The ABCC has now published Guidance on contractor and subcontractor obligations in relation to Security of Payment (‘SoP’) under the Code for the Tendering and Performance of Building Work 2016 (Building Code 2016), including new reporting requirements that will take effect from 1 September 2018. Under Building Code 2016, the ABCC is responsible for monitoring SoP requirements of code covered entities.

In summary the guidance highlights that contractors and subcontractors that are covered by the Code must:

• comply with state and territory security of payment laws
• not coerce or unduly pressure or influence a contractor, subcontractor or consultant not to exercise rights under state or territory security of payment laws or to exercise such rights in a particular way
• report disputed or delayed progress payments to the ABC Commissioner
• ensure payments that are due and payable are made in a timely way and not unreasonably withheld
• have documented dispute settlement processes detailing how disputes about payments to subcontractors will be resolved
• comply with the dispute settlement process and any determination made under such a process
• ensure disputes about payments are resolved in a reasonable, timely and co-operative way
• comply with any project bank account or trust arrangement that may apply on a Commonwealth funded project.

The ABCC sits on the SoP working group, of which Master Builders is also a member, who are charged with making recommendations to the Minister with regard to SoP-related matters.

Master Builders is in the process of seeking further clarification from the ABCC on a number of points raised in the guidance material and will continue to work closely with the Commissioner to ensure obligations of all code covered entities are reflected accurately.

Members seeking further information are encouraged to contact the IR Department on (03) 9411 4560.