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Labor Scarcities

It is estimated that one of every seven
unionized drywall tradespeople working
in the Greater Toronto Area is an
illegal immigrant. Many of the 1,000 or
so illegal immigrants, who have been
working in Toronto for three to five
years, have proven skills, are reliable
workers and good citizens. These workers,
along with the estimated 9,000 to
13,000 other illegals in the GTAs thriving
building industry, are a vital part of
the industry’s labor pool at a time when
skilled tradespeople are in short supply.



Hugh Laird, executive director of the
Interior Systems Contractors Association
of Ontario, is one of a number of
industry pundits that is lobbying the
federal government to permit these
workers to stay in Toronto. “We need
these people,” he says. “Without them,
we couldn’t possibly meet the demands
of this building boom.”



Construction leaders have tried in vain
to get the federal government’s immigration
department to grant amnesty to
illegals with proven work records. Now
they are looking at other options to
keep the illegals working in Toronto.
One idea involves changing the “point
system” used to grade foreigners applying
for entry into Canada.



Carlos Pimentel, director of organizing
for the Carpenters & Allied Workers
Local 27, believes the immigration department’s
point system should be re-vamped
to make it easier for qualified
foreign tradespeople to get work visas.
And he’s hoping the CIC will listen to
the idea. Since 9/11, the federal immigration
department has not been “very
open” to innovative solutions.



The rating system awards individuals
points in such categories as work experience,
education, ability to speak English
and financial capacity, Applicants
must score a specific number of points
to qualify for entry into Canada.
Pimentel and other building industry
experts see flaws in that rating system,
which prevent many of the illegal construction
workers in Toronto from getting
a passing grade.



One of those flaws is that points are
awarded to applicants who have extensive
educational background in their
chosen trade. The problem is that most
illegals (predominately South American)
never went to school for their
trade. They learned their building skills
on the job in their native countries.
Many of them, in fact, have little structured
education. Another flaw with the
point system is that it essentially penalizes
applicants who can’t speak English,
although English is not vital to the work
many do in construction.



Pimentel says the union would like to
see a point system that is more specific
to illegals, which he calls “undocumented workers.” “We’d like to see a system
that allows people to stay if they’ve
been in the country working the field for
a number of years already and if they’ve Important for
had no problems with the law.”
Applicants should also be graded on how well
they’ve coped in the community during
their stay, “if they got married, bought
a house and have proven to be good citizens,
for example.”



ISCA’s Laird suggests that illegal immigrants who have unblemished working
records in Toronto for at least two years
and have assimilated well into the community,
should be reconsidered for work
permits. Laird, along with executives
from the union, the Greater Toronto
Home Builders’ Association and other
building associations affected by trades
shortages in Toronto, hope to hammer
out an arrangement with Denis
Coderre, the Federal Minister for Citizenship
and Immigration, soon.
Coderre has agreed to set up a working
committee to assess the industry in the
Greater Toronto Area, particularly the
booming multifamily residential sector
where many illegals are working.



Important for Many Reasons



Pimentel says the industry can’t underscore
enough the importance of the
South American illegal to the current
building boom. Without them, the
price of homes would likely rise sharply.
“Contractors that pay the best wages
would be the ones to get the skilled
workers needed to complete homes. But
those builders would pass on their higher
costs to developers who in turn would
pass on the increases to homebuyers. It’s
a case of supply and demand.”



What’s more, he says that the average
home, which takes 100 days to complete,
would take close to 200 days if all
the illegals were sent home. Similar
delays would occur in the low-rise multifamily
sector.



While labor scarcities have long been
one of the downsides of a building
boom, most experts in Toronto believe
that the current aging work force simply
won’t be able to cope with future building
booms. Projections are that building
trades shortages will continue for three
to four years because housing starts are
forecast to continue at a rate of 35,000
to 40,000 units per year.



Pimentel says estimates are that upward
of 75,000 non-documented workers in
all industries—including construction
in Greater Toronto. Of that number,
24 percent are in residential construction.






“The residential market is the Wild
West of the building industries. There’s
very little documentation of who is really
working in it,” he says. “They work
for subcontractors who, in many cases,
pay them cash. It is a great opportunity
for them to work for a couple of
months, make a little money. Many of
them go back home after their visitor’s
visa expires.”



However, many others go underground.



Not all illegal workers are good for the
local economy. Some, who work “under
the table” for disreputable contractors,
also illegally collect welfare checks from
the government, notes Laird. These illegal
immigrants, however, don’t represent
the majority. Most are economic
refugees, not political ones, who have
come to Toronto to make an honest living
because the economy in their home-land
is so depressed that they have little
hope of landing enough work to feed
themselves or their families.



Many of them have not been treated well
by employers. For example, Pimentel
says many illegal immigrants working in
the framing sector of union Local 183
have been paid about half the union
wage rate, and they didn’t receive benefits.



