California Specifics

California Prompt Payment Act

California law sets strict deadlines for construction payments. If you're waiting too long to get paid, you may have legal recourse.

4 min read

California has multiple statutes that govern payment timing in construction — collectively referred to as the Prompt Payment Acts. They apply to both public and private projects and set enforceable deadlines for when money must change hands.

Private projects

Under California Civil Code Section 8800 et seq.: Owners must pay GCs within 30 days of a properly submitted pay application. GCs must pay subcontractors within 7 days of receiving payment from the owner. If the GC wrongfully withholds payment, interest accrues at 2% per month on the unpaid amount.

Public projects

Under California Public Contract Code: For state projects, GCs must pay subs within 7 days of receiving progress payments. For local agency projects, the deadline is also generally 7 days. Undisputed amounts must be paid even if other portions of the pay app are in dispute.

What 'properly submitted' means

The payment clock doesn't start until you submit a properly completed pay application with all required documents. If your COI is missing or your lien waiver is wrong, the owner or GC may argue the application wasn't 'properly submitted' and the deadline hasn't started. This is why having your compliance docs in order matters — it starts the clock.

What to do if you're not paid on time

First, confirm your pay app was complete and submitted correctly. Then send a written notice to the GC identifying the overdue payment and the applicable deadline. Document everything. If payment still isn't made, you may have a claim for the 2% monthly interest penalty in addition to the principal amount.

This is general educational information, not legal advice. Payment law is complex and fact-specific. Consult a California construction attorney if you believe you're owed payment that's being wrongfully withheld.

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