WHAT IS PROMPT PAYMENT ONTARIO?

Prompt Payment Ontario (PPO) is a sole-purpose alliance or coalition of contractor associations, unions, suppliers, general contractors, pension trust funds, and anyone else who has an interest is seeing prompt payment legislation enacted in the province of Ontario. Its purpose and goal are just that, to persuade the Ontario government that delinquent payment is a growing problem in the construction industry and that legislation is needed to ensure that money flows as it is intended down through the contractor supply chain.

LEGISLATION IS NEEDED

THE PROBLEM

Delinquent payment is rampant and a growing problem.

Construction is a primary driver of the economy, providing for the employment for more than 434,000 Ontarians (6.4% of Ontario's workforce). Yet delinquent payment in construction is rampant and a growing problem. Trade contractors are commonly made to wait for periods of four months or longer to get paid for work that has been certified as being complete.

This represents an unfair transfer of financial risk from owner/developers (those who stand to profit the most from a construction project) to trade contractors (those who can least afford it yet create jobs, employ workers, and drive the economy).

Ontario and Canada lag behind a majority of other jurisdictions who already have prompt payment legislation in place – 49 US states have it for public sector projects, 31 US states have it in place for the private sector, the US federal government has had prompt payment legislation in place since 1982, the European Union, United Kingdom, Ireland, New Zealand, and Australia all have prompt payment legislation.

The existing law in Ontario, the Construction Lien Act (CLA), is costly, cumbersome, and inaccessible to 80% of the construction industry (small and medium-sized family-owned companies consisting of 20 or fewer employees) – it addresses non-payment as opposed to delinquent payment and the lien rights of many in the industry will expire long before they realize they will not get paid.

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THE CONSEQUENCES

Delinquent payment drives up the cost of construction.

  • Delinquent payment drives up the cost of construction... as contractors have to factor the risk of delinquent payment into their bids.
  • Delinquent payment strains cash flow..., especially for small businesses that still have to meet payroll, pay bills, taxes, WSIB premiums and other costs to the point of forcing some businesses into insolvency.
  • Delinquent payment stymies new job creation... and restricts investment in apprenticeship training (the construction industry accounts for roughly 40% of all apprenticeships) as trade contractors must limit their payroll commitments to meet cash flow expectations.
  • Late payment practices erode the level playing field... as those who maintain honourable practices are put at a disadvantage.

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THE SOLUTIONS

Legislation that requires 30 day payment for completed work.

  • Legislation that requires payment for construction work... certified as being complete within 30 days of that certification.
  • Allow for monthly progress payments... projects of longer duration.
  • Allow for interest and penalties to accumulate... where payment within 30 days is not forthcoming.
  • Allow for contractors to suspend work... where payment is not forthcoming for unreasonable periods.

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Join the Conversation @PromptPaymentOntario

QUESTION
OF THE DAY

How often have you been paid within 30 days of completing a certified job?

28%1-5
3%15-20

6%5-10
8%20+

3%10-15
47%Never




VIEW RESULTS

EVENTS

  • SatApr 30

    Release of CLA Review Report

  • ThuMay 5

    PPO Membership Meeting at ISCA

  • WedMay 11

    Queen's Park Day

NEWS

NTCCC Prompt Payment Summit and Advocacy Day

04/21/2016
PRESS RELEASE

The National Trade Contractors Coalition of Canada (NTCCC) held the 2016 Prompt Payment Summit from April 17th-20th in Ottawa, following in the footsteps of the successful summit held in 2015.

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Liberals Eyeing Prompt Payment Legislation Amid Pan Am Dispute

03/09/2015
The Toronto Star

Problems at the Hamilton Pan Am soccer stadium with subcontractors getting paid highlight the need for prompt payment legislation, Liberals say.

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Ontario Lien Act Review Experts Welcomed by Industry

02/24/2015
Daily Commercial News

No matter where industry leaders fall on prompt payment legislation, they are encouraged by the province's announcement of an expert review of the Construction Lien Act, which will include the examination of payment issues.

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Industry eyes prompt payment in Manitoba

02/17/2015
Journal of Commerce

Construction leaders and contractors in Manitoba have formed a new committee to advocate for the implementation of a Prompt Payment Act, which would be applied to public and private projects in the province.

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Ontario Launches Expert Review of Construction Lien Act

02/11/2015
Ontario Government Newsroom

Ontario is launching an expert review of the Construction Lien Act that will include the examination of payment issues within the construction sector.

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NTCCC Has Plans for National Prompt Payment Summit

01/29/2015
Daily Commercial News

Ontario construction leaders agree there is a need for the provincial government to pass prompt payment legislation, but there is no consensus on whether or not this initiative should be linked to a review of the Construction Lien Act.

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Industry Differs on Lien Act Review and Prompt Payment

05/11/2014
The Toronto Star

Ontario construction leaders agree there is a need for the provincial government to pass prompt payment legislation, but there is no consensus on whether or not this initiative should be linked to a review of the Construction Lien Act.

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COCA Votes to Join Prompt Payment Ontario

31/10/2014
Daily Commercial News

The Council of Ontario Construction Association's (COCA) is set to join Prompt Payment Ontario (PPO), following a vote by its Board of Directors.

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Prompt Payment a Hot Issue at COCA Construction Day

30/10/2014
Daily Commercial News

COCA's recent Construction Day at Queen's Park was the perfect forum to hit home the message to Ontario MPPs that prompt payment legislation needs to be top of mind, says the association's president.

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New Ontario Prompt Payment Group Forms

20/10/2014
Daily Commercial News

Leaders from a variety of segments of Ontario's construction industry are launching a new umbrella organization, Prompt Payment Ontario (PPO), which will advocate for the passing of prompt payment legislation in the province.

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Ontario Offers Prompt Payment Lessons

08/14/2014
Daily Commercial News

Ontario's effort at enacting legislation to enforce timely payment of monies due on construction work came to an abrupt end earlier this year.

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Should Ontario Prompt Payment Bill and Lien Act Be Linked?

03/03/2013
Daily Commercial News

During the second day of committee hearings for Bill 69, the Prompt Payment Act, presenters were asked if the issue should be encompassed within reforms to the Construction Lien Act.

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The Need for Prompt Payment Legislation

04/2015

The status quo is not working. It is time for government to fix the problem

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MEMBERS