The Trowel - Spring 2019

The Voice of the West Coast Wall and Ceiling Industry • www.thetrowel.ca • Spring 2019

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Contractors Tell All Walls for a Good Cause

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Technology for Construction Professionals Task Management

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The Voice of the West Coast Wall and Ceiling Industry • www.thetrowel.ca • Spring 2019

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Contractors Tell All Walls for a Good Cause

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Technology for Construction Professionals Task Management

8 The Trowel team Jessica Kirby, Publisher / Editor 250.816.3671 • jkirby@pointonemedia.com Christina Tranberg, Advertising Sales 877.755.2762 ext 1408 • ctranberg@pointonemedia.com Lara Perraton, Creatives 877.755.2762 • lperraton@pointonemedia.com

contributing writers Mark Breslin Ron Coleman Andrew Delmonico Jason Krankota Drew Smith Matthew T. Potomak

cover photo

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CONTENTS • SPRING 2019

Courtesy of Nova Drywall

8 Contractors Tell All BCWCA Contractors talk about issues and strategies for 2019 and beyond.

Published bi-monthly by Point One Media, Inc. The Trowel P.O. Box 11, Station A Nanaimo, BC V9R 5K4 t: 877.755.2762 • www.thetrowel.ca While information contained in this publication has been compiled from sources deemed to be reliable, the publisher may not be held liable for omissions or errors.

Contents ©2019 by Point One Media Inc. All rights reserved. No part of this publication may be reproduced or duplicated without prior written permission from the publisher.

Printed in Canada. Postage paid at Coquitlam, BC.

10 Walls for a Good Cause

Nova Drywall donated time and talent on a six-home Habitat for Humanity development in Richmond.

12 Technology to Help Construction Finance Professionals

Technology can assist construction CFOs in better managing company finances.

14 Getting Things Done: Urgent vs Important

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Departments & Columns Journal of Record for

The Trowel is a registered trademark of the BC Wall & Ceiling Association.

The Trowel is published six times per year expressly for members of the wall and ceiling industry.

04 editorial

17 it’s the law

05 industry news

18 contractors’ advice

15 feature focus

19 advertiser index

16 around the world Next issue: Safety Culture • Restoration / Renovation • Interior Finishing

editor’s COMMENT Working Together is a Source of Strength Mother Teresa said, “We ourselves feel that what we are doing is just a drop in the ocean. But the ocean would be less because of that missing drop.” She believed in spreading goodwill and that sharing, suffering, and working together was a great source of strength in the world. She believed positive feelings were made more valuable with action.

So what does it mean to bring action into positivity? It means walking the walk, meaning what you say and saying what you mean, and giving of your time to others, no matter how small a contribution you have. The volunteer workforce in Canada is 13 million strong, with 47 percent of the population reaching out to help others in some official capacity. The quantifiable result of those efforts is about 2 billion volunteer hours a year, or the equivalent of 1.1 million full-time jobs. On average, Canadian volunteers donate 156 hours per year each, which is about 21 working days.

Although often thankless work, the truth is our nation wouldn’t be the same without volunteers and philanthropic acts. The volunteer job description is far from enticing—long hours, no monetary pay, and more self-discipline than most of us can muster. So why do we do it? What inspires 13 billion Canadians to lace up for the good of others every, single year?

Altruism. Some people have in them an intense desire to help others and contribute to community. In fact, many people see volunteering as a social responsibility – an act anyone capable of carrying it out should – and believe those who can but don’t aren’t pitching in their fair share.

Self-indulgence. Volunteering feels good and wholesome and useful—people who do it are actually generating positive feelings in themselves and enjoying a better quality of life than those who do not volunteer. Some argue that if an act is committed because of a personal sense of achievement then it isn’t truly selfless, but the truth is, we do what we like. We are indulgent creatures, so we may as well embrace it for the good of all.

Social Economics. Interestingly, the importance of volunteerism and philanthropy isn’t lost on corporations and other businesses who recognize the value of the social economy. Like the financial return on green building, for

Are you working on an interesting or challenging project?

Tell us about it.

Contact our editor, Jessica Kirby, at 1.250.816.3671 or email editor@thetrowel.ca.

4 » The Trowel

By / Jessica Kirby, Editor

Businesses build policy around what time, materials, or other resources they will donate, partnerships with other agencies for mutual exchange, and all the ways they will selflessly give back to communities. instance, the act of giving becomes a marketing tool, and a nocost way of elevating one’s profile in the eyes of consumers.

Businesses build policy around what time, materials, or other resources they will donate, partnerships with other agencies for mutual exchange, and all the ways they will selflessly give back to communities. Of course, this work offers a return on investment when consumers choose to do business with a company because of its philanthropic policy, generating plenty of ethics-driven conversation. However, if supporting said businesses allows it to continue to share time and wealth with those in need, is there really any harm in perpetuating that cycle?

Construction is the perfect field for volunteerism. Fuelled by hard-working, strong, and capable men and women with diverse and essential skill sets, the industry certainly has the people power to make volunteer-driven projects come together.

Partnerships abound in construction, and everyone “knows a guy” who can get task A or material B to come together for the right cause. Since its ridiculous to assume anyone is going to start erecting buildings all over the place for free, doing this kind of work in construction requires strong partnerships, meticulous planning, and fair delegation and compromise.

Habitat for Humanity (see page 10) is just one non-profit that leverages the construction industry to do good for others. Construction for Change is another, and many private companies donate labour, materials, or time each and every year to a variety of organizations and projects. If construction isn’t the ideal forum to put action into positivity, I don’t know what is. Remember, although Mother Teresa didn’t say it, I’ll be she was thinking it: Many hands make light work (John Heywood, 1497 - 1580). ▪

industry NEWS CertainTeed® Announces Call for Project Submissions for the 5th Gypsum National Trophy Award CertainTeed, a leading North American brand of building materials, is pleased to formally announce the open call for project submissions for consideration in the 5th CertainTeed Gypsum National Trophy Awards, recognizing outstanding work using CertainTeed Gypsum products. The award ceremony, to be held November 7-9, 2019 in Phoenix, Arizona, will celebrate those projects selected by a panel of industry experts to be honoured in front of their peers as the best in the business.

