Construction Contract Template (UK)

A construction contract is the written agreement between the person paying for building work — the employer — and the contractor carrying it out. It records what is being built, for what price, when payment falls due, how changes are handled, and how disputes get resolved. This guide sets out what to look for in a construction contract template for UK projects before you adapt one.

Construction agreements carry a statutory layer most contracts do not. Part II of the Housing Grants, Construction and Regeneration Act 1996 gives parties to most commercial construction contracts a right to adjudication and imposes a payment-notice regime — whether or not the document mentions either. Where the contract is silent or falls short, the Scheme for Construction Contracts is implied in to fill the gap.

Two scope points decide whether any of this reaches your project. First, Part II bites by reference to where the work is: section 104(6) applies it to contracts relating to construction operations carried out in England, Wales or Scotland, and section 104(7) applies it whether or not the law of England and Wales or Scotland otherwise governs the agreement. Second, section 105(2) carves out whole sectors — drilling for oil or natural gas, extraction of minerals, and the assembly or installation of plant on a site whose primary activity is nuclear processing, power generation, water or effluent treatment, or the production or bulk storage of chemicals, pharmaceuticals, oil, gas, steel or food and drink. Supply-only arrangements and wholly artistic works sit outside it too.

The payee default notice under section 110B

A common assumption is that a missing payer's notice automatically hands the contractor its application. It does not happen by itself. Where the agreement required the payer to serve a notice and none was served, section 110B lets the payee serve its own — and section 111(2)(c) then makes that the notified sum, payable in full unless a pay less notice follows. But the payee has to actually serve it, and under section 110B(3) the final date for payment is pushed back by however many days late that notice was.

Where a construction contract comes in

Building work on commercial premises — a fit-out or extension, often of space held under a commercial lease agreement; the lease governs the letting, and the works need their own contract.
A developer engaging a main contractor for a new build or conversion.
A main contractor engaging subcontractors for individual trades. Our free IR35 status determination statement template covers the off-payroll status process for those chains.
Architectural, design or surveying work, and advice on building or engineering — section 104(2) brings these inside the definition as well.
A homeowner engaging a builder — though an agreement with a residential occupier sits outside Part II (section 106), so the written terms carry the whole load.

Clause by clause

The parties and the works — a precise description referencing drawings and specifications. Vague scope is where most disputes start.
Price and payment dates — lump sum or measured work, and a defined due date and final date for payment. Section 110(1) requires an adequate mechanism for determining what becomes due and when, plus a final date for payment; the statutory notices hang off those two dates.
Stage payments — section 109 entitles a party to payment by instalments, stage payments or other periodic payments, unless the agreement specifies, or the parties agree, that the work is estimated to last less than 45 days.
Payment notices — section 110A requires the agreement to provide for a notice, from either the payer (or a specified person) or the payee, stating the sum considered due and the basis on which it is calculated, given no later than five days after the payment due date.
Pay less notices — under section 111 the payer must pay the notified sum in full by the final date for payment unless a valid notice of intention to pay less is given in time.
Variations — a written instruction procedure and a method for valuing changes.
Time and delay — start date, completion date, grounds for extensions of time, and any agreed damages for late completion.
Retention — the 1996 Act sets no retention rules, so this is purely a matter for the parties: state how much is held back and exactly when it is released.
Defects — a rectification period after practical completion, and who bears the cost.
Suspension for non-payment — section 112 lets an unpaid party suspend any or all of its obligations after at least seven days' notice giving the grounds. Section 112(3A) makes the defaulting party liable for the reasonable costs of that suspension, and section 112(4) disregards the suspension period when computing contractual time limits.
Adjudication — section 108 lets a party give notice at any time of an intention to refer a dispute to adjudication, with a decision normally due within 28 days of referral. A non-compliant clause is replaced by the Scheme's adjudication provisions.
Insurance, site duties, termination — who insures the works, duties under the Construction (Design and Management) Regulations 2015 (which apply in Great Britain), and what happens on termination or insolvency.

