Exploring nuanced approach to criminalization of late payers in the construction sector

Abstract

Recent report suggests that ‘the only viable solution to chronic late payment in the construction sector is contingent on criminalizing late payers addicted to the unethical practices’. Yet, there is little research about nuanced approach to criminalization of late payers. Moreover, research that examine construction payment laws vis-à-vis punitive measures are scarce. The aim of the study is to create awareness about nuanced approach to criminalization of late payers in the construction industry. The research questions are: What are the possible punitive measures that are proportionate to the gravity of late payment conundrum in the construction sector? How best can construction industry optimally manage client’s domineering commercial powers and enhance payments to supply chain? The study adopted sequential explanatory type of mixed research methods. The study population sample was drawn from array of construction stakeholders. Findings from the study reveal that the only practical punitive measures proportionate to gravity of late payment problems is to compel late payers to pay compensation and sanctioning of tier 2 clients addicted to late payment. Victims of late payment must explore practical options such as robust contract negotiation and payment arrangements, to optimally manage construction client’s domineering commercial powers.

Keywords:

• Construction sector
• construction laws
• criminalization
• late payers

Disclosure statement

No potential conflict of interest was reported by the author(s).

Data availability statement

Data underlying the study are available on request in MS Excel formant.