We all know workers have rights in the workplace even if we are not always sure what those rights are. The source of these workplace rights varies and may depend on where you live and whether or not your workplace is unionized. Some workplace rights are found in legislation and regulations such as the Employment Standards Act, 2000 or the Ontario Human Rights Code. The courts, tribunals, and common law decisions may form the basis for the protection of other workplace rights. Additional rights may be found in contracts, workplace policies or, in the case of unionized employees, collective agreements.
Which rights apply to your situation can often depend on how you are classified as a worker. Some common classifications include employee, independent contractor, gig worker, or dependent contractor. What do these words mean? How can they impact your rights? What changes is the Ontario government currently considering? These issues are discussed in detail below as they apply to non-unionized provincially regulated workers in Ontario.
Put most simply, an employee provides work or services to an employer for wages. An employee in Ontario has rights under the Employment Standards Act, 2000, Ontario Human Rights Code, the Occupational Health and Safety Act and other legislation and regulations. An employee may also be entitled to reasonable notice of termination under the common law in Ontario. We have written about reasonable notice of termination here.
Contractors, gig workers, independent contractors and dependent contractors, generally speaking, have fewer legal workplace rights. For example, in Ontario, these workers are not covered by the Employment Standards Act, 2000. However, they may still have contractual rights in their agreements with the company or individual for whom they are providing services and may also have protections under common law.
Employees are generally entitled to reasonable notice of their dismissal. The courts recognize that at least some contractors have similar rights. When a contractor brings a claim for wrongful termination, the courts look at the degree of dependence the worker has when determining whether the contractor is entitled to reasonable notice as a dependent contractor.
When analyzing dependence, the courts may look at:
- The length of time the contractor provided the services – the longer the time period, the increased likelihood of dependence;
- Whether they were able to provide services to other entities during the contract;
- How are the services connected to the company’s core business;
- How much risk of loss or profit the contractor has under the arrangement; and,
- Other facts that show dependence or independence.
In most workplace relationships, the company usually drafts a contract that defines the worker as an employee or contractor. When workers who are really employees are misclassified as contractors they lose out on a number of rights, including Employment Insurance programs, Canada Pension Plan participation and overtime protections to name just three. In recent years, courts and employment standards tribunals have awarded large verdicts to employees in these situations.
In Sondhi v Deloitte et al, a number of workers engaged in document review work were classified in their work contracts as independent contractors. They were not participating in the Canada Pension Plan or Employment Insurance programs. These workers were not eligible for overtime pay, holiday pay on statutory holidays, or vacation pay.
The court reviewed the facts of their work arrangements, including that Deloitte controlled the worksite and technologies used, the contractors could not subcontract the work, and the contractors had no financial risk or opportunity for profit. Based on these and other factors, the court determined that these workers may have been misclassified and certified a class action lawsuit against Deloitte for damages. The damages included compensation for overtime pay, holiday pay, and vacation pay. While the matter is still before the courts, an interim costs order was issued granting the lawyers representing the workers costs in the amount of $353,790.88.
This is a complicated area to navigate. If you are an employer and you are unsure about how to classify individuals who work for you, it is always valuable to seek legal advice on this topic. Similarly, employees who feel they have been misclassified should speak to an experienced employment lawyer for advice on their specific situation.
Even when a worker is properly classified as a contractor, there can still be unfairness. After all, simply being a contractor doesn’t mean the individual has the power or independence to negotiate reasonable agreements to protect themself. This can lead to injustices that the Ontario government is currently looking into addressing.
The Ontario Workplace Recovery Advisory Committee, which we’ve previously written about here, has made a number of recommendations on workplace rights for workers who are not currently covered by the Employment Standards Act, 2000.
The Ontario Workplace Recovery Advisory Committee recommendations include:
- Creating and clarifying separate categories for independent and dependent contractors;
- Continuing to provide the opportunity for flexibility for highly skilled workers in the independent contractor category;
- Codifying basic employment rights for more dependent contractors; and
- New requirements related to gig platforms to provide specific information to the contractors using their platforms.
While the Ontario Government has not adopted these recommendations yet, there is some indication that these changes and other changes for gig workers and contractors are under consideration. Ontario Labour Minister Monte McNaughton recently spoke with CTV News Toronto and said the following:
“My message to Uber, to Skip The Dishes, to these gig companies, if they’re not going to look after their workers, then we’ll take action to ensure that those workers are protected.”
It is important to emphasize that these changes are currently being discussed and have not been adopted into law. As you can see, the facts matter and employees, contractors, and companies should always seek legal advice for their specific situation.
Contact Peter A. McSherry Employment Lawyer for Experienced Advice on Workplace Issues Involving Contractors and Employees
If you are concerned about how to classify workers or you are concerned you have been misclassified, Peter A. McSherry Employment Lawyer can provide you with the resources of an experienced and skilled Guelph employment lawyer. We have worked with employees, employers, contractors and gig workers and can ensure your case is handled properly and efficiently for a fair resolution. Contact us online or by telephone at 519-821-5465 to schedule a consultation.