A series of ITC blogs from Compass Energy Consulting.
One question that has been coming up more frequently across projects is:
How should prevailing wage be determined when an eligible collective agreement has expired, and a new agreement has not yet been negotiated?
This situation is not uncommon, particularly where agreements are in transition, but it can introduce uncertainty for projects seeking to comply with Clean Economy ITC labour requirements.
Why This Matters
Prevailing wage requirements are tied to eligible collective agreements.
When those agreements expire, projects are left with a key question:
What benchmark should be used to demonstrate compliance?
This becomes especially relevant where:
- Construction timelines overlap with agreement transitions
- Wage expectations may change
- Documentation will be required to support compliance
What the Legislation Indicates
The Clean Economy ITC labour rules do provide direction for situations where collective agreements have expired.
Section 127.46(4) outlines how prevailing wage may be determined in these cases, including how expired agreements may continue to be referenced for a defined period, and how adjustments may be applied if new agreements are not in place.
While the legislative language is technical, the intent is to provide a consistent reference point where agreements are in transition.
What We’re Seeing in Practice
In practice, we’re seeing teams approach this in slightly different ways depending on project context.
This often includes:
- Referencing the most recent collective agreement as a baseline
- Monitoring updates closely as new agreements are negotiated
- Building flexibility into compliance planning to adjust if required
The key is ensuring that whatever approach is taken is:
- Consistent
- Defensible
- Clearly documented
Where Risk Can Emerge
This situation can introduce risk where:
- Wage assumptions are not clearly defined
- There is no documented rationale for how wages were determined
- Adjustments are not made once new agreements are in place
As with other areas of labour compliance, the challenge is often less about the requirement itself and more about how it is implemented and recorded.
Practical Considerations
For teams navigating this, a few considerations can be helpful:
- What is the current reference point for prevailing wage?
- How will updates to agreements be tracked and incorporated?
- How will the approach be documented for potential review?
Having a clear approach, even in uncertain conditions, is typically more effective than reacting later.
Final Thought
Situations like this highlight a broader theme in ITC labour compliance:
It is not always about having perfect information, but about having a clear, structured, and well-documented approach.
Projects that approach these grey areas thoughtfully are generally better positioned to demonstrate compliance.
Ready to simplify your ITC Labour Compliance journey?
Contact Rachelle at rachelle@compassenergyconsulting.ca to get started with expert advice tailored to your needs.
