Learning Curve: Ontario government misguided in changing rules for temp workers

by Tracy Clayson
Tracy Clayson is managing partner, business development of Mississauga, Ontario-based In Transit Personnel.

The Ontario government’s recent announcement of the “Fair Work Places and Better Jobs” policy is designed to legislate and enforce labour laws in a one-size-fits-all program. The legislation introduces measures to ensure staffing companies apply the same work conditions as those their clients provide to their employees.

The Ontario Government states ‘secure, full-time, permanently employed work status’ is something that all those in the workforce, including the so-called ‘precarious temp worker’ should benefit from. Most production, distribution and transportation company environments have a flexible workforce employed by a third party in order to mitigate variations in workload, the cost and process of on-boarding, and extensive payroll administration resources needed to manage a fluctuating labour supply and demand climate.

Furthermore, the increasing challenge of attracting, screening and retaining applicants due to the aging workforce and millennial-driven low level of engagement means businesses rely on service providers to spend their time and energy to access the skilled talent required. Ontario is listed as the second costliest place in the G7 to employ workers, not because of wage levels but because of employer payroll costs — that is, government costs. What does that do for job creation?

While the efforts to raise minimum wage, standardize the wage practices between full-time employees and temp workers and amend the labour organization process to include temporary workers might appear to address the quality of work and wage conditions, many companies already employ dedicated contract employer companies as a business service and solution to the challenges of a skill shortage and complex Canadian payroll compliance processes. They match the competitive wage levels and all the perks like benefits, bonuses and incentives.

Clearly the mandate with the Ontario Workplace legislation is a reaction to the status of work for employees who are not in-house and who opt for the flexibility of making their own work schedule and having more independence and do not require the seemingly protective labour unions to negotiate their work status.

Organized labour has traditionally challenged strikebreakers in Canada and has created collective agreements to protect members from having jobs replaced by temporary workers. Some companies will pay the union dues for the agency workers to keep the flow of work going when additional and otherwise not available workers have been accessed from agencies.

There can be a very large difference in quality of work between strikebreakers, temp agency workers and contract employee placement companies. Most retention success for agencies comes when they either mirror or better wage rates, vacation allowances and other workplace benefits.

Some of the companies that use these services prefer to outsource their HR function and focus on their core competency, especially entrepreneurial firms with tight budgets or large corporations with extensive HR administration and lengthy on-boarding processes for staff when the work demands are immediate. With the Employment Standards Act applying to every employee, regardless of status of employee on a dedicated assignment or temp agency worker, the right to overtime, paid holiday, vacation pay and other features are already in place.

So with input from temp industry nowhere to be seen in the Ontario Government’s agenda of attacking workplace practices, where are the facts to support the negative working conditions being presented to pressure governments to make these rules?

An Ontario Chamber of Commerce report, in 2015 reported the majority of Ontario workers had held their position for nine years, showing employment stability and undermining some claims made on the necessity of employment reform action.

If the goal is to find a way for Ontario businesses to be even less competitive than other markets, then they have won. Ontario is already a tough place to do business; utility costs, the tax costs, and onerous government reporting policies are all putting businesses in Ontario at a disadvantage.

This short-sighted and reactionary mandate set out by the Ontario government is an attack on free enterprise and shows blatant bias towards labour interest groups who would prefer we all operate unionized enterprises. Perhaps the unions are trying to access union dues from temp workers and in their minds build a stronger workforce presence so they can leverage increased wages and perks.

However, many of the workers in the temp help sector do not see the value in unions, and have not seen the benefits of worker solidarity to ensure job security.

The thing about an entrepreneurial company is that we focus on mutual prosperity with clients and candidates. Adversity never wins.