North America

By Sherisa Rajah and Shane Todd, Fasken Martineau DuMoulin

Canada has been enjoying its lowest unemployment rate in nearly forty years.[1] Despite that rosy economic indicator, a majority of surveyed Canadians are experiencing a “psychological recessions” — we feel that the country is experiencing a mild or severe recession.[2] This economic anxiety may be a symptom of uncertainty about the modernization of the Canadian economy, and changes in the nature of work. The best treatment for our anxiety may be embracing the gig economy as part of the future of work.

What is the gig economy?

Investopedia describes a gig economy as one in which “temporary, flexible jobs are commonplace and companies tend towards hiring independent contractors and freelancers instead of full-time employees”.[3] It is different than the historic model of full-time workers “who rarely change positions and focus instead on a lifetime career”.[4]

In economically struggling communities and regions roiled by globalization and changing consumer demands, technology can create spontaneous work opportunities that may not have otherwise been available. The gig economy can also provide more efficient services to consumers. This growth is, in part, based our dependency on the internet. Social media now allows service providers in the gig economy to connect with the consumer in real time via “work on demand” apps. For example, Handy — an app that allows users to retain people offering residential, cleaning, installation and other home services on demand.

The gig economy is not limited to new apps. Canadian employers are already using the gig economy for work that does not create fixed employment.

A workforce study conducted in 2017 estimated between 20% to 30% of the Canadian workforce already consisted of “non-traditional workers” — meaning contingent, consultant, contractual, part-time, freelance and/or virtual workers.[5]

The social and economic benefits of a gig economy

Workers in the gig economy are usually independent or dependent contractors. A key characteristic is increased control over one’s own affairs. This may be one of the key individual benefits. One study found that approximately half chose work in the gig economy for greater autonomy and control, half said they were supplementing their income on the side, and over forty percent said they were balancing career with family needs.[6]

The benefits of the gig economy to competition have also come to light. The Competition Bureau of Canada, whose mandate includes promoting the benefits of competition, published a White Paper in 2015 that concluded the gig economy impacting the traditional taxi industry was for the better and here to stay:

“[…] Consumers can expect to enjoy the benefits of this increased competition, including lower prices, greater convenience and availability, and better quality of service through improved technology. With the right balance of competition and regulation, passengers can expect that the industry will ensure safe, competitive, and innovative transportation options in the future.”[7]

There have been fears that the gig economy will displace workers in traditional businesses. But, preliminary studies in the taxi industry have shown there may be more complementation (that is, working in both traditional and gig models) rather than displacement.[8] Some loss of market share may result from competition, but the pie can still grow and benefit everyone. Entrepreneurs, for example, can benefit from the multitude of professional services available to their business without the onerous employment obligations.

In addition to benefits from increased competition, gig economy platforms may have equitable effects. Ride-sharing services, for example, have becoming a preferred option for women due to stronger accountability features that make women feel safer accessing them over traditional enterprises.[9] There is also anecdotal evidence of enhanced consumer access for racialized minorities and traditionally underserved communities.[10]

The gig economy may also lift people out of the underground economy by giving them legitimate, flexible work opportunities with low entry barriers. Vulnerable members of society — like the disabled, or those with cultural, language, or social barriers to finding employment — can avoid the traditional burdens of the hiring and employment process through gig economy platforms. After all, the only thing they need is an Internet connection and a willingness to work.[11]

Embracing the future of work

A worker in the gig economy is free to manage their own output, deliverables, and earnings. They have no obligation to work, but if they choose to do so, they can work from wherever, whenever, and for whomever they choose without exclusivity.

This in stark contrast to the presumptions of the traditional employment relationship. What we have are a number of economic opportunities for gig workers to earn a living that are being frowned upon because there is no conformity to traditional employment models. The vexing question is why these commercially negotiated relationships have to be boxed in as employment relationships at all.

As Canadian companies look to optimise operations and streamline costs, it has become clear that businesses, entrepreneurs and unemployed citizens alike may have to embrace the gig economy despite the muddy regulatory waters may be. The focus should be on encouraging gainful economic opportunities through better protections for gig workers, rather than quashing models that have the potential to empower the workforce.

