing in prompt-payment rules, and the government has worked closely with the sector to ensure the approach reflects the needs of B.C. contractors, subcontractors and owners.
“We welcome this critical step toward payment certainty for B.C.’s construction industry,” said Chris Atchison, president, British Columbia Construction Association (BCCA). “It marks a new starting line that requires sustained collaboration between industry and government. Establishing fairness in how money flows means the industry can focus on building, not battling over payment. BCCA remains committed to continuing to work with the provincial government on this important issue.”
“This legislation is a long-overdue and critical first step toward securing payment certainty and is a positive development for all of B.C.’s construction industry. It will help owners by reducing payment disputes that can stall or disrupt projects, keep work moving as planned and ensure our collective focus remains on building, not battling over payment.”
Once passed, the legislation will come into force after a transition period. This will allow time to establish an adjudication authority as well as to support industry through outreach and education. This is being done so that businesses of all sizes understand their rights and responsibilities under the new system.
Prompt-payment rules will apply to both private- and public-sector projects in B.C., including government contracts, unless specific exemptions are set out by regulation.
The new legislation will help support schools, hospitals, and housing and infrastructure projects. This is part of a broader plan to move B.C. forward with a stronger economy.