Doing the work is only half the job — getting paid for it on time is the other half. Prompt payment laws exist to keep money moving down the chain from owner to GC to subcontractor. Here's how they work and the levers that actually help you get paid faster. (This is general information, not legal advice — verify the rules for your state and project.)
What prompt payment laws do
A prompt payment statute sets deadlines for payment and often allows interest on late amounts. There are two layers:
- The federal Prompt Payment Act, which governs federal construction projects.
- State prompt-payment statutes, which most states have for public projects and, in many states, private projects too.
They typically work by starting a clock: once the owner pays the GC (or once your pay application is approved), the party above you has a set number of days to pay you.
The payment deadlines
Exact deadlines vary by state, by whether the project is public or private, and by your contract — they commonly land somewhere in the range of about 7 to 30 days after the upstream payment or approval, but there's no single national number. The takeaways that matter:
- The clock usually starts at approval or at upstream payment, not at submission.
- A clean, correct pay application gets approved faster, which starts that clock sooner.
- Look up your specific state statute and read your subcontract's payment terms.
Pay-when-paid vs. pay-if-paid
Two clauses in your subcontract decide how owner non-payment affects you. They sound alike and are very different:
| Clause | What it means | Your risk |
|---|---|---|
| Pay-when-paid | Timing only — GC pays you within a reasonable time after being paid | Lower — you still get paid eventually |
| Pay-if-paid | Condition — GC's receipt of owner payment is a precondition to paying you | Higher — shifts owner non-payment risk onto you |
Pay-if-paid clauses are restricted or unenforceable in some states. Know which one is in your contract before you sign — it determines who eats the loss if the owner doesn't pay.
Retainage release
Many states also regulate retainage — capping the percentage on public work and setting deadlines for releasing it after completion. If your retainage is overdue, your state's retainage or prompt-payment statute may be your lever.
How to actually get paid faster
- Submit clean pay apps. Math errors and missing backup are the most common reasons a draw stalls. A correct G702/G703 approves faster.
- Send required lien waivers with the bill. A missing conditional waiver is an easy reason to delay you.
- Bill on a consistent scheduleand hit the GC's cutoff date — miss it and you wait a whole cycle.
- Know your statutory deadlineso you can follow up the day it's missed, with the law on your side.
Stop building pay apps in a spreadsheet
DrawFort fills in the carry-forward, computes retainage and current payment due, handles change orders, and exports a clean G702/G703 PDF your GC can approve at a glance.