The courts continue to deal with ongoing contract labour disputes due to lack of due diligence in consistently classifying workers and ensuring that contractual agreements are legal and fair. The following FedEx lawsuit from Helena, Montana exemplifies many of the complex legal issues that can arise when organizations have not properly protected themselves.

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Federal court judge Charles Lovell in Helena has said that the arbitration clauses in FedEx contracts with its drivers are so one sided that they are “Unenforceable”, and has ruled that the lawsuit move forward without arbitration. Lovell also ruled to dismiss four of the eight complaints made by Tracy LaSalle in his wrongful discharge lawsuit filed against FedEx Ground Package System. The dismissed complaints include malice, violation of Montana’s independent contractor law by misclassifying him as an independent contractor instead of an employee, unjust enrichment, and not paying him for overtime.

Lovell wrote that, under the law, an arbitration provision is unenforceable when it is both “procedurally and substantively unconscionable”, and this case falls into that area. Lovell ruled to wave the arbitration primarily because it unfairly requires “binding arbitration of the weaker bargaining party’s claims, but allows the stronger bargaining party the opportunity to see judicial remedies to enforce contractual obligations”. Lovell stated that “This type of disparity can become so one-sided and unreasonable that the agreement becomes unconscionable and oppressive.”

LaSalles’s lawsuit is part of a larger issue in which FedEx drivers argued that they were employees rather than independent contractors, and as such should be awarded overtime and holiday pay, and not be required to pay operating expenses for delivery vehicles, renting uniforms, and fuel.

In October 2010 a settlement was reached with FedEx that said the delivery drivers were, in fact, employees, but it also outlined a business model in which they could still be private contractors if they handled numerous routes instead of just one. Initially the required number was three, and LaSalle tried to sell his route. However, FedEx then changed the number of routes to two, and LaSalle’s sale fell through and he claims to have lost $175,000.

The October 2010 precedent setting settlement has had a large impact on LaSalle’s case and other subsequent trials. This case indicates that it is increasingly important for companies to perform the necessary steps in order to ensure compliance with contract labour law and tax regulations.

For more information about how your organization can mitigate contract labour risk, contact Contingent Workforce Solutions at:

Christina Fabugais
Marketing Manager
Contingent Workforce Solutions Inc.
Direct Phone:  416-642-9077
Toll Free:  1-866-837-8630 x9077
Email:  christina.fabugais@cwsolutions.ca

Youth unemployment has been a hot topic in the news lately, with youth unemployment rates reaching as high as 40% in economically troubled countries such as Spain. While the outlook is not so grim in Canada, many people are still concerned. Youth often face more difficulties finding work during a recession because of increased competition from more experienced candidates.

It’s not all bad news. Companies are starting to realize that as baby-boomers retire they will be left with a large employment gap to fill. This means that young people need to be trained and ready to move into these roles. One of the easiest ways for companies with limited resources during difficult times to train potential new employees is by hiring young contract workers. When the company recovers, it can then hire the trained youth for more contract projects, or in a permanent position.

In Canada there are jobs available for youth – just not always permanent full time jobs that they expect after completing their education. However, temporary or contract work could actually be the best answer for youth. Many young people want mobility; they want to have time off from work to travel, or they want to move to new and exciting places. Contract work allows young people to work and earn money, and have the mobility they crave.

Similarly, many young people do not have enough experience to know what type of work they enjoy doing. Contract work allows youth to “test” various industries and roles in a non-committal manner. If they do not enjoy the job, they can easily move on to something else.

Difficult economic times are often more difficult for young people. However, by pursuing contract work, youth can build their skills and knowledge as well as find the freedom that they desire.

For more information about how Contingent Workforce Solutions can help you manage your contract workforce, or become a contract worker, Click here or contact:

Christina Fabugais
christina.fabugais@cwsolutions.ca
1-866-837-9077

A recent study has shattered the myth that, in tumultuous economic times as these, full-time employees are forced into contract and freelance work due to layoffs and cutbacks. This study found that Contractors actually prefer the independent lifestyle, and, counter to popular belief, many individuals are choosing self employment.  A mere 13% of respondents were forced into contract work due to layoffs, and 80% of accidental contractors say they are happier now than they were before engaging in contract work.