Common mistakes

Assuming a missing payer's notice automatically hands the contractor its application. It does not happen by itself — see the payee default notice under section 110B above: the payee has to actually serve it.
Trying to contract out of the Act. Excluding adjudication simply triggers the Scheme, and section 113 makes pay-when-paid clauses ineffective except where the third party is insolvent.
Confusing the due date with the final date for payment. The notices are timed off different dates; one wrong date can invalidate a notice.
Assuming an unwritten deal is outside the regime. Section 107, which limited Part II to agreements in writing, was repealed on 1 October 2011 for England and Wales and 1 November 2011 for Scotland. An oral bargain can now carry the statutory adjudication right — and because section 108 requires the adjudication provisions themselves to be in writing, an oral bargain will normally fall to the Scheme.
Using a commercial template for a homeowner job unchanged. Under the residential occupier exclusion the statutory payment and adjudication rules do not apply automatically — the document must spell them out.

England & Wales, Scotland and Northern Ireland

The 1996 Act reaches construction operations carried out in England, Wales and Scotland, but the implied fallback terms differ. England and Wales share a base instrument, the Scheme for Construction Contracts (England and Wales) Regulations 1998, which extends only to England and Wales; Scotland has its own Scheme for Construction Contracts (Scotland) Regulations 1998, which extends to Scotland only. Since 2011 the picture has fragmented further: the 1998 Scheme was amended separately for England and for Wales, and the Scottish Scheme by its own 2011 amendment regulations. Be careful reading these online — legislation.gov.uk currently publishes both 1998 Schemes only in their original as-made form, so what you see there does not show the 2011 changes.

Northern Ireland sits outside the 1996 Act altogether. The Construction Contracts (Northern Ireland) Order 1997 makes broadly parallel provision — adjudication (article 7), payment notices (articles 9A and 9B), the requirement to pay the notified sum (article 10) and suspension (article 11) — with its own Scheme made under article 13. The timing differs too: the Northern Ireland equivalent of the section 107 writing restriction, article 6, was not repealed until 14 November 2012. Site health-and-safety duties in Northern Ireland come from the Construction (Design and Management) Regulations (Northern Ireland) 2016, not the 2015 Regulations.

Frequently asked questions

What is adjudication in a construction contract?

A fast statutory dispute procedure: a party can give notice at any time of an intention to refer a dispute to an adjudicator, and a decision is normally due within 28 days of referral — extendable by up to 14 days with the referring party's consent, or by a longer period the parties agree after referral. The decision binds until the dispute is finally determined by legal proceedings, by arbitration or by agreement.

Can we exclude adjudication from our contract?

No — under section 108(5), an agreement within Part II that does not meet the statutory requirements simply picks up the Scheme's adjudication provisions instead.

What is a pay less notice?

A written notice that the payer intends to pay less than the notified sum, specifying the sum the payer considers due and the basis on which it is calculated. It has to be given no later than the period the parties have agreed before the final date for payment or, where they have agreed no period, the period set by the Scheme. Without one, section 111 requires the notified sum to be paid in full.

Does the Act apply to building work on my own home?

Usually not. Section 106 excludes an agreement that principally relates to operations on a dwelling which one of the parties occupies, or intends to occupy, as a residence — so the document must set out payment and dispute terms expressly. Watch the definition: for this purpose a dwelling-house does not include a building containing a flat, so work on a block of flats you own is not automatically excluded. Health-and-safety duties are unaffected — regulation 7 of the 2015 Regulations applies to domestic clients, passing the client duties to the contractor or principal contractor.

Can a contractor suspend work for non-payment?

Yes — where the notified sum has not been paid by the final date, section 112 lets the unpaid party suspend some or all of its obligations, but only after giving at least seven days' notice stating the grounds. Suspending without that notice risks putting the contractor in breach instead.

Statutory references on this page were checked against primary sources (legislation.gov.uk, GOV.UK, HSE, ICO and Acas) on 8 August 2026. Our templates themselves are not solicitor-drafted — see the note below.

This page is legal information, not legal advice.

Dogetlawyer is a Legal-Technology platform, not a law firm.

Our templates are not solicitor-drafted and have not been checked against primary sources. They are starting points to adapt, not finished documents.

This page describes the law of England and Wales unless it says otherwise. For anything significant, consider taking advice from a qualified professional.

Statutory references describe the position in England, Wales and Scotland unless stated.

How to get the template

Dogetlawyer is a Legal-Technology platform, not a law firm. This template is one of around 114 free UK legal templates on the site. Browse every title on the free UK legal contract templates A–Z index; downloading requires a free account — registration, not payment. For a self-employed individual providing services rather than building works, see the contractor and freelancer agreement; directly employed site staff need an employment contract, which section 104(3) puts outside the definition of a construction contract.