CTA, Teamsters and carriers take Driver Inc. fight to Parliament Hill
Crisis. Unsavory. Atrocity. Scam. Those were some of the words thrown around today as the Canadian Trucking Alliance (CTA), member carriers, and Teamsters Canada came to Parliament Hill with their campaign against the Driver Inc. model of misclassifying employee drivers as independent contractors.
In some of their strongest language to date against Driver Inc., CTA representatives including president Stephen Laskowski and members Claude Robert (president of Robert Transport) and Scott Tilley (president of Tandet Group) — along with Teamsters Canada leaders — implored the federal government during a press conference to take action against the growing scheme.
“We’re here today to sound the alarm bells,” Laskowski said. “The alarm bells have been sounding for many years that there is a crisis in our industry, a labor abuse funded by a tax scheme.”
He noted that the use of Driver Inc. in the trucking industry surged 17% between the years of 2018 and 2021, while in the broader economy the use of “zero-based employees” shrank by 1%. “That is staggering,” he said.
Drivers filing taxes as personal service businesses (PSBs) would naturally pay more in taxes than employee drivers, Laskowski said, indicating there’s no benefit for company drivers to operate as independents when driving company-owned equipment.
“Ask yourself, why would anyone do it? Why would anyone pay more? Why would anyone give up their labor rights?” he asked.
ESDC Driver Inc. investigation
He said an Employment and Social Development Canada (ESDC) investigation found that 60% of the carriers they looked into operated in this manner. But, he lamented, little has been done by the federal government to crack down on the practice. Laskowski said a promise in the Fall Economic Statement to devote $26 million toward enforcement of Driver Inc.-related abuses has yet to be confirmed.
And he said Canada Revenue Agency (CRA) has also failed to act. Promises that there’d be language in the latest federal budget to clamp down against Driver Inc. went unheeded, he added. He called on ESDC and CRA to bring “meaningful” enforcement against Driver Inc. carriers.
“Last but not least, work together on joint audits, starting with the 60% of carriers that are already having violations,” he urged.
Robert offered remarks in French, echoing the industry’s concerns about Driver Inc., followed by Tilley who told attending media that this was a widespread, national crisis that exploits vulnerable workers and puts public safety at risk.
“Driver Inc. will affect us all and the clock is ticking,” he warned, adding “the Canadian fabric is being attacked by this program.”
“If we fail,” he added, “our industry will regress by at least 40 years.”
Avoiding deductions and remittances
Tilley took direct aim at employers he said “force the Driver Inc. model on unsophisticated individuals.”
These employers, meanwhile, often do not offer vacation pay, statutory holidays, or CPP, EI or workers’ compensation deductions and remittances. In Ontario and B.C., he added, they don’t pay employer health taxes, robbing provincial coffers of funds needed to hire doctors and nurses.
“There are few rules for Driver Inc. Just the ones they make up or cannot get around,” he said. “It sounds not quite legal to me. It seems to be an unsavory bunch. We need to stop the atrocities being inflicted on thousands of drivers across Canada.”
Teamsters Canada president Francois Laporte supported the CTA position, adding “This is very detrimental for the industry.”
Quebec carriers echo concerns
In a related press release, the Quebec Trucking Association added its voice to those calling for an end to Driver Inc.
“The Driver Inc. scam is costing governments at least $1 billion annually,” association president Marc Cadieux said in the release. “That’s money that should be going to build our infrastructure and securing our social safety net, but instead is going into the pockets of crooked businesspeople. It has to stop!”
And in the same release, Robert spoke directly to truckers, letting them know “There are hundreds of honest carriers in Canada who offer great working conditions to experienced drivers, in accordance with legislation. Reach out and get out of that trap! We need you, and you are more than welcome to work with us.”
The Office of the Minister of Labour, Seamus O’Regan, responded to the press conference to TruckNews.com with the following statement:
“Employee misclassification harms workers by stripping them of their basic labour rights, including minimum wage, paid sick leave, the right to unionize, workers’ compensation, and employer contributions to Employment Insurance (EI) and the Canada Pension Plan (CPP). Our government is focused on an education-first approach to stop this discriminatory practice. Employers who continue to knowingly break the law following education and awareness will be held accountable.
“We have a Labour Code in Canada that enshrines workers’ rights. We are making sure those rights are known, upheld, and protected.”
Have your say
This is a moderated forum. Comments will no longer be published unless they are accompanied by a first and last name and a verifiable email address. (Today's Trucking will not publish or share the email address.) Profane language and content deemed to be libelous, racist, or threatening in nature will not be published under any circumstances.
Though we certainly appreciate The Office of the Minister of Labour, Seamus O’Regan comment!
However below is the comment made by Finance Minister Freeland recently which directly contradicts it.
“In the trucking industry, there is a long history of companies using the misleading Drivers Inc. practice, whereby drivers are encouraged to self-incorporate and operate as independent contractors without being provided information on the downsides of the practice,” the feds wrote in the statement, delivered by Finance Minister Chrystia Freeland.
