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 Florida, prompt payment statutes are designed to ensure that contractors and subcontractors are paid in a timely manner for their work on construction projects. Florida's prompt payment laws apply to both public and private construction projects. For public projects, under Florida Statute 218.735, state and local government entities must pay contractors within 20 days of receipt of an invoice, and contractors must pay their subcontractors within 10 days of receiving payment from the government. For private projects, according to Florida Statute 713.29, the due date for payment to the contractor is outlined in the terms of the contract, and if not specified, payment is due 30 days after the completion of the contractor's work. Subcontractors must be paid within 10 days after the contractor has received payment. Interest penalties apply for late payments, and the rate is specified in the statutes. Additionally, the federal Prompt Payment Act requires federal agencies to pay contractors within a certain time frame, typically 30 days, and includes provisions for interest on late payments for federal construction projects.