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Labour Minister Announces Bill Dealing with Driver Inc. Misclassification

During an industry briefing in Mississauga yesterday, Federal Minister of Employment, Workforce Development and Labour, Patty Hajdu, drew straight from the Canadian Trucking Alliance’s arguments calling for a level the playing field by stopping some employers from misclassifying employees as a way to avoid source deductions or other labour obligations – a practice known as Driver Inc.

Contained in a new omnibus bill introduced by the federal government are new provisions that deal with the misclassification of drivers intended to take aim at those that might promulgate the classification of drivers as independents “to avoid their responsibilities under the Code.”

As the Minister noted, these provisions came as a direct result from requests by CTA for ESDC to better combat Driver Inc. At the event, with CTA present, the Minister acknowledged that responsible, compliant employers strongly dislike the scheme because it gives a “competitive advantage to those other employers who were misclassifying people as ‘self-employed.’”

Meanwhile, she added that employees who thought there would be certain benefits to the structure began to realize that they were being “ripped off” once they actually began to pay the costs of being self-employed, and balanced those against the benefits of being an employee.

“In trucking in particular, we heard both from employer and employee groups that misclassification was a real challenge and created a sense of instability and an unlevel playing field,” she said.

“Our intent is to create a level playing field.”

Her comments were made in the offices of Trillium Roadways, which openly admits to incorporating about half of its 96 drivers.

Trillium president Jaspreet Samra told Today’s Trucking magazine that it’s the drivers who mainly request the payment structure. Although he’s accommodated them to date as a way to recruit and retain drivers in the face of a driver shortage, he said he plans to transition them into the workforce as employees.

“We do think that it is unfair to the entire sector if some people are playing by different rules than others,” said Hajdu.

CTA president Stephen Laskowski stressed that the Alliance will always champion genuine entrepreneurism. He said legitimate owner-operators and small businesses are the ones affected the most by Driver Inc.

“Our industry is built around a lot of independent contractors who invest a lot of money to get into the industry by leasing and purchasing their truck,” he said. “Investment is risk. The misclassification of someone who doesn’t have that risk is really unfair to the entrepreneurial spirit of those individuals.”

While CTA is confident the Minister recognizes those distinctions and grasps just how prevalent the Driver Inc. problem is, the Alliance says it will remain vigilant in urging resources be put towards widespread enforcement.

— with files from Today’s Trucking. See full TT story here.

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