Every trade picks this vocabulary up eventually, usually the hard way — a bond you didn't know you needed, a holdback release you assumed worked like an American job's retainage, a "site instruction" you treated as a change order and then couldn't get paid for. This glossary won't make you a contracts lawyer, but it'll get you through a tender package without guessing at what a term actually obligates you to. Terms are grouped by where they show up in a project's life — before you bid, the bonds, the contract itself, during construction, and money/closeout — with each group alphabetical inside itself.
One general note before the list: Canadian construction law is provincial. Holdback percentages, lien-filing deadlines, and the exact test for substantial performance all vary by province and change over time as legislation gets amended. Where a term below depends on one of those specifics, we've described the mechanism rather than guessing at a number — check the lien/construction act that applies to your project.
The bid process
Addendum
A written change or clarification issued by the consultant or owner during the bidding period, before bids close — it becomes part of the contract documents the moment it's issued. Miss one and you've priced the wrong scope; every addendum needs to be logged and acknowledged on your bid form.
Alternate (bid alternate)
An optional scope priced separately from your base bid — "add $X to substitute polished concrete for the specified topping," for instance. The owner can accept or reject each alternate after bids are opened, so your base price and every alternate price both need to stand on their own.
Bid depository
A system, mainly used historically by some mechanical and electrical trades in parts of Canada, where trade bids for a project are submitted to a neutral third party rather than directly to the general contractors bidding the job — so every GC bidding that project sees the same trade price. Less common than it used to be, but it still shows up on certain institutional work.
Division (CSA/CSI MasterFormat)
The numbered organizational system, 00 through 49, that Canadian and American specifications are structured around — Division 03 is concrete, Division 09 is finishes, and so on. See our MasterFormat reference for the full list.
Instructions to Bidders
The section of the tender package that governs the bidding process itself — bid closing time and location, bonding and insurance requirements, how to submit, how addenda get acknowledged, and the owner's rights around rejecting bids. It's the procurement rulebook for this one project; read it before you read anything else.
Scope of work
What you're actually agreeing to build for your price — drawn from the drawings, specs, and any dedicated scope-of-work document, and refined by exactly what you did and didn't exclude on your own bid. A carefully worded scope of work is your best protection against "well, it's shown on the drawing" after the fact.
Sub-bid
The price a subcontractor or trade contractor submits to a general contractor bidding the same project — as distinct from a "tender," which more often refers to the GC's own submission to the owner. On a bid-depository job, sub-bids may go to the depository rather than directly to each GC.
Tender
What Canadians call the whole bidding process, and often the bid itself — where an American estimator says "bid" or "the bid documents," a Canadian estimator says "the tender" or "the tender package." The words are largely interchangeable in practice, but "tender" is the one you'll see on Canadian project documents and public procurement notices.
Walkthrough / site visit
An organized tour of the project site (or the existing building, on a renovation) held during the bidding period so bidders can see actual conditions before pricing. Some tenders make attendance mandatory and will reject a bid from a firm that didn't sign in — check the Instructions to Bidders.
Bonds and security
Bid bond
A bond, usually a fixed percentage of your bid price, that guarantees you'll sign the contract and provide the required performance and payment bonds if you're the successful bidder — if you walk away after winning, the bond covers the owner's cost of re-tendering or awarding to the next bidder. Issued by a surety, not your bank.
Bid security
The broader category bid bonds belong to — any form of security (a bid bond, a certified cheque, an irrevocable letter of credit) submitted with your bid to guarantee you'll honour it if you win. The tender specifies which forms it will accept.
Labour and material payment bond
A bond that guarantees your subtrades and suppliers get paid for labour and material even if you don't — usually issued alongside a performance bond, and often demanded further down the chain by trade contractors from their own subs. Distinct from a lien: this is insurance-style security, not a claim registered against the property.
Performance bond
A bond guaranteeing that if you default on the contract, the surety will step in to complete the work — or pay the owner's cost to have someone else finish it — up to the bond amount. Larger public and institutional tenders routinely require one, sized as a percentage of contract value.
Surety (bonding company)
The company that issues your bonds and is on the hook if you default — distinct from an insurance company, since a surety expects to eventually recover what it pays out from you. Your bonding capacity (how much work a surety will bond you for at once) is a real limit on how much you can bid.
Contract forms and pricing
Cash allowance (provisional item)
A dollar amount carried in the contract for work or a product that isn't fully defined yet — a lighting fixture allowance before the owner has picked a fixture, say. You carry the stated amount in your price, and the contract price is adjusted up or down once the actual cost is known.
CCDC
The family of standard contract forms published by the Canadian Construction Documents Committee — CCDC 2 (Stipulated Price Contract) is the one you'll see most, but there are others built for different delivery models. We've got a dedicated article on CCDC forms coming; for now, know that "CCDC 2" on a tender cover sheet tells you which standard risk-allocation terms you're bidding into.
General conditions
The standard contract terms governing the whole project — payment procedures, insurance, changes, disputes, termination — usually the CCDC's own boilerplate unless the owner has substituted their own version. Read it alongside the supplementary conditions, which amend it for this specific project.
Lump sum vs. unit price
Two different ways a contract prices work. A lump sum (stipulated price) is one number for a defined scope, full stop — if your quantities were wrong, that's your risk to carry. A unit price contract instead pays a rate per unit of measured work (per cubic metre of concrete, say), so quantities get measured as-built and you're paid on what's actually installed.
Schedule of values
A breakdown of your lump-sum contract price into line items by trade or work category, used to calculate progress payments as the job proceeds. Get this wrong — too front-loaded, or too coarse — and it becomes an argument every time you submit a progress draft.
