Canada prompt payment
Canada's prompt-payment reform started with Ontario's Construction Act in October 2019 and has spread across the country: fixed payment clocks, mandatory notices for withholding, rapid adjudication, and anti-waiver provisions that void contrary contract terms. If your subcontract still reads like 2018 — 60-day terms, silent pay-when-paid — much of it is now overridden by statute.
The owner must pay a proper invoice within 28 days; to withhold, it must deliver a prescribed notice of non-payment within 14 days stating all reasons, and pay the undisputed balance regardless. Once the contractor is paid, every subcontractor in that invoice must be paid within 7 days. Contracting out is impossible by design: s 4 voids any agreement that the Act doesn't apply, and s 5(1) deems every contract amended to conform.
Ontario didn't ban pay-when-paid — it made it expensive to invoke. A contractor who wants to defer paying you because the owner hasn't paid must give a formal notice of non-payment attributing the shortfall, attach the owner's notice, and undertake to take the owner to adjudication within 21 days. No notice, no deferral: you must be paid within 35 days of the proper invoice even if the owner never pays.
Disputes go to statutory adjudication through ODACC — determinations in roughly 30 days, payable within 10. The 10% holdback regime secures the lien pool, with mandatory annual release of accrued holdback since the January 2026 amendments, and lien rights expire 60 days after the trigger unless preserved. Proper-invoice gaming is also constrained: invoicing can't be conditioned on prior certification or owner approval (s 6.3(2)).
Prompt payment with adjudication is in force in Alberta (2022), Saskatchewan (2022), Manitoba (2025), and for Quebec public contracts (2025, staged); the federal Act covers construction on federal property (2023) with a 28/35/42-day cascade down the tiers. BC has legislation assented but not yet in force, as do New Brunswick and Nova Scotia. Wherever you are, a contract review flags the clauses your province's regime overrides — and the ones it doesn't.
Common questions
No. Section 4 of the Construction Act voids any agreement that the Act doesn't apply or that its remedies aren't available, and s 5(1) goes further: every contract is deemed to be amended so far as necessary to conform to the Act. Longer payment terms, waivers of adjudication, and lien waivers are all overridden. What the parties can vary is what the Act leaves open — scope, price, program — not the payment architecture.
It isn't banned the way it is in the UK or Australia, but under Ontario's regime it only operates through a strict channel: a formal notice of non-payment within statutory deadlines plus an undertaking to refer the owner's non-payment to adjudication within 21 days. Absent that, the 7-day and 35-day clocks apply regardless of whether money arrived from above. Other prompt-payment provinces run similar notice architectures — check your province's specifics.
As of mid-2026: Ontario (since October 2019, with further amendments in force January 2026), Saskatchewan (March 2022), Alberta (August 2022), Manitoba (April 2025), Quebec for public contracts (September 2025, staged rollout), and the Northwest Territories (September 2025, prompt payment without adjudication). The federal Act has covered construction on federal property since December 2023. BC, New Brunswick, and Nova Scotia have passed legislation not yet in force.
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