Dismissal of dependent contractors

Differences between entitlement of dependent contractors and employees
By Colin Gibson
|Canadian Employment Law Today|Last Updated: 04/15/2015

Question: What are the main differences between “dependent contractors” and employees with regard to notice of dismissal and just cause for dismissal?

Answer: Traditionally (or as one judge described it, “in simpler times”), a distinction was drawn in the law between two types of workers: employees and independent contractors. The former were entitled to protections at common law and under statute (generally including an entitlement to reasonable notice of dismissal without cause), and the latter were not. More recently, courts — and in some jurisdictions, the legislatures — have recognized there exists a category of worker who has many characteristics of an independent contractor, but is sufficiently dependent economically on a particular employer or organization to justify providing the worker with legal protections an independent contractor would not enjoy. Workers falling into this “intermediate” category are commonly referred to as dependent contractors. In McKee v. Reid's Heritage Homes Ltd., the Ontario Court of Appeal identified dependent contractor relationships as“non-employment work relationships that exhibit a certain minimum economic dependency, which may be demonstrated by complete or near-complete exclusivity.”