The CISC is pleased to announce that the Federal Prompt Payment for Federal Projects is finally in force as of December 9, 2023. The Public Services and Procurement Canada announced the news on December 12, 2023.
Read the Government of Canada’s Official News Release here: https://www.canada.ca/en/public-services-procurement/news/2023/12/new-federal-prompt-payment-legislation-to-protect-construction-workers.html
Driven by the NTCCC (National Trade Contractors Coalition of Canada) of which CISC is a member, the results of a long hard battle have finally paid off. Although the legislation was passed many years ago, it has taken the government until just this month to codify the required regulations and processes into place to turn the program on.
This is just one more jurisdiction in Canada that has adopted some form of working Prompt Payment legislation and regulations. The CISC remains committed to ensuring the few remaining jurisdictions/provinces that do not have Prompt Payment in construction, at present, put this in place to protect the companies, their employees and their families that do the actual work.
Under the introduced terms of the legislation, the federal government will have 28 calendar days to pay after the contractor submits a proper invoice. The contractor will then have 7 days to pay its subcontractors, subcontractors will have another 7 days to pay their sub-subcontractors, and so on down the contracting payment chain. This will take effect immediately for new federal contracts, and up to one year for existing contracts before December 9, 2023. The legislation aims to protect each party in the construction chain and ensure timeliness in payment and invoice fulfillment.
*All existing construction contracts will have 1 calendar year from December 9th, 2023 to comply with the legislation.*