Under the Workplace Safety and Insurance Act (the “WSI Act”), condominium corporations can now be liable for a construction company’s unpaid WSIB premiums.
Amendments to the WSI Act have made it compulsory for almost all construction workers to have WSIB coverage, including independent operators, sole proprietors, and most executive officers and partners in construction firms. There are certain exemptions, but in most cases those exemptions won’t apply to workers hired by a condominium corporation.
Before hiring someone to perform construction work, a condominium corporation will have to obtain a clearance certificate from the WSIB confirming that the worker is registered and is in good standing with the WSIB. There is no fee to obtain the clearance certificate.
It should be noted that the condominium corporation will only be responsible for obtaining clearance certificates for contractors and subcontractors it hires directly. If the contractor then retains any subcontractor(s), the contractor is responsible in relation to the subcontractor(s).
The clearance certificate can be obtained by either the condominium corporation or the contractor – but the condominium corporation must obtain a copy. The condominium corporation can also include a term in the contract requiring the contractor to obtain and supply a current WSIB clearance certificate prior to commencing work.
Note as well that each clearance certificate is time-limited (up to 90 days). An updated certificate must be obtained when a given certificate expires (even during a particular project).
Condominium corporations that fail to obtain clearance certificates before hiring construction firms or independent workers expose themselves to liability. Under the WSI Act, the WSIB can hold the condominium corporation liable for a contractor’s unpaid premiums to the WSIB (if no certificate has been obtained).
In rare cases, there may also be offence sanctions for not obtaining a clearance certificate which could result in penalties of up to $100,000 if convicted.
Condominium corporations also risk civil liability and could be held liable for a worker’s injuries if a worker is injured while performing construction work and the contractor does not have WSIB coverage.
In addition, in certain circumstances, the condominium corporation may still be sued if, even after obtaining a clearance certificate, a worker is injured on condominium property and the injury was clearly caused by the condominium’s negligence. The injured worker may elect to sue the condominium corporation rather than claim WSIB benefits.
In order to avoid risk of civil liability, condominium corporations should apply to the WSIB for coverage. If the application is accepted, the condominium corporation will be registered with the WSIB and will begin payment of premiums to the WSIB. Injured workers will not be able to commence an action against condominium corporations that are registered with the WSIB.
The WSIB will not be enforcing the new requirements until December 31, 2013, but that date is fast approaching…