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Compliance Glossary Term

Payroll Tax

Mandatory government deductions withheld from employee wages, including CPP, EI, and income tax. Subcontractors with direct employees must remit these to the CRA on a set schedule. Misclassifying workers as independent contractors to avoid payroll tax can trigger costly audits.

Related Terms

Compliance Theater

Compliance

When a prime contractor or owner requires paperwork and box-checking that looks rigorous but adds no real safety value. Subcontractors absorb the administrative burden without reducing on-site risk. Recognising it helps crews push back on inefficiencies that drain time and resources.

Indemnity Provision

Compliance

A contract clause that transfers liability for losses, injuries, or damages between parties. Subcontractors are often required to indemnify the prime contractor or operator against third-party claims. Review these clauses carefully, as they can expose your company to costs beyond your scope of work.

Surface Transportation Reauthorization

Compliance

A periodic federal renewal of legislation governing road, rail, and trucking regulations. For subcontractors, it can change load limits, hauling permits, and carrier compliance requirements. Review updates carefully, as new rules may affect equipment mobilisation costs and timelines.

Local Content

Compliance

A requirement that a set percentage of workers, materials, or services come from the local region or country. Subcontractors must often prove local hiring and sourcing to help clients meet these obligations. Non-compliance can disqualify your bid or void a contract.

Jones Act Waiver

Compliance

A temporary federal exemption allowing foreign-flagged vessels to transport cargo between U.S. ports. Subcontractors may encounter this during emergency offshore operations or disaster response work. Waivers affect vessel availability, crewing rules, and subcontract scope on marine projects.

OFAC (Office of Foreign Assets Control)

Compliance

A U.S. Treasury agency that enforces sanctions against designated countries, companies, and individuals. Subcontractors must screen clients and vendors against OFAC lists before accepting contracts or payments. Working with a sanctioned party can result in severe fines and contract termination.

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