From its origins in Paris to today, the Trophy honours those craftsmen and craftswomen who use CertainTeed solutions in sustainability, comfort, safety, aesthetics, and modularity to build a better world. The competition judges building professionals for their gypsum-related skills in residential and non-residential categories.

Drywall and finishing contractors across Canada are welcomed to submit their most innovative drywall projects for consideration of the 5th CertainTeed Gypsum National Trophy.

“So much of our time in this industry is spent focused on project deadlines, budgets, and looking ahead to the next job,” said Wayne Edgecombe, vice-president sales, Canada.

“This event is an opportunity to celebrate and honour the best building professionals in the industry – those who approach complex and challenging building designs with creativity and ingenuity to achieve outstanding results in both residential and commercial projects, all while staying on time and on budget.”

The deadline to submit projects is May 1, 2019. Instructions and guidelines to submit projects for the 5th CertainTeed Gypsum Trophy can be found online at www.certainteed.ca/ trophy.

Winners of the 5th CertainTeed Gypsum National Trophy will proudly represent CertainTeed Canada at the 12th SaintGobain Gypsum International Trophy Awards ceremony to be held in Athens, Greece in April 2020, where the company anticipates projects from 35 countries to be showcased and represented by the building professionals responsible for their achievement.

“These professionals represent the best in the industry, and it will be our honour to celebrate the projects and people that represent true innovation and craftsmanship in the trades,” added Edgecombe. ▪

Anti-Woodpecker Wall System Company Joins Canadian Franchise Association EIFS Armour, a patented woodpecker-resistant wall system product company, has joined the Canadian Franchise Association (CFA) in order to expand throughout Canada.

With 310 successful projects completed in Western Canada over the past six and a half years, the tried-and-tested product is now being requested for projects across the country.

Due to the large number of requests they have received, EIFS Armour has decided that franchising is the most effective way to support the company’s growth.

Franchising will allow interested construction companies or individuals to offer the patented product to clients in other cities across Canada. Franchise owners should have experience in the construction industry, and will receive training, support, and the benefits of advertising efforts.

The choice to join the CFA was made to reach potential franchise owners and offer them the peace of mind that they will be expanding on a successful, accredited business. An EIFS Armour franchise has already existed in Calgary since 2015, and discussions for franchises in Edmonton, Toronto, Mississauga and Ottawa are in the works.

The next step for EIFS Armour is to join the USA Franchise Association as the company already receives roughly 200 requests from the United States each year. Learn more at keith@eifsarmour.com ▪

SAVE THE DATE BC Wall & Ceiling Association Events April 17 - Skills BC at Tradex June 5 - BCWCA AGM & Golf at Guilford Golf & Country Club Lower Mainland Wall & Ceiling Events April 3 - LMWCA AGM & Dinner Meeting 6 p.m., Elements Casino, Surrey, BC September 11 - LMWCA Golf Tournament, Guilford Gold & Country Club Southern Interior Wall & Ceiling Association Events April 2 - SIWCA Lunch Meeting 11:00 a.m. Smack Dabs May 8 - SIWCA Lunch Meeting 11:00 a.m. Smack Dabs June 7 - SIWCA Golf Tournament Tentatively September 13 - 15 - SIWCA Charity Ball Tournament Vancouver Island Wall & Ceiling Association Events June 7 - VIWCA Charity Golf Tournament - there will be a meeting in the basement of the course prior to the tournament.

For all enquiries contact Leesa or Jeff at BCWCA (604) 575-0511, admin@bcwca.org, or fax (604) 575-0544. wallandceiling.ca » Spring 2019 » 5

industry NEWS BC Construction Industry Introduces Worksite Conduct Standards to Improve Worker Retention Builders Code program aims to make women 10 percent of the construction workforce by 2028 The Province of BC and the BC Construction Association (BCCA) marked International Women’s Day in March with the launch of the Builders Code, a comprehensive program that aims to address BC’s skilled labour shortage by reducing harassment, bullying, and hazing on construction worksites.

The Builders Code defines an Acceptable Worksite and provides employers with tools, training, and resources to improve and promote safe and productive worksite behaviour.

Led by the BCCA, in collaboration with the Province and industry partners, including the Industry Training Authority, WorkSafeBC, LNG Canada, BC Construction Safety Alliance, Employee Benefits Trust, Minerva Foundation of BC, and four Regional Construction Associations (NRCA, SICA, VICA, VRCA), the Builders Code includes an ambitious “10x10” goal to have BC’s skilled workforce comprised of 10 percent tradeswomen by 2028, a standard not yet achieved by any province in Canada.

The Builders Code expands the definition of construction safety beyond physical hazards to include stress or distraction caused by discrimination, bullying, hazing, or harassment. A Builders Code worksite will seek to be free from behaviour that threatens the stability of work conditions including job performance, health, well-being, safety, productivity, and the efficiency of workers.

At its core, the Builders Code seeks to improve the retention of tradeswomen who are working in BC’s construction sector.

Project partners quickly recognized that to be successful, the Builders Code could not single out tradeswomen for special consideration. Every person working on a worksite is affected by stress and distraction caused by bullying, hazing, and harassment.

“As Canada’s largest construction project, we have already helped provide training for more than 1,000 apprentices in BC,” said Andy Calitz, CEO, LNG Canada. “We are committed to creating a workplace that supports equity and diversity. Our support of the Builders Code will help the province grow and retain its skilled labour pool. We look forward to working with contractors and suppliers whose commitment to safety and diversity matches our own.”

The Builders Code will be a valuable opportunity and asset for contractors looking for competitive ways to attract and retain skilled tradespeople at a time when BC faces a skills shortage of 7,900 workers, and when tradeswomen comprise only 4.7 percent of the skilled workforce. Although women, youth, and 6 » The Trowel

other equity-seeking groups are entering construction trades at a higher rate than in the past, retention rates remain low. First year retention rates for women apprentices have anecdotally been estimated at less than 50 percent. By comparison, first year retention rates for men are estimated at 70 percent. Those contractors who lead the way in culture change will have distinct advantages.

