The Canadian Trucking Alliance (CTA) and Teamsters Canada have joined together in calling for specific enforcement action against Driver Inc. fleets that misclassify employees as independent contractors.
“The Driver Inc. scheme sees truck drivers illegally misclassified as corporations. As a result, drivers lose out on labor protections, like vacation time and paid sick days, and receive less total compensation,” Teamsters Canada president Francois Laporte and CTA president Stephen Laskowski said in a joint statement.
“Governments also lose over $1 billion in lost revenue since incorporated drivers and their employers are not making deductions or otherwise evading taxes.”
The groups said the problem has grown despite enforcement and education launched by Employment and Social Development Canada (ESDC) and the Canada Revenue Agency (CRA).
As a result, CTA and Teamsters Canada have called on “immediate and proactive” enforcement based in regions that have seen growth in businesses reporting zero employees.
Such action would include ESDC and CRA audits on carriers that ESDC has identified as gross violators, focusing on the companies and incorporated drivers also known as personal service businesses.
“All gross violators who also received federal employee wage subsidies (CEWS) should be audited by the CRA to determine if CEWS were given to PSBs,” the groups say.
“Companies found to have gross violations should face the maximum penalty ESDC can levy and must be forced to return all wages and entitlements owed to workers. Follow-up audits should also be required.”
So, too, have the groups asked for the names of gross violators to be released by ESDC and CRA.
“Teamsters Canada and the CTA would also like to work with the federal government and the provinces to develop a public awareness campaign focused on educating drivers on misclassification, the consequences of participating in this scam, and legal/government support options if they are being forced into this arrangement by employers,” they add.
Other recommended actions include shutting Driver Inc. businesses out of government and Crown corporation contracts, as week as government-led immigration and training support programs.
The requested actions also go beyond federal agencies.
“Upon identification of federal transgressions, ESDC should automatically notify corresponding provincial workers’ compensation boards (WCB) of infractions. In turn, ESDC and CRA should accept audit results from provincial authorities who have identified Driver Inc. misclassification,” the groups say.
“Similarly, when gross non-compliance is found, ESDC should also notify the according provincial/territorial transportation officials responsible for safety fitness certificates and carrier oversight to identify whether offending carriers are meeting their requirements under relevant provincial permitting regimes, are maintaining appropriate commercial vehicle insurance, and are not attempting to engage in oversight avoidance.”
They also want authorities to cancel safety fitness certificates and require Driver Inc. businesses to cease operations.
“The cancellation of safety fitness certificates would also apply to all known affiliated companies and companies under the control and direction of primary carrier ownership, with the information posted publicly.”