ACT Security of Payment: Practical Steps for Subcontractors to Recover Money

You’ve done the work. Materials are on site. But the money hasn’t landed in your account, and your head contractor won’t return your calls. If you’re a tradie or subcontractor working in the ACT, you’ve got legal rights—and they’re stronger than you might think. The ACT Security of Payment Act 2009 exists to make sure people like you can recover unpaid invoices without waiting years for a court case.

This post walks you through what you need to know about the ACT security of payment scheme and the practical steps to protect your cash flow.

What is the ACT Security of Payment Act?

The ACT Security of Payment Act 2009 is Commonwealth territory legislation designed to give tradies and subcontractors a fast, low-cost way to force payment disputes into a binding process called adjudication. It applies to construction contracts in the ACT—including residential, commercial, and civil work.

Unlike suing someone in court (which can take 18 months and cost tens of thousands), the Act lets you lodge a payment claim and get an independent decision within weeks, not years.

The scheme covers most construction-related work: site work, labour, materials, design, consulting—anything that contributes to a building, structure, or service on land. It doesn’t cover purely commercial contracts that have nothing to do with construction.

Key Timeframes You Need to Know

The ACT Act moves quickly. Here are the critical dates:

1. Payment claims must be served in writing. You can issue one every 28 days (or whatever period is in your contract). If you’re owed money for work completed, you have the right to claim it.
2. The respondent (person who owes you money) has 10 business days to issue a “payment schedule” setting out what they’re going to pay and why they’re withholding the rest. If they don’t respond, you can move straight to adjudication.
3. You have 10 business days after receiving the payment schedule to lodge an adjudication application if you disagree.
4. The adjudicator must make a decision within 10 business days of receiving your application (though they can extend this to 15 days if the case is complex).

That means from claim to decision, you could be looking at 20–30 business days. Not instant, but a hell of a lot faster than court.

How to Lodge a Payment Claim in the ACT

A payment claim doesn’t need to be fancy or formal. The Act sets out what must be included, but it’s straightforward:

• Your name and contact details
• The respondent’s name (the person who owes you money)
• A description of the work you’ve done or materials you’ve supplied
• The date(s) the work was done
• The amount you’re claiming (in AUD)
• A statement that it’s a claim under the ACT Security of Payment Act 2009

You must serve it on the person who owes you money—by email, post, or hand delivery. Keep proof of service; you’ll need it later.

Many subcontractors try to do this themselves with a detailed invoice plus a cover letter, and that’s fine. But mistakes are easy to make, and a poorly prepared claim can be thrown out on a technicality. If you want to skip the stress and ensure it’s done right, you can file a payment claim through a service that handles the paperwork and serves it properly for a flat fee.

What Happens After You Lodge a Claim

Once you serve your payment claim, three things can happen:

1. They pay you. Some respondents simply pay when they receive a formal claim. No fuss.

2. They issue a payment schedule. They’ll outline what they’re paying, what they’re holding back, and their reasons (e.g., defects, variations, disputed scope). This is their chance to explain why they’re not paying the full amount. If you disagree with their reasons, you can lodge an adjudication application.

3. They ignore it. If they don’t respond within 10 business days, you can apply for adjudication anyway. Ignoring a claim doesn’t make it go away—it makes things worse for them, because the adjudicator will only hear your side of the story.

Many head contractors and builders choose to settle or pay rather than escalate to adjudication, because an adjudicator’s decision is binding and can force payment plus interest and costs. But that’s their choice to make, not yours to assume.

Adjudication: The Fast Track to a Decision

If the respondent issues a payment schedule and you’re not happy with it, or if they don’t respond at all, you can apply for adjudication. This is where an independent third party (the adjudicator) reviews the evidence and makes a binding decision.

You’ll need to lodge your application with the ACT Legislation Register or via a private adjudication scheme (check the ACT legislation for approved schemes). You’ll attach your claim, evidence of service, any correspondence, and your reasons for disagreeing with their payment schedule.

The adjudicator will read both sides and issue a determination. That determination is binding and enforceable in court if the respondent refuses to pay.

Bottom Line

The ACT Security of Payment Act 2009 is there because construction cash flow matters. You shouldn’t be waiting months or years to recover money for work you’ve already done. The scheme is designed to be fast, affordable, and within reach of small tradies and subcontractors.

Start with a clear, properly served payment claim. If the respondent doesn’t respond or disputes your claim unfairly, you’ve got a legal pathway to adjudication that doesn’t involve hiring a lawyer or sitting in court.

Get the claim right from the start—it makes everything that follows easier.