Freelance and Contract work empowers women and men to lead the lives they want to live. 30% of female respondents and many men want to have schedules that accommodate the demands of daily life. They chose to be self employed because contract work makes this flexibility possible. Similarly, individuals have grown tired of answering to someone else, therefore over 20% of surveyed men, and many women, cited a desire to be their own boss as their top reason for switching to contract work.  Over half of the respondents were between 30 and 49 years of age, which indicates that Generations X and Y are switching to and finding success in contract work.

The study also pointed out that while the majority of respondents work full time as Contractors, some also use contract work for supplemental income. Contract work gives individuals the ability to increase their means because it affords more freedom to choose projects that work with an already busy schedule. This is also a great way for new graduates or people looking to switch careers to gain valuable job experience without sacrificing income.

The study found that optimism about future business prospects is high among contractors even though it also found that finding clients is the biggest challenge that contractors face today. Contractors primarily rely on referrals and networking to find work, and over 45% indicated they intend to leverage their personal network more in the coming year. However, over 45% also specified that they intend to social media more in their search for clients.

Contract workers currently represent 25% of the Canadian workforce, and this percentage is growing. People aren’t being forced into contract work due to layoffs; they are increasingly finding that contract work will allow them to enhance their lives both personally and professionally.

To find out how you can become a contract worker, contact CWS at

Christina Fabugais
Sales & Marketing Manager
Phone: 1-866-837-8630 Ex. 9077
Email: christina.fabugais@cwsolutions.ca

All statistics were found in: Gandia, Ed. 2011 Freelance Industry Report: Data and Analysis of Freelancer Demographics, Earnings, Habits and Attitudes. Sept, 2011. http://d3go1ztdjepprc.cloudfront.net/ifd2011/FreelanceIndustryReport2011.pdf

A couple months ago, Statistics Canada published a labour report entitled, TemporaryLabour in the Downturn. This sparked the interest of many temporary/contract labour experts as this is the first piece of research published by the Canadian government that focused solely on the emerging usage of temporary labour.

What does this mean?

The Canada Labour Market is beginning to realize the value of temporary labour and the need for companies to recognize the significance of this growing workforce.

Some Interesting Statistics:

  • In 2009, 1.8 million Canadians, or 1 in 8 paid workers, had some form of temporary employment.
  • Contract positions account for the majority of temporary jobs, and their share increased between 1997 and 2009, from 47% to 52%.
  • Temp agencies have been rapidly expanding since the 1990s, generating $9.2 billion in 2008 from $1 billion in 1993

To view the full report Click Here

Remember when everyone kept talking about the recession and the strain it put on our economy? Well, although people are STILL talking about it, at least now it is in the context of a steady road to recovery. Not to say that we are out of the wood-work just yet, but it seems that employers are beginning to hire again which is great news for both our economy and our nation’s morale. At the forefront of employment growth is temporary and contract labour. As discussed in previous CWS Blog posts, temporary and contingent labour is a great way for organizations to employ the resources they need in an efficient and cost effective manner. So it should be no surprise, that those in the temporary staffing realm are reaping the benefits of this much anticipated, and much talked about, economic recovery.

In a recent article by Staffing Industry Analyst, Benchmarks: Temp Staffing Revenue,stated that temp/contract staffing revenue increased by 12% in 2010 from 2009 totalling approximately $80 billion. The research projects that by 2012, the temporary/contract market will make up $97.3 billion.

Other temporary/contract staffing facts:

  • 27%: Growth in staffing of industrial jobs in 2010, the most growth of any temporary and contract staffing segment.
  • The strongest performing of the professional segments were IT and engineering, with each growing 13% in 2010.