A caution to owners: Health and safety on the project site

Vanessa Werden is a partner at construction law firm Jenkins Marzban Logan LLP. Named one of the Top 40 Under 40 in Canadian Construction in 2020, she is licensed to practice in B.C., Alberta, the Northwest Territories, and Ontario. Earlier this year she was ranked by Lexpert as one of two “Leading Lawyers to Watch” in Construction Law in BC, and one of five “Lawyers to Watch” in Infrastructure Law in Canada.

On November 10, 2023, the Supreme Court of Canada issued its ruling in a case called R. v. Greater Sudbury (City). The case arises from a fatal accident and concerns the proper interpretation of Ontario’s Occupational Health and Safety Act (the “Ontario Act”).

In September 2015, a pedestrian was struck and killed in Sudbury, Ontario, by an employee of Interpaving Limited who was driving a road grader in reverse, through an intersection. The City of Sudbury had contracted with Interpaving Limited to act as a constructor to repair a downtown water main. Contrary to a provincial regulation, no fence was placed between the construction project workplace and the public intersection and no signaller was assisting the Interpaving worker. In separate proceedings, Interpaving was convicted of breaching its duty as an employer under section 25(1)(c) of the Act to ensure that the measures and procedures prescribed in the applicable regulation were carried out on the project site.

The issue before the Supreme Court of Canada was whether the City was liable as an “employer” for breaching the same duty. Section 1(1) of the Ontario Act defines an employer as “a person who employs or contracts for the services of one or more workers”. The City denied that it was an employer because it lacked control of the repair work and had delegated control to Interpaving.

The Supreme Court of Canada held that the City was liable as an employer for breaching its obligations under section 25(1)(c) of the Ontario Act. The Court determined that nothing in the text, context or purpose of the Ontario Act requires the Ministry to establish control over the workers or workplace to prove that the City breached its obligations as an employer. In its reasons, the Court confirmed the following in respect of the application of the Ontario Act:

• Where an owner who contracts for the services of a constructor on a construction project is prosecuted for a breach of s. 25(1)(c), a court must first consider whether the Ministry has proven beyond a reasonable doubt that the Act applied to the accused because the accused was an employer under s. 1(1) of the Act. An owner is an employer if it employed workers at a workplace where an alleged breach of s. 25(1)(c) occurred, or contracted for the services of a worker at that workplace (including for the services of a constructor). The Ministry is not required to prove that the owner had control over the workplace or the workers there. It is clear from the text of the definition of employer that control is not an element that the Ministry must prove to establish that an accused is subject to the duties of an employer.

[Emphasis added]

The commentary by construction lawyers in Ontario has been in the nature of concern, calls for legislative reform, and even panic. Much of the concern about the Court’s reasoning is a lack of clarity on what will or will not constitute a sustainable due diligence defence on the part of an owner. The Court stated that in the construction context, it may be open to a judge to find that the owner took every reasonable precaution because the owner decided to delegate control of the project and responsibility for workplace safety to a more experienced constructor. Relevant considerations might include whether the owner pre-screened the constructor before hiring the constructor to ascertain, for example, whether the constructor has superior expertise, a track record free of prior convictions, and the capacity to ensure compliance. An owner may argue that its relative inexperience with workplace safety was why it chose to delegate control over a project to a more sophisticated constructor.

In British Columbia, occupational health and safety is regulated by the Workers Compensation Act (the “BC Act”) and the Occupational Health and Safety Regulation. In the BC Act, employer is defined to include, “every person having in their service under a contract of hiring or apprenticeship, whether the contract is written or oral, express or implied, a person engaged in work in or about an industry.”

In BC, the concept that a project owner could be deemed by WorkSafeBC to be an employer is not new. However, owners who have been found liable under the BC Act are not necessarily forced to pay, as WorkSafeBC has discretion to relieve an employer from liability if satisfied that the default was excusable. Similar to the due diligence defences suggested by the Supreme Court, there are defences available to project owners in BC who have taken reasonable and appropriate steps to delegate authority for health and safety to a contractor.

Where an owner has engaged a contractor to do work at its property, they should always seek a clearance letter from WorkSafeBC to avoid potential exposure to premium payments. Even when owners have retained an independent contractor, it is important that they do their due diligence to ensure that the contractor is in good standing with WorkSafeBC. Owners who fail to do so can become jointly liable with the contractor for unpaid WorkSafeBC insurance premiums. Owners can confirm a contractor’s status by getting a clearance letter from WorkSafeBC.

Finally, consider that most forms of CCDC contract provide that the contractor is responsible for construction safety. For example, General Condition 9.4.1 of the CCDC 2 provides:

• 9.4.1 The Contractor shall be responsible for establishing, initiating, maintaining, and supervising all health and safety precautions and programs in connection with the performance of the Work in accordance with the applicable health and safety legislation.

This General Condition establishes that the contractor is solely responsible for construction safety at the project. That responsibility, however, may differ where the owner engages other contractors under separate contracts or employs own forces to perform work. The owner and its consultants also must abide by safety regulations at the site. There is nuance to workplace safety, and when in doubt, and particularly when deviating from the traditional general contracting delivery method, seek legal advice to ensure compliance and make sure you understand your obligations and exposure to risk and liability in the context of the selected contracting and project delivery model.