Saskatchewan had the lowest job vacancy rate in the country in November. Quebec had the highest.
This is one of a basket of measures we use to assess the condition of the labour market in the country. When employers post job openings, there are a couple of factors that will determine how quickly the vacancy will be filled. One is the size of the labour pool – this can sometimes be measured by the unemployment rate – and another is whether pay levels are competitive.
There were just over 8,000 unfilled jobs on the books in Saskatchewan in November. That is about 1.7 per cent of the total job pool. That vacancy rate is the lowest in the country.
Then, when you look at wage rates, we saw a bit of softening in November. Normally, we’d think that is a problem, but in the pandemic environment it’s the exact opposite. Lockdowns hit lower-paying jobs hardest, so a falling rate means more lower paid positions remain filled…further evidence that Saskatchewan’s lockdown is milder than anywhere else in the rest of the country.
Jason Nemanishen from Nemanishen Contracting Ltd. (and an SHCA board member!) answers a few questions to help SHCA members get to know him a little better.
1. Where are you from?
I am from Langham, Sask., born and partially raised here. I now have a wonderful family (wife and two kids) firmly rooted in this community that we are happy to call home.
2. How did you get your start in the heavy construction industry and/or what do you credit to getting you where you are today?
Road construction has always been a way of life for my family. I am a third-generation road builder and got my start picking stones and staking up grid roads at the age of 10. The encouragement, leadership and support of grandparents, parents and others in our family business has fostered in me a love for dirt, business and people.
3. What is your career history?
From the age of 10 years old, I have been an earthmover with Nemanishen Contracting Ltd. As the years have gone by, my roles have changed, but my love for our company and what we do has not.
4. What’s the best piece of business or career advice you have or have been given? Your integrity is one of the most valuable things you can give to your business. A reputation of honesty is tough to gain and easy to destroy. As C.S. Lewis aptly put it, “Integrity is doing the right thing when no one is watching.”
5. What’s your favourite thing about Saskatchewan and working in the industry? Although I have enjoyed a great deal of things in this industry over the years, getting to know and work with other companies and the satisfaction of completing a challenging project would certainly have to be at the top of the list.
6. What is your greatest extravagance?
I take particular enjoyment in a fine glass of scotch – the subtle orange zest finish of one to the sea salt and peatiness of another. I can’t think of many better ways to enjoy an evening than sitting back in the recliner to watch a game of pigskin with a glass of Glenmorangie Signet in hand.
7. What is the quality you most like in a person?
I appreciate a person who builds their life around humility and integrity. I believe these two traits emulate a selfless individual that is willing to place others before himself.
8. Who is your favourite writer?
W.E.B. Griffith would have to be one of my favourites. His attention to detail when he recounts historical events and times in his novels brings the pages to life.
9. Where would you most like to live?
Amongst the many great places around the world, I think one of the most amazing locations to live would be Tuscany, Italy. Tuscany encompasses such a laid-back atmosphere along with food, art, history and ambiance. “Mangia bene, ridi spesso, ama molto” – Eat well, laugh often, love much!
10. What is it that you most dislike?
I find it ironic that as much as I enjoy food, I despise mushrooms. This is indeed a shame as the individuals who like them seem to love them. Alas, maybe one day my palate will change for the better.
The Government of Saskatchewan has completed $40 million in highway safety improvements all over the province since 2019. This marks year two of a five-year, $100 million strategy to improve safety at intersections and highways in Saskatchewan.
“Our government made a commitment to make significant investments in intersection safety,” said Highways Minister Fred Bradshaw. “I am pleased to see the progress that has been made in the first two years of this strategy and look forward to much more in the next three.”
After the tragic Humboldt Broncos bus crash, the Government of Saskatchewan made a commitment to review every intersection in the province. That review is now complete and safety improvements are being made all across the province as a result. This includes at the intersection of Highway 35 and 335, where all but two of the 13 safety recommendations made by an independent traffic safety engineer are complete. The two remaining recommendations are scheduled for completion in 2021.
“These investments mean a lot to our members,” said Saskatchewan Trucking Association executive director Susan Ewart. “Improved intersections and highways contribute to an overall climate of road safety in Saskatchewan.”
Some of the completed road safety projects include:
Intersection improvements at:
Highway 1 and Kalium Road, west of Regina
Highway 3 east of Prince Albert
Highway 11 and Davidson South Commercial Access
Highway 20 at Lumsden
Intersection and lighting improvements at Highway 21 and Highway 307
Pedestrian crosswalk improvements on Highway 155 in Buffalo Narrows
Railway crossing warning system upgrade on Highway 14 east of Biggar
Pedestrian crosswalk improvements on Highway 55 at Flying Dust First Nation
Numerous intersection sight triangle improvements
The Government of Saskatchewan is meeting its target of improving more than 1,000 km of provincial highways this year, the first of its 10-year Growth Plan goal to build and upgrade 10,000 km of highways. Another $300 million in highways stimulus funds is being invested over the two years in thin-membrane surface upgrades, passing lanes and improvements to municipal roads and airports.
