Massachusetts

Retainage

Public works. Massachusetts limits retainage on public construction contracts to 5 percent of each progress payment under the General Laws governing public building and public works contracts, with procedures for release after substantial completion.

Private works. For private construction projects where the prime contract is for $3,000,000 or more, excluding smaller residential projects, Massachusetts caps retainage at 5 percent of each progress payment. The same statute sets a process for notice of substantial completion, a punch list, and deadlines for releasing retainage once the listed items are complete. Smaller private projects are not covered by the cap; their retainage is set by contract.

Prompt payment

Private works. Massachusetts's prompt-payment statute applies to private construction contracts of $3,000,000 or more, again excluding smaller residential work. Pay applications must be approved or rejected within a stated number of days, with written reasons for rejection, and approved amounts must be paid within a stated number of days after approval; an application not rejected in time is deemed approved. The statute also limits the enforceability of pay-if-paid clauses to defined circumstances and sets a process for change order requests.

Public works. The General Laws set periodic payment deadlines for public construction contracts and require general contractors to pay subcontractors within a stated period after receiving payment for their work, with interest for late payment.

Official sources

• Massachusetts General Laws, Chapter 149, Section 29E (private prompt payment)
• Massachusetts General Laws, Chapter 149, Section 29F (private retainage)
• Massachusetts General Laws, Chapter 30, Section 39K (public building contracts)