Stipulated price contract
The formal name for what most people call a lump-sum contract — CCDC 2 is literally titled "Stipulated Price Contract." One fixed price for the defined scope of work, and the most common contract type on ICI work.
Supplementary conditions
A project-specific document that amends the standard general conditions — insurance limits raised, a clause reworded, a requirement added to an otherwise generic form. Always read the supplementary conditions against the general conditions they're modifying; that's usually where the real risk-shifting happens.
Unit price
A rate you carry for one unit of measured work — per square metre, per linear metre, per cubic metre — rather than one lump sum for the whole scope. Used where actual quantities can't be pinned down until the work is measured in place, which is common on earthwork, concrete, and site services.
During construction
Back charge
A cost one party bills back to another for correcting or completing work that party should have done — the GC hires someone to clean up after a trade that didn't, then deducts the cost from that trade's next payment. Always dispute a back charge in writing if you don't agree with it; silence tends to read as acceptance.
Change order
A signed document that formally amends the contract price and/or schedule for a defined change in scope — the paper that turns "can you also do X" into money you're actually owed. Never treat a verbal instruction or an unsigned change directive as a change order; get the signature before, or very soon after, the work happens.
Prime contractor
The contractor holding the direct contract with the owner — usually the general contractor — responsible for coordinating every trade on the project. On some Canadian jobsites "prime contractor" also carries a specific occupational health and safety meaning (the party responsible for site safety coordination), which isn't always the same party as the GC — check your provincial safety legislation if that distinction matters on your job.
RFI (Request for Information)
A formal written question to the design team when the drawings or specs are unclear, conflicting, or silent on something you need answered to build the work. Get the answer in writing before you proceed on an assumption — an RFI response is often the cleanest paper trail you'll have if a dispute comes up later.
Site instruction
A written direction from the consultant or owner's representative to proceed with something — distinct from a change order because it doesn't itself adjust price or schedule. If a site instruction implies extra cost or time, that's your cue to follow up with a change order request, not just do the work and hope.
Trade contractor
A contractor performing one specific trade's scope of work — concrete, drywall, electrical — usually under contract to the prime or general contractor rather than directly to the owner. Used somewhat interchangeably with "subcontractor," though "trade contractor" is the more neutral term, increasingly preferred in Canadian ICI usage.
Money, closeout, and Canadian-specific concepts
Certificate of insurance
A document from your insurer confirming your coverage — commercial general liability, usually — meets the limits the contract requires, naming the owner and GC as additional insureds where required. Required before you're allowed on site on most ICI jobs; have your broker keep one current and ready to send.
Closeout documents
Everything you owe at the end of the job besides the physical work — as-built drawings, operation and maintenance manuals, warranties, training records, spare parts ("attic stock"). Final payment and holdback release are routinely tied to complete closeout documentation, so this is real money, not paperwork.
Construction lien
A legal claim against the property that an unpaid contractor, subcontractor, or supplier can register when they haven't been paid for work or materials supplied to a project — it gives them security tied to the property itself. Every province has its own construction/builders' lien legislation, with its own deadlines and procedures (Québec's mechanism runs through the Civil Code as a legal hypothec rather than a common-law lien) — check the rules where your project is, rather than assuming they match another province's.
Cutting and patching
Cutting into finished or existing work to install something, then repairing the opening to match — the default rule in most Division 01 general requirements is that whoever cuts, patches. If your work penetrates another trade's finished assembly, read the clause before assuming the patch-back is someone else's cost.
Deficiency
An item of work that doesn't meet the contract requirements — missing, damaged, or simply not to spec — typically logged on a deficiency list (a "punch list") walked around the time of substantial performance. Clearing your deficiency list promptly is usually what stands between you and your final holdback release.
Holdback
A percentage of every progress payment that the owner or GC withholds until the work — or the whole project — reaches substantial performance and the lien period expires. It's a Canadian statutory concept, required by provincial construction/builders' lien legislation, not a discretionary contract term — and that's the key difference from "retainage" as the term gets used in the U.S.: American retainage is negotiated contract by contract, while Canadian holdback is a legal minimum every payer on the project has to observe, with its own rules for when and how it can be released. Percentages and release timing vary by province and change as legislation is amended, so check the lien act that applies to your project rather than assuming a number.
Liquidated damages
A pre-agreed daily (or weekly) dollar amount the contract lets the owner deduct for late completion, in place of having to prove actual damages in court. The amount is supposed to be a genuine pre-estimate of the owner's likely loss rather than a penalty — but don't count on that legal distinction to get you out of the clause; price the schedule risk instead.
Notice of award / letter of intent
Written confirmation from the owner or GC that you've been selected for the work, issued before the formal contract is fully signed — it lets everyone start mobilizing (ordering material, scheduling crews) without waiting on contract execution. Read it carefully: it can create real contractual obligations even though it isn't the final signed agreement.
Statutory declaration
A sworn written statement, typically confirming that all your subtrades, labour, and suppliers on a project have been paid — required at various payment stages, and almost always before final payment or holdback release, as the owner's or GC's protection against liens showing up after they've already paid out. Signed in front of a commissioner of oaths or notary; false statements carry real legal consequences.
Substantial performance
A defined legal milestone under Canadian construction/builders' lien legislation — roughly, the point at which the work is ready for use for its intended purpose, with only minor deficiencies remaining. It matters because it starts the clock on lien-filing deadlines and holdback release, and every province's lien act sets its own test and thresholds for it — this is squarely a "check your provincial legislation" concept, not a fixed national rule.
Workers' compensation clearance
A certificate from the provincial workplace-safety-insurance board — WSIB in Ontario, CNESST in Québec, a WCB in most other provinces — confirming your account is in good standing and premiums are paid up. GCs and owners require a current clearance before you're allowed on site; an unpaid account leaves them exposed to your liability if you can't pay.