New fines, inspections coming in ‘Driver Inc.’ fight

by John G. Smith

Canada federal government

OTTAWA, Ont. – Canada’s federal government will roll out a series of initiatives this year in the fight against Driver Inc. – a business model that involves mis-classifying employees as independent contractors.

Legislative changes to come into force in 2020 will include fines and the naming of employers that don’t comply with obligations under the Canada Labour Code, an Employment and Social Development Canada spokesman told trucknews.com.

“Targeted inspections will also be initiated with carriers who may be mis-classifying their employees,” he said. “The timelines for targeted inspections will allow the employers to consider proactively making the required changes in their organizations to ensure compliance with the Code and support the education and awareness campaign where companies are not aware of their obligations.”

This spring, the federal Labour Program is also scheduled to launch an education and awareness program that focuses on road transportation companies.

“This will include information sessions on both labor standards, and occupational health and safety. The goal is to increase awareness of carriers and drivers of the requirements of the Code,” the spokesman added.

Trillium Roadways president Jaspreet Samra (left) said last year that drivers have been the ones pushing to be incorporated. Former Minister of Employment, Workforce Development and Labor Patty Hajdu said the federal government wants improper classifications to end. (File photo)

Limited enforcement

Few additional enforcement initiatives have emerged since October 2018, when then Minister of Employment, Workforce Development and Labour Patty Hajdu publicly referenced the challenge of truck fleets that mis-classify employees as independent businesses.

“In trucking in particular, we heard both from employer and employee groups that mis-classification was a real challenge and created a sense of instability and an unlevel playing field,” she said after an industry briefing.

Online information resources have been unveiled to help clarify whether businesses are considered contractors or employees. Other communications material is being developed to raise awareness for couriers and drivers, to clarify their obligations and rights under the Code.

The greatest sign of crackdowns on the business practice has come in the form of Ontario Workplace Safety and Insurance Board fines against selected carriers. The Ontario Trucking Association reported late last year that dozens of Ontario-based fleets have been sanctioned for using Driver inc. to avoid paying premiums. Audits of two trucking companies in September led to corrective debit adjustments of more than $200,000.

The ESDC spokesman said it will be working with the Canadian Trucking Alliance to inform carriers about labor standards and occupational health and safety obligations.

The Canadian Trucking Alliance has been leading the charge against Driver Inc.

Public policy push

The alliance recently launched a public policy campaign that incorporated a group company letter, driver petition, and emails to MPs, explaining the growing challenge of the business model and its impact on the economy.

The alliance estimates that Driver Inc. costs federal taxpayers at least $1 billion. Much of that would involve drivers who have not paid required income taxes, claiming business-related expenses to which they are not actually entitled.

 

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  • Unfornatuality still lot off trucking companies out there making or pushing drivers too work excess hours off service terrible ive been through it myself

  • Carrier companies cannot compete with driver.inc salaries, and they think that if it is banned, then all drivers will go to work in large shark companies. This is a little ridiculous, because no one wants to work for a salary of $ 10 per hour (24×10 = $ 240 per day in gross), and a third of all drivers will go to construction or other businesses. In addition, why do they want to ban it for drivers when programmers, computer specialists, builders, engineers and many others work on this scheme ?! And while the driver receives a salary per mile, he has the same risks as his employer, the salary is not tied to the price index, there is a dependence of the salary on force majeure factors and principles of doing business by the employing company. Truck drivers are not guaranteed a salary for the time spent, so the driver is part of the business, which corresponds to the driver.inc model.
    I know that many want to leave this low-paid business. The only way for companies is to attract cheap labor from abroad. For Canada, earning $ 240 gross for 24 hours at work during the week is very small. This after taxes is about $ 6-8 per hour.

    • I talked to a union construction worker at queens park Friday was making $38.00 per hour would a good insurance plan to provide care when sick or injured. 7 people talked to last week that no longer drove truck as other jobs in the G T A are paying better. Unless these trucking companies pay on payroll at least $28.00 per total hours worked of the E -logs plus a good medical treatment both in and outside of Canada. These companies will work with the Ford government to bring in more cheap foreigners.

  • Drivers inc should be outlawed, but unlimited foreign workers should be allowed?!?!?…….what a joke. Misinformation at its finest. Pushed by the OTA and the rest of the mouth pieces. How many MP’s run an inc. on the side to separate their government pay from their side projects? Plenty…… Also. Everyone can formulate an equation to say drivers inc is suppressing wages which is frankly irrelevant. As it stands today its a mutual agreement between the employer and employee and to the compensation for a job performed. If either party isnt on board, they have the right to refuse….. You don’t need to work for someone if you aren’t happy with the pay…..or the way its paid.

  • Much of this is owner/operators that hire drivers. They don’t take taxes, don’t pay workers comp or stat holidays, etc. The driver certainly cannot afford to pay their own comp, and also like the idea of keeping their gross pay, so taxes do not get paid. They also do not set themselves up properly, because it costs money to purchase a limited company, set up books and be legit. I for one would be happy to see this practice gone!