“Our people are what makes Houle successful, and we’re devoted to providing a safe and healthy work environment for all our employees,” said Paul Hill, president, Houle Electric Ltd. “Hazing, bullying, and harassment of any employee or coworker is unacceptable, and being one of the first companies in BC to sign the Builders Code worksite pledge is our way of reaffirming to everyone on our jobsites that safety is our first priority.”

The Builders Code pilot will highlight the business and safety implications of worksite behaviour and provide employers with the tools they need to improve retention. Employers can access no-cost posters and policies, training, and advice from experts with experience in human resources management, including mediation and conflict resolution. Contractors who lead the way will benefit from higher employee retention rates resulting in lower training costs and will gain a reputation for fair and equal treatment that will help them recruit skilled workers and market their business. They’ll also have the opportunity to be recognized via a scorecard and an awards program created specifically for the construction industry by the Minerva Foundation of BC. “A skilled tradesperson is a valuable asset, not a gender or demographic,” said Chris Atchison, president, BCCA. “Worksite behaviour is not a women’s issue; it’s a business issue. The Builders Code and 10x10 target are industry’s way of stepping up on International Women’s Day to show that we recognize the need for change and we’re ready to do the work.

The resources are available to all construction employers and we’re confident they will be utilized.”

Reaching the 10 percent goal will equate to adding another 9,500 women into the skilled trades in BC’s Construction industry.

That achievement would be especially significant as it would effectively erase BC’s projected skills gap of 7,900 workers.

“At Kinetic Construction, we view site safety and respect of others as more than just a requirement, it’s part of our culture,” said Tom Plumb, president and CEO. “The Builders Code fits in perfectly with our pro-active approach to the site environment and safety and the ‘See It, Say It, Fix It’ motto we have on all of our jobsites reflects that.”

Throughout 2019, the Builders Code partners will continue to make equity and diversity a corporate leadership priority for

industry NEWS construction employers, rolling out expanded resources and services in every region of the province.

The Builders Code is an initiative of the Construction Workforce Equity Project, funded by the BC Ministry of Advanced Education, Skills and Training through the Sector Labour Market Partnership Program.

For more information about the Builders Code, please visit www.builderscode.ca. ■

British Columbia Construction Association Selected to Provide Pre-Arrival Services

NOW LOWER COST SAME HIGH PERFORMANCE

Organization will deliver settlement services to newcomers before they arrive in Canada Pre-arrival settlement services are a key element of Canada’s immigration program. They provide newcomers, including refugees, with the information and settlement support they need to make informed decisions about their new life in Canada before they arrive, such as how to prepare for finding a job. To help deliver these important services, Immigration, Refugees and Citizenship Canada (IRCC) will be providing funding of $3.4 million to the British Columbia Construction Association (BCCA).

Gary Anandasangaree, Member of Parliament for Scarborough—Rouge Park, made the announcement on behalf of Ahmed Hussen, Minister of Immigration, Refugees and Citizenship.

“Pre-arrival services provide permanent residents with information and settlement support so they can make informed decisions about their new life in Canada and begin the integration process before they arrive,” says Hussen. “IRCC’s renewed pre-arrival program will deliver consistent, highquality client-centered services to people around the world.”

The BCCA will be providing occupation-specific employment services to pre-arrival clients. These services will prepare newcomers for jobs in the construction industry while helping to meet employment demands.

The funding announcement is part of IRCC’s renewed prearrival services program, which will maximize the social integration of newcomers, set them up to contribute to the economy, and help grow the middle class by directly connecting clients with the information and services they need through a streamlined, easy-to-navigate process. The pre-arrival services program will also provide pre-arrival services to Francophones through a collaborative partnership model; offering general, regional, and occupation-specific employment services to boost job prospects; encourage newcomers to apply for job licensure before they arrive, if

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continued on page 19 wallandceiling.ca » Spring 2019 » 7

Contractors

TELL ALL Results of The Trowel’s Outlook Survey say Contractors Look to Training and Market Expansion to Stay the Course By / Jessica Kirby

© Can Stock Photo / docent

Looking ahead into the rest of 2019 and beyond, there are some key indicators that the wall and ceiling industry is in a state of change. The same labour shortage affecting other industries is in full swing among BC wall and ceiling contractors, and although the industry sits in a relatively stable economic place, factors like government action and labour retention will play a role in whether businesses perk up or keep rolling at a steady pace moving forward.

The Trowel magazine wanted to learn more. In late 2018, we administered a survey among wall and ceiling contractors who were members of the BC Wall and Ceiling Association (BCWCA). We asked them what factors affected their businesses and the industry at large, what they were investing in to make sure their businesses stayed at the top of their game, and where they saw themselves in five years. The answers were diverse. Some see the industry as fairly flexible and ever-changing, while others are experiencing a steady stream ahead along the same trajectory. Some are investing in education and training, while others see technology as the way forward. Although our sample can’t begin to predict with certainty what 2019 holds, in the absence of a crystal ball it is the next best thing in assessing the state and mood of the industry as we embark on the next 12 months.

Looking at the most pressing issues wall and ceiling contractors face in 2019, an overwhelming 70 percent point 8 » The Trowel

to lack of skilled labour. BC is expected to seek out 10,000– 11,000 construction workers over the next two years in three major projects alone—LNG Canada, Site C Dam, and Coastal GasLink pipeline. If TransMountain gets started, that number will grow to 15,000, and it will climb even higher if the Millennium Line Broadway Extension, Woodfibre LNG, the new Pattullo Bridge, and expansions at the ports and Vancouver International Airport also move ahead. And that is just the non-residential demand. Major high-rise projects in Kelowna and steady real estate movement in Surrey are causing some forecasters to suggest 2019 may be the year of the high-rise in BC. Besides labour shortage, survey respondents said competitive pricing (or lack thereof) and political-economic factors weigh in as major influences on business. These factors tied for second place, collecting 15 percent of the vote each. Pricing wars have been raging for nearly a decade now, and although still a factor, many contractors are finding their way out by focusing on value over costs.

“We sell our company on quality, service, and management of projects,” says Ty Winterbach, Littco Enterprises. “Clients need to be aware that there is a cost to providing these services.

Price is not always the governing factor, and we try to weed those clients out and not bother bidding.”

