Business days and the holiday period—Security of Payment
With the upcoming holiday period you need to be aware of how a business day is defined under the Building Industry Fairness (Security of Payment) Act 2017 (BIF Act) and how this definition may impact payment claims given and received.
Under the BIF Act a business day is any day that:
- is not a Saturday or Sunday
- is not a public holiday or
- does not fall between 22 December and 10 January.
The last business day for 2023 is Thursday 21 December and the first business day for 2024 is Thursday 11 January.
Why is it important to be aware of this?
It is important to be aware of these dates due to office closures, payment rights and obligations and the strict timeframes for some payment dispute processes that also involve this definition of business day.
What does this mean when giving a payment claim?
You may be paid later than you were expecting. You should also consider the impact that this may have on timeframes for certain payment dispute processes.
What does this mean when receiving a payment claim?
You may have longer to respond to a payment claim received.
Reminder: Under the BIF Act, the default due date for a progress payment is 10 business days after a payment claim is given, unless otherwise stated in the contract.
A person that receives a payment claim and does not intend to pay the amount in full by the due date for payment should respond with a payment schedule. A payment schedule must be given within 15 business day or earlier if stated in the contract.
Communication is important
It is recommended that you communicate with the person that has given you a payment claim advising whether or not you intend to pay before the commencement of the non-business day period and why.
Examples of how the non-business day period impacts due dates for payment:
- if an invoice is given on 21 December 2023, the first business day after will be 11 January 2024 and the due date for payment would be calculated from this date.
- if an invoice is given between 22 December 2023 and 10 January 2024 it will be taken to have been received on 11 January 2024 and the due date for payment would be calculated from 12 January 2024.
