Pay less notice deadlines: when they're due and what makes one valid

A pay less notice is the payer's notice that it intends to pay less than the notified sum. Under section 111 of the Construction Act it must state the sum the payer considers due on the date of the notice and the basis on which that sum is calculated.

The deadline

It must be given no later than the "prescribed period" before the final date for payment. Your contract can set that period. If it doesn't, the Scheme sets it at 7 days. JCT 2016 sub-contracts commonly use 5 days. Christmas Day, Good Friday and bank holidays are not counted.

If it's missed

If no valid pay less notice is given in time, the payer must pay the notified sum by the final date for payment. Courts have repeatedly enforced this "pay now, argue later" approach, including the Court of Appeal in S&T (UK) Ltd v Grove Developments Ltd [2018]. The payer can usually still argue about the true value later, but generally has to pay the notified sum first.

What to check when one arrives

• Did it arrive before the deadline, by a method the contract allows?
• Does it state an amount (even £0)?
• Does it explain how that amount was calculated?
• Is it from the right party, about the right payment cycle?

Record the date and amount in NotifiedSum so your timeline is accurate. Whether a particular notice is valid is a legal question; take advice if a lot of money depends on it.