Security of Subcontractor Payments


Information for Head Contractors

To better protect the rights and interests of workers and Subcontractors, the Department of Communities (Communities) requires the Head Contractor to provide statutory declarations to confirm the payment of Workers and Subcontractors, pursuant to the General Conditions. 

Communities will conduct random audits of Subcontractor payments to verify the veracity of those statutory declarations and may audit any statutory declaration in response to specific Worker or Subcontractor payment complaints.

Communities will use the outcome of the audits to consider future tendering and contracting opportunities. If there is reasonable evidence to indicate that the statutory declarations have been made fraudulently, the matter may be referred to the WA Police for investigation.

Communities has also implemented the use of Project Bank Accounts (PBAs) on construction contracts with a value of $1.5 million and above. PBAs are an alternative payment mechanism that use a dedicated trust account to facilitate payments directly and simultaneously from a Principal through to the Head Contractor, and participating Subcontractors, involved in a project. PBAs have a number of benefits, as they:

  • provide a degree of insolvency protection
  • speed up the payment process for parties lower down in the supply chain
  • increase transparency and accountability in the payment process.

Find more information on PBAs​.

Information for Subcontractors

If you are a Subcontractor and find yourself in a situation where you are not being paid or are being paid late by a Head Contractor, your vital first step is to act quickly to determine your options. This is important if you want to ensure that all appropriate options to resolve the matter remain available to you. Below are your options:

  1. The dispute resolution mechanism specified in the contract.
    Generally, a dispute resolution process will be contained within the contract you have in place with the Head Contractor.
  2. Seek rapid adjudication.
    Taking legal action to recover money can be expensive and time consuming. The Construction Contracts Act 2004 provides an alternative and quick mechanism for those involved in building and construction work to take a disputed payment claim to an independent adjudicator for review. Visit the Building and Energy website or call 1300 489 099 for further information.
  3. Guided dispute resolution and mediation. 
    The Small Business Development Corporation can advise on alternative options for dispute resolution. Visit or call 13 31 40 for further information.
  4. Claims for debt or damages.
    Visit the Magistrates Court website for minor claims for debt or damages or call 9425 2222.
  5. Contact your relevant industry association. 
    Your association may have its own low-cost dispute resolution processes available to members.

How to lodge a complaint with Communities

In the first instance, subcontractors working on Communities-managed projects should speak to the Head Contractor of the project to seek resolution. If no resolution has been reached, you may lodge your complaint with Communities online.​​