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.”