Act
Proposed amendments to the Employment Standards Act, 2000 for an exemption for certain highly skilled workers.
Regulation Number(s):
N/A
Instrument Type:
Act
Bill or Act:
Employment Standards Act, 2000
Summary of Proposal:
The ministry is proposing amendments to the ESA that, if passed, would exempt "business consultants" and "information technology (IT) consultants" who meet specified criteria from the application of the ESA.
The terms "business consultant" and "information technology consultant" would be defined in the Act to include individuals who provide advice or services to a business or organization in respect of its performance or in respect of its information technology systems, as the case may be.
"Business consultants" or "information technology consultants" would be exempt from the ESA if they meet specific criteria, most notably:
• They provide services either as a sole proprietor that is registered under the Business Names Act, or through a corporation of which they are a director or shareholder party to a unanimous share holder agreement; and
• They are paid at least $60 per hour for their work, excluding bonuses, commissions, expenses and travelling allowances and benefits.
During engagements of the Ontario Workforce Recovery Advisory Committee (OWRAC), some workers expressed a preference to be treated as independent contractors rather than employees.
Some businesses have voiced concern about the uncertainty involved in entering contracts with these types of workers. These businesses want assurance that they will not be found to be in an employment relationship - with all the additional costs that entails. This amendment aims to provide some clarity in relation to the treatment of these workers under the ESA (it does not address status under tax and other legislation).
MLTSD is bringing forward this proposal as part of a package of legislative proposals that will help shape the "future of work" in Ontario. These proposals respond to several recommendations made by the OWRAC, which was appointed in June 2021.
If the ESA amendments are passed, they would come into force on January 1, 2023.
The terms "business consultant" and "information technology consultant" would be defined in the Act to include individuals who provide advice or services to a business or organization in respect of its performance or in respect of its information technology systems, as the case may be.
"Business consultants" or "information technology consultants" would be exempt from the ESA if they meet specific criteria, most notably:
• They provide services either as a sole proprietor that is registered under the Business Names Act, or through a corporation of which they are a director or shareholder party to a unanimous share holder agreement; and
• They are paid at least $60 per hour for their work, excluding bonuses, commissions, expenses and travelling allowances and benefits.
During engagements of the Ontario Workforce Recovery Advisory Committee (OWRAC), some workers expressed a preference to be treated as independent contractors rather than employees.
Some businesses have voiced concern about the uncertainty involved in entering contracts with these types of workers. These businesses want assurance that they will not be found to be in an employment relationship - with all the additional costs that entails. This amendment aims to provide some clarity in relation to the treatment of these workers under the ESA (it does not address status under tax and other legislation).
MLTSD is bringing forward this proposal as part of a package of legislative proposals that will help shape the "future of work" in Ontario. These proposals respond to several recommendations made by the OWRAC, which was appointed in June 2021.
If the ESA amendments are passed, they would come into force on January 1, 2023.
Analysis of Regulatory Impact:
The proposed amendments would not add any new requirements for businesses, and the cost impact on businesses would be insignificant.
This proposal could benefit both affected workers and organizations. It could provide employers with certainty about the status of these consultants under the ESA. It could enhance options and leverage of these consultants in Ontario's labour market. It could also enhance Ontario's attractiveness to highly skilled workers and competitiveness in the global economy.
This proposal could benefit both affected workers and organizations. It could provide employers with certainty about the status of these consultants under the ESA. It could enhance options and leverage of these consultants in Ontario's labour market. It could also enhance Ontario's attractiveness to highly skilled workers and competitiveness in the global economy.
Further Information:
Bill 88, Working for Workers Act, 2022
Proposal Number:
22-MLTSD 004
Posting Date:
February 28, 2022
Comments Due Date:
March 30, 2022
Contact Address:
Employment, Labour, and Corporate Policy Branch
Ministry of Labour, Training and Skills Development
400 University Avenue, 15th Floor
Toronto ON M7A 1T7
Ministry of Labour, Training and Skills Development
400 University Avenue, 15th Floor
Toronto ON M7A 1T7