Get Paid, Not Played: B.C. Introduces Prompt Payment Bill

On October 7, 2025, the BC Government introduced Bill 15, the Construction Prompt Payment Act (the "Bill 15"), marking a significant shift in the province's construction landscape. While prompt payment legislation has been in force in Ontario and Alberta for several years, this is BC's first move toward codifying payment timelines and obligations in the province's construction sector.

Bill 15 is largely modeled after Ontario's 2019 prompt payment legislation and is designed to address persistent payment delays across the construction industry. When passed, it will establish mandatory timelines for payments between owners, contractors, subcontractors, suppliers, and workers. Construction industry stakeholders should stay informed on the legislation to understand how their rights and obligations may be affected.

How Did We Get Here?

BC's construction industry is one of the largest employers in the province. For many years, the industry has struggled with chronic payment delays, leading to cash flow problems and costly disputes. These financial challenges have resulted in project delays to vital infrastructure projects like schools, hospitals, and housing. Contractors also faced increased financial risks, often having to cover out of pocket the upfront costs for labour and materials. In light of these issues, the provincial government collaborated with stakeholders to develop prompt payment legislation aimed at ensuring timely compensation and increased efficiency for project owners and workers.

Although Bill 15 has only passed its first reading in the BC Legislature, its introduction signals a strong commitment to reforming payment practices in the construction industry. The government has emphasized that the legislation is intended to promote fairness and efficiency—ensuring that timely payments help keep projects on schedule and within budget. This predictability is expected to support better business planning and contribute to economic growth across the province.

Given the widespread adoption of prompt payment legislation in other provinces, including Ontario and Alberta, it is reasonable to anticipate that British Columbia will follow suit. Industry stakeholders should begin preparing for the legislation's passage and implementation, as it represents a long-awaited shift toward standardized payment timelines and enhanced accountability in BC's construction sector.

What We Expect to See:

Bill 15 signals a large shift from long-standing industry practices. In particular, the legislation proposes:

• mandatory timelines for payment on construction projects;
• a fast-track adjudication process for resolving payment disputes without lengthy court proceedings; and
• measures to improve cash flow and financial certainty across the construction supply chain.

In its current form, Bill 15 would require owners to make payments to contractors within 28 days of receiving proper invoices. Notably, while payment timelines affect both private and government contracts, regulations may exempt its application to specified public projects. Contractors would have to pass down payments within 7 days of being paid by owners. However, contractors should carefully assess their compensation structures and remain aware of their obligations. Even where a contractor has not been paid due to a milestone-based payment arrangement, they may still be required to pay subcontractors within 28 days of receiving a proper invoice. This could create cash flow pressure and operational risk, particularly in complex, multitier projects.

Due to this predictability in payment schemes, Bill 15 also proposes to eliminate the Shimco lien, a specific legal claim unique to BC that allows subcontractors to pursue payment from statutory holdback funds. BC's dual lien regime arising from the Shimco decision can be a source of uncertainty for owners, who retain holdbacks to secure claims against prime contractors but remain liable to unpaid subcontractors to the extent of the holdback. The removal of Shimco liens may help rebalance risk and simplify holdback administration.

In addition to the payment scheme, Bill 15 proposes a streamlined adjudication process which aims to resolve disputes quickly and cost-effectively to minimize project delays rooted in payment disagreements. Under the proposed regime, adjudicators would be bound by strict timelines to make the process efficient and predictable.

Mirroring Alberta's prompt payment legislation, Bill 15 grants payors 14 days to dispute a claim for payment. However, Alberta's experience suggests that this window is often too narrow for payors to properly validate invoices—particularly when detailed backup is required for labour, equipment, and materials. This compressed timeline increases risk and may compel payors to allocate additional staff to meet compliance demands. Accordingly, all parties involved in invoice validation should prepare for these accelerated timelines and consider implementing internal processes to ensure readiness once the legislation comes into force.

When passed, a transition period would be implemented to give stakeholders time to understand their new rights and obligations, and to allow for the establishment of an adjudication authority.

Takeaways

Bill 15 will fundamentally reshape payment practices in BC's construction industry, driving greater transparency and efficiency in fund flows. Stakeholders must proactively assess how these changes will impact their operations—both current and future projects. McMillan's Construction Group has extensive experience navigating prompt payment legislation across Canada and can provide tailored guidance to help you adapt confidently to the new requirements.

The foregoing provides only an overview and does not constitute legal advice. Readers are cautioned against making any decisions based on this material alone. Rather, specific legal advice should be obtained.

© McMillan LLP 2025