Canada’s construction industry is a powerhouse, providing employment for approximately 1.5 million individuals and significantly impacting our economy. In 2016, concerns about payment delays throughout the industry surfaced, capturing the attention of stakeholders, and prompting action.

Recently, the Honourable Jean-Yves Duclos, Minister of Public Services and Procurement, introduced federal prompt payment legislation, effective from December 9, 2023. This legislation aims to tackle persistent issues within the construction sector, prioritizing timely payments, safeguarding crucial construction jobs, and streamlining business interactions with the Government of Canada.

The development of the Federal Prompt Payment for Construction Work Act resulted from collaboration between Public Services and Procurement Canada, key construction industry stakeholders, and various government departments. Under this legislation, the federal government is obligated to settle invoices within 28 calendar days of receipt from the contractor. Subsequent timelines cascade down the payment chain: contractors have 7 days to pay subcontractors, and the trend continues further.

This legislative move endeavors to ensure that all involved parties in a construction project receive timely compensation, facilitating the completion of essential federal infrastructure ventures like building and bridge projects.

• The Government of Canada maintains a robust record, promptly fulfilling 90% of its invoices within the previously mandated 30-day period.
• National consultations with industry representatives have significantly shaped the Federal Prompt Payment for Construction Work Act and its accompanying regulations.
• Provinces and territories with compatible prompt payment and adjudication systems are designated under the Act.
• Ontario, Saskatchewan, and Alberta are currently the only provinces with fully implemented prompt payment regimes.
• ADR Chambers Inc. was awarded a contract in August 2023 by the Government of Canada to oversee the adjudication process.

• 
•