The National Trade Contractors Coalition of Canada (NTCCC) is urging the Canadian Construction Association (CCA) to take a policy position on prompt payment, while voicing concerns about their involvement with legislation on the same subject in Ontario.
"Although they haven’t taken an official position on prompt payment legislation, it is the hope of NTCCC that the CCA will very soon adopt a formal position of support for a legislative solution to this growing problem," said John Galt, the chair of the NTCCC in a press release.
"There is no single issue of greater importance to the entire construction industry. Contractors need to get paid for work that they’ve done within a month of doing it so that they can pay their own workers and continue to create jobs."
According to the press release, Galt recently met with Anibal Valente, CCA chair and Michael Atkinson, CCA president, to discuss their views on the need for prompt payment legislation.
Galt said the meeting was good but he was surprised that a national association would be getting involved on the scale that the CCA seems to be with the Construction Lien Act review in Ontario.
In response, Atkinson said the CCA has not yet taken a formal position on whether prompt payment legislation is appropriate at the federal level. Atkinson said the CCA will probably be discussing the issue at its upcoming board meeting in May.
"We have also decided that for the expert review in Ontario, that we wanted to be registered as a stakeholder, primarily to get all the information," he said.
"But, we want to assure NTCCC, that we are not going to be making specific recommendations with respect to what Ontario should do legislatively."
The Ontario government selected Bruce Reynolds on Feb. 11 to conduct an expert review of the Construction Lien Act, which will focus on prompt payment and effective dispute resolution.
Atkinson said the CCA will provide its national perspective on payment and non-payment issues in the industry. This will take the form of some sort of commentary.
"But, we will not be making any specific recommendations vis-a-vis what might be done with the Construction Lien Act or any other specific piece of legislation in Ontario," said Atkinson.
"We wanted NTCCC to understand that as well, because they heard we were going to be involved in the consultation. They wanted to know why a national association would wade in provincially." Atkinson and Valente also met with the board of the Ontario General Contractors Association (OGCA) recently at its Construction Symposium 2015 to clarify their position at the provincial level.
"CCA is a national body that has been hearing about this issue from many sides and provinces," said Clive Thurston, OGCA president.
"So, for them to be involved is only natural, but in the sense of providing information, not policy. And, I think that is a very good role for them to play, because once we are successful in Ontario, this is going to spread."
One of the prompt payment concerns identified by the CCA is the extension of payment terms.
"We are seeing situations where owners routinely remove from standard contract provisions dealing with the automatic payment of interest on late payments or the ability to get reasonable evidence of financing from the owner," Atkinson said.
"We are also probably going to mention restrictive bidding clauses and all the municipal clauses that say if you bring a lawsuit against us you will be barred from bidding our work."
Atkinson said this creates a situation in which a contractor is not being paid in a timely manner or at all, but is reluctant to take advantage of any statutory or contractual remedies that are available.