According to the survey results, contractors plan to employ a variety of tactics to control the effects of these and other business challenges. Some will seek government funding and hire foreign workers, while others will strive to keep the company’s workload under control to keep capacity in check.

Most importantly, nearly all respondents said they would invest in education and training.

“Our biggest goal is to keep our guys working and the industry strong across the Lower Mainland ... We will keep changing with the times so no one gets left behind.”

“Training your workforce, apprentices or veterans who just need upgrading, is the single best thing you can do for your company,” says one respondent. “With the labour shortage it is us who has to build our industry up with skilled, capable workers. Foremen can take leadership training. Even the boss can courses in communication and conflict resolution. You’re never too old or too experienced to benefit from training.”

Government actions will weight heavily on the industry for 2019, at least that is what 58 percent of respondents say.

Twenty-eight percent say the global market is the second most important influence, and access to materials affected by pricing and trade will be paramount for 14 percent of respondents.

Comparative estimates for the economic health of contractor businesses this year compared to last are across the board.

Approximately 60 per cent of respondents see their businesses sitting at the same or slightly lower level as last year, while approximately 29 percent expect business to be up above average and 11 percent say they are bracing for the worst.

Reflections on the general state of the industry match company comparisons. The majority (57 percent ) of respondents see the wall and ceiling industry as slightly down slightly over 2018. Twenty-eight percent say it will perform about the same as last year, and 15 percent say it will be up slightly.

“This last year was exceptional, so it has to be down a bit,” says Winterbach. “It seems better than I was anticipating as I was fearing a massive drop.”

Over the next five years, the industry will continue to shift and change as wall and ceiling companies sell, expand, and change focus.

“Our biggest goal is to keep our guys working and the industry strong across the Lower Mainland,” says one respondent. “We will keep changing with the times so no one gets left behind.”

The Trowel’s Outlook Survey will be administered annually to keep BCWCA members abreast of the issues that matter most.

Please take the time to fill out the survey in Fall 2019. ▪

You work...

to build a home...

In anticipation of a flat industry, contractors are prepared to invest in their operations. “You can’t get anything out of a business you don’t invest in,” says one respondent. “And though it seems counterintuitive, the best time to spend money on a business is when times are slow. It boosts employee morale, keeps your guys busy, and shows your competition you are still in the game.”

and shape your skyline.

An overwhelming 42 percent said their dollars will go to education and training. The rest of the votes were spread evenly across labour, technology, expanding their operations, and finding new projects to bid.

We work for you.

“We are going to keep doing what we are doing,” says Winterbach. “It is working for us and expanding would force us to lose focus on management of our projects and budgets.”

“We will be expanding into new markets and making our business more diverse,” says another respondent. “If you keep putting the same thing out there, you’ll get the same thing back and for companies that aren’t doing so great it becomes a bad cycle.”

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wallandceiling.ca » Spring 2019 » 9

Walls for a Good Cause Nova Drywall Partners with Habitat for Humanity in Richmond, BC By / Jessica Kirby | Photo courtesy of Nova Drywall

E

very family deserves and warm, safe and decent place to call their own, and no one brings that mandate to life more than Habitat for Humanity. The non-profit organization’s mission is to mobilize volunteers and community partners in building affordable housing and promoting homeownership as a means to breaking the cycle of poverty. Of course, some of those community partners include construction companies and subtrade contractors without whom these projects could not work.

10 » The Trowel

The Bosa Family Foundation was asked by Habitat for Humanity Greater Vancouver (HFHGV) to help with one of the non-profit’s most recent builds, located at 8081 Ash Street in Richmond, BC. After learning about the project, ABBARCH Architecture Inc. jumped on board and offered their design services at no cost to HFHGV. The development comprises six detached houses, each containing a suite. These are not your stereotypical economical starter homes. They each have a combination of Hardie Plank siding, two styles of stucco, and cultured stone for the outside finishes. Their

exterior profiles feature large, modern roof lines and facias.

Each house measures 1775 square feet with three bedrooms for the mortgage family, and with a small two-bedroom rental unit and car ports for each unit.

The Bosa Group donated labour to pour concrete and build walls, and Daniel Bosa stepped forward, offering to donate the project’s drywall installation and finishing through his company, Nova Drywall Ltd. Nova’s stakeholders also jumped on board. Colin Ramsden of Foundation Building Materials offered to donate, deliver, and stock the board,

The main floor of each home features nine-foot ceilings. Each top floor has vaulted ceilings, which, combined with custom U-shaped staircases, made reaching the peaks a bit of a challenge. but not without its challenges. Nova supplied a four-person boarding crew followed by a six-person taping crew.

The teams began the first house in December, and finished the third three months later.

“Our challenges were there were several high vaulted ceilings on a small floorplan, so we had to rent special scaffolding systems for access,” Kiss says.

The main floor of each home features nine-foot ceilings. Each top floor has vaulted ceilings, which, combined with custom U-shaped staircases, made reaching the peaks a bit of a challenge for Nova Drywall crews.

“We solved this using the Allround System modular scaffold from Canada Scaffold,” Kiss says.

and Mark Zezek of CGC, Inc. offered to donate all the drywall.

William (Guy) Kiss looks after commercial tenant improvements and special projects, and also helps manage the US operations in Los Angeles for Nova. Kiss was tasked to manage the drywall and finishing scope of this project on Nova’s behalf.

He is no stranger to Habitat for Humanity. In 2004, when he was the training coordinator for the carpenter’s union, he recruited 20 volunteers to drywall phase one of the Habitat for Humanity’s builds on Government Street in Burnaby.

Kiss says the work at the Habitat for Humanity in Richmond was standard,

Layher’s Allround scaffolding is hot-dip galvanized and ideal for demanding scaffolding applications and where conventional scaffolding technology cannot be used optimally and economically. The manufacturer recommends it for the trickiest floor layouts and assembly situations or for complex architectural features and compliance with stringent safety requirements.

“The drywall and finishing were one of the biggest milestones for the project,” Kiss says. “The volunteers and stakeholders could now see the light at the end of the tunnel.”

It also opened up new tasks for the volunteers like painting, installing cabinet kits, installing laminate flooring, and installing the doors and trims.