Working with Unions



So how do they land union jobs? One
way is by showing up at the union hall
with a bang-up resume but without a
social insurance card, which they
promise to bring in later. Typically, these
illegals are paid as “dependent subcontractors,”
meaning they are cut a straight
check, with no tax or other deductions.



It is up to them to declare taxes at year’s
end.



Stephen Dupuis, executive director of
the GTHBA, knows that apprenticeship
skills training for young Canadians is
vital to the long-term health of the
building industry. But that won’t resolve
today’s shortages, which is why the
home builders’ association helped form
the Construction Recruitment External
Workers Services, about two years ago.
The federal government pilot project’s
aim was to allow foreign construction
workers temporarily into Ontario.



“We became supportive of some kind of
solution for the undocumented workers.
It was with the understanding that the
government would have some political
restraints so we knew we would have to
come up with something pretty creative,”
the executive director says.



More recently, the GTHBA proposed
that the feds “regularize” undocumented
workers, explains Dupuis. A document
was put together by an immigration
lawyer on behalf of the association
explaining the idea. In brief, the proposal
calls for a process similar to CREWS
that offers Temporary
Resident Permits to illegal
immigrants.



The approach is recommended
because visa
offices, usually the
venue through which
routine applications for
worker permits are
channeled, insist on
interviewing applicants.
The problem is Canadian
visa offices are in
border communities
such as Buffalo, and
most illegals would be
denied access into the
United States given
their non-status in Canada. The alternative:
processing their application in
their home country—a time-consuming
endeavor, negatively affecting the Toronto
construction industry.









The Outsourcing Option



In a heated construction economy when building schedules squeeze
contractors to the max, skilled labor often falls short of needs. One
solution to those shortages that more contractors are turning to is
job-finding companies, commonly known as headhunters.



“Many contractors like to have the appearance of using all in-house
labor, but with today’s shortage of a skilled work force in many areas,
outsourcing has become a necessity:’ explains Brentt Tumey, director
of operations of Managed Subcontractors International, Inc.,
based in Rogers, Ark. The company is a headhunter that specializes
in procuring skilled metal stud framers, drywall hangers, drywall finishers,
painters and EIFS tradespeople for regions suffering shortages
throughout the United States and the Caribbean.



In peak building seasons of spring and summer, the company procures
roughly 600 or so workers, although it has landed jobs for
more than 1,000 tradespeople in the past. “We strive to be the
‘Tylenol’ for our customers’ temporary work force needs:’ Tumey
explains.


Tumey says he has found MSl’s type of service is especially essential
to drywall contractors working on large projects outside their
home base where the skilled labor pool is unknown. The greatest
demand for headhunters has been in the South and Southeastern
United States, although recently MSI has had more requests from
contractors in Northern states.



Finding skilled tradespeople isn’t easy for headhunters like MSI,
Tumey says, noting he’s not about to give away his company’s
secrets. “Trust and sound ethical business practices are key to maintaining
our successful relationships with our resources: he says.



MSl’s pricing is on an hourly flat rate of $22.96 to $25.96 per worker
based on a 50-hour work week. The rates are for non-unionized
projects where there is no “prevailing wage” and the rules of the
Davis Bacon Act aren’t applicable. Prices are based on a project-by-
project basis because of the differences in prevailing wages on
federal and state funded jobs, The headhunter assures coverage
of workers’ compensation and general liability coverage, payment
of state and federal payroll taxes, housing costs, travel costs, per
diem costs and proper overtime payments to the workers.



Over the past few years some headhunter agencies have failed to
meet their obligations, giving legitimate job-finding businesses a bad
name, Tumey explains. “There are always bad apples in any industry. In our industry there just
seems to be more than the average.
I think the most negative
comment that I’ve heard from
contractors who reach out to us
is their inability to have qualified
men placed on their jobs. Warm
bodies are not enough.”



Numerous inexperienced placement
companies are popping up
in areas of labor shortages, he
says. “What these new companies
just don’t realize is that there
is so much more to this business
than finding carpenters who want
to work and just sending them
out. There are numerous legal and
financial issues that go along with
being a properly run company.
You have to be properly insured
(including for liability) and report
correctly. There are city, state and
federal regulations that have to be
followed.”



Also important is timely placement,
he points out. MSI insists
that its procured contractors keep
track and qualify each man sent
out by trade and length of experience.
“Of course, this is man-power
and there are some inherent
problems when moving men
and qualifying them, but we feel
MSI does a better job than most
in controlling these two factors:



While the thrust of MSl’s business
has been in the United
States, it has been involved in two
major projects in the Caribbean
and is looking at another in Mexico.
MSI is a WBE Minority Corporation.


About the Author

Don Proctor is a free-lance writer in
Ontario, Canada

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