The Government of Saskatchewan has invested more than $9.8 billion in highways infrastructure since 2008, improving more than 15,800 km of Saskatchewan highways.
Lehigh Hanson is pleased to announce the launch of EcoCem®PLUS at its Edmonton cement plant in Alberta. EcoCem®PLUS is an innovative blended Portland Limestone Cement (PLC) available in Alberta, Saskatchewan and Manitoba.
Lehigh’s latest cement product provides strength and durability while significantly reducing the carbon footprint in concrete. Along with supporting the company’s vision of sustainable cement and concrete, EcoCem® PLUS provides the following benefits to its consumers:
EcoCem®PLUS is produced by inter-grinding clinker, fly ash, limestone and gypsum
Combining materials at the Edmonton cement plant provides the highest level of quality control and assures our customers, engineers and end-users consistent proportions
EcoCem®PLUS outperforms traditional HS cement in resisting sulphate attack, a common concern found throughout the prairies. Designated as HSLb by CSA (High Sulphate Limestone Blended), its superiority makes it ideal for use in most applications.
All-in-one product reduces the need for additional silos and coordination of multiple deliveries at concrete plants and project sites
Through Lehigh’s strong network of terminals and raw material supply, EcoCem®PLUS provides customers a stable supply of cement and fly ash
Environmental Product Declaration (EPD) for EcoCem®PLUS clearly states the immediate reduction in Global Warming Potential (GWP) versus other types of cement
“The motivation behind the EcoCem brand of products is to reduce the embodied carbon of cement and concrete,” said Shawn McMillan, vice president, Cement for Lehigh Hanson’s Canada Region. “The introduction of EcoCem®PLUS to the prairie market builds on our commitment to providing environmentally responsible types of cement that deliver excellent performance while dramatically reducing CO2 emissions.”
HeidelbergCement, Lehigh Cement’s global parent company, has committed to reducing 30 per cent of its carbon emissions by 2025 and providing carbon-neutral concrete by 2050. EcoCem®PLUS is the latest of several new products recently developed to help achieve those goals.
Regina-based Clifton Associates Ltd. has been selected to begin engineering work for the Westside Irrigation Project.
Clifton was selected after successfully completing a two-staged transparent procurement process consisting of a request for qualifications and a request for proposals. Clifton’s work will encompass the first stage of the Lake Diefenbaker Irrigation Expansion – the largest infrastructure project in Saskatchewan’s history, which is being undertaken in order to double the amount of irrigable land in the province.
“This is an important step forward to realizing the irrigation potential of Lake Diefenbaker,” said Minister Responsible for SaskBuilds and Procurement Jim Reiter. “Our government looks forward to the commencement of the first phase of this generational project.”
Clifton’s team will start work immediately to complete the overall engineering preliminary design for Phases 1 and 2. Their work is expected to take 12 to 18 months, and will inform the next phases of work, including:
Preliminary engineering design for Phases 1 and 2
Geotechnical, soil suitability and geographical mapping
Environmental consulting services
Playing a central role in the extensive consultations with First Nations and other stakeholders, which will also start in the near future
“As prime consultant, Clifton is proud to lead the Saskatchewan-based Westside Irrigation Canal Project engineering team in association with Stantec and Associated Engineering,” Clifton Associates Ltd. CEO Wayne Clifton said. “Our team has deep Saskatchewan roots; each firm brings more than four decades of successful delivery of major projects in this province. We are delighted to be a part of this legacy project that will further reinforce Saskatchewan’s position as a leader in global food security while building on the vision made possible by the creation of Lake Diefenbaker a half a century ago. We look forward to continuing the tradition of prairie innovation – applying Saskatchewan talent to deliver a legacy project for the people of Saskatchewan.”
Clifton has spent more than a decade intensively involved in a variety of irrigation studies within Saskatchewan. They are among the most experienced engineering firms across Western Canada and have delivered on other large-scale infrastructure projects in the past. Clifton provides a strong team to review the environmental scope of the work required to complete the initial stages of the necessary provincial and federal regulatory approvals and permits. There will be careful assessment of potential impacts to environmental protection, downstream users and communities, including consultations with First Nations and other stakeholders as part of the process.
Announced in July 2020 by Premier Scott Moe, the Lake Diefenbaker Irrigation Project is expected to double the amount of irrigable land in Saskatchewan, a significant step to completing goals set out in the 2030 Growth Plan.
