diff --git a/api/v1alpha1/linodeobjectstoragebucket_types.go b/api/v1alpha1/linodeobjectstoragebucket_types.go
index 96f9dc2c9..371e03555 100644
--- a/api/v1alpha1/linodeobjectstoragebucket_types.go
+++ b/api/v1alpha1/linodeobjectstoragebucket_types.go
@@ -94,6 +94,7 @@ type LinodeObjectStorageBucketStatus struct {
 // +kubebuilder:object:root=true
 // +kubebuilder:resource:path=linodeobjectstoragebuckets,scope=Namespaced,shortName=lobj
 // +kubebuilder:subresource:status
+// +kubebuilder:metadata:labels="clusterctl.cluster.x-k8s.io/move-hierarchy=true"
 // +kubebuilder:printcolumn:name="Label",type="string",JSONPath=".spec.label",description="The name of the bucket"
 // +kubebuilder:printcolumn:name="Cluster",type="string",JSONPath=".spec.cluster",description="The ID of the Object Storage cluster for the bucket"
 // +kubebuilder:printcolumn:name="Ready",type="string",JSONPath=".status.ready",description="Bucket and keys have been provisioned"
diff --git a/api/v1alpha1/linodevpc_types.go b/api/v1alpha1/linodevpc_types.go
index 624eb62b8..353befb53 100644
--- a/api/v1alpha1/linodevpc_types.go
+++ b/api/v1alpha1/linodevpc_types.go
@@ -105,6 +105,7 @@ type LinodeVPCStatus struct {
 
 // +kubebuilder:object:root=true
 // +kubebuilder:subresource:status
+// +kubebuilder:metadata:labels="clusterctl.cluster.x-k8s.io/move-hierarchy=true"
 
 // LinodeVPC is the Schema for the linodemachines API
 type LinodeVPC struct {
diff --git a/config/crd/bases/infrastructure.cluster.x-k8s.io_linodeobjectstoragebuckets.yaml b/config/crd/bases/infrastructure.cluster.x-k8s.io_linodeobjectstoragebuckets.yaml
index 94e04b9fe..b5daaaed1 100644
--- a/config/crd/bases/infrastructure.cluster.x-k8s.io_linodeobjectstoragebuckets.yaml
+++ b/config/crd/bases/infrastructure.cluster.x-k8s.io_linodeobjectstoragebuckets.yaml
@@ -4,6 +4,8 @@ kind: CustomResourceDefinition
 metadata:
   annotations:
     controller-gen.kubebuilder.io/version: v0.14.0
+  labels:
+    clusterctl.cluster.x-k8s.io/move-hierarchy: "true"
   name: linodeobjectstoragebuckets.infrastructure.cluster.x-k8s.io
 spec:
   group: infrastructure.cluster.x-k8s.io
diff --git a/config/crd/bases/infrastructure.cluster.x-k8s.io_linodevpcs.yaml b/config/crd/bases/infrastructure.cluster.x-k8s.io_linodevpcs.yaml
index c7fedf061..4d73a774b 100644
--- a/config/crd/bases/infrastructure.cluster.x-k8s.io_linodevpcs.yaml
+++ b/config/crd/bases/infrastructure.cluster.x-k8s.io_linodevpcs.yaml
@@ -4,6 +4,8 @@ kind: CustomResourceDefinition
 metadata:
   annotations:
     controller-gen.kubebuilder.io/version: v0.14.0
+  labels:
+    clusterctl.cluster.x-k8s.io/move-hierarchy: "true"
   name: linodevpcs.infrastructure.cluster.x-k8s.io
 spec:
   group: infrastructure.cluster.x-k8s.io
diff --git a/controller/linodecluster_controller.go b/controller/linodecluster_controller.go
index aa636ce6b..b32f0f101 100644
--- a/controller/linodecluster_controller.go
+++ b/controller/linodecluster_controller.go
@@ -30,7 +30,6 @@ import (
 	clusterv1 "sigs.k8s.io/cluster-api/api/v1beta1"
 	cerrs "sigs.k8s.io/cluster-api/errors"
 	kutil "sigs.k8s.io/cluster-api/util"
-	"sigs.k8s.io/cluster-api/util/annotations"
 	"sigs.k8s.io/cluster-api/util/conditions"
 	"sigs.k8s.io/cluster-api/util/predicates"
 	ctrl "sigs.k8s.io/controller-runtime"
@@ -84,11 +83,7 @@ func (r *LinodeClusterReconciler) Reconcile(ctx context.Context, req ctrl.Reques
 
 		return ctrl.Result{}, nil
 	}
-	if annotations.IsPaused(cluster, linodeCluster) {
-		logger.Info("LinodeCluster of linked Cluster is marked as paused. Won't reconcile")
 
-		return ctrl.Result{}, nil
-	}
 	// Create the cluster scope.
 	clusterScope, err := scope.NewClusterScope(
 		ctx,
@@ -136,6 +131,7 @@ func (r *LinodeClusterReconciler) reconcile(
 	if err := clusterScope.AddFinalizer(ctx); err != nil {
 		return res, err
 	}
+
 	// Create
 	if clusterScope.LinodeCluster.Spec.ControlPlaneEndpoint.Host == "" {
 		if err := r.reconcileCreate(ctx, logger, clusterScope); err != nil {
diff --git a/controller/linodemachine_controller.go b/controller/linodemachine_controller.go
index adf8495f3..9c3fea0b5 100644
--- a/controller/linodemachine_controller.go
+++ b/controller/linodemachine_controller.go
@@ -487,9 +487,14 @@ func (r *LinodeMachineReconciler) SetupWithManager(mgr ctrl.Manager) error {
 		return fmt.Errorf("failed to build controller: %w", err)
 	}
 
-	return controller.Watch(
+	err = controller.Watch(
 		source.Kind(mgr.GetCache(), &clusterv1.Cluster{}),
 		handler.EnqueueRequestsFromMapFunc(r.requeueLinodeMachinesForUnpausedCluster(mgr.GetLogger())),
 		predicates.ClusterUnpausedAndInfrastructureReady(mgr.GetLogger()),
 	)
+	if err != nil {
+		return fmt.Errorf("failed adding a watch for ready clusters: %w", err)
+	}
+
+	return nil
 }