New regulations requiring builders and trades people to be licensed will help ensure a level playing field for the industry, according to Cayman Contractors Association President Heber Arch.
Speaking at the Royal Institute of Chartered Surveyors conference on Thursday, Mr. Arch acknowledged the new system would add to the cost of doing business. And he accepted that those costs could be passed on to consumers.
He said the Builders Law, which is expected to be approved following the next session of the Legislative Assembly, would create a level playing field for the industry.
Rogue contractors who do not have qualified personnel or fail to pay pension and insurance contributions to their employees will be unable to get Trade and Business Licenses under the new framework.
Mr. Arch said the law would help prevent shoddy work from unskilled or unqualified contractors and would ensure contractors have the relevant liability insurance.
The law, which has been on the table since 2004, was drafted amid concerns that some companies were cutting corners to save costs. It was passed in 2007 but never enacted. It is now being brought into force with a handful of amendments, likely to go to the Legislative Assembly before June.
Mr. Arch, fielding questions on the bill from business owners at the Marriott hotel last week, said the Contractors Association supported the law.
“A lot of people are doing work and they don’t carry insurance or pensions, they don’t comply with the Labor Law,” he said. “This registration will see that is done, so there will be an equal playing field, but that could affect costs.”
Mr. Arch believes the law will improve industry standards. “It is up to us to make sure things are properly built, to establish capability to make sure whoever does the work is doing it well. “Everyone will have to have pensions, insurance and will have to satisfy the law that they are performing properly. If they don’t, the board can pull their licenses.”
He said he did not believe there was a conflict of interest in having contractors on the board, responsible for vetting qualifications.
“Nobody can assess contractors better than other contractors,” he added. Mr. Arch said the eight-member board, which will police the new law, would be broad enough to ensure that no one company was advantaged by its involvement.
The law has different categories of registration from general contractors to sub trades, like plumbers, roofers and masons, with a sliding scale of requirements and fees.
At the top end, general contractors, businesses qualified to engage in construction, and civil contractors, businesses that build roads, docks, bridges and utilities infrastructure, must meet the strictest criteria for experience and qualifications. Smaller or less experienced businesses can apply for a separate category of “building contractor” for construction of commercial industrial or residential buildings less than 25,000 square-feet or three stories. A fourth category of “residential contractor” is for businesses that construct or renovate buildings comprising four homes or less.
Mr. Arch said not all businesses in the industry would qualify in the category they wanted, but there should be a place within the new framework for the vast majority of the estimated 580 contractors operating in Cayman.
Separate legislation is believed to be in the works for architects and surveyors.
Kevin Drysdale, general manager of Charterland, speaking at the same event, added, “I welcome the registration of architects and, as a quantity surveyor, I look forward to the registration of quantity surveyors as well. I don’t see it as a threat to my profession, I see it as a commercial advantage. These are not threats, they are just changes.”
Premier Alden McLaughlin said the Builders Law would regulate contractors and protect consumers.
“The law will bring the competency of the construction industry to a standard that will protect, as well as give confidence to, consumers,” he said. “Once the law is passed, it will guarantee that plumbers are plumbers, electricians are electricians; carpenters are carpenters.”
The law, which has been on the table since 2004, was first drafted amid concerns that some companies were cutting corners to save costs. It was passed in 2007 but never enacted.