Guide
Does the Security of Payment Act Apply to My Project?
Subcontractors, suppliers, and head contractors all sit differently under the Act. Here's a plain-English overview of who's covered.
Subcontractors, suppliers and head contractors are all covered differently under the Act — and since 1 March 2021 this includes owner-occupier residential work, not just commercial and industrial projects. If you're unsure whether your project qualifies, the fastest way to find out is a free assessment.
The Security of Payment Act applies across the construction industry in NSW, but where you sit in the payment chain shapes your risk and your options.
Subcontractors & trades
Subcontractors are often last in line when cash flow gets tight further up the chain, and the Act gives a fast, statutory way to enforce payment without going to court.
Suppliers
Suppliers of materials and equipment are covered in most cases, even without a direct contract with the head contractor in some circumstances.
Head contractors & principals
If you're managing claims from multiple subcontractors, getting payment schedules right and out on time is critical to avoiding automatic liability for claimed amounts.
FAQs
Does the Act apply to residential building work?
Yes, including owner-occupier residential work. A narrow exclusion for contracts where the person the work was for resided, or intended to reside, in the premises applied until it was repealed on 1 March 2021. The main exclusions that remain relate to mining, tunnelling and mineral or petroleum extraction work.
Does it matter if I don't have a written contract?
No. The Act applies to construction contracts whether they're written, oral, or partly both.
Can my contract say the Act doesn't apply?
No. Any term that tries to exclude, modify or restrict the Act is void — you can't contract out of it.
Does it apply to work outside NSW?
No. This Act only applies to construction work carried out, and related goods and services supplied, in New South Wales. Other states and territories have their own equivalent legislation.
Not sure if your project is covered? Call us for a quick, free assessment.