New rules help forestry contractors succeed

The B.C. government is delivering on its commitment to modernize the forest sector, protect good jobs and put people and communities first by making regulation changes to help forest-sector contractors stay in business, improve competitiveness and prosper.

Amendments to the Timber Harvesting Contract and Subcontract Regulation create transparency in contract negotiations and improve the dispute resolution process between forest tenure holders and the contractors they hire, including log harvesters, log haulers and road builders, who hold replaceable contracts. One change to the regulation requires licence holders to provide contractors with clearer work specifications to understand the full scope of work to negotiate their rates.

'Our vision for a sustainable forest industry is focused on making sure everyone benefits from our public forests,' said Katrine Conroy, Minister of Forests, Lands, Natural Resource Operations and Rural Development. 'We want to make sure forestry contractors and subcontractors can better count on a stable income, support their families, invest in their businesses and communities, and stay competitive.'

The changes, effective June 10, 2021, result from the Contractor Sustainability Review, initiated in 2017 and completed in 2020.

During the initial phase of the review, the 2018 Contractor Sustainability Review Final Report identified that almost half of forestry contractors were losing money or insolvent. Amending the decades-old regulation was the recommendation of Dan Miller, former B.C. premier, who facilitated the last phase of the review.

This is one of the ways the Province is taking action to modernize the forest sector, as outlined in an intentions paper released on June 1. These amendments conclude the work done in collaboration and consultation with contractors and tenure-holder representatives throughout the review. Their advice is reflected in the changes.

Replaceable contracts are a requirement of some tree farm licences and forest licences. They require licence holders to continue their contracts with contractors who are fulfilling their obligations.

Quotes:

Bob Brash, executive director, Truck Loggers Association (TLA) -

'For many years, the TLA has advocated for fairer and more sustainable means to determine the rates B.C.'s loggers are paid for their services. Our expectation is that these changes being implemented by the Province will rectify the current imbalance in negotiating such rates to the benefit of the contractors and the resource communities they and their families live and work in. As outlined in the Province's recently announced initiative to modernize forest policy, this is one critical step of many to protect jobs and advance our sector to benefit all British Columbians.'

Jeff Bromley, wood council chair, United Steelworkers -

'These changes are sorely needed to hopefully improve the ability of the dependent forestry contractors to be competitive and improve margins with the tenure holders. We believe the razor-thin margin environment with the contractors has impacted the safety and working conditions of our members who work for them. It affects our ability to negotiate better wages and benefits but, most importantly, better hours and standards in the bush to ensure the safety of our members is first and foremost.'

Ron Volansky, chairman, Interior Logging Association (ILA) -

'It has been a long process, but the ILA's board of directors has been unwavering in its position that Bill 13 contractors' investments need to be protected, and it is the hope that these changes will assist not only them, but all contractors, in ensuring their ability to negotiate fair and equitable rates. It is our hope that these changes will help to balance the inequities that were identified in the 2018 Abbott Report, and not only will the contractors benefit, but their employees and communities will also.We look forward to working with government to ensure the best interests of our members are represented as we move forward with discussions on the recently released intentions paper on modernizing forest policy in British Columbia.'

Dan Battistella, president, Interior Lumber Manufacturers' Association -

'As an industry, a lot of effort has gone into creating the new Timber Harvesting Contract and Subcontract Regulation. We believe it will help address the issues raised by the contracting community, and we look forward to the improved communication and transparency that will go a long way in moving our industry forward.'

John Nester, NorthWest Loggers Association -

'We are pleased that the first of the 14 recommendations from the Contractor Sustainability Review are finally to be implemented. In 2019, Premier Horgan set the stage for implementing these recommendations when he stated the market rate test that was established in 2004 would be eliminated. This test created an imbalance in negotiations between contractors and licensees, forcing many contractors to work at rates below their costs. We look forward to these amendments, which will create a more balanced approach to the contractor and licensee relationship, benefiting the communities in which we work.'

Michael Armstrong, vice-president, forestry, BC Council of Forest Industries (COFI) -

'COFI was pleased to have worked collaboratively with the contractor associations and government on these regulatory changes. They provide a foundation for success and sustainability for both contactors and licensees, including increased collaboration and information sharing between both parties at the negotiating stage. This is important because contractors are integral to supporting a strong, sustainable forest industry that contributes to the economic and social well-being of our province.'

Learn More:

Modernizing B.C.'s forest sector:
https://www2.gov.bc.ca/gov/content/industry/forestry/competitive-forest-industry

Read the intentions paper:
https://www2.gov.bc.ca/assets/gov/farming-natural-resources-and-industry/forestry/competitive-forest-industry/modernizing_forestry_in_bc_report.pdf

Timber Harvesting Contract and Subcontract Regulation:
https://news.gov.bc.ca/files/Timber_Harvesting_Contract_and_Subcontractor_Regulation.pdf

A backgrounder follows.

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