Progress claims, variations and retention for steel fabricators (AU)

Last reviewed 6 November 2026 · Sources linked below · Written by Jay at Andwat Co, an Australian boilermaker/fabricator (Cert III Engineering, 12+ years in the trade). About

How Australian steel fabricators and mobile welders document progress claims, variations and retention: what to put on the claim, how to prove a variation, QLD retention caps and defects-liability release, and NSW Security of Payment pointers. Links a progress-claim tracker kit.

Small steel shops and mobile welders often get paid late not because the weld was wrong, but because the paperwork didn't survive a payment schedule. A progress claim that only says "Stairs – $12,000" with no variation trail and no retention tracker leaves money on the table. This guide is the shop-floor method: what belongs on the claim, how to prove variations, and when retention is due back under Queensland and New South Wales security-of-payment rules. It isn't legal advice — check the linked QBCC and NSW Government pages for your job.

The short answer

• Progress claim = written request that identifies the work, states the amount, and asks to be paid. Roll approved variations and unpaid earlier amounts into it.
• Variations need a paper trail before or as soon as the extra work starts (email, text, VO, site diary). List each one as its own line with the instruction reference.
• Retention is held against defects. In Queensland, QBCC limits how much can be held and when it must be released after the defects liability period; claim it with a final payment claim.
• One claim per reference date in QLD. Don't send a bare variation email and assume it is also a payment claim — see the QLD BIF payment claim guide for the 10 and 15 business day rules.

Why fab shops lose money on variations and retention

Typical failure modes on structural steel, stairs, handrails and site welding:

• Extra cleats and base plates done on a verbal "just do it". Months later the payment schedule says the variation was never approved.
• Percentage-complete claims with no mark list. The builder can't match your claim to drawings, so they certify less.
• Retention forgotten after practical completion. The defects liability period ends and nobody lodges the final claim inside the statutory window.
• Mixing a variation notice with a payment claim. In Queensland case law and QBCC guidance, a variation submission that doesn't demand payment is not automatically a BIF payment claim.

What belongs on a progress claim

Across Australian security-of-payment schemes the claim has to identify the construction work (or related goods and services) and the amount. Queensland's BIF Act is explicit: the claim must be in writing, identify the work, state the amount, and request payment — QBCC confirms a tax invoice can be the claim if it meets those three. For a steel subcontract, make the identification usable:

• Job name, site address, contract or PO number, your ABN
• Reference date the claim relates to (contract date, or last day of the month if silent in QLD)
• Breakdown: contract work to date (marks, tonnes, or % complete against a schedule of rates)
• Each approved variation as its own line with VO / email / diary reference
• Unpaid amounts from earlier claims rolled forward
• Retention withheld this period and retention held to date (so both sides see the same number)
• GST treatment if you're registered (see the tax invoice guide and quoting with GST)

NSW contractors have the same cash-flow right to progress payments under the Building and Construction Industry Security of Payment Act 1999. Use NSW Fair Trading / NSW Government Security of Payment pages for claim and adjudication deadlines in that state — they differ from Queensland's business-day caps.

How to document variations so they survive a payment schedule

1. Capture the instruction the same day. Email or text confirming scope, reason and that you will claim extras. If they only spoke on site, write it in the site diary with who said it and the time.
2. Price it before you bury the bay in overtime when you can: hours, steel kg, consumables, coating, cranage, travel. Fixed quotes beat open-ended dayworks when the scope is clear.
3. Do the work against that reference and keep photos / heat numbers / delivery dockets that match the variation line.
4. Put the variation on the next progress claim as a separate line. Don't wait until the final account — unpaid variations go stale and final-claim windows are short.
5. If they reject it in a payment schedule, the schedule must give reasons. Keep those reasons with the claim pack; they matter for adjudication timeframes.

Retention: holding, caps and getting it back

Retention is money held back to cover defects. Treat it as a separate ledger column, not a surprise at the end.

• Queensland caps (QBCC contractor payments guide): retention/security generally must not exceed 5% of the contract price before practical completion, reducing to 2.5% after; cash retention from each progress payment is generally capped at 10% of that payment. Confirm against the current QBCC retentions page and your contract.
• Defects liability period: if the contract doesn't state one clearly, QBCC says the default is 12 months from practical completion.
• Notice before release: a contracting party holding retention after PC must give subcontractors an S67NC notice of the end of the defects liability period (within 10 business days before the end, or within 5 business days after receiving their own linked notice).
• Final payment claim: claim retention before the latest of the contract's final-claim date (if any), 6 months after completion, or 28 days after the end of the last defects liability period. Missing that window is how fab shops permanently lose retention.
• NSW: retention trust rules apply to head contractors on large projects (NSW Government notes trust requirements for projects over A$20m). Subbies still track every dollar held and the contractual release triggers; use the NSW Security of Payment hub for adjudication if unpaid.

Shop checklist before you hit send

1. Is this on or after a valid reference date?
2. Does every variation line have a written instruction reference?
3. Do quantities / % complete match the drawings or schedule of rates?
4. Is retention withheld this period and held-to-date shown?
5. If you're GST-registered, does the claim also work as a tax invoice?
6. Have you diary-noted delays that may need an EOT claim on domestic QLD work?

Sale note (other kits): some Andwat Co kits on Payhip — including the Steel Cut List & Stock Length Optimiser (48fod) and the Sole Trader Invoice & GST Threshold Tracker (k7GIA) — currently show a short sale ending late 7 Nov AEST. Check each product page for the live sale price. List prices on this site stay as list. The Progress Claim tracker above is the matching product for this guide.

Common questions

What should a steel fabricator's progress claim include?

Identify the work (job, drawings, marks or percentage complete), state the amount claimed including approved variations and any unpaid earlier amounts, and clearly request payment. In Queensland the BIF Act requires those three elements in writing; a tax invoice can be the claim if it meets them.

Can I put a verbal variation on a payment claim?

Security of payment regimes still expect the claim to identify the work. Keep written evidence (email, text, variation order, site diary) before or as soon as the extra work starts, then list each variation as its own line with the instruction reference. Without that, the respondent often disputes it in a payment schedule.

When can I claim retention back in Queensland?

Usually with a final payment claim after the defects liability period ends. If the contract is silent or unclear, QBCC says the default defects liability period is 12 months from practical completion. Final claims must be given before the latest of the contract date (if any), 6 months after completion, or 28 days after the end of the last defects liability period.

How much retention can be held on a QLD building contract?

QBCC's contractor payments guide says retention or security generally must not exceed 5% of the contract price before practical completion, reducing to 2.5% after, and cash retention withheld from each progress payment is capped at 10% of that payment. Check your own contract and the current QBCC page.

Sources

• QBCC – Request payment (what a payment claim must include, reference dates, final claims)
• QBCC – Retentions and securities (defects liability notice and release)
• QBCC – Industry guide to security of payment laws (PDF)
• QBCC – Contractor guide to payments (PDF; retention caps and final claims)
• NSW Government – Security of payment for construction contractors

Related guides

• Payment claims in QLD (BIF Act): the 10 and 15 business day rules
• Site diary template Australia
• EOT claims on QBCC domestic contracts
• What a tax invoice must show (Australia)
• How to quote a job with GST (Australia)
• Sole trader invoices when you're not GST-registered

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General information only, summarised from the official sources above as at the review date. It isn't legal, tax, WHS or engineering advice. Rules change and your situation may differ, so check the source or ask a professional.