Phase 1 of the Lake Diefenbaker Irrigation Expansion Project will include the rehabilitation and expansion of the existing Westside irrigation canal system, increasing irrigable land in Saskatchewan by 80,000 acres. Phase 2 will further expand and buildout the Westside Irrigation Project, adding an additional 260,000 acres of irrigable land. Phase 3 will see the buildout of the Qu’Appelle South Water Conveyance Project, adding an estimated 120,000 acres of irrigable land.
The Lake Diefenbaker Irrigation Expansion Project is expected to offer several future benefits, including:
An estimated $35.5 to $83 billion increase in the Province’s Gross Domestic Product over the next 50 years
Up to $20 billion in tax revenues to support public services including health, education and social services
An estimated 2,500 jobs per year during the 10-year construction phase.
What to do when an injured worker is due to be laid off
I often get asked what an employer should do if they are laying off a worker and they are currently are on a Workers’ Compensation Board (WCB) claim. The reality is that the heavy construction industry, for the most part, is a seasonal industry. Most companies lay off their workers at the end of the season and then re-hire people in the spring again. What people do in their layoff time varies from collecting employment insurance to working for another industry or maybe they vacation somewhere warmer. It varies from worker to worker.
If a worker on a WCB claim when the normal season layoff comes it can be a real pain for employers. The real issue is the worker is not medically fit to return to work, the WCB may pay them if the injury and layoff would preclude them from working somewhere else during the layoff period.
An example of this is Sam’s case. Sam works in the heavy construction industry driving heavy equipment until layoff but was injured at work. In the wintertime, Sam works doing snow removal for another company but due to his injury, this year during layoff cannot do his snow removal job. Sam’s wages would continue to be paid by the WCB unless the employer can find a job for Sam to do until he is fully recovered. Where possible, it is in the employer’s best interest to keep workers employed so the employer isn’t incurring WCB costs for the claim during layoff. Keeping people employed during a layoff season is not always possible for some employers, but if possible, it is a way to reduce WCB costs.
If you are able or can find something for an injured worker to do during layoff, it can be financially beneficial to keep that person working as long as possible to reduce your WCB costs.
In the past, if a worker was on WCB they would often make more than they would working their normal season in a seasonal industry. The Saskatchewan WCB brought in Section 70, recognizing that some workers were making more on WCB than they normally would make in a year. Section 70 states that a review will take place within 24 weeks of the claim’s acceptance to review the wage loss to see what that person would normally make in 52 weeks. If the person only ever works 26 weeks a year, then their WCB wage loss should reflect that and their wage loss may stay the same or get reduced. All claims are reviewed at the WCB for Section 70.4.
It is good to remember any cost that is put through the Saskatchewan WCB will affect an employer’s WCB premiums. In simple terms, less WCB costs equals less WCB premiums. If you are able or can find something for an injured worker to do during layoff, it can be financially beneficial to keep that person working as long as possible to reduce your WCB costs. I recognize that it may require some creative thinking to come up with some ideas for jobs during a layoff period, but it is worth it financially! Ideally, you hope you never have an injured worker still on the books during the seasonal layoff time, but sometimes it cannot be helped and you may have to bite the bullet and find something for them to do and hope it is short term.
WCB policies that can be referred to for more information are POL02/2018: Benefits Return to Work Interrupted; and Section 70.4: establishing a wage-base for seasonal workers.
How to draft construction contracts to avoid the anti-deprivation rule
In Chandos Construction Ltd v. Deloitte Restructuring Inc1[“Chandos”], the majority of the Supreme Court of Canada (SCC) reaffirmed the common law anti-deprivation rule in Canada. The anti-deprivation rule voids contractual terms that apply upon a party’s insolvency and bankruptcy where the clause removes value from an insolvent person’s estate that would otherwise have been available for the insolvent person’s creditors. Anyone entering into construction contracts should avoid contractual provisions that may trigger the anti-deprivation rule and understand that if they are already in a contract, they may not be enforceable. However, despite the anti-deprivation rule, there are contractual provisions that can be used to protect parties where their contracting counterpart becomes insolvent or bankrupt.
Factual background
Chandos Construction Ltd. (Chandos) was a general contractor that entered into a subcontract with Capital Steel Inc. (Capital Steel). The subcontract provided that in the event of Capital Steel’s insolvency or bankruptcy, Capital Steel would forfeit 10 per cent of the contract price to Chandos “as a fee for the inconvenience of completing the work using alternate means and/or for monitoring the work during the warranty period” (the “Insolvency Clause”).
Capital Steel filed an assignment in bankruptcy prior to completing the subcontract work. Chandos argued that it was entitled to rely upon the Insolvency Clause and set-off 10 per cent of the subcontract price as a fee. The Trustee in Bankruptcy for Capital Steel applied to the Alberta Court of Queen’s Bench to determine whether the Insolvency Clause was valid.