Nova completed phase 1, which comprises three detached houses, each with a legal suite. The first six families should be ready for move-in in May. Phase 2 will be three more houses, each with a suite. Construction should be starting in April and the units should be ready for drywall next fall.

Nova Drywall specializes in residential high-rise steel stud framing, boarding, and drywall finishing. Daniel Bosa started Nova Drywall 20 years ago and is now a leading wall and ceiling contractor in BC employing many workers in the Vancouver area and in the US. He has developed a great business model that really works, and developers and builders want in.

“We opened a second office in Los Angeles in 2013 to tap into that market,” says Kiss. “We’ve had offers to bid in Calgary, Victoria, San Diego, and Seattle. We are grateful for the opportunities, but we are in no hurry to grow too quickly. Nice and steady wins the race.”

Twelve families will benefit from the Habitat for Humanity community project. “The team at Nova Drywall is happy to help,” Kiss says.

Habitat for Humanity is an inclusive, non-profit, non-government organization. Through volunteer labour and donations of money and materials, Habitat works with families in need to build safe, decent, and affordable housing. ■

wallandceiling.ca » Spring 2019 » 11

© Can Stock Photo / krishnadas

technology to help construction finance professionals This technology can assist CFOs in better managing company finances By / Jason Krankota

H

istorically, the construction industry has been one of the slowest to adopt new technology, lagging only behind agriculture in digitization. But that’s changing as software entrepreneurs turn their attention to the needs of the deskless workforce.

The ubiquity of mobile devices, cheap and powerful cloud computing, 5G, and the Internet of Things (IoT) are all making it possible to put robust technology into the hands of deskless staff, including construction workers.

The venture capital industry has taken notice—funding for construction technology has seen a steady uptick since 2013.

CFOs should partner with their IT teams to modernize their back-office systems and prepare to handle a flood of data from the field as paper processes become digital. They should also figure out exactly what field data they want, what tools work best to get it, and how to integrate that data into their financial software. Deployed strategically, new

12 » The Trowel

tools can help construction finance teams resolve many challenges.

Business continuity planning Family-owned businesses are common in the construction industry, and many thriving mid-market and even large companies are still majority-owned by founding families. Finance leaders need to create business continuity plans, whether that’s figuring out how to transfer company ownership to the next generation, establishing an ESOP (Employee Stock Option Plan), or selling or merging the company. There’s a lot of work involved in valuating the business, figuring out the best planning scenario, and helping negotiate relevant deals. Industry-specific ERPs and cloud procurement platforms can give finance professionals a better view into their numbers, help with planning scenarios, and standardize the purchasing process across acquired or merged companies.

Changing accounting standards Revenue recognition is always top of mind in the industry. For the past several years, the Construction Financial

Management Association (CFMA) has sought to ensure that the new Financial Accounting Standards Board (FASB) rules around revenue recognition are favorable—or at least not punitive— towards the construction industry. As these new rules are implemented, CFOs seek to refine their strategies for how to bill against contracts and tie revenue to either a percentage of completion or work-in-progress schedules.

Mobile technologies that expedite communication between the office and the field can also help speed the flow of information.

Risk management Construction carries more risk, especially out on the job site, than many other industries—and insurance costs are rising. Some companies are investigating captive insurance programs in which multiple companies pool their assets and fund their own risk by placing money under management so they don’t have to pay exorbitant premiums.

Insurance companies have responded with more flexible products to try to help companies control their costs. CFOs need to evaluate their options—and if they want to participate in a captive insurance program, every participant needs to undergo a thorough assessment of their financial stability.

While a modern ERP system can facilitate most of that process, the assessment would also look at safety and security practices. There’s a lot of technology that can help reduce job site risk. Drones can monitor job sites for safety and security. Sensor-equipped wearables can alert workers to smoke or toxic chemical exposure, and geofencing can provide alerts when they’re entering a hazard zone. Firms can also use autonomous equipment to do work in environments that are too hazardous for human workers.

In the office, payment automation software can mitigate payment fraud as part of an overall risk-management program.

Attracting and retaining talent Lots of companies face growth opportunities while lacking enough employees to do the work. With unemployment at new lows, it’s been difficult to hire and keep good employees.

CFOs are working with HR—and, occasionally, external strategists—to refine their hiring, retention, and benefit strategies. Mobile training technology can help on-board unskilled workers faster, allowing companies to draw from a larger talent pool. Virtual reality technologies also offer promise for quicker training.

Improving job-cost accounting Tablets and handheld phones let field staff capture data and send it back to their offices electronically. GPS-enabled time cards can record employee work hours and location on a mobile phone.

IoT devices can measure equipment run time.

Cash management strategies Cash management is probably the biggest challenge at any construction company, and effective work-inprogress (WIP) schedule management is critical. The key to the challenge is coordinating between the subcontractor to confirm a job is complete, the project managers to verify that completion and the accounting department to bill the owner, all while syncing everything with the WIP schedule. This is also an area where drones and mobile apps can increase the speed and accuracy of data delivery to finance.

Finance also needs visibility, flexibility, and precision control over making and timing payments. With cloud-based payment-automation software, a project manager sitting in a truck can review a payment file, prioritize subcontractor payment schedules, and approve payments immediately without having to return to the office to sign a stack of cheques and back-up documentation.

Subs get paid faster and the job keeps moving.

With all the new purpose-built technology coming down the pipe, we’ll finally start to see some real movement towards digitizing the construction industry. Finance teams should prepare by enabling themselves with modern cloud systems for accounting, spend management, and payments. They need to enable the field with tools that communicate data back to the office in near real-time. Most importantly, they need to work out how to coordinate it all towards productivity gains and growth and join the ranks of data-driven CFOs who have done the same in other industries. ▪ Jason Krankota is VP of construction sales, West Region at Nvoicepay. His expertise in construction business technology spans 20 years, with 10+ years focused on corporate payments, accounts payable, and expense management solutions.

wallandceiling.ca » Spring 2019 » 13

Making decisions about controlling your time and utilizing your talent requires you to be thoughtful and strategic. One of the first steps on this path is to learn the difference between “urgent” and “important” tasks.

