Suspending Work for Non-Payment: Your Rights Under the Act

Continuing to work while you're not being paid can feel like the only option, particularly mid-project. The Act gives claimants a genuine right to suspend work for non-payment, but it's a right that has to be exercised correctly or it can expose you to a breach of contract claim instead of protecting you.

The basic right

The right to suspend arises in three situations: where the respondent fails to pay after providing no payment schedule at all, where they fail to pay the amount they scheduled, or where they fail to pay an adjudicated amount. This applies whether or not a payment schedule was served.

Notice has to come before suspension

You generally cannot simply stop work the moment payment becomes overdue. The Act requires written notice of an intention to suspend — stating that it's made under the Act — with at least 2 business days' notice before work can lawfully stop. Suspending before giving proper notice removes the statutory protection and can leave you exposed under the contract.

What lawful suspension protects you from

Where suspension is exercised correctly, the claimant generally isn't liable for any loss suffered by the other party as a result of the suspension. The Act's costs protection is specific rather than a general right to charge for remobilising: it covers loss or expense the claimant incurs where the respondent removes part of the work or supply from the contract as a result of the suspension. The right to suspend ends 3 business days after the claimant receives the full amount payable — continuing to suspend beyond that point loses the statutory protection.

Practical considerations before you stop work

Suspension is a serious step with real commercial consequences on both sides. It's usually worth confirming the payment position, and the correct notice content and timing, before acting, rather than after a dispute over whether the suspension itself was lawful.

How this applies across NSW

Sydney metro

On active sites around the Hills district and Penrith, the commercial pressure to keep working despite non-payment is often highest, which is exactly when getting the suspension notice right matters most. For our broader construction law services in these areas, see Archer Lawyers' Hills district and Penrith pages.

Regional NSW

For regional subcontractors around Wollongong and Nowra, mobilisation and remobilisation costs can be a larger proportion of the job, making the right to charge for resuming work after a lawful suspension particularly valuable. For our broader construction law services in these areas, see Archer Lawyers' Wollongong and Nowra pages.

Frequently asked questions

Can I stop work as soon as a payment is late?

Not immediately. You generally need to give written notice, stating it's made under the Act, and wait at least 2 business days before lawfully stopping work.

What if I suspend without giving proper notice?

You risk losing the Act's protection and could be exposed to a breach of contract claim from the other party for stopping work.

Do I need a payment schedule dispute to suspend work?

No. The right to suspend arises from non-payment of an amount that's due — whether that's after no payment schedule was served, an underpaid scheduled amount, or an unpaid adjudicated amount.

Can I charge for the cost of remobilising after a lawful suspension?

Only in a specific sense — the Act covers loss or expense you incur where the respondent removes part of the work from the contract because of the suspension, not a general right to charge for remobilising.

Is suspending work always the right move?

Not necessarily. It's a serious commercial step, and adjudication or other recovery options may be more appropriate depending on the relationship and the project stage.

If you're considering suspending work over an unpaid claim, get advice before you act. Contact our team for a free assessment.