    • Many companies have given many pushes to their drivers and they do not want if.In general the most Indian drivers demand it.

    • I know an owner-operator who pay by this model. But they do pay for WSIB (as required by law). They also help them file taxes appropriately. I’ve seen this statement a lot in the media stating that just because they pay them as a Driver Inc. that they aren’t covered by WSIB. I certainly wouldn’t put it past some companies to not do that but that’s on them. The people I know certainly don’t screw around with WSIB.

  • “ A worker can be classified as an independent contractor if the following characters are present:

    May work for other payers
    Worker provides tools
    Worker decides how the task is completed
    Sets own working hours
    May hire someone to complete the job
    Not allowed to participate in payers benefit plans
    No vacation pay, and no restrictions on hours of work, or time off
    Worker pays own expenses
    Worker is paid by the job on predetermined basis
    Submits invoice to Payer for payment
    Worker may accept or reject work
    If the worker falls within the middle of this continuum the classification of employee or independent contractor becomes complicated.”

    Driver.Inc fully complies with this category:
    The driver receives a salary for miles and not time, therefore he is not guaranteed a salary.
    The driver decides how and when to do the work.
    The driver decides to agree or refuse to work, and when to go.
    The driver uses his tools to do the work:
    GPS, mobile communications, electronic log in a mobile phone, tools for minor repairs, hard hat, reflective vest, safety glasses and work boots.
    So, if companies want to attract drivers, they will have to guarantee the driver’s income for the time spent and start paying overtime … but they don’t want to, because then they will have to pay 30-50% more)))
    So – humble yourself!

    And who decided that Drive.Inc did not pay taxes?
    They pay like any corporation, as pay computer engineers, builders, mechanics, engineers, consulting companies and other corporations.
    And if someone has a desire to discriminate against drivers, considering them stupid fools, then courts and strikes will begin. Today, the driver earns about $ 10 per hour. 10×24 = $ 240 per day.
    Maybe it’s already starting to demand compensation from companies for all the hours spent on the work, including all overtime, holidays and weekends ?!
    Someone thinks that arrogance has no limits as well as greed !!!

  • Congratulations Eugene. You and everyone else who is being paid this way, will have the opportunity to make your version the case to Revenue Canada.Go and buy your own truck and you’ll be all good.

  • And who told you that I work as Driver.Inc?
    All my friends who work Driver.Inc pay taxes and arrange everything like any other corporation.
    Buy a truck?) Why, in order to earn money as a hired driver? I already had a truck for many years, and I’m looking for how to get out of this business.
    Until the driver’s income is guaranteed, the driver is part of the business and takes risks. Therefore, he has the right to sell himself as a corporation. When the payment scheme for miles is banned and the income for the time spent is guaranteed, then we can talk. In the meantime, drivers are not protected by law, because salary per mile does not guarantee income, and is also the cause of many accidents over the past two years.
    This pay scheme is very beneficial for companies, allowing them not to improve working conditions for decades.
    Over the past 13 years, driver income has increased by about 5-8 cents per mile, which gives about $ 500-800 a month gross.
    Therefore, people are looking for ways to save a little. Working conditions for drivers in Canada became similar to working conditions in Third World Countries. Therefore, an adequate person will not get the idea to go into this business. There are no prospects, no growth, no respect, no guarantees. Miser pays twice.

  • If someone hopes that the mass discrimination of drivers will end well, he is mistaken.
    It will end with layoffs, strikes, bankruptcies!
    Before the introduction of the electronic logbook, all drivers could compensate for the lack of miles by breaking the law. Over time, everyone realized that this business has become unpromising, low-paying and disrespectful. Two decades or more, drivers’ incomes were stuck in deep stagnation. The whole business has turned into a “deceive as you can, because you too are being deceived.” And it has become the norm! Which of the drivers did not hear the phrase: “this is tracking business …”!
    And then professionals began to leave the tracking, who realized that it was more profitable to do something else. And, since it was very cheap and easy to become a truck driver, professionals were replaced by those who can do nothing more than work for 20 hours or more, breaking the laws, because otherwise it is impossible to make money in this business. Immigrants (I am one of them) also began to arrive, most of whom work as drivers as long as they receive immigration documents. On the same day, they leave for other, more profitable industries, and they are replaced by the following companies ready to work at least for free, a couple of years, until they immigrate.
    There are almost no Canadians left in this business, just as there are no real professionals who respect and love their work. People come and go.
    When electronic logbooks were introduced, the possibility of breaking the law by driving as many miles as you can not sleep was excluded. This brought down the income of the vast majority of drivers, not only those who violated constantly, but also those who violated rarely and forcedly, compensating for downtime and other cases. Over the past two years, the number of accidents with trucks has increased, and it will be even worse because incomes have fallen, and payments for cars, houses and other expenses have not decreased. And the salary for miles, the number of which was sharply limited, therefore, you need speed, regardless of weather conditions and the driver’s well-being.
    Therefore, there will be more accidents every year.
    A mile payment scheme has existed since 1938))) Europe has been banned from paying for miles for a long time, because it is a discriminatory wage scheme!
    In Europe, they pay for the day of work plus for the night that the driver sleeps in the truck. And, unbelievable, but no one went broke, and all companies work, as well as cope with electronic logbooks, although they shouted that it would be impossible to work. Today, drivers have the feeling that they all don’t care.
    Therefore, they come to this business not by vocation, but only by force. Many of my friends and acquaintances left tracking, and they remember it as a nightmare.
    So, gentlemen, if you still hope to squeeze something out of the drivers … you should not count on it. This business has already collapsed to the bottom and is drowning in a quagmire. Tracking will stop – the economy will stop! Remember this, gentlemen!
    And I think that if the laws are not changed, this will happen in the next couple of years …