Don’t mistake urgency for importance. Don’t think that because a fire is burning it warrants your immediate attention every single time. Often the fires will burn themselves out. And don’t think that endlessly jumping from one thing to another is good leadership.

Have you ever had a day when you feel you worked your ass off and got nothing done? That was a day when you decided to focus on urgent issues instead of important ones.

NOT URGENT

Urgent & Important

Not Urgent & Important

1

2

Do it now

Block off time for this

Urgent & Not Important

Not Urgent & Not Important

3

4

Automate or delegate

Periodically do this to recharge

NOT IMPORTANT

IMPORTANT

URGENT

If you look at the box above, you can easily see how to categorize any task that needs your attention. Everything you do fits into one of the boxes numbered one through four. Let’s take a look at what might fit into these boxes: Box 1: Urgent and Important (Take Action Now) These are things that need attention now. Both the critical nature of the issue and immediate timing combine in this box.

Some examples would be: • Responses to key clients • Decisions where time or money is on the line • Deadline-driven projects, tasks, or important commitments • Critical decisions that cannot be made by subordinates 14 » The Trowel

© Can Stock Photo / iqoncept

Getting Things Done: Urgent vs Important

Box 2: Important but Not Urgent (Be Proactive) There are things that are important but often don’t jump out as vital. Time spent on these things, though, directly improves the bottom-line results of the organization. Ignore these tasks at your peril. Examples of important-but-not-urgent tasks would include: • Planning • Evaluating people • Evaluating systems • Client relationship building Box 3: Urgent but Not Important (Don’t Be Reactive) These are things that are time-driven and may or may not be worthy of your action. Because of habit or others’ needs, we can sometimes get lost in urgent-but-not-important activities, which become matters of “daily firefighting.” A lot of work is involved but not much really gets done. Some urgent-but-notimportant items include: • 50% of all phone calls • 80% of all email • 95% of text messages • Problems brought to you by others for you to solve that they have not tried to solve themselves • Personnel issues that can and should wait • Any form of employee venting, frustration, or emotional dumping that does not lead to resolutions Box 4: Not Important and Not Urgent (Be Disciplined and Ignore) We live in a multitasking world where immediate reaction is standard behavior. Young people especially think they need to respond moment-to-moment via email or social media. This is indulgent and simply a bad habit to be addressed. This is a key area where major chunks of time are wasted.

Poor planners fill their time by focusing on tasks that are neither urgent nor important. It’s the stuff people do when they are reactive instead of proactive. It means inaction. This is bad stuff.

So there it is. A simple matrix to getting things done. Important stuff—not everything all the time; not what you like to do and are good at; not what other people want you to do for them.

Get your boxes lined up and apply discipline and focus—the results for you and your team will be profound. ■

feature FOCUS CHOOSING A TAPING KNIFE Taping knives are an indispensable part of every drywall professional’s toolkit. Even finishers who prefer a hawk and trowel likely have a taping knife stuck in their back pocket.

Considering how important taping knives are, it’s critical to choose the right one for you and for your project.

BLADE MATERIAL Stainless Steel Stainless steel, which resists rusting and contains up to 10.5 percent chromium, is one of the two most common materials used for the taping knife blades. The primary reason is durability: stainless steel is very hard and very long-lasting.

However, stainless steel, because of the hardness, is also less flexible than other knife styles. The result is that it will have a harder time feathering mud well, take longer to break-in, and is more prone to permanent bending.

Blue Steel Blue steel is carbon steel that has been treated to resist rust.

This treatment leaves a dark, blue-black surface, which gives this alloy its name. Blue steel is more flexible than stainless and more rust-resistant than carbon steel. It does still require somewhat more maintenance than stainless, but can be easily kept in good shape by applying a light coat of oil between uses.

HANDLE CHOICES Wood – Timeless Wood handles are traditional, and popular with those who prioritize comfort and durability. They are beautiful to look at! On the other hand, wood handles are more expensive and

heavier than other options, so while beautiful, they can be cumbersome.

Plastic – Budget Friendly Plastic is durable and inexpensive, making it a great budget choice. It will last a long time with minimal investment up front. However, hard plastic handles are generally regarded as less comfortable than the other options (with some exceptions).

Rubber Over-molds – Perfect Balance Rubber is a great all-around material that balances durability with comfort. The improved grip offered by rubber allows the user to take a lighter hand when applying or working mud. As a result, rubber-handled knives are exceptionally well-suited to feather and finishing tasks that require greater precision.

In-Line or Offset Handle Most commonly, taping knives feature a handle that is in line with the blade. However, as the name suggests, offset knives ditch the “handle in line with blade” design in favor of a handle that is offset from the blade. This allows for increased clearance for the fingers and reduces the possibility of accidentally marking the mud with your knuckles. The design also allows you to bring the knife flatter to the wall, making it easier to achieve a perfect finish. ■

Tools that work as hard as you do!

A tool brand just as committed to getting the job done as you are.

Circle Brand works alongside those who are just getting started with their first set of tools, and those who have been in the game for years

Circle Brand tools.

Visit www.wallboardtrim.com to find a dealer near you!

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wallandceiling.ca » Spring 2019 » 15

around the WORLD NORWAY TOWER IS WORLD’S TALLEST TIMBER BUILDING A mixed-use building in Brumunddal, Norway called Mjøstårnet is the world’s tallest timber building at 85.4 m (280 ft). It is Norway’s third-tallest building and its tallest with mixed uses. A hotel, private homes, and office space occupy the building’s 18 storeys.

The Council on Tall Buildings and Urban Habitat (CTBUH) recently amended its height criteria to expand the maximum allowable height for wood framed structures. The CTBUH is the official guideline by which tall buildings are constructed and measured. Now that the criteria include timber as a recognized structural material, building heights made of wood are expanding at a rapid rate.

According to CTBUH, the update to its allowable height guideline was prompted by the recent uptick of tall timber buildings under construction or in planning around the world.

The increase in activity has prompted stakeholders and the general public to understand and define what constitutes a timber structural system.

According to the revised criteria for timber structures, “both the main vertical/lateral structural elements and the floor spanning system must be constructed from timber. An ‘all-timber’ structure may include the use of localized nontimber connections between timber elements. A building of timber construction with a floor system of concrete planks, or concrete slab on top of timber beams, is still considered a ‘timber’ structure, as the concrete elements are not acting as the primary structure.”

