For businesses to truly thrive, we must all obey the same rules. With less enforcement of existing employment laws as of 2019, we are seeing businesses use false “independent contractors” and we are left wondering: why doesn’t the government help the business community by cracking down on those who are cheating the system?
Despite the laws in the Employment Standards Act (ESA) that exist both to protect the labour force and make sure all businesses have the same rules, workplace exploitation is common practice among many business owners in Ontario. With precarious work practices on the rise, many employers are even breaking the law by avoiding things like overtime pay, minimum wage, and vacation pay — and some are not paying anything for time worked, such as on-call shifts, travel time, and online/phone work outside of scheduled hours.
According to a report from human resources consulting firm Randstad, non-traditional workers, including freelancers, self-employed people, independent contractors, etc., already make up up to 30% of the workforce. We must ask the question: how many are truly independent business owners or freelancers, and how many are truly employees, but lacking basic workplace benefits and protections?
New labour laws introduced by the Ontario government in October 2018 hindered labour protections and Ministry of Labour staff have been discouraged from initiating new inspections aimed at preventing mistreatment of employees, allowing many Ontario business owners to continue breaking the law by calling employees “independent contractors.” This practice means some businesses avoid payroll taxes, and neglect all legal benefits and protections for employees, a few of which are mentioned above.
Unstable employment, lower wages, uncertainty around scheduling, and other poor working conditions affect thousands of employees in Ontario on a daily basis. This is a serious issue for the Canadian economy. Without the insurance of income security that comes along with higher employment standards, people are less likely to be confident consumers.
Weakened labour laws also negatively affect local businesses. With less enforcement of employment standards, a greater number of employers are able to get away with breaking the law. This creates an uneven playing field for Ontario business owners who follow the law and practice decent work — a minimum standard of fair wages, scheduling, and health and wellness practices in the workplace.
With the rising amount of temporary and precarious work in our society, it is important for government to enforce labour laws to support both employees and local businesses. It is also important for business owners to recognize employee mistreatment and work to prevent it. Embracing better working conditions — truly decent work — pays off. Taking the initiative to properly classify employees, rather than using the label “independent contractor” to excess, helps build strong, loyal teams, leading to more business success.
The Better Way Alliance is a network of Ontario business owners who consider employee well-being a smart investment, for our long-term profitability and the health of Canada’s economy. Our members employ more than 30,000 Ontarians. Industries represented include services, retail, food and beverage, and manufacturing.