The contractor you dealt with in 2010 never paid his CNESST premiums and you were not aware? Did you know that by law you could be responsible to pay the CNESST for part of this supplier’s outstanding premiums?
In fact, under Article 316 of the Loi sur les accidents de travail et les maladies professionnelles (LATMP) “an employer who hires a contractor may be required to pay the premium owed by the contractor.”
The concept of “contractor” has a broad interpretation. This includes, for example, recruitment agencies, transport companies, computer equipment maintenance firms, etc.
The amount you could be liable for is calculated using the cost of the contractor’s labor for the duration of the contract and contractor’s contribution rate. For example, if you hire temporary warehouse personnel through a recruitment agency (which has a contribution rate of $6.43 per $100), and the cost of the labor for the duration of your contract is for $200,000, the amount payable to the CNESST could be as high as $12,860.
By law, you can recover the premium paid from the contractor and even withhold the amounts owing to the contractor, provided that it is possible to do, which is not always the case when the contractor is no longer in business, for example.
There is no time limit for the CSST to audit and identify other possible payees, and these consequences apply even if you no longer do business with the contractor in question.
What to do to protect yourself?
Since 2011, an employer may directly request either information on the contractor’s compliance status, or a certificate of compliance from the CNESST for each of the contractors they currently deal with or are planning to deal with. Upon receipt, the CNESST communicates with the contractor to validate the information relating to the contract mentioned in the request. The contractor has 14 days to respond otherwise the CNESST considers that he authorizes the disclosure of the requested information.
This request may be made by the employer or by the contractor, whereas prior to 2011 only the contractor had this right to request this information. Should the document be supplied to you directly by the contractor, assure that an original document is being provided.
The request of information on the company’s compliance status can be made at any time during the contract period. However, it is only a certificate of compliance obtained at the end of the contract between the parties that releases the employer from liability on the payment of the contractor’s premiums.
It is therefore suggested, when signing a new contract with a contractor to always:
- Require the contractor’s permission to obtain from the CNESST information on its compliance status at the start of the contract and its permission to request the certificate of compliance at the end or at the time of contract renewal.
- Include a clause that specifies the cost of labor involved in the contract to avoid being subject to a CNESST cost estimate should the information not be readily available at a later date.
- Include a clause stating that an amount that will be retained at the end of the contract, until the certificate of compliance is received from the CNESST. Ensure that the amount covers any potential CNESST claims from the assessment of the contractor.
Prevention is better than paying an additional contribution!
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