Legitimate construction contractors in Ontario are paying twice the amount they should in order to offset the costs of contractors who don't pay, says the Provincial Building and Construction Trades Council of Ontario. The council represents about 100,000 unionized workers.

Pat Dillon, business manager for the council, says, "The construction industry is a very competitive business. The government is making it impossible for well-trained, properly insured, top-quality workers to compete. Some unscrupulous contractors are openly thumbing their noses at legitimate contractors because they know the government is doing little to enforce existing tax laws and regulations. What's the point of following the law if you know you won't get caught?"

The council says that Ontario's Workplace Safety and Insurance Board (WSIB) collected premiums from about 150,000 workers in 2000. But Statistics Canada estimates that more than 325,000 people work in the province's construction industry. "These figures clearly show that the WSIB is only collecting premiums for 48 per cent of workers," says the council.

Dillon says the provincial government must "immediately make enforcing tax and insurance laws a priority to stop these rip-off artists who are hurting the construction industry." He's calling on the government to invest in state-of-the-art technology to integrate the collection of all government insurance premiums, taxes and licensing fees, and to enforce existing regulations and tax laws.

The province of Ontario recently passed legislation that may help address some of these concerns, but the new laws won't take effect until 2004. In the meantime, regulations will be developed, including new liability insurance requirements for builders, architects, designers and registered building code agencies.

The legislation, called An Act to Improve Public Safety and to Increase Efficiency in Building Code Enforcement, is being welcomed by home builders' associations because it will streamline the time it takes municipalities to issue building permits. Sheldon Libfeld, president of the Greater Toronto Home Builders' Association, says that getting a permit to build a single-family home in some Greater Toronto Area municipalities currently takes longer that the time it takes to actually build the house. The legislation will establish time frames for which builders must receive a permit from the municipality.

The new act is also designed to enhance public safety by requiring that designers and building inspectors meet qualifications around building code knowledge. Some professional trade organizations think this may duplicate current educational requirements that are already in place.

Perhaps the most contentious issue in the new legislation is the establishment of the private registered building code agencies, which could be hired by builders to conduct building site inspections and plan reviews. Critics have wondered how objective these agencies will be when they are hired by the builders whose work they are inspecting.

The insurance requirements to be determined will address the type and scope of coverage, coverage levels, the period of insurance, deductibles and exemptions. All of these requirements would be written into the province's building code. It is also proposed that insurance would be required for seven years after construction for major structural defects.

None of the changes to the building code, however, will matter much if the existing laws and tax regulations are not enforced.

"The underground economy is ripping an estimated $1 billion out from under the provincial government," says Dillon. "If the government needs more money, we know where they can find it."