Faulty Work Deductions: What Subcontractors Need to Know

Across Alberta and Canada, workers are protected under law from unfair wage deductions—but what happens when you're a subcontractor and the company hiring you blames you for problems, then tries to deduct money from your invoice?

This situation happens far too often in construction and renovation jobs. Subcontractors work hard, but instead of being respected, they’re blamed for things they may not control—such as paint touch-ups, drywall cracks, or scheduling delays.

This blog is here to explain your rights, how to protect your team, and what to do if a company tries to unfairly take money from you.

What Is Faulty Work?

Faulty work means something was done incorrectly or caused a loss—by accident or mistake. This can include:

• Paint smudges or missed spots

• Cracked tile or trim damage

• Equipment breaking during use

• Errors from unclear communication or missing instructions

  
  

These are common on job sites. But under the Alberta Employment Standards Code, employers cannot deduct money from employees for these types of errors—even if there’s a cost to fix it.

“Faulty work includes any act or omission of an employee which results in a loss to an employer… Deductions for faulty work are not allowed.”(Source: Alberta.ca)

But what about subcontractors, who are not employees?

Subcontractors: A Grey Area

Subcontractors are independent—they send their own invoices, bring their own crew, and take responsibility for their scope of work. But many companies abuse this freedom and blame subcontractors unfairly.

For example:

• A crew does a full paint job, but later someone says "this line isn’t perfect" and withholds $500

• A fence is built correctly, but someone finds 2 cracked boards later and refuses to pay full price

• The client changes their mind on design or color, but blames the subcontractor instead of their own unclear instructions

  
  

Even if the subcontractor did everything right, they’re sometimes punished because the company wants to avoid paying the full amount.

Emotional and Financial Harm

When this happens, the subcontractor’s crew feels the stress. The workers may:

• Lose hours of pay

• Feel blamed or shamed

• Be accused of “poor work” when they tried their best

• Work harder without being thanked or respected

  
  

This leads to burnout, frustration, and unfair treatment, especially if the crew includes Deaf, Hard-of-Hearing, immigrant, or young tradespeople who are trying to build trust in the trades.

It is not just about money—it’s about respect.

Frequently Asked Questions

Can a company deduct money without a signed agreement?

No. If there is no signed contract that includes terms about deductions, then the company has no legal right to reduce your payment just because they are unhappy. Verbal agreements are very weak in court—only signed paperwork counts.

What if the company deducts anyway?

If a company goes ahead and deducts money without your agreement, you can:

• Send a formal email or letter asking them to return the deducted amount

• Request proof of the problem and the cost they are claiming

• Collect your evidence: photos, texts, screenshots, and daily logs

• File a claim in Alberta Small Claims Court for unpaid invoices (up to $50,000)

• Consider contacting a lawyer, a mediator, or an industry association for support

  
  

Is it worth going to court?

Yes—if the amount is significant and you have proof of your work, you have every right to go to court and protect yourself. You are a business, and your work must be respected.

What if the company caused stress and harmed my crew?

This happens too often. Companies that blame subcontractors to avoid payment, or who pressure workers unfairly, are not acting professionally. If this creates a toxic work environment, causes lost wages, or harms your crew’s mental health, you have the right to:

• Refuse future work

• Report unethical behavior to others in the industry

• Protect your crew by standing firm and documenting everything

  
  

Tips to Protect Yourself

1. Always Use a Written Contract Include job details, payment structure, dispute process, and your rights.

   
   

2. Document Everything Take daily before/after photos. Save texts and email conversations.

   
   

3. Ask for Clear Instructions Never rely on verbal or rushed instructions. Ask for emails or checklists

   
   

4. Don’t Accept Unfair Blame If a mistake wasn’t yours or the job was done based on what was asked, stand your ground.

   
   

5. Support Your Crew If someone accuses your staff without proof, don’t let them carry shame. Speak up.

   
   

Say No to Dirty Business

Some companies will:

• Blame subcontractors to save money

• Avoid signing contracts on purpose

• Pay late, then make excuses for deductions

• Treat good workers like they’re disposable

  
  

You have every right to walk away from dishonest business, take legal action, or share your experience to warn others.

Final Thoughts

Subcontractors deserve:

• Fair treatment

• Full payment for completed work

• Protection from unfair blame

• Mental health support for their team

  
  

If a company is trying to deduct money unfairly, causing emotional stress, or refusing to take responsibility, you are not powerless. Stand up, speak out, and protect your team.