Queensland's 2025 Construction Law Overhaul: A Legal Guide to the BIF Act, Housing Code & WHS Changes

The Queensland construction industry is on the cusp of significant change. Driven by the ambitious government target of building 1 million new homes by 2046 and addressing a projected 96,000 home shortfall by 2029, a wave of new legislation is reshaping the regulatory environment.

For builders, developers, and subcontractors, understanding these shifts isn't just about compliance—it's about survival and strategic positioning. This guide provides a comprehensive legal summary of the key reforms, including the BIFOLA Act's pause on Project Trust Accounts, the introduction of a new statewide Housing Code, and evolving WHS duties.

We will break down what these changes, spearheaded by the Queensland Building and Construction Commission (QBCC), mean for your operations. This analysis is designed to equip you with the knowledge needed to navigate the year ahead.

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Key Takeaways

• Project Trust Account Pause: The BIFOLA Act has paused the expansion of the Project Trust Account (PTA) and Statutory Trust Account (STA) regime, maintaining the current thresholds for now.

• New Queensland Housing Code: A new statewide Housing Code is being introduced to streamline approvals for diverse housing types, aiming to accelerate construction to meet government targets.

• Stricter WHS Reporting: Changes are coming to Work Health and Safety reporting, requiring more diligent and timely notifications of incidents to avoid increased penalties.

• QBCC's Modernisation: The QBCC is transitioning to a "modern regulator" model, with a focus on digital licensing and improved efficiency, impacting how you interact with the commission.

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Understanding the 2025 Legislative Landscape in Queensland

The upcoming changes to Queensland's construction legislation are not happening in a vacuum. This wave of Queensland building reform is a direct response to immense pressure on the state's housing market and a long-standing need to improve financial stability within the industry.

For any construction professional, understanding the drivers behind this construction legislation is the first step toward achieving QBCC compliance and navigating the new rules effectively. The BIFOLA Act and the Housing Availability Act are central pillars of this overhaul, each designed to address a different facet of the industry's challenges.

The Core Drivers Behind the Regulatory Overhaul

Two primary forces are compelling these legislative changes. First is the critical housing shortage across Queensland, particularly in high-growth areas like the Gold Coast and Sunshine Coast. The government's affordability agenda is directly tied to increasing housing supply, and the existing regulatory frameworks are seen as a bottleneck. Second is the persistent issue of industry solvency and payment security.

For years, the sector has been plagued by insolvencies that leave subcontractors unpaid and consumers with unfinished homes. The reforms aim to strike a balance between accelerating development and ensuring the financial ecosystem of the industry is robust and fair for all participants.

Key Legislation You Need to Know

At the heart of the 2025 reforms are two key pieces of legislation. The Building Industry Fairness (Security of Payment) and Other Legislation Amendment Act 2024 (BIFOLA) primarily addresses financial matters. Its main purpose is to amend the existing security of payment laws to refine how money flows through the contractual chain, with a significant (and controversial) decision to pause the expansion of the Project Trust Account regime.

Conversely, the Housing Availability and Affordability (Planning and Other Legislation Amendment) Act 2024 is focused on the supply side of the equation. It aims to fast-track development by introducing a new statewide Housing Code, effectively streamlining the approval process for certain types of residential projects and, in some cases, overriding local council planning schemes to achieve state government objectives. These acts amend foundational laws, including the Building Industry Fairness (Security of Payment) Act and the overarching Building Act 1975.

Why Compliance Rates Are Under the Microscope

The government and the QBCC have a strong mandate for stricter enforcement and these new laws are, in part, a direct response to perceived gaps in industry performance. The message from regulators is clear: the status quo is no longer acceptable, and compliance will be monitored more closely than ever. 

The BIFOLA Act's Impact on Project Trust Accounts

The BIF Act guide to payment security has been a central feature of Queensland construction law for several years, with the Project Trust Account (PTA) and Statutory Trust Account (STA) regime being its most significant component. The BIFOLA Act introduces a major change of direction by pausing the planned expansion of this regime.

This decision has profound implications for how a payment claim is managed and the level of security of payment afforded to subcontractors on projects that would have been captured under the expansion. Understanding the current thresholds and the reasoning behind the pause is crucial for both head contractors and subcontractors.

The Controversial Pause on PTA Expansion

The Project Trust Account (PTA) and Statutory Trust Account (STA) regime was designed to quarantine funds, ensuring that money paid by a principal for a contractor's work is available to be paid to the subcontractors who performed that work. It acts as a safeguard against insolvency, preventing head contractors from using progress payments for unrelated business expenses.

