Falsified records of employment in Alberta’s insulation industry could have cost the industry $3.7 million
In early 2024, Andrew Garrett, client & contractor liaison for Heat and Frost Insulators Local 110 in Alberta, received a tip from his colleague at Local 118 in BC: be suspicious of new applicant records of employment.
Like most Locals, Local 118 uses records of employment or ROEs when hiring to determine apprentices’ experience to qualify for technical training and Red Seal certification requirements. While they have generally found ROEs to be an accurate reflection of each applicant’s work experience, in the first week of May 2024, Local 118 noticed something unusual.
“We received about 30 ROEs that made us suspicious of potential falsification,” says Robert Sheck, Local 118 business manager.
There were several clues. Nearly all of the applications came from workers who claimed to be second-year insulation apprentices, but the forms said they all lived on exactly the same block in Etobicoke, Ontario. “The odds of that caught our attention,” Sheck says.
Many of the applications were clearly digitally altered and contained blatant errors, such as mismatched fonts. “When we began receiving these clearly forged ROEs it made us suspicious of the other applications we had received around the same time,” Sheck says. “That prompted us to contact Local 110 to see if they had had the same experience.”
Once Garrett heard the news, he started looking with a keener eye and discovered an alarming number of fraudulent ROEs coming into Local 110, as well. He started documenting them.
Over a span of three months between March 1 and May 31, 2024, Local 110 received 302 applications, representing a substantial uptick in people applying for membership. Of these applications, 109 included resumes with fraudulent information in the form of false work history in the insulation industry. Applicants claiming to have experience were asked to provide ROEs to prove their hours, and of the applicants asked, 58 of them supplied ROEs that had been altered, were fake, or contained fraudulent information.
“The first ROEs to trigger my suspicion had formatting errors,” Garrett says. “They looked to have been doctored digitally, as if parts had been cut, copied, and pasted from another document, but not in the proper place.”
In others, the fonts varied across the document, or the values weren’t properly aligned. Garrett reached out the employers named on the documents to verify the hours, and that’s when the documents were confirmed falsified.
“Some are exact copies of existing employees that have only minor alterations and look legitimate,” he says. “They could only be verified false by running them through the companies’ human resources databases.”
In total, Local 118 received about 50 ROEs that have now been rejected as falsified, with more to be confirmed. “Since this incident, when our Local receives unsolicited emails with ROEs. we put them off into a separate folder for investigation,” Sheck says.
Once Local 118 realized the extent of the issue, they immediately notified their employers and about 20 people were discharged from jobsites over the use of falsified ROEs to secure work or to elevate their pay. “Our Shop Stewards were present for the terminations and many of the employees admitted to faking their employment records,” Sheck says. “We have also received email correspondence from some of those workers apologizing for their actions and then asking for endorsements to help them find jobs elsewhere. We declined the endorsement requests.”
Garrett prepared a report about Local 110’s experience, which he presented to the union members in June. In it, he broke down the date for each ROE and the implications that the false documents could have on the insulation industry.
Hours falsified to bump pay range
The number of hours on each ROE submitted varies from 523 to 3,173. Some applicants submitted several ROEs, resulting in more ROEs than applicants. As a result, the number of hours assigned to an applicant could push them up the pay scale, with financial consequences for employers.
“Twenty-two percent of fraudulent applicants would be considered first-year apprentices, while the large majority (74%) fall between the hour ranges identified by the current apprenticeship structure as second-year apprentices,” Garrett says. “The remaining 4% would be considered third-year apprentices.”
There were higher numbers of false documents coming from specific employers—namely, larger companies with employees into the hundreds. Although it is difficult to say why without a thorough investigation, one possibility is that fraudulent reporters list larger companies since those companies may have higher turnover and be more difficult to verify, just by odds of probability.
“It could also be that if someone were to create a fraudulent ROE, they would assume that a larger company would be less likely to be questioned or that a large company would be too busy to assist with verifying hours,” Garrett suggests.
Potential cost to the industry
Looking at how those hours fit into the apprenticeship structure in Alberta and the wage schedule used by Local 110 to determine Industrial workers compensation, if the fraudulent applicants were employed in the industrial sector, over one calendar year it would cost the industry $3.7 million.
If the applicants had applied without fraudulent ROEs and had been hired at a first-year apprentice’s wages, the cost difference would have been $700,000.