Parties can also protect themselves in the event of an insolvency or bankruptcy by their contractual counterparts by taking security, acquiring insurance or requiring third-party guarantees when the contract is executed.
Trial and appellate judgments
In Chandos, the Alberta Court of Queen’s Bench found the Insolvency Clause was valid because the Insolvency Clause was not an attempt to avoid the effect of bankruptcy laws.2 The majority of the Alberta Court of Appeal reversed this decision, finding the Insolvency Clause to be invalid based on the common law anti-deprivation rule.3
The SCC agreed the Insolvency Clause violated the anti-deprivation rule and was void. The court articulated a two part test for invalidating a contractual provision based on the anti-deprivation rule as follows:
The relevant clause must be triggered by an event of insolvency or bankruptcy; and
The effect of the clause must be to remove value from the insolvent’s estate.
The SCC stated the test for the anti-deprivation rule was an effects-based test, meaning the ultimate effect of the clause should be examined in assessing the above criteria.
The SCC affirmed that set-off is generally allowed during the bankruptcy of a contracting party due to section 97(3) of the Bankruptcy and Insolvency Act.4 Set-off reduces the value of assets that are transferred to the insolvent’s estate, but it only applies to enforceable debts or claims. Since the anti-deprivation rule voided the Insolvency Clause, Chandos was unable to apply set-off against Capital Steel for the 10 per cent amount.
Key takeaways
Chandos urges parties entering into construction contracts to avoid clauses that are triggered by insolvency or bankruptcy and that remove value from the insolvent party’s estate. These clauses are invalid and unenforceable. Some contractual terms that are prohibited by the anti-deprivation rule include clauses where a party forfeits some or all of the contract price due to their insolvency or bankruptcy, or clauses where fees, charges or other amounts are payable solely upon insolvency or bankruptcy.
Other contractual terms can be employed to protect a party in the event of insolvency or bankruptcy by their contractual counterpart. For example, any clause triggered by events other than bankruptcy or insolvency are valid, including penalties that arise upon default of the contract.
Contracting parties can consider using clauses where property is removed from the insolvent party’s estate but no value is eliminated from the estate. For example, the anti-deprivation rule does not apply if a third party’s assets are forfeited upon bankruptcy or insolvency, since this term would not reduce the value of the insolvent party’s estate. Additionally, parties may be able to modify their security interests or enter into a credit default swap agreement (amending the nature or type of security) upon the insolvency or bankruptcy of their contractual counterpart without offending the anti-deprivation rule, provided these clauses do not increase the amount of security held over the insolvent party.5
Parties can also protect themselves in the event of an insolvency or bankruptcy by their contractual counterparts by taking security, acquiring insurance or requiring third-party guarantees when the contract is executed.6 Before entering into a security agreement, parties should verify whether any creditors already have priority charges against the assets which comprise of the security. In the case of guarantees, suitable guarantors may include a parent company, directors or officers of the contracting party. A guarantee causes the guarantor to become personally liable for the debts or contractual breaches of the subcontractor.
Suppliers and subcontractors can require a labour and materials payment bond at the time of entering into a contract.7 This bond guarantees that suppliers and subcontractors are paid for the work and materials that they supply, up to a specified amount. Additionally, parties may require a performance bond, which provides payment up to a specified amount if the contractor is unable to complete the project work or is in default of the construction contract. For the most project security (but usually at an additional cost to the price of the work), a contractor would have both a labour and materials payment bond and a performance bond in place for at least 50 per cent of the value of the contract.
Overall, when entering into construction contracts, contracting parties should consider contacting legal counsel to ensure their contracts are drafted with enforceable terms that do not offend the anti-deprivation rule. When drafting construction contracts, parties should also consider if they are appropriately protected should their counterparty become bankrupt or insolvent.
Charles W. Bois is a partner in the Vancouver office of Miller Thomson LLP. Rachel Haack and Kayla Romanow are associates in the Regina office of Miller Thomson LLP. For inquiries, contact Charles at cbois@millerthomson.com, or for any Saskatchewan construction inquiries, please contact Rachel at rhaack@millerthomson.com, or Kayla at kromanow@millerthomson.com.
References
2020 SCC 25.
Alta Q.B., Edmonton, 242169632, 17 March 2017.
2019 ABCA 32.
RSC, 1985, c B-3. Set-off allows a creditor (who happens to also be a debtor) to reduce the amount they owe to the bankrupt by the amount they (as debtor) are owed by the bankrupt.
Belmont Park Investments Pty Ltd v. BNY Corporate Trustee Services Ltd, [2011] UKSC 38.
Supra note 1 at para 40.
See s. 81 of The Builders’ Lien Act, S.S. 1984-85-86, c. B-7.1 and s. 69 of The Construction Lien Act, R.S.O. 1990, c. C.30;
