Independent Contractor vs. Employee

Toronto Employment Lawyers Advising Employees on Independent Contractor versus Employee Issues 

In a rapidly changing economy, a wide range of alternative work arrangements including temporary contracts, gig work, and freelance work are becoming more and more popular. Such relationships fall outside of the scope of many pieces of legislation that govern the workplace and individuals in these arrangements are considered independent contractors, not employees. Independent contractors also work in more traditional work arrangements, and are classified as independent contractors, not employees, for a variety of reasons.

If you are involved in a non-traditional work relationship or are otherwise working under an independent contractor agreement, you should consult with an employment lawyer for guidance and advice. The Toronto employment lawyers at Sultan Lawyers can review any contract or agreement you may have with a company, help you understand the scope of your workplace relationship, and ensure that the necessary safeguards are in place to adequately protect your rights. We always think outside the box and find innovative solutions to the most challenging issues in the modern and ever-changing workplace.

Independent Contractors in Ontario 

Employers are often under the mistaken impression that classifying someone as an independent contractor or consultant will allow them to avoid certain legal obligations. In some cases, individuals are hired on a series of repeating short-term contracts, instead of a standard employment agreement, or their employment contract labels them a consultant or independent contractor. These are often ways in which employers attempt to circumvent employment legislation. However, a workplace relationship is based on much more than just a job title, label, or contractual agreement.

If there is a dispute over a worker’s status (i.e. whether they are an independent contractor or an employee), a court will review more than just the agreement in place between the parties and will look at what a worker does on a day to day basis.

Factors That Point Towards an Independent Contractor Relationship 

Factors that will be considered include:

• Control: is a worker in control over when and where they work? For instance, do they set their own hours? Do they work from home? Situations in which a worker has a high degree of independence and flexibility over their work are more suggestive of an independent contractor relationship.
• Ownership of tools: does a worker own and control their tools or any other equipment needed for the job (i.e. a computer, cell phone, etc.) and their workspace? Situations in which workers provide their own equipment and supplies are more suggestive of an independent contractor relationship, whereas situations in which a company or employer provides equipment is more suggestive of an employment relationship.
• Chance of profits: what is a worker’s earning potential? Arrangements in which a worker can work in a way that increases their profits (for instance, being paid by article or story written, or item produced) as opposed to being paid an hourly rate will be more likely to be classified as an independent contractor relationship.
• Risk of loss: what is a worker’s risk of loss? Arrangements in which a worker is more likely to lose money where work is done incorrectly or inefficiently will be more likely to be considered an independent contractor arrangement.

Employees who are working as independent contractors (including freelancers, gig workers, and others) may be entitled to additional protections under the law, depending on what the actual day to day realities of their job entail, and despite what it may say in any agreement they may have with the organization they work for.

Sultan Lawyers: Providing Legal Advice and Guidance to Freelancers and other Independent Contractors 

If you have questions about your relationship with the organization or organizations you work for, contact the Toronto employment lawyers at Sultan Lawyers. We can help provide clarity and guidance and will ensure that you are protected at work. Contact us online or at 416-214-5111 for a consultation.