|What is the state of the law on the status of gig workers today?
In Canada’s pre-pandemic context, gig workers made up about 8-10% of the national workforce. Though, given the year’s extraordinary circumstances, it is speculated that this figure has likely increased. In light of COVID-19, some factors now driving the gig economy in Canada include the increased demand for the home delivery of products and goods, a heightened reliance on technology and innovation, and a developing appetite for more flexible and easily accessible paid work. Despite this apparent increase in popularity, the employment status of gig workers in Canada is an issue that remains nebulous and, to a certain extent, controversial.
By way of background, workers in Canada are generally categorized as employees or independent contractors. In general terms, what separates one from the other is the extent of an organization’s control over the worker, coupled with his or her level of their dependency on the organization. Usually, employees are subject to a higher degree of control and demonstrate heightened dependence on the organization, while the opposite is typically the case for independent contractors.
Clues potentially indicating a higher degree of control can include an organization’s ability to discipline, set normal hours of work, manage promotions and salary increases, and approve time off. In terms of measuring an individual’s degree of dependence, factors that can tip the scales in favour of “employee status” can include an individual’s reliance on an organization to provide them with the necessary tools and equipment needed to work, to influence their advancement in the industry, and to receive compensation fundamental to their livelihood. By contrast, an independent contractor is generally a worker who provides services on a limited or temporary basis, on his or her own account.
Finally, the third category of workers relates to the sometimes elusive notion of “dependent contractors.” In general, dependent contractors in Canada lie somewhere between employees and independent contractors. When distinguishing the independent from the dependent contractor, decision-makers have paid special consideration to the level of economic dependence, vulnerability, bargaining power, exclusivity and permanence between the worker and the entity for which the worker is performing services.
When considering how these concepts apply – or don’t – to gig workers specifically, it may come as no surprise that it is not uncommonly argued that these workers should be classified as independent contractors under the law. Though, recently, there appears to be a growing attractiveness in the case law towards finding gig workers to be dependent contractors. This is important because in some provinces, like British Columbia, Alberta, Ontario, Newfoundland and Labrador and for businesses under federal jurisdiction, dependent contractors have the right to unionize under labour laws in the same way employees do. In addition, depending on the contract, dependent contractors may also be owed certain entitlements upon termination without cause in some jurisdictions, like British Columbia, Alberta, Ontario, Quebec and New Brunswick. When such protections are afforded to gig workers, the resulting consequences for the newly dubbed “employer” can be significant.
|What are the grey areas in the law?
The case law in Canada provides no clear consensus on the status of gig workers. Likewise, there is a dearth of guidance from law and policy makers on this topic, and no new or amended legislation is currently expected any time soon. Until that happens, determining the employment status of gig workers will likely continue to be a highly fact-driven and -specific exercise, and, as a result, employers can expect continued litigation in this area.
|What are trends to look out for?
The substantial contribution of gig workers to the Canadian economy continues to be increasingly noticed, above all in the context of COVID-19. This is perhaps one among other factors fueling recent legal trends whereby the contractual relationship of gig workers has been more and more likened to that of an employee.
While on the legislative front there is little to indicate any major changes in the near future, it bears mentioning that in February 2019, the federal government established the Expert Panel on Modern Federal Labour Standards. Among other issues, this panel was tasked with examining labour standards protections for non-standard workers, including gig workers. In its Report, the panel addresses certain considerations related to the working conditions in which gig workers can sometimes find themselves. The panel also discusses the expressed need for and potential advantages of securing stronger protections and benefits for those working in the gig economy. Whether initiatives such as these eventually materialize into some basis for future government intervention is undoubtedly a question that businesses and employers will closely follow in the coming time.
With many thanks to Emily Deraîche-Grossberg for her help with and contribution to this piece.