West Australian building company Jaxon Construction is entering liquidation, with operations within the group ceasing.

The move affects four sites in Western Australia.

Alarm bells were raised earlier this month when it was revealed subcontractors at the University of Western Australia's (UWA) Forrest Hall had not been paid.

The Construction, Forestry, Maritime, Mining and Energy Union's (CFMEU) state secretary Mick Buchan said Jaxon's liquidation was not a surprise.

"It's very disappointing," he said.

"It's the developers that are getting away with this, right?

"Developers are hanging on to their 20 per cent-plus margins where builders and subcontractors alike are entering these projects with very little margin if not a negative margin.

"There's no room for error out there in our industry.

"Enough is enough, the industry needs to wake up to itself, I call on all builders that are out there and the MBA [Master Builders Association] to touch base with us, let's get around the table and come up with an industry standard that can be out there, that can hold those developers to account."

Liquidator Sam Freeman of EY (formerly Ernst and Young) said two aged care developments were being affected, along with the Forrest Hall dormitory site and the Claremont apartment complex.

"There's some decisions to be made by the developers of those sites," he said.

"We'll work with them to try and transition the building as quickly as we can because that's in everyone's interests.

"What we've got to do now, and we've reached out to those site owners this afternoon, is understand where things are at and how we can look to maximise recoveries from those because we're not in a position in the liquidations to continue those works."

Collapse follows another major WA builder's downfall

The liquidation has come months after the collapse of another major WA builder, Pindan, and Mr Buchan feared it would not be the last construction company to face issues in the short term.

He said there needed to be proper margins in a tender to ensure subcontractors were paid properly, and allow for unexpected issues such as bad weather.

The projects have been described by liquidator EY as being in various stages of "commencement or completion".

EY said it was assessing the financial position of six entities within the Jaxon Group, and all operations had ceased.

In a statement, it said it acknowledged that many employees, individuals, clients, suppliers, and subcontractors of Jaxon would now be in difficult positions.

It said it would provide updates as soon as possible.