Prompt payment legislation at the federal level received royal assent on June 21, 2019. Ottawa, ON—It has been two years since the construction industry has seen any movement forward regarding prompt payment. After passing as part of the Budget Implementation Act 2019, the legislation remains in limbo with no legal coming-into-force date reported, according to the Canadian Construction Association (CCA). Federal prompt payment legislation became law after receiving royal assent on June 21, 2019.
“The issue of delays in payment along the supply chain from prime contractors to sub-contractors and sub-sub-contractors is a long-standing problem within the Canadian construction industry,” reports Public Services and Procurement Canada (PSPC). “Industry stakeholders have called on the federal government to address the issue on federal construction projects.”
PSPC informed the CCA that one reason the legislation has paused is due to a need to clarify and finalize regulations internally. A “Request for Information,” or RFI, was issued by the department, requesting the industry for feedback on the best approach to establish an adjudicatory authority. An adjudicator authority oversees any construction disputes.
The goal of issuing an RFI will be to receive feedback that could help develop a “Request for Proposal,” or (RFP), that would enable firms or associations to bid to provide the services of an adjudicator authority to support the adjudication process, reports the CCA in a press release.
“This inconsistency drives the cost of federal construction up and ultimately does not support growth, innovation, and employment. Delayed payment throughout the payment chain may erode government buying power, increase financial risks and escalate costs for construction enterprises,” according to PSPC.
The RFI’s objective is to solicit feedback that could help Canada develop a comprehensive and competitive Request for Proposal (RFP) that would enable firms or associations to bid to provide the services of an Adjudicator Authority to support the adjudication process.
The proposed approach to the adjudication authority would mean that the entity would provide the following services:
- Developing and providing training for adjudicators
- Certifying, renewing certifications, withdrawal of certifications for adjudicators, and ensuring that adjudicators meet all prescribed criteria
- Maintaining a publicly available registry of qualified adjudicators
- Establishing and maintaining a fee schedule
- Establishing a standard contract template for adjudication services
- Appointing an adjudicator when the disputing parties are unable to choose their adjudicator within the required timeframe required
- Establishing a code of conduct to regulate the conduct of adjudicators
- Establishing a complaints procedure and addressing complaints against an adjudicator
- Appointing adjudicator replacements, when necessary
- Tracking information about adjudications
Adjudicator services will be offered in both English and French. To provide feedback, visit https://buyandsell.gc.ca/procurement-data/tender-notice/PW-GB-009-79704. Comments will be accepted until April 6 at 2 p.m. The CCA encourages all interested members and parties to follow up if interested.