What law protects subcontractors in New South Wales?
The Building and Construction Industry Security of Payment Act 1999 gives anyone who carries out construction work or supplies related goods and services in NSW a statutory right to progress payments (s 8). It sets hard deadlines for the builder to respond and pay, gives you a fast adjudication process, and lets you stop work safely when you are not paid. Building Commission NSW administers it.
The rules in this guide are the ones that apply to contracts entered into from 21 October 2019, when the last major amendments started. The Fair Trading and Building Legislation Amendment Act 2026 renames "business day" as "working day" without changing its meaning, so a deadline counted in business days is counted the same way under either name.
Am I covered if I work for a builder on a house?
Yes. The Act covers written and verbal agreements alike, and a subcontract that is part of a job for a homeowner is a "connected" contract that keeps every right in the Act (s 4). Since 1 March 2021 even builders can claim against homeowners, so a subcontractor working for that builder is plainly covered. The one practical difference is the payment term, covered below.
Three conditions to check:
- You cannot sign your rights away. Section 34 voids any contract term that excludes, limits or changes the Act.
- Licensing matters on residential work. Since 20 August 2024, s 8(2) removes the right to a progress payment where residential building work was contracted for without the licence required by s 4 of the Home Building Act 1989, or done in breach of the home building insurance rules in s 92.
- The work must be in NSW. The Act of the state where the site is located applies.
How do I make a valid payment claim in NSW?
A payment claim under s 13(2) must identify the work, state the amount claimed, and state that it is made under the Act. Without that statement it is not a payment claim at all. Use this wording: "This is a payment claim made under the Building and Construction Industry Security of Payment Act 1999 NSW." Serve it in a way you can prove, by email to the address in the contract.
When and how often you can claim:
- From the last day of each month. A claim can be served on and from the last day of the month in which you first did work, and the last day of each month after that (s 13(1A)), or an earlier day if the contract allows (s 13(1B)).
- One claim per month for work done in that month (s 13(5)). You can include amounts claimed before and still unpaid (s 13(6)).
- After termination, from the date of termination (s 13(1C)).
- Time limit: within 12 months after you last did work, or longer if the contract allows (s 13(4)).
What must the builder do, and by when?
If the builder will pay less than you claimed, they must give you a payment schedule within 10 business days after your claim is served, or sooner if the contract says so (s 14(4)). The schedule must state the amount they will pay and every reason for paying less. If no schedule arrives in time, the builder is liable for the full amount you claimed on the due date (s 14(4) and s 15).
When payment falls due under s 11:
- Subcontract on a commercial job: no later than 20 business days after the claim, or earlier if the contract says so (s 11(1B)).
- Subcontract on an owner occupier job: when the contract says, or 10 business days after the claim if it is silent (s 11(1C)).
- Head contract: 15 business days (s 11(1A)).
A contract cannot push payment later than those limits, and pay when paid clauses have no effect (s 12). "I have not been paid by the client" is never a lawful reason to hold your money.
What can I do if the builder still does not pay?
You choose between adjudication and court. Adjudication is faster: an independent adjudicator appointed through an authorised nominating authority decides the amount within about 10 business days of accepting the application, and the decision is enforced as a court judgment. Or you sue for the amount as a debt (s 15 and s 16), where the builder cannot bring a cross claim or raise a defence arising under the contract.
Deadlines to apply for adjudication under s 17:
- Schedule for less than you claimed: within 10 business days after you receive it.
- Schedule given but the amount not paid: within 20 business days after the due date.
- No schedule at all: first serve a notice of intention to apply within 20 business days after the due date, giving the builder 5 business days to provide a schedule (s 17(2)). Then apply within 10 business days after those 5 days end.
How it runs from there:
- Lodge with an authorised nominating authority of your choice. The current list is on the NSW Government security of payment pages.
- The builder can respond only if they served a schedule in time, and cannot add reasons that were not in the schedule (s 20(2B)).
- The adjudicator decides within 10 business days of accepting the application, unless you agree to more time (s 21(3)).
- If the builder does not pay, the authority issues an adjudication certificate (s 24), which you file in court as a judgment debt (s 25). To have that judgment set aside, the builder must first pay the money into court.
Can I stop work until I am paid?
Yes, under s 27. If the claimed, scheduled or adjudicated amount is not paid by the due date, give the builder written notice that you intend to suspend work under the Act. You can stop at least 2 business days later and stay off the job until 3 business days after you are paid. You are not liable for the builder's loss caused by a lawful suspension.
If the builder takes your work off you because you suspended, s 27(2A) makes the builder liable for your resulting loss. That protection only exists if you gave the notice first. Never simply stop turning up.
What extra protections apply in NSW?
NSW adds two protections above the payment process. A head contractor claiming from the owner must sign a supporting statement declaring that its subcontractors have been paid, and a false statement is an offence. On larger projects, retention money must be held in a trust account. Both create pressure on a builder that is holding your money.
- Supporting statement (s 13(7) and (8)): a head contractor must not serve a payment claim on the principal without a statement that all subcontractors it engaged directly have been paid amounts due, identifying any in dispute. Serving a false one is an offence, and directors can be personally liable (s 34D).
- Retention money trust: under Part 2 of the Security of Payment Regulation 2020, a head contractor on a project worth $20 million or more must hold subcontractors' cash retentions in a trust account.
- Business days exclude weekends, public holidays and 27 to 31 December (s 4).
What should I do today if I have not been paid?
Work the steps in order and keep a dated record of each one. The deadlines run against you as well as the builder, and most lost claims are lost on a missed date or a claim that does not say it is made under the Act.
- Check you held the licence the work required.
- Serve a payment claim by email with the work itemised, the amount, and the statement that it is made under the Act.
- Diary the schedule deadline (10 business days) and the due date.
- If the due date passes unpaid, serve written notice of intention to suspend under s 27.
- Apply for adjudication within the window that applies to you, or sue for the debt.
- For large or disputed amounts, have a NSW construction lawyer check the paperwork before you lodge.
The businesses that rarely end up here run it as a system rather than a fight: every progress claim carries the statutory wording, and an AI agent tracks each claim's dates so the notice goes out the day a deadline is missed rather than weeks later.
Where is this in the legislation?
- Building and Construction Industry Security of Payment Act 1999 (NSW): s 4 (definitions, connected contracts, business day), s 8 (right to progress payments, licensing), s 11 (due dates), s 12 (pay when paid), s 13 (payment claims, supporting statement), s 14 to s 16 (payment schedules, consequences, debt recovery), s 17 to s 25 (adjudication and enforcement), s 27 (suspension), s 34 (no contracting out).
- Building and Construction Industry Security of Payment Regulation 2020 (NSW): retention money trust accounts.
- Home Building Act 1989 (NSW): s 4 (licence required to contract), s 92 (insurance).
- NSW Government: making a payment claim
- NSW Government: applying for adjudication
- NSW Government: authorised nominating authorities
- NSW Government: changes to security of payment laws
This is general information about the law as at 16 October 2026, not legal advice. Deadlines depend on your contract and the facts, so get advice from a NSW construction lawyer before relying on it for a large or disputed claim.