The BIFOLA Act has introduced an indefinite pause on the planned expansion of this trust account model, which was set to apply to lower-value contracts across the private sector. The government cited the administrative burden on smaller businesses and the current challenging economic conditions as reasons for the pause.

This decision directly impacts how payment security is managed on many projects. For a deeper dive, see our understanding your rights under the BIF Act guide.

What Are the Current Trust Account Thresholds?

Determining if a project requires a trust account under the current, un-expanded rules is a critical compliance step. The process begins with the project's value and the nature of the client. For government projects, a Project Trust Account is required for eligible contracts valued at $1 million or more. For private sector projects, the threshold is significantly higher, currently set at $10 million or more. The rules apply to contracts for "building work" as defined broadly under the legislation.

However, there are key exemptions to consider. For instance, a trust account may not be required if less than 50% of the contract price is for building work, or for contracts between certain related entities. It is essential for head contractors to assess each project against these specific criteria at the outset to ensure compliance.

What This Pause Means for Subcontractor Payment Security

While the pause on the PTA expansion may simplify administration for head contractors on projects valued under $10 million, it leaves subcontractors on these smaller jobs exposed. The original goal of the phased expansion was to extend the financial protections of the trust account model to the segment of the industry most vulnerable to upstream insolvency.

Without this safeguard, subcontractors working on these projects are in the same position they were before the reforms were conceived. They must now be more vigilant than ever with their own contractual terms and disciplined in their management of the payment claim process. The risk of a head contractor becoming insolvent and progress payments disappearing remains a significant threat for those not protected by a statutory trust account.

Expert Insight: From a legal standpoint, the pause on PTA expansion shifts the burden of risk management back onto subcontractors. Without the protection of a trust account on smaller jobs, robustly drafted contracts and a disciplined approach to enforcing payment terms under the BIFOLA Act  and the QBCC Act become your primary defence. This is where expert legal advice on Queensland's construction reforms is invaluable.

What is the New Queensland Housing Code?

To address the state's significant housing affordability crisis, the government is introducing the Queensland Housing Code. This new regulatory tool is designed to accelerate the delivery of diverse residential building projects by standardising planning rules and fast-tracking development approval processes.

For builders and developers, the code represents both a major opportunity and a new set of rules to master, particularly for projects involving multiple dwellings on a single lot.

Streamlining Approvals for Diverse Housing

The new Queensland Housing Code is a statewide planning instrument created to standardise and accelerate the approval pathway for a range of housing types that are often difficult to get approved under disparate local council schemes.

The code specifically targets housing that supports "gentle density," such as secondary dwellings (more commonly known as granny flats), duplexes, row or terrace housing, and small-scale apartment buildings.

By creating a consistent set of rules for design, siting, and lot requirements, the government aims to provide certainty and speed up the construction of these much-needed homes, moving closer to its ambitious housing targets.

How the Code Interacts with Local Planning Schemes

A critical aspect of the new code is the hierarchy it establishes between state and local planning rules. In many instances, where there is a conflict between the Queensland Housing Code and an existing local council planning scheme, the state code will override the local rules. This represents a significant shift in planning power from local councils to the state government.

The intention is to prevent local planning schemes from unduly restricting the development of diverse housing types and to enforce a consistent, statewide approach to increasing housing density in appropriate areas. Developers will need to carefully assess which set of rules applies to their specific project.

Potential Pitfalls for Builders and Developers

It is a mistake to assume the new Housing Code is a blanket approval for any project that fits its general criteria. Consider a developer in Brisbane who plans to build a duplex on a lot that appears to meet all the code's requirements for size and zoning. They proceed with designs assuming a streamlined approval process.

However, during their due diligence, they discover the property is subject to a local environmental overlay protecting significant vegetation, a constraint that is not automatically overridden by the new state code. This discovery forces them back to the drawing board, leading to costly redesigns and significant delays. The lesson is clear: the code simplifies the planning pathway, but it does not eliminate the need for thorough site-specific due diligence.

This scenario highlights the importance of not treating the code as a silver bullet. A misinterpretation of how state and local planning instruments interact can lead to disputes or the need for resolving matters through QCAT.

Navigating Stricter Work Health and Safety (WHS) Obligations

The regulatory overhaul extends deep into workplace health and safety (WHS). As the QBCC transitions to its "modern regulator" model, its approach to construction safety is becoming more stringent and data-informed. This means changes to WHS reporting obligations, particularly concerning what constitutes a notifiable incident and the timelines for reporting it. Compliance with the safety provisions of the QBCC Act is no longer just about avoiding fines; it's becoming a core pillar of maintaining your licence and reputation in the industry.

