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This Week in Construction Law: December 20 – 24, 2021

In national news, Statistics Canada has observed that although the Canadian labour market has made a complete recovery from the pandemic, its composition has changed considerably. Self-employment, which had been growing steadily prior to the pandemic, has cratered to its lowest level since 2012. In the construction industry, declines in self-employment have not been off-set by a corresponding increase in gains in paid employment. Richard Dias of Acorn Macro Consulting in Halifax suggests the reason is pandemic policies – both the restrictions and the supports – that indirectly favoured large companies.

In national news, CTV has published a feature exploring the reasons why Canadian transit construction projects are so expensive by global standards (the global median is $300 million per kilometre, while some Canadian projects are budgeted as high as $775 million per kilometre). The feature primarily blames the depth of the underground tunnels, the “grandiosity” of the stations, labour costs, and political meddling, which often prioritizes less efficient construction methods that minimize complaints from constituents who live nearby but can more than quadruple the cost.

In federal news, the CBC has published a feature explaining the federal government’s plans to increase housing construction in 2022, including the newly introduced Housing Accelerator Fund, which is intended to spend $4 billion to assist in the construction of 100,000 new homes by 2025. The feature includes critique of the Fund and related policy proposals as insufficient to address the scale of Canada’s housing affordability crisis, which is spurred in part by housing-to-population ratios that remain well behind international peers: Canada would apparently need to build 1.8 million new homes to equal the G7 average of 471 homes per 1,000 residents.

In Ontario, the Crown corporation Ontario Power Generation has selected the North Carolina-designed BWRX-300 light water reactor for construction at its Darlington station. When completed, this nuclear reactor will be Canada’s first since 1993. OPG hopes that by selecting a proven, relatively simple reactor type from a company with established supply chains (and snubbing Canadian competitors who couldn’t make the same sales pitch), it can begin the process of creating economies of scale with respect to regulation and construction of more generators in the future.

In Ontario, the Ministry of Labour has announced new charges under the Occupational Health and Safety Act in the December 2020 death of a construction worker in a wall collapse that occurred in the course of a demolition job. The worker’s employer faces charges of failing to provide supervision, failing to alert a worker to a hazard, and failure to follow procedures contained in the Occupational Health and Safety Act.

In Ontario, Daniel Aleksov, principal and co-founder of Leading Edge Building Engineers, gave a speech supporting proposed provincial legislation that mandatory building envelope and structural assessments be conducted at least every five years. Aleksov identified both the risk of catastrophic failure and the danger of compounding damage from hidden deterioration for his support of the proposal.

In B.C., the Crown corporation Infrastructure B.C. has published a guide to the Competitive Alliance procurement model on its website. The Competitive Alliance model is relatively uncommon in Canada and not well understood, but is gaining in popularity and industry interest, and is currently being piloted in B.C. on the Cowichan District Hospital Replacement Project. Compared to other models, Competitive Alliance places greater emphasis on the suitability of key individuals to produce project deliverables. The ability of candidates to collaborate with each other and with the owner is examined in detail. The model also claims to utilize a structure that eliminates litigation claims, with the exception of “highly defined occurrences of wilful default.”

In New Brunswick, the CBC reports that the province’s home builders’ association is lobbying the provincial government to introduce a contractors’ registry and mandatory licensing, similar to B.C.’s Homeowner Protection Act, in order to prevent predatory practices in the industry by unqualified and/or unscrupulous individuals. Many contractors don’t have liability insurance, don’t provide warranties, and aren’t trained in WorkSafeNB safety requirements, the association claims, and observes that homeowners are often left with no recourse except litigation, as police will rarely get involved unless a pattern of unethical behaviour by a homebuilder emerges.

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