A common question among those who wish to engage the services of a plumber at their home is whether they need a contract for the work they’ve organised. If you’re in this situation, here’s what you need to know to answer the question.
Residential Building Work over $5000
If the work you wish your plumber to complete will cost more than $5000 (including GST), by law, your plumber must provide you with a copy of the Consumer Building Guide and a written contract that includes the contract price.
This plumbing work contract must include the names of and be signed by (or on behalf of) every party that is involved in the job (1). This is usually just you and the plumber but if the work happens to involve a neighbour or neighbours – if the plumber will be working on a stormwater drain that runs through multiple properties in a rural area for instance – then your neighbour/s will need to sign the contract as well.
The work must also be conducted under the auspices of a licensed plumber and the licence number must be included in the contract. If the plumber actually doing the work is not the licence holder, the person who does hold the licence must also sign the contract.
As with all contracts, it must also be dated.
In addition to this, the contract must contain:
• a description of the job and any associated plans or specifications
• a ‘quality of construction’ clause that promises the work will comply with all requisite codes, standards, and specifications, including the Building Code of Australia, as well as any development consent conditions or complying development certificate stipulations
• a clause that limits the liability of the plumber if the work breaches the ‘quality of construction’ clause because of a design or specification that you prepared (or which was prepared on your behalf) or which you required the plumber to comply with (provided the plumber advised you in writing that the design or specification would cause a breach of the ‘quality of construction’ clause).
Supply of Materials and Labour exceeding $5000
As with work costing more than $5000, your plumber must provide you with a written contract if the market cost of the materials and labour used in a job is in excess of $5000.
This is true even if the total price of the contract is unknown.
The contract must include the same things as specified above except that the total price of the job may be omitted if it is not known at the time the contract is prepared.
Residential building work worth more than $20,000
If the total price of the job is less than or equal to $20,000, then the contract required is a ‘small jobs contract’. But if the value is greater than $20,000, then an ‘extensive home building contract’ is required and a number of additional items are required to be added to the contract, such as a cooling off period.
Furthermore, the Home Building Compensation Fund requires that your plumber be insured and specifies that the plumber must provide you with a certificate of insurance before accepting any payment from you (including any deposit) or commencing any work.
In addition to the above requirements, if the price of your job exceeds $5000 the plumber must not require a deposit in excess of 10% of the value of the job, regardless of the total price of the job.
If the value of the work is $5000 or less, a plumbing work contract is not required but the plumber must still have a licence (2). Similarly, all plumbing work must comply with the Plumbing Code of Australia regardless of the price of the job