“I hope this finds you well during these unprecedented times.”
This is a phrase I’m sure most Canadians are sick of reading and sick of typing.
During these unprecedented times, Canadian workers have taken the time to re-evaluate their needs and priorities. We are asking ourselves if we want to continue living our lives the same way we did “PP” Pre-Pandemic. We’ve transitioned to work from home models, closed physical offices, are considering a 4-hour workweek. The landscape of employment is changing as people want more control, more autonomy and more flexibility.
In light of this, many people are considering a switch from being an employee to being an independent contractor. Below are some preliminary considerations when making this transition.
Benefits of being an independent contractor
- Determining your own work/life balance.
- Setting your own schedule.
- Seeing a direct correlation between the time spent and the money earned.
- Working for multiple companies at once.
Downsides of being an independent contractor
- No employment benefits.
- No guarantee of consistent income.
- No protection under the Employment Standards Act.
- Taxes are not withheld on your behalf.
Things to consider before getting started
- Do you require liability insurance?
- Do you need to be registered with WSIB?
- Do you require any licenses to complete your work?
- Are you required to charge H.S.T. on your goods/services?
- Are you providing goods/services to individuals or businesses?
- If you are providing goods/services to individuals, are you compliant with the Consumer Protection Act?
- What warranties will you provide?
Independent Contractor Agreements
Any experienced contractor will tell you that scope creep is one of the primary issues they face in ensuring that they are paid fairly for their efforts. Independent contractor agreements are useful tools to clarify the scope of work and protect you from scope creep. Additionally, having a formal written contract will clarify cost, time lines, warranties, and more. This can prevent disagreement and clarify any ambiguity between the parties regarding what was agreed upon and can save significant costs in the event of litigation. When it comes to these contracts, we typically see is contractors using a “master agreement” which sets out their terms and conditions which apply to all jobs, followed by shorter subsidiary contracts which set out the specific scope of the current project, as well as any project-specific elements. Regardless of the format, an independent contractor agreement is a key part of your upfront cost, which can save you the headache and cost of unpaid services to clients and litigation in the event of a disagreement.
If you would like to learn more about independent contractors or would like to speak to one of our lawyers regarding your independent contractor agreement, contact us by phone at 905-471-6161 or email us at firstname.lastname@example.org.
Author: Syrah Y. Yusuf