���Ǵ���

Understand your rights and obligations under SA's Security of Payment laws to get paid on time and protect your cash flow.

Late payments strain cash flow, delay projects, and put subcontractors at risk.

) gives contractors a fast, enforceable pathway to recover money owed, without going through lengthy legal proceedings.

The Act grants a statutory right to progress payments, even if the contract says otherwise. It also outlines a clear process for making claims, issuing payment schedules, and resolving disputes through adjudication.

Key Rights Under the West Australia’s Security of Payment Act

Under the Security of Payment Act (SOPA), eligible claimants in SA can:

• Progress payments: Contractors can claim payment for construction work or related goods and services, even if there is no contractual clause
• Payment claims: Claims must be made within six months of the work being completed and can include released retention
• Payment schedules: Respondents must reply within the earlier of the contractual timeframe or 15 business days, stating the amount payable and reasons for any withheld sum
• Adjudication: Disputes can be fast-tracked through adjudication if payment is withheld or delayed
• Debt recovery: Scheduled or adjudicated amounts not paid on time can be enforced as a judgment debt
• Automatic liability: If no payment schedule is issued on time, the full claimed amount becomes payable
• Suspension rights: Contractors may suspend work if unpaid, with protection from liability for resulting delays
• Interest on overdue payments: Late payments attract interest at the higher of the contract rate or the Supreme Court rate
• Ban on “pay when paid” clauses: Contract terms that make payment conditional on upstream payment have no effect

Who Can Make a Claim?

Any party performing construction work or supplying related goods and services under a construction contract in South Australia may make a payment claim under the Security of Payment Act (SOPA).

Eligible claimants include:

• Head contractors: Claiming against project owners or principals
• Subcontractors: Claiming against head contractors
• Suppliers and consultants: Providing construction-related goods or professional services

A claimant must be entitled to a progress payment and serve a valid payment claim in line with the Act.

What Work Can be Claimed?

The Act allows contractors, subcontractors, and suppliers to claim progress payments for a broad range of construction work and related services carried out under a construction contract.

Claimable work includes:

What Work Cannot be Claimed?

Certain contracts and types of work are excluded from the SA Act:

• Resource extraction: Work relating to the extraction of oil, gas, or minerals.
• Employment contracts: Services provided as part of a direct employment agreement.
• Financial services contracts: Including guarantees, loans, or insurance arrangements.
• Non-measurable payment terms: Contracts where payment isn’t tied to the value of work or goods supplied.
• Out-of-state projects: Work performed or goods/services supplied outside South Australia.

Timeframe and Deadlines

The Security of Payment Act 2009 (SA) sets out strict deadlines for claims, responses, and adjudication. Missing these deadlines can lead to serious consequences, such as losing access to adjudication or becoming automatically liable for the full claimed amount.

Payment Due Dates

If the contract specifies a due date, payment is due on that date. If the construction contract is silent, payment becomes due 15 business days after the payment claim is served.

The Act does not distinguish between principals, head contractors, or subcontractors, unlike in other states. 15 business days apply across the board where no date is set.

Serving a Payment Claim

A payment claim can be served on or after the reference date set in the contract (or monthly, by default).

Claims must be served within the period specified in the contract or within 6 months of the last work or supply, whichever is later. Only one claim may be served per reference date, but previously claimed amounts can be reincluded.

Responding with a Payment Schedule

If a respondent intends to pay less than the claimed amount, they must provide a payment schedule. The schedule must be served within:

• The timeframe specified in the contract, or
• 15 business days of receiving the claim, whichever is earlier.

If no schedule is provided on time, the respondent becomes automatically liable for the full claimed amount.

Adjudication Application Deadlines

Timing depends on the respondent’s actions:

• If a payment schedule is issued but underpays, claimants have 15 business days from receiving the schedule to apply for adjudication.
• If a schedule is served but payment isn’t made, the adjudication application must be made within 20 business days of the due date.

If no schedule is served and no payment is made, the claimant must:

• Notify the respondent of their intention to apply for adjudication within 20 business days of the due date.
• Allow the respondent 5 business days to issue a late payment schedule.
• If no schedule is provided in that window, the claimant must apply within 15 business days from the end of the 5-day period.

After Adjudication

If the adjudicator doesn’t specify a payment date, the respondent must pay within 5 business days of receiving the determination, unless a specific date is set in the determination.

The Payment Claim Process

The Security of Payment Act 2009 (SA) sets out a structured process for claiming and recovering progress payments. Each step must be followed precisely to preserve your legal rights and ensure compliance.

