How to know you'll get paid before you start the job

The way it usually goes: a builder you have not worked with offers you a job, the rate is fine, they seem alright on the phone, you start Monday. Three weeks after you invoice, the money has not landed, and the builder is telling you the owner's progress payment has not come through yet. Now you are carrying the cost of a timing problem you had no way to see and no control over.

The reason this keeps happening is not usually a dishonest builder. It is that you are at the end of a fragile chain, and the money for your work sits in the builder's general account where it can be spent on anything before it reaches you. We have written about why the system works this way in our piece on why subcontractors don't get paid. This guide is about what you can do about it before you commit.

Spend ten minutes before you say yes to a builder you do not know.

Look up the company, not just the trading name. Get the ACN and check it on the ASIC register. A business that was registered three months ago, run by someone whose last company folded, is a pattern worth knowing about. It has a name, phoenix activity, and it is common enough in this industry to be worth a search.

Ask other subcontractors. The plasterer or the electrician who worked for this builder last year will tell you in one sentence whether they got paid on time. The trade talks. Use it before you are the one with the unpaid invoice, not after.

Notice how the builder talks about money. A builder who is straight about their payment terms and how funds are handled is a different prospect from one who gets vague or pushy when you ask.

A verbal agreement on a site is worth very little when a payment goes wrong. Get the scope, the rate, and the payment terms in writing before you start.

Set your invoices up as payment claims under your state's Security of Payment Act from day one. Most states require specific wording, usually close to "This is a payment claim made under the [name of your state's Act]". A normal invoice without that line does not trigger the Act's protections or its tight deadlines. Formatting every invoice as a payment claim costs nothing and keeps your legal position open if you ever need it. It is a backstop, not a plan, but you want the backstop in place from the first invoice. Our piece on why subcontractors don't get paid covers how the Act works in more detail.

Once you are on a job, the warning signs of a builder in trouble show up on the ground before they show up in any document.

Other trades quietly stop turning up. Suppliers switch the builder to cash on delivery, or deliveries start arriving from new supplier names. The builder asks the owner for money ahead of the schedule. Promises to pay get pushed back a week at a time. None of these on their own proves anything. Together, they are a signal to stop adding to what you are owed before it gets worse.

If a single builder owes you more than you can afford to lose, you are underwriting their cashflow risk with your own business. Spread your work across more clients where you can, and keep an eye on how much any one builder is carrying of yours at a time. The subcontractors who get badly hurt in an insolvency are usually the ones with too much tied up in the builder who failed.

Everything above reduces your risk. The thing that removes the core of it is working on jobs where the money for your part is already committed before you start, instead of sitting in the builder's account waiting on the next progress payment.

That is what BuildFair does. On a BuildFair project, the owner's funds sit in regulated custody with the banking partner Kobble, which operates under AFSL 545391 (Yondr Money Pty Ltd). BuildFair holds the verification and the release authority, Kobble holds the cash, and each project has its own ringfenced account. As a subcontractor on that project, you can see the funds for the work are committed before you pick up the tools, and when your stage or invoice is approved, payment moves through the same verified flow rather than depending on whether the builder has cash that week. You stop being the bank for the build. The way the money is held is set out on our Trust & Security page.

Being straight about it, this does not guarantee you get paid no matter what. Payment still depends on your work being done and verified, the same as always. What it changes is where the money sits and when it moves, so the long chase that the rest of this guide is about defending against is mostly gone before it starts.