New prompt payment rules support Alberta’s economic recovery and growth

Following years of inaction on nonpayment, Alberta’s government worked closely with industry to create a solution that works. The prompt payment framework addresses long-standing industry concerns, protects jobs and keeps investment moving throughout our economy.

Alberta’s government has passed the Prompt Payment and Construction Lien Act and supporting regulations. This framework sets out clear timelines and rules for payments and liens as well as a new adjudication framework for payment disputes within the construction industry. Regulations come into force on Aug. 29 and will be available online at www.alberta.ca

HRAI, in cooperation with the Alberta Trade Contractors Council (ATCC) advocated for such a framework over the past several years.

 “This framework was much needed by industry as a whole, and it’s been great working with a government that has listened to and engaged with us all along the way. These regulations are designed to provide fairness to our hard-working tradespeople, and we look forward to the regulations coming into force this summer.” - Terry Milot, chair, Alberta Trade Contractors Council  (ATCC)

What the regulations cover

The new regulations set out the rules for:

  • administration of the adjudication process, including eligibility
  • training and associated costs for adjudicators
  • payment of lien holdbacks
  • transition of existing construction contracts
  • when change orders are subject to prompt payment rules
  • administrative items, including adjudication procedures and timelines, and consolidation of disputes that are subject to prompt payment rules

Quick facts

  • The following legislative changes were passed in the fall 2020 and spring 2021 sessions, and will be in force on Aug. 29:
    • A new adjudication process for the construction industry to address payment disputes.
    • 28-day timelines for owners to pay proper invoices from general contractors.
    • Contractors and subcontractors are required to pay their own subcontractors within seven calendar days of being paid themselves.
    • Extended timelines (in calendar days) for registering liens from:
      • 45 days to 60 days for the construction industry
      • 45 days to 90 days for suppliers within the concrete industry only
    • The oil and gas lien period remains at 90 days.
    • New language has been added around public-private partnerships:
    • Prompt payment rules only apply to construction, not operations and maintenance.
    • Municipal public works projects are subject to prompt payment legislation, but provincial government projects under the Public Works Act are not.
    • Clarification was added that the prompt payment rules apply to professional consultant (engineers and architects) contracts.

Rules for posting a Certificate of Substantial Performance (which verifies that construction work is substantially complete) on job sites were modernized.

For more information, contact Scott Papp, Manager, Membership and Divisional Programs, 1-800-267-2231 ext. 233 or spapp@hrai.ca

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