New laws have been introduced into the South Australian Parliament that aim to improve protections and better payment practices for subcontractors.
Workers owed money for jobs will benefit from increased oversight and an improved adjudication system.
The reforms will be funded by a $10 fee on all building and associated trade licences.
The proposed legislation also aims improve the oversight of adjudicators and authorised nominating authorities, as well as the adjudication applications referral process, to ensure the adjudication system is fair and of a high standard.
The new laws will enable contractors or builders to make a payment claim on an owner builder of a residential property.
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Attorney-General Vickie Chapman said the extensive reforms were developed in response to the 2017 national review undertaken by John Murray to strengthen security of payment laws across Australia.
“Too often, small businesses and contractors are left in the lurch by those who engage them but fail to pay their bills on time,” Chapman said.
“Often issues arise when a contractor and subcontractor disagree over milestone or progress payments, and an independent adjudicator is required to settle the dispute.
“These new laws will increase the registration threshold for adjudicators, with approved adjudicators then bound by a Code of Conduct.”
Breaches of certain aspects of the code could be punishable of a fine of up to $5000 or and expiation of $210.
“Where an adjudicator breaches a condition of their registration – for example failing to advise the Small Business Commissioner in writing of a court’s decision to overturn an adjudicator’s determination – their registration could be suspended or cancelled,” Chapman said.
Small Business Commissioner John Chapman said de-identified adjudication determination would be published on the Small Business Commissioner’s website to help businesses understand how those determinations were made and make the process as transparent as possible.
“Overall, these reforms are aimed at strengthening processes around business payment disputes, strengthening the protections for ensuring progress payments are made in a timely manner and delivering a consistent mechanism for security of payment laws,” he said.