Footnotes

  1. [1] By the end of 2018, the rate had fallen to 5.6%: “Labour Force Survey, December 2018“, Statistics Canada (4 January 2019), online.
  2. [2] “Economic Outlook 2019: Canadians In Psychological Recession “, Pollara Strategic Insights (13 January 2019), online.
  3. [3] “Gig Economy “, Investopedia (24 May 2018), online.
  4. [4] Ibid.
  5. [5] “Workforce 2025: The Future of the World of Work “, Randstad Canada (18 April 2017), online.
  6. [6] “The Gig Economy: Achieving Financial Wellness with Confidence “, BMO Wealth Management (30 July 2018), online; see also Elaine Pofeldt, “Why Older Workers Are Embracing the Gig Economy “, Forbes (30 August 2017), online.
  7. [7] Competition Bureau, “Modernizing Regulation in the Canadian taxi industry “, Government of Canada (26 November 2015),  online.
  8. [8] Sunil Johal, Sara Ditta & Noah Zon, “Taxi and Limousine Regulations and Service Review – Emerging Issues in the Taxi and Limousine Industry “, Mowat Centre (22 October 2015) at 7-8, online.
  9. [9] See “City of Ottawa – Taxi and Limousine Regulations and Services Review: Customer Experience”, Core Strategies (14 October 2015), at 8; Ashley Csanady, “If the Uber debate is really about safety, why are women’s voices being sidelined? “, National Post (26 April 2016), online.
  10. [10] Gene Demby, “Apps Make Googly Eyes At Riders Tired Of Being Snubbed By Cabbies “, National Public Radio (21 October  2014), online.
  11. [11] See Steve Hawk, “What an economist learned by driving for Uber”, Quartz (5 March 2018), online.

Authors

Sherisa Rajah
Partner
Johannesburg
Shane Todd
Partner
Toronto, ON

© 2017 Fasken Martineau DuMoulin LLP The content of this website may contain attorney advertising under the laws of various states.

