Legal and Ethical Obligations When Hiring Contractors
The Condominium Manager’s Role in Hiring Contractors
The condominium manager is responsible for facilitating the hiring process while ensuring compliance with Alberta legislation and condominium board policies. This includes:
Consulting the condominium board before obtaining services.
Following board-approved procurement policies.
Ensuring fair bidding and contract selection.
Condominium managers must not have personal financial interests in contractor selection. The Real Estate Act Rules states a condominium manager must avoid conflicts of interest and disclose any financial or personal interest in transactions involving a condominium corporation.
The Importance of Fair and Transparent Selection
A fair hiring process ensures:
Competitive pricing by allowing multiple contractors to bid.
High-quality service by selecting qualified and experienced contractors.
Legal compliance by ensuring that work is performed according to industry standards.
Unfair selection practices, such as favoritism or failing to follow procurement rules, can result in:
Legal liability for the condominium corporation.
Complaints to the Real Estate Council of Alberta (RECA).
Higher costs due to non-competitive pricing.
Avoiding Conflicts of Interest in the Selection Process
A conflict of interest occurs when a condominium manager:
Has a personal or financial connection to a contractor.
Accepts gifts or incentives in exchange for contract awards.
Fails to disclose any relationships that could affect decision-making.
Best Practices for Avoiding Conflicts of Interest
Always disclose personal relationships with potential service providers.
Ensure board approval for all contracts before finalizing agreements.
Maintain a record of the selection process to show transparency.
Screening for Experience, Licensing, and Insurance
When selecting a contractor, the following qualifications must be assessed:
Licensing and Certification
Verify that the contractor holds valid trade certifications and business licenses.
For certain work (e.g., electrical, plumbing), confirm that they hold provincial licensing.
Insurance and WCB Coverage
Contractors should have general liability insurance to protect the corporation from financial risk.
Workers must be covered under Workers’ Compensation Board (WCB) Alberta.
References and Past Work
Request client references and previous project examples.
Check for complaints or legal disputes in Alberta business records.
Establishing Fair Bidding Procedures to Ensure Competitive Pricing
The condominium board should implement a formal bidding process to ensure fair pricing and contractor selection.
The Bidding Process
Define project scope and requirements (materials, timeline, and expected cost).
Solicit at least three bids from qualified contractors.
Ensure sealed bids to prevent influence or favoritism.
Evaluate bids based on clear selection criteria, such as:
Price competitiveness.
Contractor’s experience and reputation.
Insurance and licensing verification.
Present recommendations to the board for approval before awarding contracts.
Checklist for Unbiased Contractor Selection
Verify contractor licenses and certifications.
Confirm liability insurance and WCB coverage.
Ensure at least three competitive bids are collected.
Disclose any conflicts of interest before selecting a contractor.
Document the selection process for transparency.
Obtain final board approval before signing contracts.
