Construction industry groups in British Columbia are welcoming proposed legislation aimed at ensuring contractors are paid on time.
The Construction Prompt Payment Act, tabled on Tuesday, would establish a payment timeline and dispute adjudication system for B.C.’s construction sector.
“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,” said B.C. Attorney General Niki Sharma in a statement.
The province said the new adjudication process would allow disputes to be resolved quickly by an independent adjudicator, providing an alternative to lengthy and costly court proceedings.
It said the legislation is based on similar models used in provinces such as Ontario and Alberta.
“It marks a new starting line that requires sustained collaboration between industry and government,” said Chris Atchison, president of the British Columbia Construction Association (BCCA). “Establishing fairness in how money flows means the industry can focus on building, not battling over payment.”
The BCCA is calling on the government to enact the legislation quickly, and ensure it’s supported by clear regulations and strong education resources.
Kim Barbero, CEO of the Mechanical Contractors Association of British Columbia (MCABC), said prompt payment would bring more certainty to the construction industry.
Barbero said she has heard stories of contractors who have gone bankrupt or been unable to pay their workers because they are waiting months for payment on a project.
“When contractors do not have access to capital, when that is being tied up, they then have to go and bankroll the projects themselves,” she said. “When contractors are paid on time, they can then hire faster, they can train more apprentices, and they can bid more competitively on projects because they are able to tap into cash flow.”
Matt MacInnis, President of the Electrical Contractors Association of British Columbia said similar legislation has been successful in improving payment timelines in other provinces.
“For too long trade contractors in particular have been forced to accept onerous contract clauses that functionally force them to help finance projects,” said MacInnis in a statement.
“This legislation provides valuable protection for skilled tradespeople, construction professionals and contractors – particularly the small businesses who can least afford to take on the added risk of not knowing when they will get paid,” he said.
The province said once the bill is passed, there would be a transition period to allow time to establish an adjudication authority and support the industry through outreach and education.
It said the prompt-payment rules would apply broadly to both private- and public-sector projects in B.C., including government contracts, unless specific exemptions are set out by regulation.
