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ESDC Announces Dedicated National Team to Enforce Misclassification Compliance in Trucking Sector

The trucking industry is facing a tax evasion and labour misclassification crisis. The announcement by ESDC this week is a recognition that this crisis requires special enforcement attention through the creation of a specific road transportation enforcement unit:

To specifically tackle the misclassification in the road transportation sector, the Labour Program has set up a dedicated national team that has, to date, completed over 300 inspections and outreach sessions. Non-compliance is addressed through a spectrum of enforcement measures, and it can result in the Labour Program issuing monetary penalties up to a maximum of $250,000. During the past six months, the Labour Program has issued payment orders totalling over $600,000 to employers in road transportation sector. This represents 80 % of overall payment orders issued.

The team will continue to expand the pace and scope of its efforts to combat illegal misclassification nationwide. We are strongly committed to addressing the illegal practice of employee misclassification and will continue to expand our efforts… The Labour Program has intensified its efforts to eradicate the illegal practice of employee misclassification. Through enhanced education, as well as proactive and targeted inspections across Canada, the Labour Program is actively working at ensuring that employers understand and fulfill their obligations under the Code.

In its memo to industry, ESDC rightfully points out that misclassified workers miss out on important labour rights, protections, and entitlements as traditional employees – including overtime pay, general holidays, annual vacation, and several protected leaves like medical leave with pay – and that this practice can have serious consequences. To enforce these amendments, the Labour Program uses a spectrum of enforcement measures, including payment orders, an escalating monetary penalties system and public naming.

“Driver Inc. is a scourge on our sector and it continues to rob those who play by the rules,” said CTA President Stephen Laskowski. “This new enforcement unit must ensure that every driver being abused of their labour rights is paid in full and these gross violating carriers receive zero leniency. The laws have always been clear and they must be enforced through monetary penalties and other forms of punishment.”

The CTA will be speaking with government and opposition parties to confirm their support of this enhanced enforcement regime. Further, the Alliance will be asking all political parties to pledge their support for ending the illegal practice of employee misclassification once and for all.

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