When You Become Dependent On Independent Contractors: The Risk To Employers

A recent decision of the Ontario Superior Court is a reminder to all employers of the liability associated with engaging individuals as contractors in circumstances where the practical, day-to-day nature of the economic relationship is that of an employee. This can become particularly tricky to manage when there are transitions in that relationshipfrom contractor to employee or from employee to contractor.

As highlighted in the court's decision in Cormier v. 1772887 Ontario Limited c.o.b. as St. Joseph Communications (2019 ONSC 587), it is of particular concern where the contractual relationship begins as an independent contract, but develops into a dependent relationship, seemingly on an indefinite and implied basis, unchanged and without regular review. Cormier underscores the need for employers who regularly use long-term independent contractor relationships to understand the real risk of accruing liability that can arise when such contractual relationships are not ended and managed.

Ms. Cormier graduated from college in 1989 to begin a career in the marketing and advertising industry. In 1994, as an independent contractor, she began to work for St. Joseph Communications as a "freelance" Wardrobe Stylist. Over the first five years of this contract, she was wholly occupied by St...