Payment Predicaments: Exploring Factors and Remedies for Main Contractor-Subcontractor Dynamics in Malaysia

Abstract

Making timely and efficient payments is a key component of a project's success. In the Malaysian construction industry, payment delays by the principal contractor and client on construction projects are a major cause of worry. This research aims to address payment concerns that contractors frequently encounter on construction projects. The objectives of this research are to identify the factors that cause payment issues and to recommend potential solutions to improve the payment issues between main contractors and subcontractors. A questionnaire survey was deployed for this research, with 145 respondents involved. The collected data was analysed using the IBM Statistical Package for the Social Sciences (SPSS) software. The findings stated that post-Covid-19 is the main factor that causes payment issues between the main contractors and subcontractors. On the other hand, new payment mechanisms among developers or clients who unlawfully withhold payment are the potential solution agreed upon by the respondents as the potential solution to the issue. The findings of this research can be useful to the relevant party to minimise any issue with payment between the main contractor and subcontractors. This research is in line with Sustainable Development Goals (SDG) No. 8: Promote sustained, inclusive, and sustainable economic growth for all.