Recent legislative reforms across Australia have increased the protections for construction contractors and subcontractors against unfair contract terms and unfair time bars in a variety of construction contexts.
What began in November 2023 with increased small business protections from unfair contract terms in the Australian Consumer Law (ACL) and ASIC Act (in relation to standard form contracts that also qualify as small business contracts), has in more recent times, expanded with broader unfair contract term protections in NSW and even more broad unfair time bar protections in WA Security of Payment laws and VIC Security of Payment laws (to take effect in 2026).
There is a common purpose underlying each of these reforms and that is, to minimise the use and impact of onerous and oppressive contractual terms forced upon parties with less bargaining power in the contractual chain. In the construction industry, typically, although not always, parties lower in the chain have less bargaining power.
In November 2023, amendments to the ACL applied unfair contract term protections to a broader set of small business contracts, including in construction, that is where one party is a business with less than 100 employees and under $10m gross turnover (previous financial year).
In July 2025, in NSW Fair Trading Act expanded the application of ACL unfair contract terms to contracts for the supply of goods and services to owners corporations and community associations. This NSW amendment applied the ACL protections to a broader class of construction contracts where suppliers and contractors are directly engaged by owners corporations and community associations.
Security of Payment laws in Western Australia already provide a discretion to adjudicators, Courts, arbitrators and experts to declare notice-based time bars in construction contracts and contracts for related goods and services unfair. Security of Payment laws, by their nature, apply to an even broader range of construction contracts.
The test of unfairness of time bars under the SOP laws bears some similarity to the test applied for unfair contract terms under the ACL, however is a simplified test, applied where compliance with the notice based time bar is not reasonably possible, or its application is unreasonably onerous. A similar provision to that in WA SOP Act will soon be introduced into the Victorian SOP Act in 2026.
These legislative reforms demonstrate a national trend in to broaden the application of unfair contract terms and unfair time bar protections to a larger set of commercial contexts, and apply to more construction contracts across Australia. For contractors, subcontractors (and to a lesser extent suppliers), this creates the potential for broder protections against one sided contracts offered on a take it or leave it basis.
Queensland construction businesses that put forward contracts containing potentially unfair contract terms should consider having those contracts reviewed (particularly if in the form of standard form contracts) to ensure they are aware of which contract terms are potentially unenforceable, or in rare instances, may attract a fine issued by regulatory bodies.
Julian Troy is founder and director at Troy Legal. With over 23 years experience in construction law, Julian cuts to the real issues and provides simple and effective advice to construction businesses across SEQ and Australia. Troy Legal supports principles, owners, consultants, contractors, subcontractors, and suppliers in SEQ with contract reviews and contract advice.
For tailored advice and guidance in relation to your construction contract, reach out to Troy Legal today. Call Julian on 0439 207 579
Recent legislative reforms across Australia have increased the protections for construction contractors and subcontractors against unfair contract terms and unfair time bars in a variety of construction contexts.
What began in November 2023 with increased small business protections from unfair contract terms in the Australian Consumer Law (ACL) and ASIC Act (in relation to standard form contracts that also qualify as small business contracts), has in more recent times, expanded with broader unfair contract term protections in NSW and even more broad unfair time bar protections in WA Security of Payment laws and VIC Security of Payment laws (to take effect in 2026).
There is a common purpose underlying each of these reforms and that is, to minimise the use and impact of onerous and oppressive contractual terms forced upon parties with less bargaining power in the contractual chain. In the construction industry, typically, although not always, parties lower in the chain have less bargaining power.
In November 2023, amendments to the ACL applied unfair contract term protections to a broader set of small business contracts, including in construction, that is where one party is a business with less than 100 employees and under $10m gross turnover (previous financial year).
In July 2025, in NSW Fair Trading Act expanded the application of ACL unfair contract terms to contracts for the supply of goods and services to owners corporations and community associations. This NSW amendment applied the ACL protections to a broader class of construction contracts where suppliers and contractors are directly engaged by owners corporations and community associations.
Security of Payment laws in Western Australia already provide a discretion to adjudicators, Courts, arbitrators and experts to declare notice-based time bars in construction contracts and contracts for related goods and services unfair. Security of Payment laws, by their nature, apply to an even broader range of construction contracts.
The test of unfairness of time bars under the SOP laws bears some similarity to the test applied for unfair contract terms under the ACL, however is a simplified test, applied where compliance with the notice based time bar is not reasonably possible, or its application is unreasonably onerous. A similar provision to that in WA SOP Act will soon be introduced into the Victorian SOP Act in 2026.
These legislative reforms demonstrate a national trend in to broaden the application of unfair contract terms and unfair time bar protections to a larger set of commercial contexts, and apply to more construction contracts across Australia. For contractors, subcontractors (and to a lesser extent suppliers), this creates the potential for broder protections against one sided contracts offered on a take it or leave it basis.
Queensland construction businesses that put forward contracts containing potentially unfair contract terms should consider having those contracts reviewed (particularly if in the form of standard form contracts) to ensure they are aware of which contract terms are potentially unenforceable, or in rare instances, may attract a fine issued by regulatory bodies.
Julian Troy is founder and director at Troy Legal. With over 23 years experience in construction law, Julian cuts to the real issues and provides simple and effective advice to construction businesses across SEQ and Australia. Troy Legal supports principles, owners, consultants, contractors, subcontractors, and suppliers in SEQ with contract reviews and contract advice.
For tailored advice and guidance in relation to your construction contract, reach out to Troy Legal today. Call Julian on 0439 207 579
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