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In my case bathrooms in 1st floor/2nd floor are non-sunken versions. All i see contractor has done right now, is to lay a layer of concrete over the mould to elevate the bathroom, and he says any water proofing would be done during tiles laying. Is this the standard practice or is there anything i am missing here ? Can somebody knowledgable share on what is the right way to ensure contractor does everything needed to ensure there are no water leaks.

No it should be done before putting the plumbing pipes for water outlet and commode outlet.
At the time of laying the Tiles these pipes would have been already placed. So it would be difficult to do a water proofing on the floor