I am an electrical subcontractor working on an expansion of an ER dept. for a hospital in Boston. Overall contract for the project is approx. 4 million. My contract is 480k. Does the prompt payment clause come in to play for me also?
Jul 17, 2019
Good question. Ultimately that may come down to whether the project is considered public or private.
For Massachusetts private projects, the answer seems like a resounding "yes" - the Massachusetts prompt payment laws apply to all contractors, subs, and suppliers on private construction projects, and it appears that invoices must be paid within 45 days of their approval.
For Massachusetts public projects, things are a little less clear. Progress payments are regulated for prime contractors, but there doesn't appear to be a strict or specific time table for making payment from the prime contractor to their subs and suppliers. Rather, it appears that payments between a subcontractor and their customer should be made shortly after payment is received by that customer - though, there doesn't appear to be much in the way of penalties if that isn't done. Though, retainage payments do appear to be regulated.