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Defining ‘Contractor’ Status Would Provide Some Relief for Workers

A new rule proposed by the Department of Labor could bring partial relief to businesses struggling to stay afloat amid the COVID-19 pandemic’s economic fallout. It could also help millions of workers who are straining to maintain their livelihoods or attempting to find new ones.

For the first time in more than 80 years since the enactment of the Fair Labor Standards Act, a new proposed rule seeks to provide clarity on the definition of an “independent contractor” for general industry.

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This is important because it can be difficult for businesses to differentiate between employers and contractors, and extremely costly if they make the wrong determination.

As Labor Department Secretary Eugene Scalia noted, “Employers and workers looking for guidance have had to parse the sometimes-divergent decisions of the federal courts of appeals, and opinion letters the Labor Department issues occasionally without public notice or input.”

Ambiguity about how to classify workers can result in high administrative costs and cause fear and uncertainty for employers who risk costly lawsuits that could destroy their entire business if they make the wrong determination.

Fines and penalties for misclassifying workers can include back payroll tax payments, over 40% of the misclassified workers’ wages for up to three years, and, if the misclassification is determined to be intentional, up to $500,000 in fines and a year in prison.

It’s not just a difference in payments that separates employees from contractors. Employers could be on the hook for many other violations, such as: not properly documenting a worker’s hours, neglecting to

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Howard Levitt: Why the independent contractor status of doctors leave them vulnerable in the workplace

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At trial, the judge acknowledged that both physicians would be required to “consider new career paths” as the College of Physicians and Surgeons of Ontario required that they complete extensive retraining to practice in emergency of family medicine, as they had spent their careers specializing in urgent care and found themselves with nowhere to practice. Dr. Luczkiw developed cancer shortly after the urgent care centre closed.

Despite the, frankly, tragic result and unfavourable outcome for the physicians in this case, the Court took an important step in finding that the physicians were dependent contractors due to their economic dependence on the hospital and their high level of exclusivity. As a result, where privileges are cancelled, revoked, refused or substantially altered, absent this limited statutory exemption, physicians would be entitled to damages for reasonable notice, as dependent contractors, in the same way as employees — and potentially for dramatically more if their loss of hospital privileges prevented them from getting back on their financial feet for years.

The case exposes the cracks in our system by which independent contractor status leaves our physicians vulnerable and unprotected. For a society that has become acutely aware in recent months of the importance of physicians to the health and functioning of our society, we must ensure more fair and equitable treatment of our healthcare heroes. The court in this case, as in others, has increasingly filled in the gaps and provided deserved protection for a group which was historically, to the surprise of many, vulnerable.

Got a question about employment law during COVID-19? Write to me at levitt@levittllp.com.

Howard Levitt is senior partner of Levitt LLP, employment and labour lawyers. He practises employment law in eight provinces. He is the author of six books including the Law of

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Why the independent contractor status of doctors leave them vulnerable in the workplace



Most physicians are not employees in the traditional sense, but rather are independent contractors with hospital 'privileges'.


© Provided by Financial Post
Most physicians are not employees in the traditional sense, but rather are independent contractors with hospital ‘privileges’.

The pandemic has shone a light on many aspects of society, but nowhere more brightly than on our healthcare system.

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Exposing both its frailties and resilience, COVID-19 has made it clear that the strength of our hospitals lies with our frontline staff: physicians, nurses and other healthcare professionals. However, the independent contractor status of physicians can leave them vulnerable to unfair practices in the workplace. Recently, however, our courts recognized one of the challenges physicians practicing in hospitals face: the dependent nature of many physicians’ practices and the lack of financial protection if their privileges are terminated. Shouldn’t a physician be entitled to compensation if a hospital effectively terminates their job?

Hospitals, and in particular academic hospitals, are complex work environments. Most physicians are not employees in the traditional sense, but rather are independent contractors with hospital ‘privileges’. A hospital grants its physicians the ‘privilege’ of using its resources to provide care to patients. Privileges are very valuable to the physicians who hold them as they have significant financial, professional and reputational benefits.

Increasingly, due to financial considerations, hospitals are seeking to limit the number of physicians on staff. But the loss of privileges has dramatic negative financial consequences for physicians who earn the bulk of their income in a hospital environment, particularly physicians requiring a hospital setting to perform aspects of their jobs, such as complex surgeries.

As privileges are now much harder to come by, some physicians who lose their hospital privileges can find themselves without the ability to earn a living. Recently, the courts acknowledged that some physicians have a relationship of dependence on hospital resources and therefore should be entitled to the

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Consumers driving vessels to break status quo

Uniworld has more design ideas on the way, driven by consumers seeking an even more original boutique river cruise experience.

So said Ellen Bettridge, president and ceo, Uniworld Boutique River Cruise Collection during ‘Design Disruptors’, presented by Seatrade Cruise Brand Ambassador Ayesha Khan and sponsored by Bath Fitter at Seatrade Cruise Virtual.

‘Nothing is the same’, said Bettridge on the interior design of Uniworld’s river vessels, as she shared photographs of the artwork on display in Catherine and Antoinette and their hand crafted features. 

She went on to add that the vessels are original for having been ‘designed with a woman in mind’, demonstrated by storage spaces in bathrooms. 

‘[We’ve] certainly a few other ideas coming… [for] a luxury experience for the customer. It is the consumer driving this’, she added. 

Creating personality

Ponant’s ceo Americas, Navin Sawhney, said the cruise line’s Explorer Class ships ‘all have their own personality’ and capture lots of light so passengers ‘can enjoy the panorama in its fullest form.’ 

He described the vessels’ Blue Eye Lounge as ‘a feat of engineering’ that comprises 24 layers of glass glued together so passengers can see ‘in the ocean and the ocean floor.’ 

Sawhney concluded, ‘The idea here is to open the eye of the traveller’s mind… how this ocean exists and how we can continue to make it exist.’ 

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