Ritva Nosov is the founder of TalentEd Consulting Inc., an advisory firm providing full-service support at the intersection of people, culture and the law. She is the leadership lab columnist for December, 2020.
COVID-19 has gotten all the credit. It has been attributed with overturning our well-worn work norms and sending them into uncharted territory. But there is another big trend that has been revolutionizing our work world for years. It is the gig-ification of our economy.
According to Statistics Canada, a gig worker is defined as an unincorporated, self-employed individual who enters into contracts to complete specific tasks and/or projects for individuals or organizations. Recently, most of the headlines associated with gig workers have revolved around Foodora or Uber drivers seeking unionization and arbitration rights through the courts. Meanwhile, the white-collar work world has been quietly ushering in gig workers for many years. A recent survey conducted by staffing firm Randstad estimated that gig workers already made up between 20 per cent and 30 per cent of the professional work world – and that was in the pre-COVID-19 era.
For organizations, gigs are a means to access a larger pool of talent while saving on recruiting and employment costs. As my consulting practice has grown, I have increasingly received questions from organizations about how to address hiring for gigs. The murky world of gig work certainly raises interesting questions for both parties.
As an employer, the first question to address is: Who are you hiring? That will determine the contract you draft with your gig worker. Along the worker classification spectrum, there are three main categories: employees, dependent contractors and independent contractors. Traditionally, gig workers were defined as independent contractors in employment law. What this means for them is that they are not covered by employment legislation, such as the Ontario Human Rights Code or the Employment Standards Act, 2000.
The potential for problems creeps in when misclassification of a gig worker happens, as it regularly does. Has the gig worker you hired become economically reliant on you as their one employer? If so, they are now classified as a dependent contractor and their rights, and your obligations as an employer, have changed. In Canada, the onus has been shifting onto employers to prove that their contractors are not actually employees. It is anticipated that this shift will only continue.
At this time, there is no one conclusive test that can be universally applied to determine the status of a worker. Instead, the courts ask whether the gig worker engaged to perform the set services is performing them as a person in business on their own account. Other factors taken into consideration include the level of control the employer has over the gig worker’s activities, ownership of tools and/or equipment, the opportunity for profit, risk of loss, as well as the intention of both parties.
As gig work becomes more common, the courts will increasingly be called upon to interpret gig work cases, and legislation will in turn need to be drawn up or amended to better reflect our current employment needs.
In the meantime, it a wise idea for organizations to seriously consider how they classify their gig workers, and how that is reflected in the contracts signed between both parties, both when they begin at your organization and throughout their tenure there. Employers should schedule a regular checkpoint to reflect on the current nature of the employer-gig worker relationship. Keep in mind things can change a lot in a few months’ time span. For example, has the gig worker you hired as an independent contractor now taken on more responsibilities with the departure of their team member? Are they now working predominantly for you? If yes, then it is time to draw up a new contract that better reflects the current employment circumstances.
As an employer, there are too many risks and liabilities associated with getting misclassification and the contract wrong. Work will no longer be a physical place; instead it will increasingly resemble a series of gigs in the future. Prepare for the gig-ified economy, for it has indeed arrived.
Ritva Nosov, founder, TalentEd Consulting.
This column is part of Globe Careers’ Leadership Lab series, where executives and experts share their views and advice about the world of work. Find all Leadership Lab stories at tgam.ca/leadershiplab and guidelines for how to contribute to the column here.
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