Related Articles by Firm
New transparency registry for all private BC companies in the offing
If the bill comes into force it will have far reaching compliance consequences for all private BC companies.
Privacy Commissioner of Canada reverses position on transfers of personal information for processing
The Commissioner has made a surprising reversal of its long-standing position on the transfer of personal information.
Changes are coming!
Five factors to consider when reviewing your Canadian trademark strategy in 2019.
A closer look at Canada’s budget
Fasken’s team examines important budget 2019 measures — some which made headlines, and others that should not escape notice.
Selected tax measures in Canada's 2019 federal budget
The budget contains significant proposals to amend income and excise taxes, while also providing updates on previously announced tax measures and policies.
OSFI issues advisory on technology and cyber security incident reporting
The Advisory reflects the fact that OSFI is very focused on this increasingly significant area of risk.
Health Canada pushes for safer medical devices
The announcements foreshadow significant near-term changes to Canada's medical device regulatory regime.
USMCA impact on communications industries
How the US-Mexico-Canada Agreement affects telecommunications, broadcasting and digital trade.
Surprise changes seek to modernise Canadian trademarks law and practice
This bulletin looks at key proposed changes to trademark law in Canada.
Time limits for retaining information about employees
Retention of personal information carries various obligations, particularly in terms of access to the information and confidentiality.
Further hurdles for regulatory approval of notifiable mergers in South Africa
On July 12, the Competition Amendment Bill was introduced in Parliament, substantially revising the earlier version of the Bill.
Hitting the sweet spot: Regulation of sweetened alcoholic beverages
Health Canada issued a notice of intent to restrict the amount of alcohol in highly sweetened alcoholic beverages.
Significant changes proposed to Canada’s AML/ATF regime
The Proposed Regulations are wide ranging and include a number of substantive changes as well as technical amendments.
Canada: Privacy commissioner issues key guidelines for consent and inappropriate data practices
Important guidance documents issued in respect of activities regulated pursuant to the Personal Information Protection and Electronic Documents Act ...
Cybersecurity risks for directors and officers
The cybersecurity field is ripe for affected stakeholders to test claims that directors and officers have failed to discharge their duties.
Cybersecurity Risks for Directors and Officers
Directors and officers in Canada face increased risk of personal liability and threats to job security in relation to cybersecurity...
Proposed changes to Canada's anti-money laundering and anti-terrorist financing regime
A consultation paper released in February could potentially have broad implications for Canada's AML/ATF regime.
Bill 148 Update: Scheduling and the three-hour rule
The Fair Workplaces, Better Jobs Act, 2017 makes significant changes to the Employment Standards Act, 2000.
Does your non-competition clause really protect you?
Or does it merely offer the illusion of protection? What you need to know about the validity and enforceability of a non-competition clause.
Canada: Selected Tax Measures in the Federal Budget 2018
Canada's 2018 Federal Budget contains significant proposals to amend the Income Tax Act and the Excise Tax Act while also providing updates on previously announced tax measures and policies ...
Expect the Intersection of Privacy and AI in 2018
We must consider how to regulate, or at least control, the use of artificial intelligence at different levels ...
Energy Licences and Approvals in Canada
Update on Directive 067: Eligibility Requirements for Acquiring and Holding Energy Licences and Approvals ...
Canada to Revise Tax Voluntary Disclosures Program
Effective March 1, 2018: New Regime will Result in Limited Relief for Certain Taxpayers Disclosing Errors and Omissions ...
Canada: New CASL Ruling
CRTC Provides Guidance on B2B Messaging and the Due Diligence Defence ...
Corporate Parent Liability: Litigation Risks for Resource Companies
Traditionally, parent companies have been considered legally distinct entities and thus immune from the actions of their subsidiaries, a concept described as the “corporate veil”. This position is now being challenged ...
Canada: No Duty to Consult Triggered by Omnibus Changes to Environmental Laws
In Canada (Governor General In Council) v. Courtoreille, 2016 FCA 311, the Federal Court of Appeal found that the federal government did not owe a duty to consult when it developed and implemented changes to environmental legislation through two omnibus bills ...
The Global Reach of Canadian Privacy Law
Federal Court Issues Landmark Ruling in Globe24h ...
Temporary Foreign Workers in Canada: Employer Compliance Rules
The regulations that govern applications for work permits provide a very strict framework for employers who hire temporary foreign workers in Canada ...
Canada is Open for Business
Trump and the Changing Political Landscape in the US ...
Primer on Procurement Rules in the New Canadian FTA
Fasken Martineau Releases Primer on Procurement Rules in the New Canadian Free Trade Agreement ...
Canada: Donald Trump, Paris and the Climate Policy Two­-Step
Will the U.S. withdrawal from the Paris Agreement fundamentally alter Canada's course?
China’s Priorities for a Free Trade Agreement with Canada
Analysis of Chinese language commentary, news media and academic studies, reveal some of China's top priorities for a free trade agreement with Canada ...
Canada: New Authorities under Vanessa's Law
On June 18, 2016, the Federal Department of Health published a Notice of Intent to amend the Food and Drug Regulations and the Medical Devices Regulations to implement key authorities under Vanessa's Law...
Canada: Consultation on New Health Regs for Self-Care Products
Health Canada is seeking consultation on new standards for self-care products, over-the-counter drugs, natural health products and cosmetics ...
Private right of action under Canada’s Anti-Spam Law
As of July 1, 2017, individuals and organizations will be entitled to institute a "private right of action" before the courts against those that contravene certain provisions of Canada's Anti-Spam Law ...
New Federal Consumer Protection Regime for Bank Customers
Canada: The government has introduced a bill which proposes to create a comprehensive federal consumer code and strengthen federal jurisdiction over provincial jurisdiction with respect to products and services of banks.
Canada: Alberta's Renewable Electricity Program
Alberta released details of the Renewable Electricity Program to accelerate the development of renewable power generation through a competitive bid process.
Certainly Uncertain: Construction Trusts after Iona in Canada
A recent decision clarifies the law regarding provincial statutory trusts in the insolvency context, particularly in the construction sector.
The Fight against Climate Change and the Overhaul of Canada's Environment Quality Act
A bill allows government to require a "climate test" from a project proponent.
Health Canada Is Cracking The Whip On Advertising Violations