The Federal Government is well aware of the long history of Driver Inc. and knows that if you break the law you should suffer the consequences not wait for some education process. That’s how laws work at least here in Canada. Federal government needs to take action and now! No more excuses! Stop trying to save votes for your re-election as you cannot allow lawbreakers to continue to abuse a vulnerable workforce! You have certainly lost my vote and many more!
Known upheld and protected “ obviously not other wise it wouldn’t be a problem that keeps going on.
Years ago when these guys would push their drivers into the Never Never plan to be an owner operator so they would not have to pay pay roll deductions, I guess that was ok! Can someone explain to me why owning a truck that is plated and insured to one company and you cannot work for another company is not a different version of Drivers Inc? If this was such a big issue with ripping off the goverment, wouldn’t the Goverment be Auditing all these criminals? These guys are just scared as they cannot get drivers and I love how they are acting like they are the saviors of the Canadian Goverment and Canadian Trucking! They never mention that Big trucking gets Volume Fuel discounts, Cheaper Insurance and equipment buying power that the little guys dont get! They implemented Speed Limiters, E Logs and now its Drivers Inc under the guise of Level Playing field
Owner operators qualify as independent contractors because they supply the bulk of the equipment to do the job. How they pay for that equipment is immaterial. They take the risk of profit and loss. They are required to pay, or be exempted from, WSIB. There are a myriad of other regulations they must, and do, follow.
Every O/O contract in the country reads that the O/O can work for whomever they want … they just can’t use the carrier’s license or insurance.
O/O’s sign on, long(er) term, with carriers so they too can take advantage of the discounts you listed.
Being an owner operator is unquestionably different than Driver Inc.
You said it the way it is dead on!!
The big guys only whining for self interest .
They not care about unpaid taxes.
YES SIR TAKE THE BATTLE TO THE HIGHEST LEVEL HEAVY ARTILLERY THE BIG GUN.
CALL A SPADE A SPADE
CHEATERS THAT WHAT IS THE CANADIAN TRUCK OPERATORS ASSOCIATION AND THEIR PRESIDENT ARE
Here’s the problem with Driver Inc. … It’s not illegal, and it’s not just limited to the Trucking industry. The Independent Contractor model is rampant throughout all sorts of different businesses across the country i.e. Writers, Loggers, Construction Workers, Roofers, Mechanics, Tradesmen of all sorts, Janitorial services, and on, and on.
However, not paying your taxes is illegal. Carriers can employ incorporated drivers and legally skip out on paying their portion of the employee tax burden. If independent contractors paid their share of the tax burden, this whole subject would not be an issue, however, the problem is that the independent contractors do not pay their taxes, and there are far too many of them for the government to chase down, audit, and prosecute (which literally takes years to conclude). Imagine, if you will, the sheer size, and cost, of government bureaucracy if they were to successfully prosecute Driver Inc. into the ether. It’s incomprehensible, and impossible to execute, at least in time to save small and medium sized legacy carriers in Canada from having to switch to Driver Inc. to stay alive.
Make no mistake about it, unless something drastic happens, and quickly, Driver Inc. is here to stay. Government will be hard pressed to do anything to curb Driver Inc., even though there is a solution, a nuclear option if you will, and this is the biggest reason why; There are far too many votes at stake in the GTA, Vancouver, and Montreal where Driver Inc. flourishes. Whatever government takes a stand against Driver Inc., will not win the next election.
According to pollsters it is pretty much a forgone conclusion that the Liberals will not win the next federal election. This is the Liberal party’s chance to leave their mark. Execute the solution to the Driver Inc. problem. Implement a carbon copy of California’s AB5 legislation. Yes, it’s going to catch up the owner-operator, but at least there are reasonable methods to deal with that. AB5 goes a long way towards eliminating Driver Inc. and closes the carrier loop hole of “Hey, I’m doing my part legally.” which at the end of the day is the death knell of Driver Inc.
There are industry representatives that do not agree with me on implementation of AB5, at least publicly they don’t, but the reality of the situation is that unless Driver Inc. is stopped outright, and immediately, small and medium size carriers across the country are going to have to switch to the Driver Inc. model to attract, and keep drivers.
These same representatives maintain hope that shippers will agree with them, and not use carriers that employ Driver Inc., but I think we all are well aware that is never going to happen. We all have to bear in mind that corporations, especially big ones, don’t answer to the moral majority, they don’t even answer to governments most of the time, but they do answer to shareholders, and shareholders love cheap transportation rates, which is exactly what they get with Driver Inc.
As for my company, we don’t subscribe to the Driver Inc. model … yet. But we are, like many, many other carriers out there, seriously considering the change.
Drivers Inc. can be a terrible way to treat a human being!
These Drivers Long to work with a reputable company for their families in some cases…
Some Drivers Inc go along with the scheme on purpose, however in meeting with drivers we come across many that cannot afford to stop !
The Government should consider an amnesty one time shot per driver with the change to be made over to not working as a drivers Inc. and work with the NON- DRIVERS INC. companies to get them back in the right side of the Transportation Business ! Prove us as NON – Drivers Inc with WSIB Audit then give us some power for a change !
This should have taken place at least 15 years ago .