April 2, 2026 · 6 min read · Compliance Insights
This article is for informational purposes only and does not constitute legal advice. For guidance specific to your situation, consult a qualified legal professional.
What the Supreme Court Decided
“Contracting for services is enough to carry employer obligations under OHSA — regardless of whether the hiring organization exercises day-to-day control.”
Businesses hiring contractors for construction or facilities projects in Canada now face a direct question of OHSA employer liability — and most haven’t adapted to what the law requires. OHSA due diligence is the primary legal protection, even when a general contractor manages the entire site. That’s the practical consequence of a Supreme Court of Canada decision most companies still haven’t caught up to.
The case — R v. Greater Sudbury (City) — addressed a question that contractor-hiring organizations and project managers had been debating for years: when you hire a general contractor for a construction project, are you still liable as an “employer” under Ontario’s Occupational Health and Safety Act?
The case arose from a fatal accident in Sudbury, Ontario. The city had contracted with a general contractor to repair a downtown water main. The contractor controlled the site and managed all workers. The city’s only on-site presence was a small team of quality control inspectors.
When a pedestrian was struck and killed by construction equipment, both the contractor and the city were charged with OHSA violations. The city argued it wasn’t an “employer” on the project because it had no hands-on control over the work.
The Supreme Court disagreed — in a closely divided 4–4 split decision. The prevailing view held that the definition of “employer” under OHSA is deliberately broad: if you contract for services, you can carry employer obligations under the Act, regardless of whether you exercise day-to-day control over the work site. The dissent argued this interpretation set too low a threshold, but it did not carry the majority.
The practical effect of the ruling is significant for any organization that engages contractors — even where a general contractor manages all on-site activity.
Why This Changes the Risk Calculus for Contractor-Hiring Businesses
Before this ruling, many organizations assumed that hiring a reputable general contractor effectively transferred workplace safety obligations to that contractor. The Sudbury decision challenged that assumption in a meaningful way.
Under the majority’s interpretation, organizations that contract for services — construction project owners, property management companies, REITs, municipalities, facilities operators, and any business that regularly engages contractors — may carry employer obligations under OHSA even without hands-on site control. This doesn’t mean liability is automatic or that the GC’s role is irrelevant. General contractors remain responsible for day-to-day site safety. What the ruling clarifies is that the hiring organization’s obligations don’t disappear simply because a GC is in place.
The practical consequence: if a contractor’s insurance has lapsed, if a subcontractor’s safety certification has expired, if any OHSA regulation is violated on a project your business owns — the question of your liability will turn on what you did to prevent it, not on who controlled the site.
The Due Diligence Defence: Your Primary Protection
The Supreme Court left one critical door open. An employer charged with an OHSA violation can avoid penalties by proving “due diligence” — that it took every reasonable precaution under the circumstances.
Importantly, this defence worked in Sudbury. The city was ultimately found not guilty. In a follow-up decision, the Ontario Superior Court found that the city had taken reasonable precautions: it had vetted the contractor before award, delegated control based on the contractor’s superior expertise, and maintained consistent quality oversight throughout the project — without crossing into hands-on construction management.
The court outlined the specific factors it considered:
- The hiring organization’s degree of control over the workplace and the workers
- Whether the organization delegated control to the contractor based on the contractor’s superior expertise
- Whether the organization evaluated the contractor’s ability to comply with OHSA before awarding the contract
- Whether the organization monitored and supervised the contractor’s work to ensure OHSA compliance throughout the project
The takeaway: due diligence isn’t a one-time checkbox. It’s a documented, ongoing process that must be provable after the fact. The city won — but only because it had the records to prove it.
Why Manual Compliance Tracking Struggles With This Standard
The due diligence standard requires organizations to demonstrate what they knew, when they knew it, and what actions they took. That means auditable records, timestamps, and a paper trail that holds up under legal scrutiny.
Many businesses track compliance for their contractors through spreadsheets, email chains, and shared drives. This approach tends to create three operational vulnerabilities.
1. Insurance lapses happen silently
A contractor’s insurance certificate might have been valid when the project started, but policies can lapse mid-project without any notification to the hiring business. If an incident occurs during that gap, the organization faces questions about what monitoring was in place.
2. Verification doesn’t scale
A single project might involve dozens of subcontractors, each with multiple certificates, licences, and insurance policies. Multiplied across a portfolio of active projects, the volume becomes difficult to manage consistently through manual processes.
3. Proof requires timestamps, not intentions
In a legal proceeding, “we usually check” is not due diligence. The record needs to show when the check happened, what the result was, and what action was taken. That level of documentation is difficult to reconstruct from spreadsheets and email chains after the fact.
What Audit-Ready Workforce Compliance Looks Like in Practice
The standard set by Sudbury points toward four operational requirements for any business managing contractor relationships at scale:
- Verify every contractor’s insurance, credentials, and safety record before they start work
- Monitor those credentials continuously and receive automatic alerts when something lapses
- Maintain a complete, timestamped audit trail that’s accessible on demand
- Scale that process across multiple projects, sites, and contractor relationships without relying on manual follow-up
This is the operational gap that compliance automation platforms are designed to close. Entuitive Workforce was built specifically for organizations managing high volumes of contractor relationships — automating insurance verification, credential tracking, and real-time compliance monitoring across projects and sites.
The Bottom Line
The Sudbury ruling isn’t new — but many businesses that regularly hire contractors still haven’t adjusted their compliance processes to reflect what it means. If your organization hires contractors in Canada, the question of your employer obligations under OHSA is real and worth taking seriously.
The city of Sudbury won its case. It won because it could prove, on the record, that it had done the work. That’s the standard worth building toward — regardless of what tools you use to get there.
See how it works in practice — read our case study.
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This article references R v. Greater Sudbury (City), 2023 SCC 28. Analysis is based on publicly available court decisions and the Norton Rose Fulbright legal summary. It does not constitute legal advice.