Prompt Payment

FEDERAL PROMPT PAYMENT

As someone involved in the construction industry, you know that payment delays have serious and negative effects on your business, and the efficiency of Canada’s construction sector. The Mechanical Contractors Association of Canada (MCAC) has been working hard with our partners in the National Trade Contractors Coalition of Canada (NTCCC) to fight payment delays for years and incredible progress was made.

There has been tremendous progress made over the last couple of year on this legislation both federally and provincially. In April, 2016 with the help of NTCCC Senator Don Plett introduced Bill S-224, known as the Prompt Payment Bill. In November 2016the Bill passed second reading. Finally it passed 3rd reading and the Senate Committee line by line review. It was then sent to the floor of the House of Commons for its review.

In the meantime, several provinces were engaged in developing provincial legislation. In Ontario, the Reynolds Report was brought forward in 2017 and in December 2017, Bill 142 was passed into Legislation.

On January 30, 2017 the Federal Government announced plans to introduce Prompt Payment Legislation, which the NTCCC strongly supports.


Federal Government Announces Support for Prompt Payment Legislation – January 30, 2018

Ottawa, ON Members of the National Trade Contractors Coalition of Canada (NTCCC) are expressing support for the federal government’s plan to legislate prompt payment requirements on all federal construction projects. The move comes after months of collaborative work between contractor groups, civil servants and Parliamentarian champions. Steven MacKinnon, Parliamentary Secretary to the Minister of Public Services and Procurement, hosted stakeholder groups to announce the initiative today at the department headquarters in Gatineau, Quebec. Click here to read the Press Release


Ontario Passes Bill C-45 Construction Lien Amendment Act – December 5, 2017

Toronto, ON (December 5, 2017) – Today, Bill 142, the Construction Lien Amendment Act, was passed with a unanimous vote at Queen’s Park, and marks a pivotal moment wherein the rights and securities of Ontario’s workers will now be held to a much higher standard.  This is the first legislation of its kind in Canada and hopefully will serve as a guide for the rest of the country looking to put forth their own legislation that will protect the financial security of Canadians from coast to coast. Click here to read the Press Release.


Senate Passes Bill S-224 Prompt Payment Act – Heads to House.
May 5th, 2017 (OTTAWA) – Canada’s construction community is applauding the Senate of Canada for passing Bill S-224, The Canada Prompt Payment Act, at third reading. After debate in the chamber and careful consideration at the Senate Standing Committee on Banking, Trade and Commerce the bill was passed. It now heads to the House of Commons for Consideration. Click here to read the Press Release.


An open letter to Canadian Construction Industry.
March 24, 2017 – Bill S-224, The Canada Prompt Payment Act, was introduced in the Senate over 11 months ago. The Canadian Construction Association (CCA) has taken no public position on the legislation. It is clear to Canada’s trade contractors and suppliers that, while a piece of legislation has been tabled that would solve the issue of payment delays with the federal government, it is irresponsible for CCA to stay on the sidelines. Continuing to make progress toward changes that have no force and effect is the definition of futility…. Read more…


Senate Review – Prompt Payment Legislation, Bill S-224  has passed 1st & 2nd reading in the Senate and is now before the Senate Committee on Banking, Trade and Commerce. Hearings were held on February 2nd, 8th & 9th, 2017 featuring MCA Canada, Senator Plett and numerous industry stakeholders and representatives of the federal government. The following are links to the Senate Committee hearings:
February 2-  Click Here (Senator Plett, CIPH & CBTU)
February 8- Click Here (MCAC President Del Pawliuk, NTCCC, & CMMTQ)
February 9- Click Here (Parliamentary Secretary Steven MacKinnon)

MCA Canada is calling on all government parties to commit to supporting Bill S – 244, otherwise known as the Prompt Payment Bill which was introduced into the Senate on April 13, 2016. The Bill requires all federal contracts for construction projects to include a prompt payment clause. This would require federal government owners and contractors to make payments on-time for work that has been completed and that is not in dispute. Without costing the government anything extra, this would be a positive stimulus to the construction industry and would have the positive, long-term effect of inviting more competitive bids and more affordable projects overall.

Other countries like the United Kingdom, Ireland, Australia, New Zealand and the United States (including 49 of 50 states) have eliminated delay issues by implementing prompt payment legislation.  Canada has not! MCA Canada  strongly supports the need to eliminate payment delays for completed work and is diligently working with all levels of government to initiate protocols to ensure contractors get paid for the work the have successfully completed.

Bill S-224 – The Prompt Payment Bill – click here to view or download the Bill
Click here to download the NTCCC Position Paper


Delayed payments are a harmful practice in Canada’s construction industry. They are a significant problem for small businesses, their employees and families, and taxpayers. This issue has led to layoffs, bankruptcies, higher construction costs and fewer competitive bids in the construction sector, which has driven up prices for consumers, governments, and taxpayers.