Understanding the "Modern Regulator" Approach to Safety

The QBCC's shift to a "modern regulator" is not just about digital licensing; it fundamentally changes its approach to safety oversight. This means a greater reliance on data analytics to identify high-risk contractors and activities, a focus on proactive risk assessment rather than purely reactive enforcement, and significantly less tolerance for recurring safety breaches. In practice, the regulator will be looking for patterns of behaviour. A single incident might be investigated on its own merits, but a series of minor breaches could be interpreted as a systemic failure in safety management.

This approach is grounded in the spirit of the Queensland Building and Construction Commission Act 1991, which empowers the QBCC to ensure licensees are fit and proper to operate, with safety being a key component of that assessment.

Changes to Notifiable Incident Reporting

The process for reporting a notifiable incident on a construction site is becoming more formalised and time-sensitive. The updated procedure begins with the immediate actions required at the scene: securing the area to prevent further risk and providing aid. Following this, the transition to formal notification must be swift. The revised timelines will require an initial report to be lodged via a dedicated digital platform, often within hours of the incident occurring. This initial report must now include more specific information than previously required, such as the precise location, a detailed description of the event, and the immediate actions taken.

Failing to provide this level of detail can result in follow-up penalties, even if the incident itself was reported on time. The goal is to give Workplace Health and Safety Queensland (WHSQ) a clearer, faster picture of serious incidents to guide their response.

The Consequences of Non-Compliance

The penalties for failing to meet WHS reporting obligations are set to increase in severity, both financially and professionally. The regulator is creating a stronger link between a company's safety record and its ongoing licensing suitability. A history of unreported incidents or a pattern of safety breaches, once uncovered, could trigger a formal review of your QBCC licence. This reinforces the argument that a poor safety record is no longer just a cost of doing business—it could directly threaten a company's ability to operate.

In the most serious cases, where negligence leads to significant harm, the consequences can extend beyond regulatory action, potentially leading to prosecution and civil claims when matters escalate to litigation.

Warning: Failing to comply can have consequences beyond fines, impacting your QBCC licence and reputation. It is critical to ensure your safety management systems are updated to reflect these new, stricter requirements. The Queensland Law Society often provides resources for legal compliance in this area.

The QBCC's Transformation into a "Modern Regulator"

The term "modern regulator" is a key phrase in the QBCC's strategic plan, signalling a fundamental shift in how it operates. This transformation is centred on technology, efficiency, and a more proactive approach to compliance. For licensees, this means changes to everything from how you manage your QBCC licence to how QBCC complaints are handled.

Understanding this new operational philosophy is essential for interacting effectively with the commission, whether you're renewing a licence or using the QBCC search function to check a subcontractor's status.

The Push Towards Digital Licensing and Renewals

A cornerstone of the QBCC's modernisation is the move away from cumbersome, paper-based systems towards a fully integrated digital licensing environment, a change being driven by the Queensland Building and Construction Commission and Other Legislation Amendment Bill 2025. For licensees, this transition promises practical benefits, such as faster processing times for applications and renewals, easier access to your licensing information, and simplified methods for updating details.

However, this convenience comes with a new responsibility. Licensees will be expected to maintain their digital records with a high degree of accuracy and to engage with the commission primarily through its online portals.

This is a key part of the commission's effort to improve efficiency and provide better oversight, which is a core function of the Queensland Building and Construction Commission (QBCC).

What Increased Efficiency Means for Investigations

A more efficient, data-driven QBCC will likely lead to faster and more frequent investigations. The argument is simple: digital systems and data analytics allow the regulator to identify patterns of non-compliance, clusters of complaints, or financial red flags far more easily than was possible with manual systems.

A contractor who consistently generates complaints in a specific area, for example, will be flagged by the system for review. This means that licensees can no longer rely on administrative delays or bureaucratic inertia as a buffer. Regulatory action is likely to be quicker and more targeted, requiring a prompt and well-prepared response from the licensee.

Expert Insight: A "modern regulator" has a longer memory and connects dots faster. If you are facing an inquiry, the process will be swifter than in the past. Understanding the procedural rules for navigating QBCC regulations is more important than ever.

Will This Change How the QBCC Handles Disputes?

The modernization efforts are intended to significantly impact the QBCC's dispute resolution services. The primary goal is to triage complaints more effectively. By using better data and clearer criteria, the commission aims to divert minor contractual or communication issues towards mediation or early resolution services. This will, in theory, free up its investigative resources to focus on more serious matters, such as significant defective work, unlicensed contracting, or issues that fall outside the standard defects liability period. For contractors, this could mean a faster pathway to resolving minor disputes but also a more intense focus on any serious allegations that are made against them.

