Winnipeg, MAN — Contractors in Manitoba have more security in place, ensuring that the work completed receives the proper compensation. The province announced that Bill 38, The Builders’ Liens Amendment Act (Prompt Payment) has officially received royal assent.
According to the Heating, Refrigeration, and Air Conditioning Institute of Canada (HRAI), the development of the Bill was driven by a coalition of construction associations called Manitoba Prompt Payment. “The aim of the coalition was to have legislation in place to address delayed payments which cause problems throughout construction project chains,” reports HRAI in a press release.
The coalition wanted to ensure orderly and timely construction projects by avoiding the effects of non-payments through supply chains, avoiding increased construction costs that result from bidders adding contingency amounts to allow for the risk of late payments, ensuring better value, reducing the risk of disruptions to construction projects while ensuring subcontractors and suppliers can pay bills and workers, and establishing an adjudication framework to resolve prompt payment disputes in a timely manner.
“There is still work to be done as the next step would be for the government to develop regulations in consultation with industry for this new legislation,” reports HRAI.
Under the newly adopted code, the owner must pay the contractor within 28 days. But the owner can suspend this payment deadline if it gives notice of non-payment to the contractor within 14 days.
The contractor must pay its sub-contractor within seven days after receiving full or partial payment from the owner. But if the owner doesn’t pay in full, the contractor must pay its sub-contractor the entire invoiced amount within 35 days. The contractor can suspend the payment deadline by giving its sub-contractor a notice of non-payment before the deadline.
The contractor must give the owner a proper invoice each month unless their contract provides for a different time period. The time for payment for all payors in the payment chain starts to run from the date the invoice is given.