Employee Misclassification Checklist

This article is an introduction to the Employee Misclassification under Bill 148.  The ESA now specifically prohibits an employer from treating an employee as an independent.  Employers must prove that the Subcontractor is independent and not an employee.  The Ministry of Labour can issue fine as high as $50,000 for an individual with misclassified employees, to as high as $500,000 for a repeat-offender corporation.  Employers who misclassify employees are liable to former independent contractors for vacation pay, notice or severance, and other unpaid benefits. 

The onus is on the employer to prove that a worker is an independent contractor and not an employee.  Therefore, employers will want to conduct a self-assessment to ensure that they have done their due diligence when engaging contractors.  The four areas to key areas to consider are control, ownership of tools, chance for profit and/or loss and integration. 

Other Items of Interest

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