The House approved legislative language on June 20, 2017, with strong bipartisan support drafted by James R. Santora (R-Delaware) and Michael Driscoll (D-Philadelphia) to permit contractors to suspend their work if they are not paid per contract terms. The bill passed the House Commerce Committee with complete support several weeks ago. 

According to an announcement by Santora’s office, contractors and subcontractors would be able to stop working on a project if:

• Payment is not received per contract guidelines;
• At least 60 days have passed since the end of the billing period, and; 
• Seven calendars days’ notice was given of their intent to suspend work. 

Currently, suspension of work is not included in the payment dispute remedies available for contractors and subcontractors. 

Language was added to the bill that would prevent the provisions of the legislation to be waived in a contract. Also, it would require a written explanation to be provided when payment is withheld because the customer is unhappy with the work or materials provided. Failure to comply would require payment in full to the contractor or subcontractor. 

Feel free to contact me at 610.828.1900 or Marty.McCarthy@MCC-CPAs.com if you have questions. I am always happy to help.