Besides the economic implications, having underskilled workers on the job can pose important safety risks. “A worksite with inexperienced insulators is at risk of accidents and serious injuries to those workers and others on the jobsite,” Sheck says. “And contractors are at risk of wasting money on workers not skilled enough to do an effective job and complete quality work.”
Across Canada
David Gardner, business manager at Local 95 in Ontario says that while that local hasn’t received falsified documents, it has encountered applicants who aren’t as skilled as they initially claim. “Anyone who applies and claims to have experience is brought into our training facility to show us their skill set,” he says. “And too often, people say they’ve been doing insulation for 15 years but when they get on the tools, they can’t back it up.”
There are several reasons for the discrepancy, Gardner says, ranging from a flat out lie to simply not having the breadth of experience they thought they would need to challenge an apprenticeship program.
“Some people who come in know construction is booming and that there is a lot of work, but they don’t want so start at the bottom and work their way up,” he says. “In other cases, we get people from other jurisdictions, like Europe where they typically have a higher skill set and a greater focus on mentorship than in Canada, but they might only have commercial experience.”
Regardless of the applicant’s skillset, they are offered a place in Local 95’s training facility that coincides with their actual skillset. “We give everyone a fair shake,” Gardner says. “Even if that means starting at the bottom.”
Contractors and unions working together
Garrett believes it’s possible that other parts of the construction industry in Alberta are dealing with false documentation. Recent legislative changes at the provincial level have shortened the time required to complete an apprenticeship, and Garrett wonders if the new system has reduced the value of completing an apprenticeship in mechanical insulation.
“It is important to remember that these are just the projected costs of 58 applicants,” Garrett cautions. “This is a very large industry with many players spread over a large area. It is not unreasonable to expect that there are more fraudulent applications and fraudulent ROEs across the province. This would mean that the potential cost to the industry is much higher than the amount calculated by this small sample.”
With Alberta’s reputation as a hotbed of larger projects, resulting in growing demand for insulators, Garrett says organizations and companies need to work together to diligently ensure they are sharing information and verifying it. Another option is for the province of Alberta to make mechanical insulation a compulsory trade.
“If mechanical insulating were a compulsory trade in Alberta, then all hours would have to be submitted and verified by Apprenticeship and Industry Training (AIT),” Garrett says. “This would make falsifying documents immeasurably more difficult and would likely eliminate it.”
Sheck agrees. Without a provincial or federal mandated policy for all contractors to register their new workers to an indentured Red Seal apprenticeship program, he believes the construction trades will continue to see acts taken to circumvent the system currently in place. “Trades workers’ experience level and hours on the job are increasingly difficult to verify, and we are forced to use less-than-ideal means to validate them,” he says. “Unfortunately, resumes are very easily falsified, and with the progress of technology, the ROEs are now, too.”
Harmonizing Red Seal training across Canada is one solution, Gardner says, although this is not popular in all jurisdictions. “In some places, like Alberta, they had to shorten their program because the oil and gas industry is so busy they need more people and quickly,” he says. “But just because you have a ticket doesn’t mean you’re a true journey. You need at least another five years on the tools before someone could leave you to a big job and walk away knowing there would be nothing to worry about.”
He also believes in a strong mentorship component. “In an open market, there is a lot of work, but it is very competitive,” he says. “Having good mentorship would help everyone develop a stronger workforce.”
Local 118 believes the best way to safeguard against the use of falsified records is to re-establish the certified trades program policy, formerly known as compulsory trades in British Columbia.
“If contractors could have a single, regulated source where trades experience hours can be submitted to and verified, it would save both employers and unions countless hours and provide a method for everyone to validate the experience of the workers,” Sheck says. “All tradespeople should be obligated to enroll in an indentured apprenticeship program, and all contractors should be obligated to have their workers be indentured apprentices or certified journeypersons to ensure clients and taxpayers are receiving the quality of work through skilled labour on their projects.”
Nova Scotia is the only jurisdiction in Canada with an application pending to make insulation a compulsory trade. Although Local 116 Nova Scotia Business Manager Matthew Benson says he isn’t aware of any falsified ROEs in his area, he notes that compulsory trade certification could be key for resolving the matter elsewhere.
“We applied for compulsory certification because training—by regardless of whether it involves union or non-union contractors—would stop the ‘fly-by-night’ contractors who do sub-par work,” he says. “We believe that these types of contractors are the ones who falsify ROEs, and that compulsory certification would help rectify that.” ▪