What is the difference between a subcontractor and an employee?

In Ottawa construction projects, the difference between subcontractors and employees affects your liability, insurance coverage, and legal protections - here's what Ottawa homeowners need to know.

When you hire a general contractor in Ottawa, they may use both employees and subcontractors to complete your project. Understanding this distinction protects you from potential liability and ensures proper insurance coverage.

Employees vs. Subcontractors: The Key Differences

Employees work directly for the contractor, receive T4s at tax time, and have income tax, CPP, and EI deductions taken from their pay. The contractor controls how, when, and where they work, provides tools and equipment, and carries WSIB coverage for them.

Subcontractors are independent businesses hired by your main contractor. They receive T4As, handle their own taxes, control their own work methods, typically provide their own tools, and must carry their own WSIB and insurance coverage.

Why This Matters for Ottawa Homeowners

The distinction becomes critical if someone gets injured on your property. In Ontario, if a contractor misclassifies employees as subcontractors to avoid WSIB premiums, you could face liability issues. Always verify that your main contractor has proper WSIB coverage by requesting a WSIB Clearance Certificate from wsib.ca/clearances.

Red Flags to Watch For

Be cautious if a contractor can't provide WSIB clearance or seems evasive about their worker classification. Some contractors misclassify employees as subcontractors to reduce costs, but this puts you at risk. In Ottawa, reputable contractors will readily provide WSIB documentation and explain their worker structure.

When getting quotes from Ottawa contractors, ask directly: "Are these workers your employees or subcontractors?" and "Can you provide WSIB clearance for all workers on my project?" Legitimate contractors welcome these questions.

Verifying Proper Coverage

For any construction project in Ottawa, ensure your contractor provides:

• Valid WSIB Clearance Certificate


• Proof of liability insurance ($2 million minimum recommended)


• Clear explanation of which workers are employees vs. subcontractors

You can verify WSIB clearance online or call WSIB directly. The City of Ottawa Building Code Services (613-580-2424) can also provide guidance on contractor requirements for permitted work.

Your Protection Strategy

When signing contracts with Ottawa contractors, include clauses requiring proper WSIB coverage and worker classification compliance. This protects you from potential liability if workers are improperly classified or lack coverage.

Remember, in Ontario's construction industry, proper worker classification isn't just about taxes - it's about ensuring everyone on your Ottawa renovation project is properly covered and protected.

For verified contractors who maintain proper WSIB coverage and worker classification, check our directory at https://ottawaconstructionnetwork.com/directory.