“Licensed” in Toronto: What the City Business Licence Means for Renovators and Plumbers

Toronto’s licensing by-law follows a trade business from its flyer to its final bill. Here is what it puts on each piece of paper you handle, and what it leaves for you to ask.

I’m Arthur Zhao, a broker with AZ Real Estate Partners. The word “licensed” turns up on almost every renovation flyer and trade website, and it rarely says which licence it means. It could point to a provincial trade qualification. Gas work has its own authority, the Technical Standards and Safety Authority (TSSA), and electrical work answers to the Electrical Safety Authority (ESA). And inside the city limits, there is a municipal business licence issued by the City of Toronto.

This article is about that last one: the business licence required by Chapter 545 of the Toronto Municipal Code for building renovators, plumbing, drain and heating contractors, and a few related trades. It matters to a homeowner for a practical reason. The Chapter does not only say who needs a licence. It also sets rules for the documents a licensed business hands you: the advertisement, the paperwork, the contract, any change order, and the bill.

So I have organized this around those documents, one at a time, in the order they reach you. It is general information on how the by-law reads, not legal advice on your project.

The advertisement or flyer

The licence obligation starts before any contract is signed. Chapter 545 defines a building renovator, and separately a plumbing contractor and a heating contractor, to include anyone who solicits the work or who advertises or holds themselves out to the public as doing it. A business that only advertises renovation services, and has not picked up a hammer yet, is already inside the definition. The City’s own Building Renovator licence page puts it the same way: the licence is required for all businesses that repair or renovate buildings and structures, “including any business that advertises renovation services.”

The Chapter then tells licensed businesses what their advertising has to carry. Building renovators (§ 545-437A), plumbing and drain contractors (§ 545-420) and heating contractors (§ 545-429) must print the words Toronto Licence No. followed by their licence number on stationery, forms, bills, invoices, statements and advertising material, including published ads in newspapers, periodicals and directories. The same inscription goes on both sides of every vehicle used in the business, in letters and figures at least 10 centimetres high and clearly legible at a distance of six metres.

Once you have the number, the City provides a Business Licence look up, linked from its permits and licences “Common Resources” page, which it describes as a tool for looking up businesses that hold a valid City of Toronto business licence.

The quote

A quote is the first document written for your house specifically. If it comes on the company’s letterhead or a printed form, it falls within the “stationery, forms” the Chapter lists, so the Toronto licence number belongs on it as well.

For renovation work, the quote is also where you first see what kind of work is being proposed. That matters because of how the renovator licence is built. Under § 545-441A, a building renovator may perform a type of work only if the licence is endorsed for that type of work, or if a licensed renovator whose licence carries that endorsement is employed throughout the job. Chimney work has its own rule: under § 545-441B, a building renovator may employ only a licensed chimney repairman for chimney repair.

A quote is not the contract. For building renovators, the document that counts under the Chapter comes next.

The contract

This is the part of Chapter 545 that speaks most directly to the homeowner, and it applies to building renovators. Section 545-442 sets out the rules:

• Before any work starts, the renovator must enter into a written contract with the person the work is for, signed by both (§ 545-442A).
• The contract must be in the form attached as Appendix I at the end of the Chapter (§ 545-442A).
• The renovator must fill in the form in as much detail as is practical: the quality and quantity of materials, the number of hours of labour and the rate, and all other dimensions and measurements of the work (§ 545-442C).
• The contract may not contain any clause other than those in Appendix I without the express approval of the Executive Director or a designate, and the renovator may not enter into a side agreement whose terms are inconsistent with the contract (§ 545-442E).

The practical reading is that the form is fixed and the detail is where the substance goes. A contract that names the job in one line and a lump sum has left most of the form’s fields doing nothing.

The plumbing and heating articles of the Chapter (§§ 545-415 to 545-432) contain no equivalent contract-form rule. The Appendix I requirement is specific to building renovators.

A change or an extra

Renovations change once walls are open. The Chapter anticipates this. Under § 545-442B, a building renovator may not do any other work, “as an extra or otherwise,” until a further contract on the same form covering that work has been entered into in the same way as the first.

For the homeowner, that means the paper trail for a renovation is not one document but a set: the original Appendix I contract plus one more for each addition, each signed by both sides before the extra work begins.

The bill

The final document is the invoice, and the Chapter treats two trades differently here.

• Building renovators: on request, the renovator must give the person the work was done for an itemized and detailed written bill within 24 hours (§ 545-442D). The trigger is your request.
• Drain contractors and drain layers: before receiving payment, they must give an itemized account setting out the hours worked and the materials supplied, with the charges for each (§ 545-419). No request is needed.

For renovators, plumbing and drain contractors, and heating contractors, the bill or invoice is also one of the documents that must carry the “Toronto Licence No.” inscription. Under §§ 545-420C, 545-429B and 545-437B, the number meant is the trade number the City’s Municipal Licensing and Standards Division issues to identify the particular trade or type of business licensed.

Who has to supervise the work

For plumbing and heating, the Chapter ties the business licence to a named, qualified person.

• Plumbing: only a licensed master plumber, or the regular full-time employer of one, may be issued or keep a plumbing contractor licence (§ 545-424A). All plumbing work by a licensed contractor must be under the direct, personal supervision of a master plumber (§ 545-424B).
• Heating: the same structure applies. A heating contractor licence goes only to a licensed master steam and hot water heating installer or master warm air heating installer, or the regular full-time employer of one (§ 545-431A), and heating work must be under the direct, personal supervision of one of those master installers (§ 545-431B).

Under § 545-425A and § 545-432A, a master plumber or master installer may act for only one contractor at a time.

What the Chapter requires of the business, and what it leaves you to ask for

What this licence does not cover

A Chapter 545 business licence is permission from the City of Toronto to carry on a trade as a business within the city. Several things sit outside it:

• New-home building. The renovator definition excludes a building contractor whose principal business is the construction of buildings or structures.
• Electrical work. Electrical contractors and master electricians were deleted from the Chapter’s licence list on October 2, 2015 by By-law 973-2015. Electrical work falls under the Electrical Safety Authority, covered in a separate article.
• Gas work. Fuel safety is the TSSA’s territory. The City’s combined Plumbing & Heating Contractor licence application asks for a Fuel Safety Certificate issued by the TSSA; the TSSA side is covered separately.
• The building permit. Whether a project needs a permit is a different question from whether the business needs a licence.