How These Reforms Affect Your Construction Business Day-to-Day

These legislative shifts are not abstract legal concepts; they have direct, practical implications for the daily operations of every construction business in Queensland. From the clauses in your construction contracts to the training you provide your staff, adapting to the new environment is a matter of proactive risk management.

Understanding how to navigate issues like contract termination and maintain building industry fairness will be key to thriving in this reformed landscape. Seeking timely legal advice is no longer a luxury but a strategic necessity.

Reviewing and Updating Your Contracts

The first and most critical step for any construction company owner is to conduct a thorough review of their standard contracts. This process should start with identifying and updating all clauses related to payment claims and security to reflect the current state of the BIF Act, especially noting the pause on the PTA expansion. Next, you must transition to incorporating terms that acknowledge the new Queensland Housing Code's processes, which may affect timelines and approval contingencies.

Finally, it is crucial to detail and update your WHS clauses to ensure they align with the stricter reporting duties and the "modern regulator" approach to safety, clearly defining responsibilities on site.

This is particularly crucial when considering the grounds for a guide to terminating construction contracts.

Training Your Team on the New Rules

A compliant business is one where every team member understands their role within the new legal landscape. It is essential to implement internal training programs to bring your entire team up to speed.

Project managers and site supervisors must be trained on the new WHS reporting triggers and the precise steps to take when a notifiable incident occurs. Similarly, your contract administrators and accounts staff need to understand the nuances of the BIF Act's payment claim procedures to ensure compliance and protect the company's cash flow. This training is not a one-off event but should be an ongoing part of your professional development program.

When to Seek Proactive Legal Advice

In a shifting regulatory environment, waiting for a problem to arise before seeking legal help is a costly mistake. The core argument for proactive advice is simple: a small investment in a contract review or a compliance audit can prevent a major, expensive dispute down the line.

By engaging with legal professionals early, you can ensure your contracts are robust, your internal processes are aligned with the new laws, and you understand your legal position before a problem escalates. This is the most effective form of risk management and a hallmark of a well-run construction business.

Navigating this new landscape requires foresight. The team at Merlo Law provides strategic guidance to help businesses adapt and thrive. For a complete overview of the foundational principles, refer to our comprehensive guide to building and construction law.

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FAQs

What is the BIFOLA Act and how does it affect me?

The Building Industry Fairness (Security of Payment) and Other Legislation Amendment Act 2024 (BIFOLA) is a Queensland law that amends the existing security of payment framework. Its most significant impact is the indefinite pause on the expansion of the Project Trust Account (PTA) regime. If you are a head contractor, this means the current thresholds ($1M for government projects, $10M for private projects) remain in place. If you are a subcontractor on projects below these thresholds, you will not have the protection of a trust account, making robust contracts and diligent payment claims essential.

Does the new Queensland Housing Code mean I don't need council approval anymore?

No, it does not eliminate the need for approval, but it aims to streamline it. The Queensland Housing Code is a statewide planning tool that standardises the rules for certain types of housing, like granny flats and duplexes. While it can override some local council planning rules to fast-track approvals, it does not override all of them, especially site-specific constraints like environmental overlays or infrastructure limitations. Thorough due diligence is still required for every project.

What changes are happening to WHS incident reporting?

Work Health and Safety (WHS) reporting is becoming stricter and more time-sensitive. The changes require faster notification of "notifiable incidents" through designated digital platforms. The initial reports must also contain more detailed and specific information about the event. Failure to comply with these new procedures will likely result in increased penalties and could impact your QBCC licence suitability.

How does the QBCC's "modern regulator" model affect my licence renewal?

The QBCC's transition to a "modern regulator" involves a major push towards digital systems. For licence renewals, this means the process will be primarily online. You will be responsible for maintaining accurate digital records and interacting with the QBCC through its online portals. The goal is to make the process faster and more efficient, but it also requires licensees to be proficient with the new digital platforms.

With the PTA expansion paused, how can I protect myself from non-payment as a subcontractor?

Without the protection of a trust account on smaller projects, your primary defences are contractual and procedural. Ensure your subcontract is professionally drafted and clearly outlines payment terms, timelines, and dispute resolution mechanisms. Be disciplined in issuing compliant payment claims under the BIF Act and be prepared to enforce your rights promptly if a payment is late. Seeking legal advice to strengthen your contracts is a crucial proactive step.

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This guide is for informational purposes only and does not constitute legal advice. For advice tailored to your specific circumstances, please contact Merlo Law

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