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Construction law

prompt payment statutes

Prompt payment statutes are laws that require the payment of contractors and subcontractors within a certain period of time, and prescribe interest and penalties for late payments. In some states these laws only apply to public works construction projects that are funded by the government—and sometimes only to public works projects over a certain dollar amount. There is also a federal Prompt Payment Act for federal construction projects.

In Arkansas, prompt payment statutes are designed to ensure that contractors and subcontractors are paid in a timely manner for their work on construction projects. Arkansas Code Annotated § 22-9-201 et seq. governs the prompt payment for public construction projects. This statute requires that a public entity must pay the prime contractor within 30 days after receipt of a proper invoice, and the prime contractor must pay its subcontractors within 7 days of receiving payment from the public entity. If payment is not made within these time frames, interest penalties may apply. For private construction projects, Arkansas does not have a specific prompt payment statute, but the terms of the contract typically govern payment obligations and any applicable penalties for late payment. Additionally, the federal Prompt Payment Act applies to federal construction projects, requiring federal agencies to pay contractors within a certain time frame and to pay interest on late payments.

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Construction law

prompt payment statutes

Individual & Family Legal Plan

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Arkansas State Code

Arkansas State Code

Construction law

prompt payment statutes

Articles