In employment law context, any contractual term that attempts to limit an employee’s entitlement to the Employment Standards Act (ESA) minimum standard is under strict scrutiny. Employment agreement drafting is substance over form and a lot of legal issues are involved, and drafting enforceable employment agreement contractual terms in an employment contract is becoming more of an art than a science. It takes an experienced employment lawyer to draft a legally enforceable employment contract.
In employment law, an independent contractor employment agreement is important in its own right. In employment law, time and time again, the Court keep emphasizing and hammer home the message that misclassification is prohibited under both the Common law and the Employment Standards Act (ESA).
In employment law context, misclassification occurs when a worker is assigned to a different category than the one he or she should be in. Some employers try to circumvent the ESA by assigning workers who look like, smell like, sound like employees to fill independent contractor positions. In many employment law cases, the independent contractors in question are deemed to have been misclassified, and as such are eligible to all employment law entitlements that are reserved for employees.
Having a carefully crafted independent contractor agreement by an experienced employment lawyer setting out the intentions of the parties is crucial, to make sure you don’t end up creating an employer-employee relationship inadvertently, if you are the payor hiring the independent contractor. In contrast, if you are a worker, you want to consult an employment lawyer to make sure you fully appreciate your rights and responsibilities, and legal ramifications before signing an independent contractor employment agreement.
The more control the business has over its independent contractor, the more likely it is for a Court in the employment law context to find that an employment relationship is established. In employment law context, when workers purchase or rent equipment or large tools that require major investments and costly maintenance, it usually indicates that they are self-employed individuals.
The more the independent contractor is shield off from risk of loss, and the more financial dependent an independent contractor is on the payor, the higher the likelihood he/she will be deemed to be an employee in employment law context.