Prompt payment in Alberta construction starts with a proper invoice. Once an owner receives one, they must pay the amount payable within 28 calendar days, and payment obligations then flow down the contractual chain on their own timelines. The regime runs alongside builder’s liens rather than replacing them, and it gives contractors something they did not previously have: a statutory deadline, an interest entitlement when it passes, and an adjudication process that resolves payment disputes without waiting for a trial.
Key Takeaways
- The proper invoice is what starts the payment clock.
- Owners must pay contractors within 28 calendar days of receiving a proper invoice.
- Proper invoices must be issued at least every 31 days once work begins.
- A party disputing an invoice must issue a notice of non-payment in the prescribed form.
- Adjudication offers a faster route than litigation for payment disputes.
- Alberta government projects follow the Public Works Act, with different timelines.
This article provides general information and is not legal advice. The prompt payment regime has been amended several times since 2022, so confirm current timelines before relying on them.
The Proper Invoice Is the Trigger
Nothing in the regime starts until a proper invoice is delivered, which makes invoicing discipline the foundation of everything that follows.
What Makes an Invoice Proper
A proper invoice is a defined concept rather than whatever your accounting software produces. It has prescribed content requirements, and an invoice missing them may not start the clock at all.
The practical consequence is worth taking seriously. A contractor who believes they are 40 days into a 28-day window, when the invoice was never proper, has no interest entitlement and no basis for the escalation they were planning. Review your standard invoice template against the requirements once, properly, rather than discovering the gap during a dispute.
The 31-Day Issuing Requirement
Proper invoices must be given at least every 31 days after work begins under the contract. This is an obligation on the party doing the work, not a right they can defer.
Contractors who invoice at milestones, or who hold invoicing until a phase completes, need to reconcile that practice against the requirement. The Government of Alberta sets out the billing and invoicing rules alongside the payment timelines.
Contracts also cannot make payment of a proper invoice contingent on prior certification or owner approval, except where the contract provides for testing and commissioning of completed work. Certification clauses that delayed payment indefinitely under the old regime no longer do that job.
The Payment Timelines
Once a proper invoice is in play, the clock runs down the chain.
| Payment obligation | Timeline |
| Owner to contractor | 28 calendar days from receiving a proper invoice |
| Contractor to subcontractor | 7 days after receiving payment from the owner |
| Subcontractor to sub-subcontractor | 7 days after receiving payment from the contractor |
The owner-to-contractor period is set out directly in the Government of Alberta’s guidance. The downstream periods, and the backstop deadlines that apply when payment does not arrive from above, have been among the provisions amended since 2022. Confirm the figures for your position in the chain rather than working from a summary.
Interest accrues on unpaid amounts once the payment period expires, at the rate set in the contract or, failing that, the rate prescribed by regulation. That is a meaningful change from the position where late payment cost the paying party nothing.
What Happens When Payment Is Disputed
Disputing an invoice is permitted. Ignoring one is not.
A party who disputes a proper invoice must issue a notice of non-payment in the prescribed form, generally within 14 days of receiving the invoice, setting out the reasons for refusing to pay. Undisputed portions still have to be paid on the normal timeline, which prevents a small dispute being used to hold an entire invoice.
For the party receiving one, a notice of non-payment is information rather than a defeat. It tells you exactly what the objection is, in writing, on the record. That is considerably more useful than the silence that used to be the standard response, and it gives you a defined issue to resolve or escalate.
Adjudication as a Route
Adjudication is the part of the regime most contractors have heard of and fewest have used.
It is an interim dispute resolution process covering matters such as valuation of services or materials, change orders, non-payment, and holdback amounts. An adjudicator’s determination is binding on an interim basis, and determinations can be entered with the court for enforcement.
The availability of adjudication has broadened since the regime was introduced, including in circumstances where proceedings have already been commenced. Because those provisions have been amended, that question is worth putting to legal services rather than resolving from a summary written before the changes.
Adjudication suits disputes that are genuinely about valuation or entitlement. It achieves nothing against a counterparty with no money, since an interim determination against an insolvent party is no more collectable than a judgment against one.
Public Works Projects Follow Different Rules
Alberta government project contracts are subject to the Public Works Act and are exempt from the timelines in the Prompt Payment and Construction Lien Act.
Prompt payment was extended to public works effective April 1, 2025, and the framework mirrors the private regime in structure while differing in specifics. The Government of Alberta’s industry factsheet on extending prompt payment to the Public Works Act sets out those requirements, including the 31-day proper invoice obligation and the payment periods that apply.
If you work across both private and public projects, do not assume one set of dates. Check which statute governs each contract before calculating any deadline.
When Prompt Payment Is Not the Answer
The regime is powerful for disputes about whether and when payment is due. It does not help with a counterparty that cannot pay.
Where an owner or contractor is genuinely insolvent, the practical routes are lien registration inside the applicable deadlines, which run on their own clock separate from prompt payment, and ordinary recovery. Those two work together, since the lien preserves security while the payment obligation establishes what is owed.
Where the lien window has closed and adjudication offers nothing, the account becomes a straightforward commercial debt collection matter. Recovery on construction receivables falls with age the same way it does elsewhere, which is the pattern set out in the time factor in debt collection.
Common Questions About Alberta Prompt Payment
The questions below come up on most projects.
How long does an owner have to pay?
Twenty-eight calendar days from receiving a proper invoice, on private projects governed by the Prompt Payment and Construction Lien Act.
My invoice was rejected as not proper. What now?
Ask which requirement it failed, correct it, and reissue. The clock starts from the proper invoice, so the sooner a compliant one is delivered the sooner the payment obligation attaches.
They issued a notice of non-payment. What do I do?
Read the stated reasons and decide whether to resolve, adjudicate, or escalate. Any undisputed portion should still be paid on the normal timeline, and a notice covering the whole invoice when only part is genuinely in dispute is worth challenging.
Is adjudication worth it?
For disputes about valuation, change orders, or non-payment where the counterparty can pay, it is faster and cheaper than litigation. Where the counterparty cannot pay, it changes nothing.
Does prompt payment replace my lien rights?
No. Lien deadlines run separately and are shorter. Tracking payment timelines while missing a lien deadline is a common and expensive mistake, and strong accounts receivable management on construction files means tracking both.
Use the Timelines, Then Escalate
The prompt payment regime gives contractors and suppliers real deadlines to point at, and pointing at a statutory deadline works considerably better than asking politely. Where it does not work, the reason is usually that the other party cannot pay rather than will not.
If you are holding project receivables that have run past every timeline in this article, the question is which ones still support a remedy and which need collection. Bison Credit Solutions recovers construction and supply receivables on a contingency basis, with no charge where nothing is collected, and can work accounts through third-party collections while legal deadlines are assessed separately.
Contact Bison Credit Solutions to review unpaid project accounts and decide the route for each one.
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