Do consultants have rights under the Employment Standards Act?

This article was originally published by The Hamilton Spectator.

Q: I work full-time as a consultant providing advice to a business. Do employment laws apply to me?

A: Several laws have bearing on the issue of employment-status in Ontario and the answer will always depend on the context of the case. That being said, there is a change to the ESA as of 2023 for certain “business” and IT consultants in Ontario, for whom minimum employment standards may no longer apply.

Despite the change to the ESA, under “common” law (made by judges) employee status may still be found to exist for all types of contractors and consultants if the context of the relationship suggests so (no single factor, such as a written contract, is decisive; the whole context matters). That means employment standards, and more generous common law severance pay, remain potentially at play for all manner of contractors and consultants, at least in the right circumstances.

Although common law will continue to have potential application in general, the ESA no longer applies to a specific class of business and IT consultants, if the following (current) criteria are met:

1. the Consultant provides services through either: a corporation or using a business name registered under the Business Names Act; and

2. there is an agreement under which the consultant is actually being paid, which sets out time for payment and an hourly rate of at least $60 per hour, excluding certain compensation.

The legislative amendment takes away some employment standards that might have otherwise applied to a subset of such consultants. However, the common law continues to have potential application across the board.

With regard to legislation, there is unfortunately still very little statutory clarity about employee-status for most other dependant contractors working in our province.

If you’re a worker or employer with questions about overtime pay, employment law class actions, or any other labour, disability or human rights law, please feel free to connect with a member of the Ross & McBride team.

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Wesley Jamieson
Wesley Jamieson
P: 905.572.5806