Hiring a Contractor? What Your Water Co-op Needs to Know

When work needs to be done at your water co-op, it is important to make sure the contractor you choose has the certifications, coverage and permits required to do the job safely, and to protect your co-op from legal and financial risk.

Whether your co-op is doing routine maintenance, upgrading a pump house or handling an emergency line repair, hiring a contractor is a regular part of keeping the water flowing. The lowest bid should not be the only factor in your decision.

Protecting your co-op, your board and your community means confirming that anyone stepping onto your site is compliant, insured and qualified before work begins. Here is a checklist of what to ask for before any contractor starts work.

1. WCB Clearance

Never let a contractor begin work without proof of Workers' Compensation Board (WCB) coverage. Request a WCB clearance letter before the job starts and again before releasing final payment.

A clearance letter confirms the contractor's account is in good standing. Without one, your co-op could be held responsible for the contractor's unpaid WCB premiums, and could be exposed to a workplace injury claim if the contractor turns out not to have coverage in place. See WCB Alberta's clearance letter guidance for more detail.

You can request a clearance letter through WCB Alberta's online clearance system. Follow the instructions to search for the contractor and confirm they are clear.

2. Proof of Insurance

Underground utilities and pump house work carry real risk, so you should ensure any contractors doing work for your co-op are bonded and insured. Ask for a Certificate of Insurance showing Commercial General Liability (CGL) coverage. Confirm the minimum coverage that applies to your project. If you are unsure, contact the Water Federation for advice on what is required. 

RMA recommends the following:

• Request a certificate of insurance from the contractor outlining coverages, limits, and policy effective dates.
• Ensure the certificate lists the Water Federation and the water co-op as additional insureds (the Federation is the main policy holder, and water co-ops are ANIs – Additional Named Insureds).
• Confirm the contractor carries Commercial General Liability (CGL) insurance with a minimum limit of $2 million.
• Review any additional coverages needed based on the contractor’s work.
• Confirm a 30-day notice of cancellation clause.

RMA has published background on construction related insurance that may be useful: Construction Risk Cycle and Builders Risk Policies.

3. Bonding

If a contractor requires a deposit, ensure they are bonded before the work begins and that they hold a Prepaid Contractor License.This protects you if the contractor fails to finish the job, does not meet the terms or provides a way to recover costs if something goes wrong. 

4. Safety Records and Certifications

Ask whether the contractor holds a Certificate of Recognition (COR) or, for smaller crews, a Small Employer Certificate of Recognition (SECOR). Both are Alberta safety certifications issued through government authorized Certifying Partners after an audit of the contractor's health and safety management system.

COR and SECOR are voluntary. A contractor does not need either one to work legally. What every contractor must meet, regardless of certification, is basic compliance with the Occupational Health and Safety Act.

At minimum, the contractor should be able to provide a site specific safety plan, proof of crew safety training and confirmation that they comply with the Occupational Health and Safety Act.

More information on COR and SECOR is available from the Government of Alberta.

5. Licensing and Trade Qualifications

Confirm the contractor holds a valid business license for the municipality where the work is being done. Also confirm that the workers doing the job, whether water, wastewater, or another specialized trade, hold the trade qualifications required for that work. Ask to see current certification before work begins.

For digging or excavation, a locate request must be submitted to Utility Safety Partners (formerly Alberta One Call). This is a legal requirement, not a courtesy call, and it identifies buried utilities in the work area before digging starts. Ask your contractor for a copy of the locate ticket as proof this step was completed. Ensure that the contractor has ground disturbance training for staff.

6. References and estimates

When looking for a contractor, you should also check their references to confirm the quality of their past work. Make sure you get a documented estimate and schedule so you know what the job will cost and when it will be completed.

The Bottom Line

Verifying a contractor's WCB, safety and insurance documentation protects your co-op financially and reduces risk, and confirms that the legal requirements around trade certification and utility locates are being met. This is a core part of your co-op's governance and risk management. 

Here are some tips to help you through the process:

• Document as much as possible before work begins so your co‑op is protected if anything unexpected happens. Clarify how the contractor manages change orders and cost adjustments.
• Request multiple quotes that include schedules, scope of work and detailed costs. Review them carefully, select the successful contractor, and prepare written agreements.
• Vet contractors through references and credible reviews. Ensure your co‑op has a clear procurement process for selecting materials, equipment and contractors.
• When the project is complete, debrief with the contractor, assess their performance and quality of work, and prepare a final project report.
• Establish how communication will take place between the contractor and the co‑op, and how updates will be shared with members.
• Confirm all guarantees and warranties and understand what they cover.
• Ask whether the contractor has a site you can visit to see their work firsthand.

For more on contractor vetting, consult the Water Federation's Best Practices Guidelines on the Resources page of our website.