Canadian Employment Law Today

November 8, 2017

Focuses on human resources law from a business perspective, featuring news and cases from the courts, in-depth articles on legal trends and insights from top employment lawyers across Canada.

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Have a question for our experts? Email Jeffrey.R.Smith@thomsonreuters.com with Stuart Rudner Ask an Expert RUDNER LAW, TORONTO Canadian HR Reporter, a Thomson Reuters business 2017 2 |November 8, 2017 Independent contractor given work requiring long hours Question: Are there any employment standards ramifications if an independent contractor has no set hours but must complete a certain amount of work, but the work given requires the contractor to work long hours every day? WEBINARS Interested in learning more about employment law issues directly from the experts? Check out the Canada Professional Development Centre's live and on-demand webinars discussing topics such as employee off-duty conduct, benefits during the notice period, and Ontario's new employment law changes. To view the webinar catalogue, visit cpdcentre.ca/hrreporter. Answer: Short answer: no. Since I am ex- pected to fill a good portion of the page, I will elaborate. If a worker is truly an independent con- tractor, then her work is not regulated by em- ployment standards legislation. As a result, the rules regarding hours of work, overtime, statutory holidays, vacation, termination, and everything else governed by employ- ment standards legislation do not apply. In my practice, I have seen countless "con- tractors" that are really employees in all but name. In many cases, the individuals prefer this arrangement, as there are some tax ben- efits. However, they fail to appreciate that they also give up the protections that em- ployees enjoy. at said, courts and tribunals will not simply accept the manner in which parties define their relationship. ey will look at the underlying factual reality, and determine whether a worker is, in fact, an independent contractor or an employee. ere are several tests that can be used, relating to factors such as control over the work done, ownership of tools, opportunity for profit and risk of loss, financial dependence, and others. Ultimate- ly, the question is whether the individual is truly in business for herself (an independent contractor), or whether she is really part of the organization (an employee). So while the short answer is "no," the more precise answer is that a true contractor will not be governed by employment standards legislation, but if she is really an employee, then she would be. Even though someone is paid as a contractor, she could always con- tact the Ministry of Labour in her jurisdic- tion and file a complaint, alleging that she is an employee and her rights pursuant to em- ployment standards legislation have been breached. Employee's job duties being handed over to independent contractors Question: If an employer hires independent contractors that eat away at the job duties of a regular employee to the point where the employee's duties barely resemble his original job, can that be constructive dismissal? Answer: Short answer: yes. e key aspect is the latter part of this question. It doesn't matter whether the du- ties are being transitioned to another em- ployee or to a contractor, or whether they are being eliminated entirely. What matters is that an employee is losing a significant portion of her duties and responsibilities. is would, in all likelihood, amount to a substantial change to a fundamental term of her employment, which is the definition of constructive dismissal. First, there would need to be a factual as- sessment of the significance of the changes. As well, the terms of the employee's con- tract would have to be considered they may have agreed that the employer has the right to make such changes. Furthermore, such changes can be made, even without a con- tractual right, if they are implemented with appropriate notice. Lastly, it is always open to the parties to agree to new terms of the relationship, though this would have to be a legitimate agreement involving consider- ation flowing both ways. So regardless of why, if an employee is los- ing a significant portion of her duties, then there may well be an issue of constructive dismissal. However, all of the circumstances would have to be considered before a deter- mination is made. Stuart Rudner is the founder of Rud- ner Law, an employment law firm in Markham, Ont. He is the author of You're Fired: Just Cause for Dismissal in Cana- da published by Carswell, a omson Re- uters business. He can be reached at stu- art@rudnerlaw.com or (416) 864-8500. Ultimately, the question is whether the individual is truly in business for herself or whether she is really part of the organization. The terms of the employment contract may allow the employer the right to make changes to the employee's duties

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