As B.C. fast-tracks a new wave of mining, natural gas, renewable energy and housing projects, a growing coalition of unions and business groups is urging the province to fast-track pay for workers as well.
The province needs to catch up to the rest of the country and implement what’s called “prompt-payment legislation” to ensure contractors and their employees get paid, said Matt MacInnis, president of the Electrical Contractors Association of BC.
It’s particularly timely given the NDP government’s intention to expedite $20 billion worth of mining, natural gas and renewable energy projects in response to U.S. President Donald Trump’s threat of tariffs on Canadian goods, he said.
“We’ve seen that the Trump tariffs have encouraged the provincial government to look insular about what it can do to ease the cost of doing business for B.C. businesses,” said MacInnis.
“Prompt payment would provide that certainty and fairness across the construction sector.”
In most other provinces, laws exist to require owners and developers to pay their trades contractors within 28 days of an invoice. But in British Columbia, contractors and subcontractors are increasingly waiting months, which means they are out thousands, if not millions, of dollars in cash as they try to meet their ongoing obligations to pay suppliers and employees.
“This isn’t a union-only problem at all, it’s an industry issue,” said Jim Lofty, business manager at International Brotherhood of Electrical Workers, local 213, the largest local in the province.
“As we try and move towards affordable housing, if you are adding more risk there, or less profit, or inherent risks to projects, and then there’s funding problems, then you have people saying, ‘No thanks I don’t want to participate.’”
Small contractors feeling squeezed
Ensuring the confidence of trades and contractors will be key if the BC NDP government hopes to build out the $20 billion in fast-tracked natural resource and energy projects Premier David Eby announced this week, to help drive the economy in the face of U.S. tariff threats.
Eby said the 18 projects will generate up to 8,000 jobs at mines, natural gas pipelines, LNG facilities and new wind turbine projects.
All of those projects will require electrical contractors. But they are increasingly frustrated at late payments.
MacInnis said one member contractor reported 40 per cent of invoices took longer than 60 days to be paid last year, and 20 per cent of invoices stretched beyond 90 days. In the meantime, the contractor had to find financing to cover payroll and supplies.
“Right now two things are happening: Big contractors, especially the largest operators, are offering extremely punitive terms in their contracts,” said MacInnis.
“It’s not usual to have them pushing down 60-90 days or more. And then even in instances where a contract might say 28-days payment, nobody is paying that. Large corporations and big developers have in-house counsel or the resources to bully these contractors.
“There is a very little risk to them to the fact they are using these companies’ money as a kind of bargaining cudgel.”
BC considers new legislation
Lofty said his union has started helping the Electrical Contractors Association in lobbying provincial MLAs for change.
“We don’t like it when contractors are in this place, because it can lead to risk aversion on big jobs or taking on too many jobs they haven’t been paid for,” he said.
And yet, progress has been slow. The government has spent more than a year studying the issue.
The Electrical Contractors Association helped the government conduct a review of prompt-payment legislation in other provinces, and craft a made-in-BC version at the request of Attorney General Niki Sharma’s ministry.
Other provinces typically have an adjudication system for disputes, so that small contractors aren’t dragged into expensive legal fights with larger developers.
“We believe the work is done on the legislation,” said MacInnis.
“What we need now is the political will to translate that work into legislation.”
Sharma said in a statement she’s also heard from the BC Construction Association and Mechanical Contractors Association of BC in support of the idea.
“Our review with industry is very near completion, and we will determine our next steps soon – including any legislative options,” said Sharma.
“Prompt payment legislation is one tool to improve the construction industry.”