NSW’s Security of Payment regime is set by the Building and Construction Industry Security of Payment Act 1999 (NSW). This is a short, plain-English orientation — not legal advice, and not a substitute for the Act itself or qualified advice.
The lead Act in NSW
In NSW, progress-payment rights are governed by the Building and Construction Industry Security of Payment Act 1999 (NSW).
- NSW’s Act was the first of its kind in Australia and remains the reference regime, with the most adjudication activity and case law.
- It follows the payment-claim / payment-schedule / adjudication structure that defines the East Coast model.
- NSW has introduced retention-money trust requirements for larger contracts, so retentions on big jobs are held in trust rather than used as the holder’s cash.
The process, in short
Like the rest of the East Coast model, the process runs from a payment claim, to a payment schedule in reply, to adjudication if the claim is short-paid or unanswered, and then to enforcement of the adjudicated amount. The specific timeframes and requirements are set by this state’s Act — each is a defined number of business days that varies by jurisdiction, so confirm the current Act rather than relying on a number from elsewhere.
Where it leaves trades exposed
The statutory right is powerful but reactive: you invoke it after the work is done and the money is already at risk, on strict timeframes, and a winning determination is worth little if the payer is insolvent. Milestone escrow addresses the same problem from the other end — ring-fencing each stage’s payment before the work starts. It complements the statutory regime; it does not replace it.