Independent Contractor?

Independent Contractor or Employee?

What’s the difference and which one are you?

With successful court challenges to Fedex in California, with more challenges coming, the Federal Court Decision against Dynamex (see side bar) in Canada, the winds of change are blowing for the outdated Independent Contractor model of business. Really, it is downloading the risk and cost to a group that should be employees as a means of financing their operations - which is why the courts keep ruling against courier companies.

Federal Court Decides.

Are couriers employees or independent contracts?

The Federal Court of Appeal has upheld an order by a referee under the Canada Labour Code requiring an employer to pay vacation and holiday pay to workers who provided courier and delivery service.

Read the full decision.

Text Box: The only thing truly defining a courier as an ‘independent contractor’ is that the owner-operator has to pay all the expenses to do the job.

The following is a check list used by the courts to determine the difference between an employee and an independent contractor. If you are like the vast majority of commission delivery drivers, you will find that you have check marks on both sides, sometimes in the same category. Which is why a few years ago the Federal Court of Appeal, in a landmark decision for delivery drivers, created a new category: The Dependent Contractor.

The highlighted portions apply to the vast majority of owner operators

Contractors

Disguised Employees?

A Case Study of Couriers in Winnipeg

Employee	Independent Contractor
follows instructions on how to work	works without detailed directions on procedure
trained on how job should be done	uses own experience, expertise to do job
works within company environment	works alone - not part of company "team effort"
hired to work as an individual, based on skills, talent, and potential	hired to provide service many times, regardless of who actually does work
has indefinite employment status	hired for a set time period only
works under set hours	sets own hours
works for one employer at a time	can work for several employers at a time
works mainly on-site; employer-directed off-site	can work either on-site or off-site, without employer direction
works in employer-established order to allow for supervision	works any way desired to provide required service or product
reports on work efforts as part of supervision	reports only as agreed upon
compensated regularly, at specified time periods	paid on per-job basis in a lump sum
has work-related expenses paid by employer	pays own expenses out of expected compensation
has tools and supplies provided by employer	provides own tools and supplies
does not own or control work site	may own or control work site
generally does not work on profit / loss basis	generally works on profit / loss basis
gives employer exclusive effort	works for many contractors at once
cannot offer efforts to general public	markets services to anyone who wants them
can be fired at employer's discretion (subject to employment agreement)	can be fired only if work falls short of expectations
can end employment at any time	responsible for completing job as agreed upon