The CTBUH Height and Data Committee was created to establish and, when necessary, refine the height criteria upon which tall buildings are defined and measured, and meets regularly to discuss and evaluate developments and demands in the tall building industry. It considers possible additions or revisions to the criteria, and occasionally, specific buildings requiring close evaluation to determine their height and/or categorization in accordance with the established criteria.

The world’s tallest fully wooden highrise under construction in Brumunddal, Norway. Photo by Bjoertvedt.

Prior to Mjøstårnet, Canada held the world record for the tallest timber tower with the 18-storey Brock Commons Tallwood House, a student residence at the University of British Columbia (UBC), in Vancouver. The 164-foot-tall structure was dubbed the world’s tallest “plyscraper.”

Before Brock Commons established the record, The Treet in Central Bergen, Norway, was the world’s tallest timber structure. It took that title in 2014 from the 10-storey, 104-foot-high Forte residential block in Melbourne, Australia, that overlooks the Victoria Harbour.

Tokyo is set to top all those buildings in 2041 when Japanese company Sumitomo Forestry says its 1,148-feet-tall timber tower will be completed. The tower’s erection will mark the company’s 350th year in business and cost approximately 600 billion yen ($5.6 billion) to build.

The 70-story tower will be a hybrid structure made from 90% wooden materials. A steel vibration-control framework will underpin the design—an essential feature in an earthquakeprone city. ■

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16 » The Trowel

it’s the LAW MAKE SURE YOU KNOW WHO IS GOING TO PAY YOU BEFORE YOU GO TO WORK It is easy to be so distracted by the anticipation of a new project that formalities fall by the wayside. Unfortunately, the failure to take basic preliminary steps, such as clearly establishing who is responsible to pay for your work, can have a real impact on collecting when the job is done. The recent case of Kooltech Refrigeration v. Toor and Imraj Holding Enterprises, 2018 BCPC 297 addresses a contractor’s risk in going to work before understanding, and clearly documenting, who is going to pay for its work.

The Facts In early 2011, Imraj Holdings Enterprises Ltd. (the “Owner”) acquired and began renovating a truck stop in Salmo, BC, known as the Whiteline Truck Stop (the “Project”). To assist with the renovations, the Owner entered into a verbal agreement with Trousdale Construction Ltd. (the “General Contractor”) to construct a walk-in cooler and sales counter.

The claimants in this case were engaged to provide refrigeration services to the Project. Specifically, the claimants were initially approached by, and received most of their initial instructions from, the General Contractor. The claimants say it was the General Contractor who told them that they would get paid by the Owner. Unfortunately, the claimants never bothered to confirm this with the Owner or get any commitments in writing from the General Contractor.

The claimants performed the work at the Project and no issue was taken with the quality of their work or the amounts charged. The real issue was who was responsible for paying the claimants’ bill. The claimants asserted it was the Owner who was responsible to pay the bill, while the Owner claimed it was the General Contractor.

By / Andrew D. Delmonico and Matthew T. Potomak

The Decision The BC Provincial Court ultimately dismissed the claimants’ action against the Owner.

The claimants based their claim for unpaid invoices on, among other things, an argument that they had a contract with the Owner. The claim for interest was based on a statement that appeared at the bottom of the claimants’ invoices, which read: “Interest will be Charged at 2% Net 30 days on All Over Due Accounts.”

With respect to the first part of the claim, the Court was unable to find any evidence that the claimants’ contract was with the Owner, rather than the General Contractor. The Court reasoned that two parties cannot agree to bind a third party to a contract without that third parties consent or some evidence of agency, so the General Contractor could not oblige the Owner to pay the claimants’ invoices.

With respect to the second part of the claim, the Court found the claim for interest was based on a unilateral decision to charge interest by the claimants. It was not a term that was agreed to by the Owner, so could not be recovered by the claimants.

The claimants commenced an action against the Owner and its principal, Mr. Toor, for unpaid invoices and six years’ worth of interest at the rate of 2% per month. The General Contractor also became a Third Party in the litigation, but for unknown reasons, was later released from the action before trial.

Lessons Learned 1. There are typically many different parties involved in a construction project. Before starting work, make sure you understand who your contract is with, and which of these parties is going to be paying your bills.

Wondering how to stay up to date between issues?

2. A right to charge interest on unpaid invoices cannot be based on a unilateral term inserted in an invoice. Consider instead including provisions in a written agreement that unpaid invoices are subject to contractual interest. ■

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This article was written by Andrew D. Delmonico and Matthew T. Potomak, lawyers who practice in construction law with the law firm of Kuhn LLP. This article is only intended as a guide and cannot cover every situation. It is important to get legal advice for specific situations. If you have any questions or comments about this case or other construction law matters, please contact us at 604.864.8877 (Abbotsford) or 604.684.8668 (Vancouver). wallandceiling.ca » Spring 2019 » 17

contractors 101 DIVIDENDS VERSUS SALARY I recently received an email from a client who is turning 70 and wanted to know if he should take salary or dividends, now that he is claiming Old Age Security (OAS) .

In reviewing his particular situation, I recommended that he take dividends and his wife a salary. I said the company had retained earnings of $300,000 and he could take dividends out of this amount and pay about 10 percent less tax than on salary.

I was gobsmacked by his next email. “What are retained earnings?” he asked. This question came from a seasoned business owner, a professional engineer.

So, can you explain exactly what retained earnings are? The next question is, “Should you take dividends or salary?” That’s a much tougher question to answer.

Retained Earnings Retained earnings are the after-tax profits (earnings) that the company has retained in the business over its lifetime.

Privately held businesses pay approximately 13 percent corporate tax on annual profits up to $500,000. The 13 percent tax is a combination of provincial and federal tax rates and varies a little by province. The current federal rate is 10.5 percent, and in BC the provincial rate is 2.5 percent, making a total of 13 percent. We are referring to active business income here. Do explore this concept with your accountants as we are not privy to your personal circumstances and therefore can’t give direct advice.

