Navigating Prompt Payment Acts
Prompt Payment Acts are state and federal laws designed to ensure that contractors and subcontractors are paid in a timely manner. These laws set deadlines for payment and often impose interest penalties for late payments.
Federal vs. State
The Federal Prompt Payment Act applies to federal government construction projects. Most states have their own versions for private and public state projects ("Little Miller Acts").
What You Need to Know
- Payment Timing: Usually 7-14 days after the owner pays the GC.
- Interest: You may be entitled to interest on late payments.
- Attorney Fees: In some cases, you can recover attorney fees if you have to sue for payment.
Knowing your rights under these acts is essential for getting paid faster.