What could your liquidated damages clause actually cost you?
The rate looks small on paper. The exposure isn't: 83% of the LD clauses we've analysed carry no cap (19 of 23 identifiable, August 2026), and the median rate is $1,500 a day (n=26). Enter your numbers to see the exposure at any delay — and what a market-standard cap would change.
Common questions
What is a normal liquidated damages rate on a subcontract?
Across the real Australian subcontracts we've analysed, the median LD rate is $1,500 per day (n=26, August 2026). Rates vary widely with project size - what matters as much as the rate is whether liability is capped.
Are liquidated damages usually capped?
Mostly not: 83% of the LD clauses we've analysed carry no cap (19 of 23 where the drafting was identifiable, August 2026). The market position worth asking for is a cap at 5-10% of the contract sum - head contractors have accepted it on comparable packages, but almost never offer it unprompted.
Can LDs run against me for a delay that wasn't my fault?
Yes, if your extension of time claim dies on a time bar. Every identifiable time bar in our dataset is drafted as absolute - miss the notice window and the entitlement is extinguished regardless of who caused the delay, leaving the LD clock running against you. The LD clause and the EOT time bar have to be read together.
Are uncapped liquidated damages enforceable?
Generally yes, if the rate is a genuine pre-estimate of loss rather than a penalty. Courts rarely rescue a subcontractor from a bad LD clause - the penalties doctrine is a narrow escape hatch, not a safety net. The reliable protection is negotiating a cap before signature.
Keep reading
General information, not legal advice. Your contract's actual drafting governs — rates, caps and time bars interact, and enforceability turns on the specific clause. Nothing you enter here is uploaded or stored. Built by Mat Kennedy at The Construction Contracts Co.