Tactical police gather Wednesday morning near the Workers' Compensation Board in Edmonton, where a man with a gun was holding hostages. After a standoff that lasted until evening, the man surrendered to police. (Jimmy Jeong/Canadian Press)

A gunman who held eight hostages at the Workers' Compensation Board building in downtown Edmonton surrendered peacefully around 6:30 p.m. Wednesday, police said.

The alleged hostage taker is Patrick Clayton, 38, a carpenter who was out of work because of an injury. Court documents obtained by CBC show a history of drug abuse and financial problems.

When CBC reporter Briar Stewart visited Clayton's home in a highrise building near the University of Alberta, she was able to reach him by buzzing his apartment intercom, which was forwarded to his cellphone. Clayton told Stewart he was at the WCB building and that the media should come down.

CBC has learned Clayton was living on compensation board payments that were cut off just over a week ago.

'Negotiating from the get-go,' police say

A police officer stands guard behind a tree near the Workers' Compensation Board building in downtown Edmonton. (CBC)

The hostages were all released unharmed and taken to police headquarters to ensure they were unharmed, said Insp. Terry Rocchio, immediately following the arrest.

Rocchio gave credit to the police negotiating team for convincing the gunman to surrender. They "were negotiating with him from the get-go," said Rocchio.

During the standoff, a man claiming to be the hostage taker called the CBC Edmonton newsroom to complain about the treatment he received from the WCB. He said he was injured on the job, the WCB had unfairly cut him off his benefits and that he has been unable to work since.

"I've got tax forms here saying that I've lived on $5,000 a year. They cut me off for two years. I went to social services. I was trying to do career development with them because WCB would not retrain me. All they did was give me a f--king floppy disk, type out my resumé and run around the countryside trying to get employment."

"I'm sitting there. Why do I get this treatment? Why does everybody else get treated better than I do. What did I do so wrong?"

He then ended with what sounded like a threat.

"I'm not walking out of here. I'm not going to jail tonight.That's why I'm saying, this is my last stand."

By mid-afternoon, most of the hostages had been freed as the negotiations continued. By early evening, the last two were freed and the gunman surrendered to police

The standoff began Wednesday at around 8:45 a.m. at the office on 107th Street and 99th Ave. One employee who got out of the building told CBC News that a tall bald man had entered the building with a gun and one shot was fired, but no one was injured. Rocchio said there had been conflicting reports about a shot that were part of the ongoing investigation.

About 700 people work in the building, and many of them streamed out Wednesday morning to call friends and relatives to tell them they were OK.

Beth Anne O'Neil, who was on the fifth floor when the incident began, said she and dozens of other people were told by police to stay put and were locked into offices in the building.

"I don't know why we were left in there, but we were put in rooms, all sorts of rumours flying around, and then we just waited until we could get out," O'Neil said. "I've never been in a situation like this before, and I hope to God I never do again."

'People are frustrated': WCB advocate

An advocate for injured workers who worked at the WCB for 27 years, Gail Cumming, told CBC reporter Kim Trynacity she's not surprised at the incident.

"There's a lot of people that are worried about what's happened and can relate to what's happening right now," she said.

"I think people are frustrated and don't feel that they can go to the government for help any more. These people are not being retrained, they're given 12 weeks to find employment after their injuries when they're severely injured, and they're cut off benefits." she said. "These people are at their wit's end and don't know what to do any more."

Leo Cody is an injured worker who came to the standoff area to watch. He said he understands how frustrating dealing with the board can be.

"There are thousands of us out there who are walked on and abused by these people," Cody said. "It's terrible, terrible."