Failure to pay subcontractor for Australian Parliament House work leads to penalty
New South Wales company N-Cap Pty Ltd has been penalised $5,000 and ordered to pay its subcontractor $10,633 in outstanding payment claims following ABCC action.
The Federal Circuit Court on 3 February ordered N-Cap to provide proof the ACT-based subcontractor has been paid the outstanding amount within 90 days.
Legal proceedings commenced on September 2020 after N-Cap failed to pay a subcontractor for work at the Australian Parliament House Security Upgrade project in Canberra – despite being issued with a compliance notice to do so.
The ABCC initiated an audit to assess compliance with security of payment obligations at the project in July 2019.
The ABCC’s audit found N-Cap had failed to comply with the Code for the Tendering and Performance of Building Work 2016 (Building Code) when it failed to make payment to the subcontractor.
On 12 May 2020, the ABCC issued a compliance notice to N-Cap requiring it to pay the subcontractor.
The ABCC commenced legal action after N-Cap failed to comply with the notice in contravention of section 99(7) of the Building and Construction Industry Improving Productivity Act 2016 (BCIIP Act).
In the course of proceedings, N-Cap reached agreement with the ABCC on a pecuniary penalty and an order to compel the company to pay the subcontractor in full.
Australian Building and Construction Commission Commissioner Steve McBurney says these were the first court proceedings the ABCC has initiated relating to non-compliance with security of payment laws: “The ABCC takes seriously the security of payment of subcontractors. Subbies deserve to be paid for the work they have undertaken, in full and on time.”