What is the effect of treating workers as independent contractors?
The misclassification of workers as independent contractors has a series of negative consequences, including but not limited to:
- Potential loss of employment insurance benefits on cessation of employment.
- Non-contribution to Canada Pension Plan and its effect on benefits payable on retirement.
- Loss of benefits under the Workplace Insurance and Safety Act, 1997, for injuries arising out of the course of employment.
- Potential liability in respect of income taxes.
- Loss of the ability to sue for wrongful dismissal.
- Loss of various protections under the ESA, including but not limited to:
- Termination/Severance Pay
- Overtime Pay
- Hours of Work
- Maternity/Parental Leave
- Vacation Pay
- Minimum Wage (for example, in situations where the amount paid to the purported subcontractor divided by the hours worked in performing the work amounted to less, per hour, than the minimum wage).
Clearly, by treating workers as subcontractors, Impact has placed such workers in a vulnerable position, working without some of the most fundamental protections and statutory benefits.