Ontario applauded for plan to license staffing agencies

Staffing agencies that are broadly used as a source of temporary truck drivers can expect new licensing requirements in Ontario, as the province looks to crack down on operations that exploit workers. “The underground activity … makes millions of dollars off the backs of workers by not paying minimum wage, not paying holiday pay, and not paying overtime pay,” said Ontario Minister of Labour, Training and Skills Development Monte McNaughton, when announcing proposals earlier this week. He also referred to recruiters that charge illegal hiring fees and claw back pay.

(Photo: istock)

If enacted, the rules will see new licences for agencies and recruiters, required security bonds, and fines and possible jail time for offenders.

There are also plans for dedicated enforcement teams to investigate agencies that are exploiting or trafficking workers. “I think it’s fantastic,” said Dave MacDonald, president of Revolution Staffing. “In every industry you have pretenders and professionals, and unfortunately in our industry there’s a fair number of pretenders.” “What I’m looking for is regular auditing of the businesses.

We run a very transparent business,” he said, adding that “unscrupulous” operations are often guilty of not following safety protocols. The Ontario Trucking Association (OTA) has applauded the move, saying it will help to target temporary help agencies that follow a Driver Inc. business model. That model refers to businesses that misclassify employees as independent contractors.

“The Driver Inc. scheme is used to sidestep requirements like WSIB premiums, labor standards, and tax laws – all of which exploit vulnerable workers and warp the competitive playing field for compliant companies,” said OTA president Stephen Laskowski. “Driver Inc. siphons tax dollars away from vital Canadian services and infrastructure and is redirected into the underground economy while circumventing important labour, safety and environmental rules. This practice must end and we think this recently announcement is another enforcement tool to help with that cause.”

Patty Coates, president of the Ontario Federation of Labour, also called on the ministry to hold temporary work agencies and client companies jointly responsible for workplace deaths and injuries. “He [Ontario Premier Doug Ford] could do it today, at the stroke of a pen,” she said, referring to the Workplace Safety and Insurance Act. The federation also wants a 20% cap on temporary workers within a given workforce, a maximum of 12 weeks on a job before temporary workers become permanent, and a timeline to implement licensing and fines. Still, MacDonald stresses that there is a role for law-abiding staffing agencies.

“We need to be careful that we not paint all agency providers with the same brush,” he said.

“It is the [fleet’s] responsibility to vet, verify and validate the company’s practices as it relates to independent contractors or employees – not just because they have a legal obligation, but because there is a moral obligation for companies to care for employees.”