It was only a quick job and none of your regular guys could make the trip. So you called an “independent driver service.”
Things went fine until you got a call from the loading dock. Your driver got hurt and is headed for emerg. The only thing is, he’s not technically your driver. Turns out, he’s not really anybody’s employee.
But he is your problem, because the law might decide so.
The fact is, driver services have become a fact of trucking life, but it pays to learn how to separate the good ones from the bad. Truckers often need professional driver services. And most are fine — just like temp agencies that provide office help.
“A quality driver agency will provide trained and qualified professional drivers-a qualified driver being one who has been fully screened, road tested and trained,” says Claire Ward, owner of AC Personnel in Hamilton, Ont.
These drivers are also employees of the agency. They’re on the regular payroll, with Worker’s Comp coverage and other deductions and benefits. Unfortunately, that industry has been tarnished by what I call “Self-Employed Independent Driver Services,” or underground drivers. These are independents that pick up work for the same reasons that driver services do. Except these guys are anything but legit.
These guys, mostly for tax reasons, choose to work outside the established legal framework. The problem is, while tax-evading drivers risk a Revenue Canada audit, you — if you take one on even for day-share that risk. And more: you might get stuck with back payments for E.I., WSIB/WCB, and CPP contributions.
Even though you think the driver delivering your load is legally self-employed, you might be responsible for him. To determine the true nature of an independent driver, use the criteria provided by Revenue Canada. Answer the following questions:
Who plans the work?
Who decides the amount paid to the driver?
Who determines the time frame in which the work is done?
Who decides how the work will be done?
Who decides the work location?
Who supervises the tasks?
Who sets standards of quality and volume?
Who covers the costs related to the job?
Who hires any helpers?
If you answered “the carrier” for most of these questions, then there is a legitimate employer/employee relationship at work. It’s that simple.
According to the Canada Revenue Agency (CRA) — formerly known as Revenue Canada — “the payer [carrier] exercises control if he has the right to hire and fire, determines the wage or salary to be paid, and decides on the time, place, and manner in which the work is to be done.”
Do you currently know of any self-employed drivers who exercise any of the above controls? Probably not. In a typical employer/employee relationship, an employer generally supplies the equipment. In addition, the employer pays all costs incurred in the completion of that work, including repairs, insurance, transport, rental, and operation.
If you are unsure whether a driver is employed or self-employed, contact CRA for assistance. (www.cra-arc.gc.ca.). Should one of your drivers operating as a self-employed agent attract the attention of the auditors, you can bet you will be included in the exercise, especially if one party launches a complaint or applies to WCB when an on-the-job injury occurs.
There are two solutions: one is, avoid these independents and conduct due diligence whenever you’re hiring. But the other part of the answer is good management and healthy remuneration for drivers. Drivers who continue to work off the books typically work for marginal carriers.
Trucking’s wage increases will command the attention of good self-employed independent drivers who could be lured to the legit world with an attractive pay package that includes benefits and job stability.
There are really only two kinds of professional drivers you can utilize: employee drivers and owner-operators. There is no such thing as a “self-employed individual driver service.” Carriers employing these so-called independents need to understand their exposure — and the potential for an audit.
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