Independent Contractor Misclassification

Your employer called you a contractor. But if the reality of your working relationship tells a different story, you may actually be an employee. And that distinction could be worth a significant amount of money.

What Is Independent Contractor Misclassification?

Misclassification happens when an employer labels a worker as an independent contractor to avoid the obligations that come with employment: severance pay, benefits, vacation pay, and protections under the Employment Standards Act.

But what you are called in a contract is not what determines your legal status. Ontario courts look at the reality of the working relationship — not the label on the agreement.

Common Red Flags

You worked exclusively or primarily for one company — true independent contractors typically work for multiple clients.

Your employer controlled how and when you worked — set your hours, directed your tasks, and supervised your work.

You used your employer’s tools and equipment — rather than investing in your own.

You had no real chance of profit or risk of loss — your income was fixed and predictable, not dependent on your own business decisions.

Your contract was renewed repeatedly — what started as a short-term arrangement became years of continuous work.

How We Help

Step 1 — We assess your situation. We look at the full picture of your working relationship to determine whether you were genuinely an independent contractor or an employee.

Step 2 — We tell you what you’re owed. If you were misclassified, we calculate what you should have received: reasonable notice, vacation pay, benefits continuation, and any other entitlements that were wrongfully denied.

Step 3 — We make the claim. Through negotiation or litigation, we pursue the full compensation you’re entitled to. Many misclassification claims resolve without going to court, but we are fully prepared to litigate when necessary.

What About Dependent Contractors?

There is a middle ground called a dependent contractor — a worker who is economically dependent on one employer but does not have the full protections of an employee. For example, if you spend 80% or more of your working time with a single employer, you may be a dependent contractor.

Unlike true independent contractors, dependent contractors may be entitled to reasonable notice of termination or pay in lieu — potentially amounting to up to 24 months’ of pay in some cases.

If you are a contractor and have been terminated, or if you are unsure about your employment status, we can help.

Frequently Asked Questions

Does it matter that I signed a contractor agreement?
No. Courts look at the substance of the working relationship — not the label. A contractor agreement does not override the legal reality of how you actually worked.
What if I invoiced the company and collected HST?
These are factors courts consider, but they are not determinative on their own. Many misclassified workers invoiced and collected HST and were still found to be employees in law.
What if I worked for multiple clients occasionally?
Working for multiple clients is a factor that supports contractor status — but it depends on the full picture. Some workers with multiple clients are still found to be employees of their primary client.

Contact Pinto Shekib LLP, Your Toronto Employment Lawyers

Unlike true independent contractors, dependent contractors may be entitled to reasonable notice of termination or pay in lieu — potentially amounting to up to 24 months’ of pay in some cases.

If you are a contractor and have been terminated, or if you are unsure about your employment status, we can help.