  • Well Eugene,
    You do have some of the concept under control. The rules set out by CRA do require the independence from the company. Drivers do need their own WCB and business freedom to make a profit or loss.
    On YOUR business model, the $10.00/hr. example may be what you and some others work for, but this just indicates how little people know about a ‘business’ before they get involved.
    When ‘Contracting’ I charged a minimum of $5.00/hr ( or equivalent rate) MORE than a company would pay full time employee. Sometimes a higher mileage rate, other times a higher %, or a higher hourly rate.
    If these people who were looking for a driver didn’t want to pay the extra charge, then they didn’t get my services. Unfortunately, most ‘Driver Inc.’ operators don’t have a good business model, don’t understand business and more often than not, think that ALL the money they make is ‘theirs’. this in turn leads to non payment of CPP, WCB and Payroll deduction ( income Taxes ) This then becomes the responsibility of the company they contracted to. – BUT these same people will expect to claim for these benefits – And will be surprised to discover they are not eligible.
    A good business model requires a ‘business plan’ something which most ‘Driver Inc’ don’t have. In most cases the company they do the work for DOES have a plan – Take advantage of their people and/ or work for less to get more work – always a slippery slope. ” More, Better, Faster for Less” is not a business plan, by the way.
    THAT is how we get to what we see more of today – poor pay, poor skills and people just occupying ‘seats’. ( This doesn’t even begin to touch on the subject of corruption in the Immigration and foreign worker programs that have been uncovered.

  • I have been in the trucking business for 28 years, of which 13 years in Canada!
    Quickly, if you didn’t earn, you won’t earn more than $ 250-300 in 24 hours. It is a fact!
    More per mile or less, the salary is about the same everywhere. More salary per mile – less miles for the same period of time. But I agree that it’s nice to think that you earn more than others and consider yourself smarter)
    For the performance of the same type of work and in the same mode, the salary is the same everywhere.
    Everyone I know who works according to the Driver.Inc scheme pays taxes, and everything else.
    But still, this scheme is more profitable.
    As for dependence on business, truck owners cannot change the company while they have a contract. When I was the owner of the truck, I could not transport goods to another company, but to the one with which I have a contract.
    Therefore, the ban on the Driver.Inc model will enable owners of every trip to transport goods of any company, leaving an empty trailer wherever they want)
    Already today there are companies that fictitiously rent, and it is impossible to prove falsification! The contract indicates the cost of the truck, and the required amount is deducted from the driver’s income.
    Only a ban on salaries for miles will solve the problem of accidents and lack of drivers, and then incomes and taxes will increase.

    • Sorry, there was an error in the previous message, and there is no way to erase

      I have been in the trucking business for 28 years, of which 13 years in Canada!
      No matter how much you earn, you will not earn more than $ 250-300 in 24 hours. It is a fact!
      More per mile or less, the salary is about the same everywhere. More salary per mile – less miles for the same period of time. But I agree that it’s nice to think that you earn more than others and consider yourself smarter)
      For the performance of the same type of work and in the same mode, the salary is the same everywhere.
      Everyone I know who works according to the Driver.Inc scheme pays taxes, and everything else.
      But still, this scheme is more profitable.
      As for dependence on business, truck owners cannot change the company while they have a contract. When I was the owner of the truck, I could not transport goods to another company, but to the one with which I have a contract.
      Therefore, the ban on the Driver.Inc model will enable owners of every trip to transport goods of any company, leaving an empty trailer wherever they want)
      Already today there are companies that fictitiously rent, and it is impossible to prove falsification! The contract indicates the cost of the truck, and the required amount is deducted from the driver’s income.
      Only a ban on salaries for miles will solve the problem of accidents and lack of drivers, and then incomes and taxes will increase.

  • This is a headless & shameless government people. It takes 2 years to learn the truck driving & lots of unpaid work driver has to do before becoming a full work driver. No body wants to stay away from the family but the truck driver comes back home after 1 or 2 weeks.
    Truck drivers makes Canada to get 1800 billion dollars GDP per annum. Can the CRA or other idiots do it. Hiways drivers daily meals costs around $40 everyday, but when the hiway driver get stuck on the long weekends in Canada USA or Mexico, he only get $50 per day for the waiting. Truck drivers go through the life threatening weathers in the rocky mountains all year long.
    CRA don’t like truck drivers attitude about the pay then CRA should do the driving work.