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Changes to B.C. Builders Lien Act could make it easier for contractors to get paid

    Rule Changes Could Make it Easier for Contractors to Get Paid

    The provincial government is expected to contemplate changes this fall

    Legislative changes that would ensure contractors working on large construction projects get paid in a timely manner are being contemplated by the B.C. government.

    Amendments to the Builders Lien Act are expected to be tabled in the provincial legislature at some point this fall, which would follow changes made in Ontario in 2019. Some of the proposals include set payment timelines, a more refined invoice process, and a dispute resolution mechanism.

    “We encourage the provincial government to move on these much-needed changes as quickly as possible,” said Keith Barron, a lawyer with Clark Woods LLP. “A lot of people rely on the construction industry for a paycheque and the last thing a contractor wants is to not get their money.”

    The construction industry is one of the largest employers in B.C., with more than 215,000 people relying directly on construction for their paycheque. According to the B.C. Construction Association, which supports changes to the Builders Lien Act, a lack of prompt payment is one of the most significant issues facing the sector.

    “Enacting such legislation would help get funds to tradespeople who may be already struggling to afford housing and groceries due to inflation and rising interest rates as well as free up billions of taxpayer dollars, helping construction projects be delivered on time and on budget,” the BCCA stated during budget consultations with the provincial government earlier this year. “When contractors don’t get paid on time, it places a financial burden on small businesses and blocks cash flow in the economy.”

    In October 2019, Ontario imposed payment timelines, requiring owners to pay an invoice within 28 days unless they disputed the charges within 14 days. Contractors would then be required to pay their subcontractors within seven days of receiving payment, followed by subcontractors to sub-subcontractors. If a payment is not made by the deadline, interest would be applied to the total until the bill is settled.

    After Ontario’s amendments, Saskatchewan quickly followed with similar changes to its Builders Lien Act. This summer, Alberta also made changes to its mandatory payment terms when the province enacted the Prompt Payment and Contract Lien Act and Prompt Payment and Adjudication Regulations in August 2022.

    If you believe you are owed money through the Builders Lien Act or are just seeking counsel on debt collection, Clark Woods LLP can help. Please fill out our contact form, or call 604-330-1777 to set up a free consultation.

    Related: Get paid for your work with the Builders Lien Act