First: did you send a payment claim, or an invoice?
Everything depends on this. An invoice asks to be paid. A payment claim starts legal deadlines. They can be the same piece of paper, but only if it:
- Says it’s made under the Security of Payment Act. Leave that line off and it’s just an invoice.
- Identifies the work and states the amount claimed.
- Is sent to the right person — in person, by post, to the email address they nominated for notices, or however your contract says.
- Is sent in time. From the end of each month (earlier if your contract allows), one claim per month, and no later than the contract’s period or 12 months after you last did the work, whichever is later.
Before anything else: are you licensed and insured for this work?
For residential building work, you only have a right to a progress payment if you hold the licence the work needs and, where it applies, home warranty insurance (HBCF). No licence, no right to payment under the Act, however clearly you’re owed the money. Check yours at verify.licence.nsw.gov.au.
How long does a builder have to pay you?
The Act counts in business days — no weekends, public holidays or 27–31 December. A claim sent in mid-December runs well into January, and that catches trades out every year. Where a period comes from your contract instead, it’s counted the way your contract defines a day (calendar, working or banking days), which can make a week’s difference.
You send the payment claim (from the end of the month).
They must send a payment schedule saying what they’ll pay and, if it’s less, exactly why. Or the shorter period in your contract, whichever comes first.
Payment is due — subcontractor claiming from a head contractor.
Payment is due — head contractor claiming from a principal.
Payment is due — a home the owner lives in: whatever the contract says, or 10 business days if it doesn’t say (s 11(1C)).
After a written notice that you intend to stop work (saying it’s made under the Act), you can stop.
An adjudicator decides the claim, on the papers.
They must pay the adjudicated amount.
Your contract can shorten these payment periods, but not lengthen them. A clause pushing payment out to 45 or 60 days is void, and the Act’s date applies whatever you signed. You also can’t sign away the Act — even a clause that just discourages you from using it is void.
It covers work on people’s own homes too. The old owner-occupier exemption (s 7(2)(b)) has been removed. Those contracts just have their own due date: whatever the contract says, or 10 business days if it doesn’t say.
Which situation are you in?
What you can do next depends on which of these happened. The deadlines are different, and they’re strict — miss one and that option is gone, however strong your claim.
No payment schedule, and no payment
Your strongest position. If they don’t reply in time, they owe the full amount and can’t later raise defects, back-charges or a dispute about value.
You can sue for it as a debt (where contract defences aren’t available to them), or apply for adjudication, and you can stop work on notice. For adjudication here, you must first give notice within 20 business days of the due date; they then get 5 business days to send a late schedule, and you have 10 business days to apply.
A payment schedule for less than you claimed
Now it’s about value — but any reason they left out of the schedule, they can’t raise later. A vague schedule is a weak one.
You have 10 business days from receiving it to apply for adjudication. It’s the shortest, strictest deadline in the process.
They scheduled an amount, then didn’t pay it
They’ve agreed the amount in writing and not paid. Same options as situation 1: sue for the scheduled amount as a debt, or apply for adjudication (within 20 business days of the due date), and stop work on notice.
Two powers most trades don’t know they have
You can stop work, legally
Send written notice that you intend to stop work, saying it’s made under the Act. 2 business days later you can stop, and you’re not liable for any loss that causes them. If they give the rest of the job to someone else while you’re stopped, you can claim that loss too. Once paid, go back within 3 business days. Without the notice, walking off is a breach of contract. With it, it’s your legal right.
You can freeze the money above your builder
If you’re a subcontractor and you’ve applied for adjudication, you can send a payment withholding request to whoever pays your builder (the principal contractor). They must hold back enough to cover your claim. If they pay your builder anyway, they become personally liable to you for the debt. Hardly anyone uses it, because hardly anyone knows it exists.
What ruins a good claim
- Not saying it’s made under the Act. The most common mistake. It’s then just an invoice, and no deadlines ever started.
- Missing the adjudication deadline. An application even a day late is invalid — the adjudicator can’t hear it, however good your case.
- No licence, or no home warranty insurance where the work needed it. You lose the right to payment under the Act.
- More than 12 months after the work (or outside your contract’s period, if that’s longer).
- Going into liquidation. A company in liquidation can’t use the Act.
- Waiting. Every option here has a short deadline. The trade who acts on day 12 has more options than the one who acts on day 40.
One honest limit
Adjudication is fast, but it’s interim. It doesn’t finally decide who’s right — either side can still go to court over the contract later. What it does is get the money into your account in the meantime.
Work out your payment deadlines
A payment claim starts several deadlines the moment it’s received: when the other side must reply, when payment is due, and how long there is to apply for adjudication. Miss one and you can lose the right altogether.
Weekends, NSW public holidays and 27–31 December don’t count, and your contract can shorten some periods — so the real date is rarely the one you’d guess. If your contract sets its own period, it’s counted the way the contract defines a day (calendar, working or business days), which can make a week’s difference.
Our free calculator asks a few questions, then shows every deadline, the section of the Act it comes from, and what happens if you miss it.
The calculator asks questions because the website doesn’t know your contract. eSiteOffice will: you enter the contract once, and every deadline is worked out from it. Opens October.