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INFORMATION BULLETINS


It is our pleasure to give you our most recent bulletin. As for previous bulletins, you may access these through the hyperlink, by consulting the archival list.




November 2007

 INFORMATION BULLETIN

The CSST may claim from you sums that are owing by others…

 

The title of this information bulletin is aimed at drawing your attention to a matter that very few are aware of. It pertains to article 316 of the Act respecting industrial accidents and occupational diseases whereby the CSST may "demand payment of the assessment due by a contractor from the employer who retains his services".

Even though this is not a new provision of the Act, businesses and even counsels are often unaware of it.

This means that if you (hereinafter the "employer") deal with, for example, a messenger service (hereinafter the "contractor") and that the contractor is in default of declaring or paying contributions to the CSST for its own employees, the Commission will have the right to claim such contributions from you insofar as it relates to services provided by the contractor at your request.

The Commission has the authority to establish the amount of the assessment by determining a proportion of the price paid by you for the services of the contractor, which represent the labour costs for the contractor, but it will usually ask for further information from the employer.

When considering the following elements, it is clear that the employer will not benefit from any leniency in answering a request from the Commission:

• a 5% penalty on the assessed amount if the employer does not respond in the time limit (article 319);

• if the employee of the contractor suffers an accident or disease during the period of time when the employer refuses or neglects to respond to the request of the Commission, the employer may be subject to payment of the benefits of that worker (article 321);

• the amounts owing by the employer grant the Commission a legal hypothec on the employer’s property (article 324);

• the board, when hearing a case on such matter, is not bound to apply the rules of civil evidence and civil procedure (article 2 of Regulations respecting evidence and procedure of the Commission des lésions professionnelles);
 
• where a contractor fails to file its annual statement, the Commission may make an estimate of the wages earned by the workers, up to 200% of the wages reported in the last previous statement (article 307);

• the right of entry and inspection of the Commission (article 331.1);

Even though this provision has been in force for many years, there is still little jurisprudence on the issue; however, the following principles have been expressed:
 
1. the Commission does not need to exhaust a recourse against the contractor; it may claim directly from the employer;

2. there is no limitation period provided in the Act and, as matters stand now, no precise decision could be located that would resolve the issue of extinction of the right of the Commission to claim from an employer;

3. the matter must relate to a contract for the delivery of a material or intellectual work or the supply of services for a consideration that the employer agrees to pay to the contractor. This would seem to exclude the mere supply of goods;

4. even if the contractor is bankrupt, the employer remains responsible;

5. it is immaterial whether the action or inaction of the CSST results in a loss of recourses by the employer toward the contractor;

6. it is immaterial that, by reason of lateness of the CSST in claiming from the employer, the employer is not able to claim from the contractor by subrogation.

Having regard to the above, one should be cautious at the time of signing contracts with service suppliers.

A clause should be inserted in all contracts whereby a certain amount would be withheld by the employer until such time that the contractor has provided the employer with an attestation de conformité for a given period. This procedure would exempt the employer from liability for the period in question. All contracts pertaining to supply of services should be reviewed and, if need be, revised accordingly. The attestation de conformité is to be obtained from the contractor as the CSST takes the stand that all information concerning the contractor are confidential even though the CSST may claim from an employer! A copy of the attestation de conformité form can be obtained at:


www.csst.qc.ca/portail/fr/formulaires/accueilformulaires.htm?filter0

November 2007

 


This bulletin is intended as a general information instrument and is not to be considered as a legal advice or opinion on any of the issues raised.