Excess Salary A company should avoid paying out excessive salaries to the owners to allow it to minimize income tax and to provide working capital for the company.

For example, if you took a salary of $100,000 and the company had profits, after your salary, of $150,000, you would pay significantly less tax than if you took the entire amount out as salary. The $150,000 would only attract tax at 13 percent compared to around 44 percent if that $150,000 was added to your personal income. You are deferring tax of approximately $45,000. The company can use that money for working capital or other business needs. When you take out that $150,000 as a dividend in future years the tax will catch up with you, but that could be in 10 or 20 years time. As you build up your retained earnings this could be a very significant amount, and at that time your marginal tax rate would likely be lower.

Defer Income Tax The first strategy then is to defer income tax by keeping excess profits in the company (or holding company) and only take what you need for personal use and to top up RRSPs and maybe TFSAs.

By / Ron Coleman

The second strategy is to determine how and when to take the dividends out of the company. The best time to do this is when you retire or sell the business. If you sell the shares of the business you want to ensure that the retained earnings are in a holding company. If you sell the assets it doesn’t matter.

If you and your spouse are shareholders, with the same class of shares, you would each take the same dollar value of dividends. Likewise, other owners of that class of shares also must take the same dollar value of dividends.

The advantage here is now that you are retired you have a much lower regular income and, therefore, will avoid the higher tax rates. So, when you take out that $150,000, the tax on it will be significantly lower than the 44 percent you would have paid when the company earned the income, and you will get a credit for the tax the company paid. Typically, I find contractors save an overall of about 10 percent of the tax. So, deferring the tax for a number of years so that your company can use the money and then paying 10 percent less tax is appealing.

Avoid the OAS Claw Back Also, make sure to balance your dividend income and other income to ensure you avoid a clawback on your Old Age Security. The clawback starts at an income of $73,756 per individual.

Let me clarify a few points. Dividends can be paid up to the full amount of retained earnings over as many years as you wish. Because the company has already paid corporate tax on the dividends you get a credit for that tax when you declare the dividends on your personal tax return. When you take a salary the company shows that amount as an expense, which reduces profits and issues you with a T4 up to December 31.

Dividends are paid from after-tax earnings and are based on the tax year for the company, and you are issued a T5.

In the average construction contracting company, based on the 2016 financial benchmark report I completed for a local association, the retained earnings were over $1 million per company. This is a serious number and allows these companies to continue with strong tax planning. The average company with annual sales under $2 million had retained earnings of more than $400,000. As you can see, this is a key issue for you. continued on page 19

18 » The Trowel

advertiser INDEX INDUSTRY NEWS

continued from page 7

needed; and link clients to federal and provincial settlement services in Canada.

“As part of IRCC’s renewed pre-arrival program, I’m happy that IRCC has selected the British Columbia Construction Association to deliver these important services,” says Anandasangaree. “This investment will allow this organization to support the employment needs of newcomers looking for jobs in the construction industry before they arrive in Canada.” ▪

Canada’s Building Trades Unions Pleased with Government of Canada’s Continued Commitment to People in 2019 Budget Funding announced to promote skilled trades as first-choice career option key to addressing skills shortage Canada’s Building Trades Unions (CBTU) commends the federal government for its continued commitment to priorities that include investing in people, showcasing skilled trades as a first-choice career, continued investment to address the on-going opioid crisis, willingness to work with communities affected by coal plant closure, and the implementation of a National Pharmacare program.

“Canada’s Building Trades Unions are committed to making a career in the skilled trades open for everyone, which includes retraining for those already in the workforce, and encouraging and supporting young people to learn about the opportunities that exist in the trades,” said Arlene Dunn, director, Canada’s Building Trades Unions. “With the support of the federal government, through a campaign to put skilled trades as a career option front and centre to young Canadians, it will fill a much-needed gap in awareness.”

Funding to support workers who need to get retrained while protecting their income to support their families will open the door to workers who want to upgrade their skills and possibly pursue becoming an electrician or heavy equipment operator or a number of other professions in the construction industry where we need people,” she adds.

The federal budget contains continued commitment to skilled trades, which includes a new Canada Training Benefit, $4.6

billion over five years, to support workers who need to pay for training, get income support, and potentially get job protection while upgrading skills.

The federal government has also committed to a two-year campaign with $6-million to promote a career in the skilled trades, and $35 million over five years to address skills development of workers affected by the closing of coal plants. Priority projects in affected communities will see $150 million.

A $30.5 million commitment over five years is earmarked for a response to the opioid crisis. In support of a national pharmacare program, the budget promises a new agency to buy drugs in bulk and cut Canadian medication costs as a first step.

“Taking care of Canadians includes skills training, providing meaningful work opportunities, and helping Canadians afflicted with an opioid addiction get the help they need, while looking at this as the bigger societal issue that it is and figuring out how to address it,” Dunn says. “The government’s commitment to continued funding to address the opioid epidemic will work towards saving lives.”

The CBTU will put out a full analysis of the budget in the coming months, and is looking forward to continuing to work with the federal government to put Canadians first. ▪

CONTRACTORS 101

continued from page 18

If you are thinking of selling your company or are getting close to retirement, you should review these strategies with your accountant. If you are continuing in business, you should start planning on how to maximize your income by minimizing and deferring taxes. Happiness is cash flow.

Your Plan of Action • Explore your options with your accountant. A prudent business person will minimize and defer taxes for as long as possible and avoid the OAS clawback.

• Put your tax strategy in place.

• If you have investment income and have not capped out on your TFSA then transfer the sources of that income to your TFSA. ▪

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Steeler Ltd (Delta BC)

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wallandceiling.ca » Spring 2019 » 19

REDHEADER PRO™

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The new Bailey RedHeader PRO™ cuts on-site labour by up to 50% by reducing the number of wall framing members required to frame windows and door openings. The superior strength and carry capacity of the new system means higher performance with fewer members.

Bailey RedHeader PRO™’s one-piece header and jamb replaced conventional boxed headers and built-up jambs which require multiple studs, tracks and screws.

The new Bailey RedHeader PRO™ is preengineered, and pre-cut to specified lengths.

The system uses the same-sized member for the jamb and header for greater functionality. The top of the header is open which allows for easy insulation installation.

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