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What Is a ?Pay-When-Paid? Clause? In contrast, ?pay-when-paid? clauses are provisions that only govern the timing of a contractor's payment obligation to the subcontractor, usually by indicating that the subcontractor will be paid within a specified time period after the contractor itself is paid by the property owner.

A Payment Notice is a mandatory obligation on the payer to value the work done and to certify the payment due. If served too late to be a Payment Notice, it still may be in the correct timescale for a Pay Less Notice.

2. Schedule payment reminder messages Use clear subject lines. Re-attach the original invoice. Write in a friendly tone, even if payments are late. Make the payment due date clear, and reiterate the payment terms they agreed to. Remind them how they can pay, and list the payment methods you offer.

Without a contract clause or state statute[i] addressing payment obligations, payment for construction work is due on substantial completion of the work. Under the majority view[viii], a pay-if-paid clause is a condition precedent to payment and a pay-when-paid clause is merely a timing provision.

Template #1: A gentle reminder I hope you're well. Just a quick one to remind you that we have an outstanding invoice for the [product] you bought. The invoice number is [#reference number] and it's due for payment on [date due]. I would be grateful if you could confirm that everything is on track for payment.

A ?pay when paid? clause defers timing of the payment. However, the main contractor retains the risk of non-payment by the employer. Consequently, while a main contractor may invoke a ?pay when paid? clause it is not able to do so indefinitely.

The change to the law was achieved by the effective prohibition of pay when paid clauses by s113 of the Housing Grants, Construction and Regeneration (HGCR) Act 1996. The only exception to this prohibition is a pay when paid clause applying in the event that there is an 'upstream' insolvency in a construction contract.