• Recent amendments to the Illinois Mechanic’s Lien Act prohibit no-lien contracts.
• A subcontractor or supplier may subordinate its lien to other encumbrances if such subordination agreement is set forth in writing, in its entirety in the subcontractor's or supplier's contract.
• Pay if paid clauses do not waive lien rights.
• “Paid if Paid” is enforced if explicit.
• “Pay when Paid” suggests time for payment.
• Pay-when-paid clause in the subcontract or purchase order does create a condition precedent to payment.

Retainage Provisions

Private

SB 1636 Effective for contracts starting 8/20/19 retainage will be 10% until the project is 50% complete then it will be reduced to 5%. 

Public

605 ILL. COMP. STAT. 5/4-104.  Subcontractors' trust agreements. This Section applies to subcontractors' retainage amounts expected to be equal to or greater than $20,000. Upon the contractor's receipt of the first partial or progress payment from the Department, at the request of the subcontractor and with the approval of the contractor, the retainage of the subcontract shall be deposited under a trust agreement with an Illinois financial institution, whose deposits are insured by an agency or instrumentality of the federal government, of the subcontractor's choice and subject to the approval of the contractor. The subcontractor shall receive any interest on the amount deposited.