As of July 1, 2026, Florida law contains a new provision aimed at contractors who fail to pay their subcontractors and suppliers. Section 489.1295, Florida Statutes, enacted as part of Senate Bill 290, has generated commentary suggesting that contractor licenses are now at stake in ordinary payment disputes. The statute deserves attention, but its practical reach is narrower than the headlines suggest. For contractors and subcontractors alike, understanding both what it requires and where its limits lie is more useful than alarm.
The Rule: Pay Within 45 Days of Being Paid, or as the Contract Provides
The obligation itself is brief. A licensed contractor must compensate a subcontractor or supplier for services, labor, or materials within 45 days after receiving payment for that work, or in accordance with the terms of the contract, unless there is a bona fide dispute regarding the amount due. A contractor who knowingly or willfully violates the statute is subject to disciplinary proceedings under Section 489.129 before the Construction Industry Licensing Board. Available sanctions include administrative fines of up to $10,000 per violation, restitution, investigative costs, probation, and suspension or revocation of the license. In practice, discipline follows the board’s penalty guidelines, and fines and restitution are the realistic outcome in most cases. License suspension or revocation sits at the far end of the scale, reserved for serious or repeated misconduct.
Why the Statute Is Narrower Than It Sounds
Three features limit its reach. The bona fide dispute exception removes most contested nonpayment from the statute entirely, and genuine disagreements over backcharges, defective work, or scope are the norm in payment fights, not the exception. The statute also treats payment in accordance with the contract as an independent path to compliance, so a contractor following its subcontract’s payment terms has little to fear from the 45-day clock. And discipline requires a knowing or willful violation, a standard well above late payment or an accounting mistake.
There is also context the commentary tends to omit. The licensing board has never been a collections forum, and payment-related misconduct was already disciplinable before this statute. Falsely certifying that subcontractors have been paid and misapplying construction funds have long been grounds for discipline. Section 489.1295 adds a standalone nonpayment ground, but it is an incremental step, not a new regime. For the ordinary payment dispute, where each side has a defensible position on what is owed and why, not much changes.
Where the Statute Will Actually Matter
The exception has edges worth noticing. It covers a bona fide dispute about the amount due, not every explanation for a late payment. Cash flow pressure is not a dispute about the amount due. A contractor who has been paid for a subcontractor’s work and holds that money to fund other obligations sits squarely within the statute’s target, and that scenario is more common than the no-basis nonpayment the law seems written for. A backcharge assembled only after a complaint arrives may also have trouble passing as bona fide.
The near-term effect will be felt as leverage rather than discipline. Expect demand letters that cite Section 489.1295 and complaints to the Department of Business and Professional Regulation filed to get a nonpaying contractor’s attention, because even a complaint that ultimately goes nowhere must be answered. For general contractors, the sensible response is documentation rather than concern. When money is withheld, the basis should be stated in writing at the time, tied to the amount due, and consistent with the subcontract. That contemporaneous record is what makes a dispute bona fide on paper and not just in hindsight.
Conclusion
Section 489.1295 is a modest change. It will not turn the licensing board into a payment referee, and contractors with ordinary, documented disputes face little new exposure. What it does is remove cover for the contractor who has been paid and simply sits on the money, and it gives subcontractors one more pressure point in collection efforts. Every situation turns on its contract and its facts, so it is worth speaking with an attorney about how the statute bears on your payment practices or an unpaid balance. If you are dealing with a payment dispute on a construction project, our attorneys can help you understand your options and protect your position.