A broad front of B.C. construction contractor associations are working to lobby the B.C. government for prompt-payment legislation, joining contractor groups in Ontario and Alberta that are pushing for parallel regulations.
"We are really waiting for the Ontario legislation," said Bill McEwen, executive director of the Canadian Masonry Contractors Association, following a meeting January 17 at the office of the Vancouver Regional Construction Association (VRCA) offices with representatives of other contractor groups.
"This is a fairness issue," said Ivan van Spronsen, executive vice-president of the Roofing Contractors Association of BC, noting that contractors are often obligated to pay their suppliers quickly and their workers "immediately," but then find themselves waiting "45, 60, even 120 days" for payment.
Ontario trades, through the Council of Ontario Construction Associations (COCA) and the National Trade Contractors Coalition of Canada (NTCCC) are spearheading the Ontario lobby.
Because the construction industry does not operate with well-defined guidelines of timelines for payment for services rendered, many contractors are resigned to "financing" the costs of their projects until they are paid or, in a worst-case scenario, left without payment altogether, according to van Spronsen.
"The message the construction industry is sending with this initiative is that the long-accepted practice of late payment for work completed will no longer be tolerated. Many jurisdictions have already adopted prompt-payment protocols as the terms and conditions for doing business, including the United Kingdom, European Union and many American states," according to COCA.
"It is not primarily a problem associated with general contractors not being paid by owners, but general contractors not paying subcontractors for services delivered, " the NTCCC explained in a release.
McEwen said a particular flashpoint is the new wording "paid when paid, pay if paid" that is cropping up in contracts.
Basically, he explained, this means that if a general contractor is not paid for a project, the subcontractors may not be paid.
"In many cases the contractor doesn't even know if the general contractor has been paid or if there is some issue with the project," van Spronsen said. "It is not a good way to do business." It is hoped that Ontario legislation, once passed, could be used as a template in B.C., van Spronsen said.
from Western Investor March 2013
