WorkplaceNL clearance letters: who pays when a contractor owes assessments

When you hire a contractor in Newfoundland and Labrador, the law makes you a backstop for the contractor's assessments. A clearance letter removes that risk.

Shared liability

WorkplaceNL says the principal and the contractor are both liable for assessments on the work; unless the contract says otherwise, the contractor is primarily liable as between the two.

What clearance does

A clearance letter confirms the contractor has its own coverage and is in good standing, and clears you of responsibility if the contractor has unpaid assessments.

How long it lasts

A clearance letter is valid for 45 days from issue, or for the period shown in the letter where optional personal coverage is in place, and is limited to the current year.

Holding back payment

A principal may hold back from the contractor an amount WorkplaceNL estimates the principal could become liable for on that contract.

Independent operators

If WorkplaceNL classifies a contracted individual as an independent operator, the principal is not liable for assessments on that contract. Proprietors and partners without optional personal coverage are different: a principal can face civil liability for their work injury.

Prevention Checklist

• Request a WorkplaceNL clearance letter before work starts.
• Renew it every 45 days on longer jobs.
• Hold back an estimated amount if clearance is not available.
• Ask whether the contractor has optional personal coverage.
• Keep the letters with the contract.

References

1. WorkplaceNL. Request Clearance, Web page, How to request. Accessed 2026-11-01.
2. WorkplaceNL. Policy ES-16: Clearance, Web page, Validity; shared liability. Accessed 2026-11-01.
3. WorkplaceNL. Liability: Employers Contracting Work (fact sheet), Web page, Holdback; independent operators. Accessed 2026-11-01.

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