Why should you hire a licensed contractor for your renovations?

July 15, 2013
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Old tools on a wooden table

Without a doubt, the number one piece of advice from anyone with tips on renovations is making sure you hire a reputable contractor for your project. It’s great advice, but where do you start? And why does it matter whether they licensed or not? If they give you a great finished project at a good price, isn’t that enough? No, it’s not. The money you might save up front on your project could cost you later in safety issues, legal fees, and a lot of big headaches. Asking your prospective renovator about these items and making a few calls can save your bacon.

Beware of the fly by night contractor commonly known as “Chuck with a Truck”

Licensing

Here in Edmonton, general contractors need a city business licence and a prepaid contractors licence. A city business licence let’s you know that the contractor does business in Edmonton. So what, right? Well, knowing where their place of business is might be important if you have any problems after the work is completed. Not that we had any major flooding in Edmonton, but could you imagine living in Calgary, having someone come in and “repair” water damage to your home, do a substandard job, and then finding out they were only here for the summer? A city business licence helps prevent these situations.

A prepaid contractors licence allows a contractor to take a down payment on a project, protecting the homeowner in case they decide to walk off with your funds. If fraud is committed, the homeowner can contact consumer corporate affairs and start the process to track down their money. Without the prepaid contractors licence, you’re handing money over to an unknown, making a down payment is risky.

To find out if the contractor has a city business licence or a prepaid contractors licence, ask them for their licence number, the name the company goes by and the company address (you need the address for the city to search for the company). Then call 311. Providing the company name, address and licence number will get you information on the status of the licences of the company. If the contractor isn’t licenced, think twice about giving them any money upfront.

Call the City of Edmonton for contractor licensing information.

Taxes

Did you know that an agreement between a homeowner and a contractor for the purpose of avoiding taxes makes a contract, verbal or written, illegal? Yes, if the authorities catch up with a contractor who doesn’t have a GST number, you can be on the hook as well. In addition, any contract that you agree to, may not be enforceable. So, if a contractor is doing your project “under the table” you may not have any legal recourse if they don’t see the work through.

Phone the Canada Revenue Agency Business Enquiries Line at 1 800 9595525 (or visit http://www.cra-arc.gc.ca/ ) and provide them with the company’s GST number and name (again, you have to ask the contractor for those) to find out if they are legitimate.

Contractors working without a GST number could get you into trouble if you do business with them.

Workers’ Compensation

A contractor that doesn’t have workers’ compensation insurance is someone you don’t want working on your property. If anyone working for them injures themselves on your property, you can be found responsible. Without workers’ compensation, by default, the homeowner acts as the general contractor. Worker’s Compensation not only protects the workers, but it also protects you. Call 780 4983999 and provide the company’s name for information on their insurance status.

Without worker’s compensation, legally, you are considered the general contractor and could be held responsible if any injuries occur.

Warranties

Although this doesn’t have to do specifically with licences, also be aware that if a renovator doesn’t install certain products correctly, the manufacturer may not honour any warranties. Some manufacturers require that photos be taken of the install and sent to them before a warranty can be issued. Other manufacturers require the completion of a training course, usually which costs hundreds of dollars to complete. If a contractor hasn’t bothered to meet any of the warranty requirements, that seemingly solid warranty package from the manufacturer might just be null and void.

Ensuring that your contractor follows all installation procedures for a product means that your warranty will be valid. Otherwise, your warranty could be null and void.

Do yourself a favour when you’re ready for your next renovation project. Hire a licenced contractor with the required insurance and documentation. It may seem like you pay a little more up front, but you’ll have some peace of mind and more likely a problem free renovation.  

 If you’re in the Greater Edmonton area and are looking for a contractor for you renovation project, visit our website at www.nordalta.com/contact.php to find information on how to contact us. We’d be happy to speak to you about what we can do to get the ball rolling on your next home or office project. You can also leave comments with us at info@nordalta.com.

Michael Breault is a project coordinator for Nord Alta Construction. You can find the company website at www.nordalta.com. You can also find Michael and Nord Atla Construction on facebook at www.facebook.com/NordAltaConstruction, on twitter at www.twitter.com/Nordalta, and on LinkedIn.

Robert Breault is the president and owner of Nord Alta Construction. You can find the company website at www.nordalta.com. You can also find Robert and Nord Alta Construction on facebook at www.facebook.com/NordAltaContruction and on LinkedIn.