Building industry amendments commence on 1 October 2020

On 22 July 2020 we published an email alert advising about changes to laws impacting the Building & Construction Industry that had been passed by the Queensland Parliament. You can read that alert here.

Further to that alert, the Queensland Government has now set commencement dates for additional changes that were made by the Building Industry Fairness (Security of Payment) and Other Legislation Amendment Bill 2020, which was passed on 15 July.

The following amendments will commence from 1 October 2020.

Under the Building Industry Fairness (Security of Payment) Act 2017 (Qld)

1. A new requirement for Head Contractors issuing payment claims: if you have engaged subcontractors on a project you will have to provide a Supporting Statement with your payment claims made under Chapter 3 of the BIF Act.  A supporting statement must declare that all subcontractors have been paid all amounts owed to them by the claimant at the date of the payment claim and, if payment has not been to some subcontractors, setting out certain details in relation to that non-payment.  A payment claim will still be valid without a Supporting Statement, but Head Contractors could face fines of up to 100 penalty units (currently $13,345) if they fail to comply.
2. For those responding to a payment claim: If you state an amount in a Payment Schedule that you agree to pay, but you fail to pay that amount by the due date for payment you could face fines of up to 100 penalty units (currently $13,345) for non-compliance.
3. For those involved in adjudications: there are new offences incurring penalties of up to 20 penalty units (currently $2,669) that will apply if parties fail to notify the QBCC about the following adjudication matters:
   a. a respondent must notify the QBCC within 5 business days of payment of an adjudicated amount noted on an adjudication decision and provide evidence it was paid on time; and
   b. a claimant must notify the QBCC if they withdraw an adjudication application as soon as practicable after the withdrawal.
4. For claimants where an adjudicated amount is not paid on time:
   a. you will be able to give a payment withholding request to the respondent’s client (for claimant subcontractors) or financier (for claimant head contractors) and they will have to withhold the adjudicated amount from a payment due to the respondent; and
   b. for head contractors – you will be able to register a charge over the land on which the construction work related to the adjudicated amount was carried out or where the related goods and services were supplied if the respondent or a related entity of the respondent is the owner of that land.

Under the Queensland Building and Construction Commission Act 1991 (Qld)

1. The exemption for non-licensed entities to enter into non-residential building contracts where a licenced contractor is engaged to actually carry out the building work will be removed. (This exemption was only previously available for commercial building work).
2. Excluded individuals will no longer be able to apply for a site supervisor licence.
3. The definition of ‘fire protection work’ has changed and the licensing associated with that work is now classed as ‘building work’, and an appropriate licence is required to do that work unless an exemption applies.
4. The definition of a business day will be amended to align with the BIF Act for the payment provisions, such that a business day will exclude 2 December and 10 January. If you use a contract which included reference to the two different definitions you should have those provisions reviewed and amended.

Under the Building Act 1975 (Qld)

1. Owners will be able to direct their builder to request the private certifier to carry out additional certifier inspections, in circumstances where the builder engages a certifier. If the owner wants to request the additional inspections, they must notify the builder within 10 business days of being advised who the certifier is. Builders need to ensure that if additional certifier inspections are requested then you treat them as a variation to ensure you aren’t left paying the additional costs.
2. Owners may request copies of inspection documents from private certifiers and the documents must be provided to the owner within 5 business days of the request.

What do you need to do?

If you require assistance incorporating the amendments commencing on 1 October 2020 into your business process or ensuring that you comply with the legislation, please contact our Construction Law Team.