As a Mainstay Insurance client you know that we do NOT allow independent contractors to be included on benefit plans. There are a number of reasons for this. CRA does not allow non-employees, most insurers will not change contract wording to include non-permanent employees, and most importantly, there is considerable liability created for both the the employer and employee if they are deemed as such. We never want the benefit plan to be the “final nail in the coffin” that redefines an independent contractor as an employee.
In Ontario (as of Jan.1, 2023), things are getting a bit messier, but maybe also a bit clearer at the same time. If you work with business or information technology consultants, then please read the info below and reach out to your HR or employment lawyers if you have questions.
On January 1, 2023, an amendment to the Ontario Employment Standards Act, 2000 (“ESA”) came into force that creates a new exemption for business and information technology (IT) consultants.1 This means that if an individual meets the criteria for a “business consultant” or “information technology consultant” under the ESA, then the consultant is excluded from the application of the ESA. If that is the case, then the employer does not have to comply with the minimum employment standards set out in the ESA with respect to the consultant.
Employers should consider whether this new exemption applies to any individuals in their Ontario workforce. In addition, it is also a good reminder for employers to consider whether they are up to date on key exemptions from employment standards legislation in all of the provinces and territories in which their business operates, as the exemptions do vary by province and territory.