The trucking industry is asking Ottawa to make good on its promises to fight the rampage of “Chauffeur inc.” “. Increasingly, this practice, used by freight companies, consists of hiring “integrated” drivers as subcontractors to provide services at a discount and avoid paying certain taxes.
“Right now, the government is losing social royalties from real workers. Across Canada, we can talk about billions. In Quebec alone, several million dollars,” says Marc Cadieux, CEO of the Quebec Trucking Association.
Over the years, “Driver Inc. Used by many players in the industry, Mr. Cateux moans. “A person first incorporates as a legal person, it is not prohibited, but when he is a simple worker, he takes advantage of tax exemptions from a company. It is clearly prohibited,” explains the manager.
He believes the scheme allows fraudsters to make substantial savings by bidding for tenders, creating “unfair” and “unfair” competition in the market.
Photo by Alain Roberge, La Presse Archives
Marc Cadieux, President and CEO of the Quebec Trucking Association
“These people are 20-30% off the normal price. They do not pay CNESST, RAMQ, Quebec pension. Driver Inc. The carrier that hires the company, in the end, doesn’t have to pay for it. He pays the person as a consultant, on the invoice for the services rendered, with no deductions at source,” continues Mr. Cadieux.
Teamsters Canada director of public affairs Christopher Monette also says the phenomenon is on the rise. He estimates that more than 10,000 drivers in the country are currently using the program. “The public would be surprised at how many 18-wheeler tax havens there are now on our roads. It’s a real bummer,” he says.
“We’re seeing companies asking their employees to join. They’re hanging on to the fact that they’ll no longer have any deductions from their salaries. On the other hand, they’re not saying that if there’s an accident at work, they’ll no longer have any coverage, no employment insurance, no paid parental leave,” continues Mr. Monette.
Guarantees are requested
In November, in its Budget Economic Statement, Justin Trudeau’s Liberal government “committed $26.3 million over five years, starting in 2023-2024, to Employment and Community Development Canada and cases to strengthen the Canada Labor Act”.
However, in her most recent budget released at the end of March, Finance Minister Chrystia Freeland did not finally announce any additional funding. “In Ontario, equivalent to CNESST [Commission des normes, de l’équité, de la santé et de la sécurité du travail], the Workplace Safety and Insurance Board, already has a pilot project in this direction. They recovered several million dollars. It’s done for regulation,” explains Marc Cadieux.
“The lack of detail in the federal budget is quite surprising,” says Christopher Monette. “We need public clarifications on the application of the law. All this is detrimental to the normal growth of wages in the industry at a time when the cost of living is skyrocketing,” he says.
M in the office.me Freeland, however, reportedly committed in Budget 2023 to “amend the Canada Labor Code so that federally regulated workers receive the protections and employer contributions they are entitled to, including Employment Insurance and Canada Pensions”. “We’re asking workers to make sure we get it right, and we’re focusing on education, outreach and stakeholder engagement in all federally regulated private sectors to end misclassification,” said Press Secretary Hartley Whitten.
Quebec says it is in action
Quebec Labor Minister Jean Boulet’s office confirms that CNESST has set up “a whistleblowing line to continue documenting the situation.”
“In particular the documentation is done in collaboration with the Minister des Finances du Québec. Thanks to these reprimands, audits were carried out with transport companies to ensure the application and respect of the laws in financial matters,” argues Maud Methodet-Funiel, press liaison to the minister.
Quebec said that “Chauffeur inc. is legal by itself, but it becomes illegal if it is “imposed by transport companies to avoid applicable laws in Quebec”. “In general, we continue to work with other government partners with the aim of regulating the problem of integrated employees,” said Ms.me Funiel.
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