Gov. Tom Wolf signed into law Friday Act 27 of 2018, which allows contractors to suspend their work if they do not receive payment per contract terms.
The legislation amends the Contractor and Subcontractor Payment Act, enacted in February 1994.
“This law will significantly impact the lives of many Pennsylvania families,” Rep. Mike Driscoll (D-Philadelphia), co-sponsor of the bill, said. “Contractors and subcontractors often face a greater risk of going unpaid because they are compensated in full after the services are provided. I think our legislation will strike the right balance in making sure contractors are paid for the work they do. Consequently, we’ll help support families who depend on that income.”
To be eligible to suspend work, the contractor or subcontractor must wait 30 days from the end of the billing cycle. They must then provide written notice via mail or email and wait an additional 30 days. If they do not receive payment, they must then provide at least 10 calendar days of notice by certified mail. If they do not receive payment during those 70 days, they may suspend work without penalty.
The law will go into effect 120 days after the signing date.