On January 21, 2016, various hospitals, natural health product manufacturers, physicians and pharmaceutical companies found themselves specifically named by Health Canada in a published list of health product advertising complaints ...
Canada: New Strategic Plan for the Patented Medicines Prices Review Board
The Strategic Plan comprises a fresh vision, a revised mission statement and four new strategic objectives ...
Transport Canada Promises New Drone Regulations
Increase in popularity has had a direct effect on risks involved for the safe use of regular aircraft ...
N. America: Northern Gateway Pipeline
Province must consult and decide but may impose conditions
Canada: Tinkering with Title - Don’t Get Caught by Surprise
The Mining Amendment Act 2015 proposes a new electronic mining lands administration system in Ontario.
New Lobbyists’ Code Will Restrict Dealings with Canada’s Federal Government and Agencies
Canada's new Lobbyists' Code of Conduct will significantly restrict the activities of lobbyists and others seeking to influence federal decision making.
Righting a Wrong: Canadian Regulators Improve the Rights Offering Regime
Canadian regulatory authorities recently overhauled how prospectus exempt rights offerings are to be conducted going forward.
A change of role for a legal representative under the new Clinical Trials Regulation 536/2014?
The roles and responsibilities of the legal representative set out under Clinical Trials Directive 2001/20/EC are likely to change under the new Clinical Trials Regulation 536/2014.
Historic Court of Appeal Decision in Dunkin' Brands: Three Lessons for Franchisors in Canada
The Quebec Court of Appeal has specified the intensity of the franchisor's implied obligations in what is the most significant franchise case in Québec since 1998.
New Compliance Form and Fee for Employers of Foreign Work Permit Applicants in Canada
Employers whose foreign employees must apply for a work permit or extension should be aware of a new Compliance Form and Compliance Fee that they must submit before the person applies for the work permit in Canada.
Use of Trademarks As Metadata & #Hashtags in Canada
A recent decision of the Federal Court of Canada provides guidance on the proper use of IP in this digital world that brand owners need to know now.
Claims that Involve a Fixed Dosage and Schedule Can Constitute Patentable Subject Matter
The Canadian Intellectual Property Office has issued a revised guidance which provides clear instructions on how to approach medical use claims and determine whether such claims are eligible for patent protection.
The Application of the Bhasin Principle of Good Faith in Canada: An Early Example
A recent decision from the Supreme Court of British Columbia provides an early example of how courts will apply the general principle of good faith in Canada.
The TPP Agreement: A Canadian Business Perspective
The TPP will impact goods access and other aspects of Canadian businesses.
Foreign Corruption and the Integrity Framework in Canada: A Difficult Corporate Board Dilemna
Canada's Integrity Framework raises difficult choices for corporate board directors and management regarding voluntary disclosure of prior foreign corrupt activity of an acquired company.
Canada-EU Comprehensive Economic and Trade Agreement Negotiation Completed: Additional Protection for Innovative Pharmaceutical Products
If ratified, key intellectual property provisions in the Canada-EU trade pact will provide additional protection for innovative pharmaceutical products.
An Update on the Proposed EU Revisions to the Regulation of Medical Devices
The proposed European regulatory regime will merge the directives on Medical Devices and Active Implantable Medical Devices into a single regulation and wholly replace the current regulation on In Vitro Diagnostic Medical Devices.
UK FCA consults on requirements for reports on payments to government
While Canada does not currently have a reporting regime for payments to governments, a process is underway to ensure that a regime is implemented in the near future.
Trademark Use: an Important Shift in Canada
Bill C-31, which was given royal assent on June 19, 2014, will eliminate the requirement that a trademark be used in order to be registered in Canada.
Intellectual Property Protection - Industrial Designs
Many companies will consider the availability of and merits of seeking patent and/or trade-mark registration. However, one form of IP protection that is often overlooked is an industrial design registration.
Protocol to Amend the Canada-UK Tax Treaty
The Canada-United Kingdom Tax Convention was amended with the signing of a protocol on July 21, 2014. This article will describe some highlights of the Protocol and comment on the impact of these provisions on cross-border tax issues between Canada and the ...
The end of the Canadian "iPod Tax" saga
The "Certain Televisions Remission Order" confirms that, in fact, there is not now, and never actually was, "tax" on "iPod" imports to Canada.
Updating Canadian Trademark Filing & Registration Strategies
Here are some key trademark filing strategies for avoiding or minimizing the potential impact of recent amendments to the Canadian trademark landscape.
The Canadian insurance M&A environment
There have been a significant number of insurance company M&A transactions in the Canadian market in recent years, a trend expected to continue. Fasken Martineau DuMoulin have surveyed the acquisition agreements from these transactions and analysed ...
Merger control and foreign investment review in Canada
Fasken Martineau DuMoulin’s Huy Do and Jack Yu1 write that acquisitions of, or investments in, Canadian businesses can give rise to merger control and foreign investment reviews. ...
Related Articles
Data collection and early case assessment for investigations
Data collection and analysis for investigations is very different to collection for discovery or review. This article discusses the differences; how Early Case Assessment (ECA) can assist and the benefits of using review technology ...
Breakthroughs in Vietnam’s securities market
Since the first promulgation of the law on securities in 2006, Vietnam’s securities market has experienced dramatical growth (roughly twentyfold in market capitalisation) ...
The rooster is on the run
The pursuit of happiness has been an inalienable right, at least in the United States, since July 4, 1776 when it originated as an “unalienable” right in the Declaration of Independence ...
Related Articles by Jurisdiction
Use of Trademarks As Metadata & #Hashtags in Canada
A recent decision of the Federal Court of Canada provides guidance on the proper use of IP in this digital world that brand owners need to know now.
Deconstructing the new Construction Act
The amendments are intended to enhance the efficiency and competitiveness of construction industry stakeholders.
Canada: New CASL Ruling
CRTC Provides Guidance on B2B Messaging and the Due Diligence Defence ...
Latest Articles
Data Privacy in Malaysia
DFDL’s William Greenlee sets out the data protection regulatory framework in Malaysia and its recent developments ...
Cross-border transfer of personal financial information in China
Jingtian & Gongcheng partners Yuan Lizhi, Hu Ke and associate Wang Beining take us through the details of the regulatory framework ...
Amendments to three data privacy laws in Korea and the implications
By Kwang-Wook Lee, Helen H. Hwang, Chulgun Lim and Keun Woo Lee of Yoon & Yang ...