Trade contractors meet in Ottawa to urge Prompt Payment legislation
South of the border 49 of the 50 states have adopted prompt payment legislation. The United Kingdom, Ireland, Australia, and New Zealand have also enacted prompt payment laws. Why is Canada - both federally and provincially - so slow to act?
April 18, 2015 by Steve Payne
Editor’s note: Why is it that Canada does not have Prompt Payment Legislation to make sure, legally, that general contractors pay trades on time? 49 of 50 American states have such laws. So does the United Kingdom, Ireland, Australia, and New Zealand. The European Union is attempting to bring it in, Europe-wide.
Here is a press release from a national group trying to get this going in Canada: The National Trade Contractors Coalition of Canada (NTCCC). Prompt payment legislation (Bill 69) was introduced into the Ontario legislature in 2013, but the passage of this bill was recently halted.
NTCCC PRESS RELEASE – Representatives of Canada’s trade contract communities came together in Ottawa on April 8th, 2015 to discuss the urgent need for federal and provincial governments to adopt prompt payment legislation. The National Trade Contractors Coalition of Canada (NTCCC) Prompt Payment Summit allowed members to highlight progress that has been made at the provincial level and to discuss the next steps for seeing these initiatives through. The summit also focused on strategies to engage other concerned stakeholders who operate regionally and at the federal level.
“The lion’s share of construction in Canada is done by trade contractors and the money is supposed to trickle down from the top” said John Blair, NTCCC Director and Executive Director of the Canadian Masonry Contractors Association. “Trade contractors have a high dependence on cash flow and right now the money isn’t trickling down to pay people who’ve completed work even when there is no dispute about the work that’s been done.”
Trade contractors perform more than 80% of all construction work in Canada. They routinely receive late payments from general contractors, which has resulted in cash flow problems that discourage hiring, investments in capital, and in some cases even bankruptcy. This has a very real impact on the economy as fewer contractors can bid on projects, thus driving employment down and preventing apprentices from opportunities to train. The adoption of prompt payment legislation would stimulate the construction sector at no direct cost to government, while bringing Canada in line with all other comparable jurisdictions.
“This issue is hurting families, young people looking for work, and costing small businesses money all across the country,” said Richard McKeagan, President of the Mechanical Contractors Association of Canada. “Governments should be aware that the lack of prompt payment legislation in Canada is a barrier to prosperity, and we’re proposing a painless fix.”
South of the border 49 of the 50 states have adopted prompt payment legislation. Globally, the United Kingdom, Ireland, Australia, and New Zealand have also enacted these laws. Most recently, the European Union has adopted a Prompt Payment directive which all of its member states are required to translate into domestic law. Canada is the clear outlier.
“It is great to see how many organizations are committed to resolving this issue across jurisdictions,” added Blair. “This group is incredibly motivated and we’ll be engaging groups and governments at all levels to ensure prompt payment becomes a reality across Canada.”
About the NTCCC
The National Trade Contractors Coalition of Canada (NTCCC) was established in 2004 to provide an organized forum for Canada’s national trade organizations to share information, resources, and to collaborate on issues that are of common interest all. The membership is currently comprised of: Canadian Roofing Contractors Association, Canadian Automatic Sprinkler Association, Canadian Masonry Contractors Association, Canadian Electrical Contractors Association, Mechanical Contractors Association of Canada, Interior Systems Contractors Association, Thermal Insulation Association of Canada, Heating Refrigeration and Air-Conditioning Institute of Canada-Contractors Division, Sheet-Metal Contractors Association, Canadian Institute of Steel Construction, and the Tile, Terrazzo, and Marble Guild.
For more information on the NTCCC, visit the website at www.ntccc.ca.