1. The Dependant Contractor Concept in Canadian Labour Law
Presented to OECD Conference on Policy Responses to New Forms of Work
Paris November 7, 2018

2. History Enacted in Labour Relations Act in Ontario 1975;
Now enacted in many other Provinces and Federally;
Has become part of the common law in the non-unionized world of wrongful dismissal in some provinces;
Not part of Employment Standards
Legislation
Over 40 years of experience in Canada
Original Concept: H.W. Arthurs: “The Dependent Contractor: A Study of the Legal Problems of Countervailing Power” ( ) 16 U.T.L.J. 89
Former all or nothing distinction between independent contractors and employees with traditional common law “four fold” test, involving control, ownership of tools, chance of profit, and risk of loss led to exclusion from collective bargaining of some who were essentially in similar economic position to employees. Led to push for reform.

3. Section 1 Labour Relations Act Ontario
“dependent contractor” means
a person, whether or not employed under a contract of employment,
and whether or not furnishing tools, vehicles, equipment, machinery, material, or any other thing owned by the dependent contractor,
who performs work or services for another person for compensation or reward
on such terms and conditions that the dependent contractor is in a position of economic dependence upon, and under an obligation to perform duties for, that person
more closely resembling the relationship of an employee than that of an independent contractor;
1 (1) In this Act,
“employee” includes a dependent contractor;

4. Purpose
Addresses persons who outwardly manifest the trappings of independent entrepreneurs, but who are in such a subservient economic position vis-a-vis the beneficiary of their services that they ought to be extended the protection of collective bargaining.

5. This new point of departure requires reference to a broader range of labour relations considerations.
Two purposes are served:
  1. persons in economic positions that are closely analogous are given the same legislative treatment. 
2. protect existing bargaining rights from being eroded by arrangements that differ only in form, but not in substance,.
Economic dependence must put the person in roughly the same economic position as an employee..  Mere economic vulnerability is insufficient.  
There must be “an obligation to perform duties for that person” analogous to an employee”.  One must look at the form of the business relationship to see if it is broadly analogous.

6. Benchmarks
Decision makers will be very sensitive to the nature of each industry and the reality of the economic circumstances:
source of work
manner of determining amount of payment
control of methods and work procedures
identification with customer
financial arrangement
ownership of tools

7. Benchmarks - Economic mobility and independence Benchmarks continued - similarity to employees - chance of profit

8. Dependent on Whom? -must be the person, not an industry -if large number of companies , not dependent on one person -can look at proportion of income as a guide -Some have used 60%, some 80% - however, in construction a dependent contractor may work for one entity in one short temporal period and then for another entity. Not clear why this does not apply outside construction. - The fact that an individual may be able to work for others elsewhere is not disqualifying

9. What about the owners of more than one vehicle
What about the owners of more than one vehicle? Can a dependent contractor employ someone?
Results vary
In some jurisdictions can be “ dependent” with two trucks and one employee
In some jurisdictions can have one “helper” but not more
Adjudicators look to the realities of who is really an entrepreneur

10. Typical Industries
truck owners hauling aggregate/lumber/ woodchips etc.
taxi owners (UBER?)
contract delivery drivers (as for bread, milk)
tree removers
nursing service providers
oil burner servicing and sales
residential framing (construction)
drywall installation (construction)
Roofers (construction)
Siding (construction)
home daycare providers