Alberta introduces construction prompt payment legislation

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Ontario Construction News staff writer

Alberta’s provincial government has followed Ontario’s lead in introducing proposed changes to the province’s Builders’ Lien Act, which it says in a statement “are the first in almost 20 years and address long-standing concerns within the construction industry, including payment timelines, lien periods and adjudication.”

“We are answering calls and addressing concerns from the construction industry to protect jobs by ensuring everyone throughout the supply chain – from general contractors to subcontractors – is paid on time for their work,” Nate Glubish, Minister of Service Alberta, said in an Oct. 21 statement.

Prompt payment and adjudication fact sheet

“We’re doing this at a critical time when Alberta’s government is moving forward on its recovery plan and when hard-working Albertans in construction can least afford payment uncertainty.”

The government says the proposed legislation would:

  • Eliminate the need for contracted timelines by requiring owners, contractors and subcontractors to pay invoices within 28 days.
  • Extend the deadline for unpaid contractors and subcontractors to file liens against a project with the government’s Land Titles Office from 45 days to 60 days.
  • Workers in the concrete and oil and gas industries would have 90 days to file liens.
  • Prohibit ‘pay-when-paid’ clauses from construction contracts to end the practice of transferring financial risk to subcontractors.
  • Establish an adjudication system to resolve disputes, rather than rely on the courts.

Other proposed changes to the bill include:

  • New rules allowing for holdback money on large, multi-year projects to be released without risk at pre-set times.
  • Improving contractors’ access to payment information.
  • Increasing the minimum amount owed that can be subject to a lien from $300 to $700.
  • Changing the name of the act from the Builders’ Lien Act to the Prompt Payment and Construction Lien Act.

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