How the Queensland security of payment regime (BIF Act) works

Security of payment is a statutory right to be paid progress payments for construction work and related goods and services, without waiting until the end of the job or running a full court case. The aim is to keep money moving down the contracting chain so the people doing the work get paid along the way.

In Queensland this sits in the Building Industry Fairness (Security of Payment) Act 2017, usually called the BIF Act. It replaced the earlier Building and Construction Industry Payments Act 2004.

It applies to most construction work, and to related goods and services, carried out in Queensland, whether or not your contract is in writing. Some work is excluded, so it is worth confirming that your contract and the work fall within the Act. The right runs alongside your contract: you can usually make a claim each month, or as the timing in your contract allows.

The regime runs on three steps and tight deadlines.

• Payment claim. The party owed money (the claimant) gives the other party (the respondent) a payment claim. It identifies the construction work or supplies, states the amount claimed, and requests payment. Under the BIF Act a payment claim no longer has to state that it is made under the Act.
• Payment schedule. If the respondent intends to pay less than claimed, they must reply with a payment schedule. It states the amount they propose to pay and the reasons for withholding the rest. A payment schedule must be given within the time set by the contract, or 15 business days after the claim, whichever is earlier.
• If no schedule is given. If the respondent does not provide a payment schedule in time and does not pay, they generally become liable for the full amount claimed. The claimant can recover it as a debt or apply for adjudication.
• Adjudication. An independent adjudicator decides, quickly, how much is payable. The claimant applies; the respondent can lodge an adjudication response; the adjudicator decides within short timeframes set by the Act.

Adjudication is a "pay now, argue later" process. The decision is binding on an interim basis and can be enforced, while either party keeps the right to have the underlying dispute resolved later, in court or by other means.

The regime is built on strict, short deadlines. Miss one and you can lose the right you were trying to use.

The value of the regime is its speed, and that speed cuts both ways.

• If you are owed money. Serve a valid payment claim, then watch the clock. If the respondent fails to give a payment schedule in time, your position is strong, but you still have to act within the time limits to recover the debt or apply for adjudication.
• If you have received a claim. If you dispute it, you must put your reasons in a payment schedule on time. Leave it too late and you can be locked into paying the full amount, and limited in what you are able to raise at adjudication.

The Act also has wider parts, including trust account requirements on some projects, but the payment claim, payment schedule and adjudication process is the part most contractors deal with day to day.

When to get advice

Because the deadlines are short and unforgiving, the time to get advice is when a claim is about to be made or has just arrived, not weeks later. We can check whether a claim or schedule is valid, work out the deadlines, and act on them. See our building, construction and infrastructure page for how we help.