1. Prepare the Payment Claim

   The payment claim must:
   
   Identify the construction work or related goods and services
   State the claimed amount, including any retention due for release
   Clearly indicate that the claim is made under the Security of Payment Act
   
   
   There is no prescribed supporting statement requirement for head contractors in SA, but contracts may require documentation confirming subcontractor payments.
   

2. Serve the Payment Claim

   The claim must be delivered in accordance with the contract or as permitted under the Act (e.g., post, hand delivery, electronic methods if agreed). It must be served:
   
   On or after the reference date specified in the contract (or the default monthly date)
   No later than the period specified in the contract or within 6 months after the last work was done or goods supplied, whichever is later

3. Respondent Issues a Payment Schedule

   If the respondent does not intend to pay the full claimed amount, they must issue a payment schedule that:
   
   Identifies the relevant payment claim
   States the amount they propose to pay (the scheduled amount)
   Explains the reasons for withholding any amount
   
   The schedule must be served within the earlier of the contract-specified timeframe or 15 business days after receiving the payment claim. If no schedule is served within this timeframe, the respondent becomes automatically liable for the full claimed amount.
   

4. Respondent Pays or Claimant Takes Further Action

   If a valid payment schedule is served, the respondent must pay the scheduled amount by the due date. If they fail to pay, the claimant may:
   
   Recover the amount as a debt in court (with limited defenses)
   Apply for adjudication
   Suspend work after giving 2 business days’ notice
   
   If no payment schedule is served and the claimed amount is unpaid:
   
   The claimant must notify the respondent of their intention to apply for adjudication within 20 business days of the due date
   The respondent has 5 business days to issue a late payment schedule
   If no schedule is served, the claimant must apply for adjudication within 15 business days after the 5-day window ends

5. Adjudication (if required)

   If the payment is withheld, underpaid, or disputed, the claimant may apply for adjudication. The adjudicator will:
   
   Review the claim, payment schedule (if any), supporting documentation, and contract terms
   Issue a written determination specifying the amount payable and the due date
   Make a decision within 10 business days, unless the parties agree to a longer period
   
   Adjudicators must be independent and qualified under the Act. The decision is binding, though limited judicial review may be available for jurisdictional errors.
   

6. Payment or Enforcement

   The respondent must pay:
   
   On the date set in the adjudicator’s determination, or
   Within 5 business days of receiving the determination, if no date is set
   
   If payment is not made, the claimant may:
   
   Request an adjudication certificate
   File it in court as a judgment debt (with a supporting affidavit)
   Suspend work after giving 2 business days’ notice
   
   Respondents cannot raise new defenses in court proceedings and generally cannot challenge the adjudicator’s decision unless there is a jurisdictional error.

What Happens After You Make a Claim?

Once a valid payment claim is served under the Security of Payment Act 2009 (SA), the next step falls to the respondent.

The respondent must provide a payment schedule within the earlier of the timeframe stated in the contract or 15 business days after the claim is received.

The schedule must:

• Identify the payment claim it relates to
• State the amount the respondent proposes to pay
• Provide reasons for withholding any portion of the claimed amount

Only the reasons listed in the payment schedule can be used in adjudication. New reasons cannot be introduced later.

If No Schedule is Provided

The respondent becomes automatically liable to pay the full claimed amount by the due date for the progress payment.

If the Claim Goes Unpaid

If the respondent doesn’t provide a schedule and fails to pay, the claimant may:

• Recover the amount as a debt in court
• Suspend work with at least 2 business days’ notice (with no liability for resulting delays)
• Apply for adjudication, provided they first issue a notice of intention to do so within 20 business days of the missed payment deadline

These same rights apply if a schedule is served but the scheduled amount is underpaid or unpaid by the due date.

Adjudication

Adjudication is a fast-track dispute resolution process. It allows contractors and suppliers to resolve payment disputes quickly and without going through lengthy court proceedings. 

While adjudication is legally available, many contractors view it as a last resort due to the relationship risk involved.

A claimant may apply for adjudication if:

• The payment schedule proposes to pay less than the claimed amount
• The respondent fails to pay the full scheduled amount by the due date
• The respondent fails to serve a payment schedule and does not pay the claimed amount, provided the claimant first issues a formal notice of intention to apply for adjudication

Respondents cannot introduce new reasons during adjudication or enforcement that weren’t included in the payment schedule. They also cannot challenge the adjudicator’s determination in court, unless there is a jurisdictional error.

The Security of Payment Act SA gives contractors a fast, enforceable pathway to get paid.

The Act outlines strict rules for making claims, responding with payment schedules, and resolving disputes through adjudication. It helps contractors maintain momentum on projects and reduce the risk of non-payment.

See what’s coming in construction over the next decade.

Download the Future State of Construction Report for insights, trends, and innovations shaping the industry over the next 8–10 years.

Download now

Written by