Source: https://www.quantsurv.com/resources/glossary/pay-when-paid Content format: Markdown version of the public page. Content reviewed: 2026-09-30 # Pay when paid: definition and example A clause making your payment depend on your main contractor being paid. By [Jack Butler-Kettle]() ยท Updated 30 September 2026 Guidance for England and Wales. Check the contract, amendments and facts that apply to your job. ## What it means in practice Read this alongside [section 113 of the Housing Grants, Construction and Regeneration Act 1996](). For construction contracts within the relevant statutory regime, payment generally cannot be made conditional on the payer receiving payment from someone else. The legislation contains a specified insolvency exception. Other conditional-payment wording and agreements outside the regime require their own analysis. Do not accept an upstream payment problem as the whole answer. [Late payment recovery]() can help examine the payment obligation and the reason given for withholding money. ## Worked example ### The facts A main contractor says it will pay a subcontractor only when the employer pays it. ### What happens 1. The subcontractor checks the applicable statute and the actual subcontract clause. 2. It establishes whether any relevant insolvency facts or other exceptions change the position. ### What this shows The explanation is tested against the payment rules rather than treated as an automatic defence to non-payment. ## Sources 1. [Housing Grants, Construction and Regeneration Act 1996, s 113 (Prohibition of conditional payment provisions)](). legislation.gov.uk.