Getting Paid in the Construction Industry: How to Always Do It
If there is one business that generates an excessive amount of challenges, claims, and disputes that CGI Credit Guard sees, it is the construction industry.
There are several explanations for this. Few businesses deal with as many varying factors, including weather, labour availability, site circumstances, and a variety of other unanticipated effects. The scope of work and contract are frequently prepared in a rush, which results in gaps wide enough for an excavator to pass through.
Contractors work in the industry because they can construct things. Writing change requests, keeping records, and giving the owner in-depth progress updates are therefore frequently outside of their expertise. Additionally, doing these activities while working for pay is difficult.
The fact that project funding is frequently connected to sectors with significant volatility is another risk. Partners, subcontractors, and even the owner of the business may close their doors if a significant project was in the middle of a severe market recession.
As a result, when things go wrong, they may quickly become quite messy. The projects stop. Businesses make last-minute changes or stop responding altogether. Contractors may be tempted to take the whole situation to court, which would result in high costs, protracted delays, and no assurance that they would ever get payment, even if they won the case in court.
You can certainly register a lien, but there are significant regional differences in the procedure, deadline, length, and holdback.
If there is any good news, it’s that you can manage a lot of things when it comes to preventing disagreements and recovering debt owed in the construction sector.
In order to significantly boost your chances of getting compensated for your labour, you need to:
- Demand a thorough scope of work.
- Recognize the many causes of disagreements.
- Obtain legal counsel for your contract.
- Maintain detailed records.
- Early problem-reporting.
- It’s also crucial to understand how to handle claims when they do occur and how to collect swiftly to prevent money from evaporating.