A group of officials representing Canada’s trucking industry held a joint news conference in Ottawa on Tuesday calling on the government to “stop the atrocities being inflicted on thousands of drivers” through a business model known as Driver Inc.
The Driver Inc. model involves a trucking company telling a driver who does not own a truck to register as a corporation and sell its driving services to the carrier, according to officials.
Canadian Trucking Alliance (CTA), Teamsters Canada, Quebec Trucking Association (ACQ) and several logistics operators said Driver Inc. is a tax scam. Employed by a growing number of companies, it uses misclassification of employees to avoid paying taxes and other withholdings.
“There are few rules for Driver Inc., just the ones they make up or cannot get around,” Scott Tilley, president of Tandet Group, said during the news conference. “It sounds not quite legal to me. It seems to be an unsavory bunch. We need to stop these atrocities that are being inflicted upon thousands of truck drivers in Canada through the Driver Inc. structure that has been allowed to begin to take over our industry.”
Officials are pressing the country’s Labour Program, along with the Canada Revenue Agency, to step up enforcement against Driver Inc.
John McCann, the national freight and tank haul director for Teamsters Canada, said another key issue is that Driver Inc. gives some carriers an unfair advantage over others, while abusing vulnerable workers.
“The key issue here is about fairness and assuring that all play by the same rules, so that no one employer is able to have an unfair advantage over another,” McCann said. “It’s about assuring that a vulnerable labor force is not taken advantage of simply because they just want an opportunity to work and support their families.”
Drivers who are being asked to file as corporations using Driver Inc. “are indistinguishable from regular employees, lack truck ownership, route choice, or any real degree of independence or financial risk,” according to a CTA news release.
“Drivers taking part in the Driver Inc. scam have a much harder time claiming employment insurance, overtime pay, vacation pay, severance pay, paid sick days, and other employee benefits accorded under labor legislation.”
Officials said they have been calling for action from the government to end the Driver Inc. practice for several years.
“The trucking industry is facing an existential crisis due to a labor abuse and tax avoidance scheme,” Stephen Laskowski, president of the CTA, said. “We need the Canada Revenue Agency and the Labour Program to tackle these issues with the enforcement resources this crisis needs. We need substantial audits on carriers involved in the Driver Inc. scam.”
The prevalence of Driver Inc. in the trucking industry increased 17% from 2018 to 2021, according to Laskowski.
The Canadian government has taken some steps to combat the use of Driver Inc. among carriers in recent years.
In 2021, amendments to Canada’s labor code went into effect making the intentional misclassification of employees illegal. Last year, the Canadian government proposed providing the Employment and Social Development Canada department with $26 million to combat employers using Driver Inc.
“In the fall economic statement, the government stated that it would bring forward $26 million for enforcement against Driver Inc. and that is a good start,” Laskowski said. “We are still waiting, though, for confirmation that indeed that funding has been approved.”
Driver Inc. cuts heavily into tax collections, according to one official.
“The Driver Inc. scam is costing governments at least $1 billion annually,” Marc Cadieux, president of the ACQ, said in a related news release. “That’s money that should be going to build our infrastructure and secure our social safety net, but instead is going into the pockets of crooked businesspeople.”
Canada’s Labour Program and the Canada Revenue Agency did not immediately return a request for comment.
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Bill Strasburg
What amazing statements! To read this article with a straight face, one has to assume that the wealth created by companies and employees actually belongs to the government. So it’s a “scam” to want to keep your money from being stolen by bureaucrats.
Who writes this crap? Socialism seems to be as strong as it’s ever been since the end of WWII, but how is it so bold? This is why we can’t have functioning societies in the world today…the governments have gotten co.pleteky out of control.
Anonymous
This is sheer foolishness; if they were to ban Drivers INC, the number of truckers who would quit would have a greater negative impact on the economy than $1 billion. Considering that drivers are already underpaid, taking this into account would further harm both the trucking industry and the economy, surpassing the repercussions of the pandemic or any previous events we have witnessed.
STOP seeking opinions from random individuals who have spent their entire lives behind a desk regarding what is right or wrong. Instead, consult actual truckers to determine what is best and most beneficial for them. These individuals are clueless about how the trucking industry operates and their misguided regulations will only exacerbate the economic damage.
GETTING RID OF DRIVER INC WILL DESTROY THE TRUCKING INDUSTRY.
Terry
This is immediate joke just like the rest of the media and the Canadian Trucking Incorporation they’re a joke look what they’re fighting about money donations just like they did in covid they didn’t back us truck drivers were truck drivers they are an organization of big corporations of guys that have trucking companies mostly in Ontario and they are scum blood sucking government spinoff they’re not trucking companies and truck drivers and people who bring people Goods because they want to their blood sucking evil scum that did nothing for us in Ottawa before just donations give me your money garbage scum just like any other system we are truck drivers independent truck drivers all of us we don’t belong to your f****** Canadian Trucking system Corporation big office in Toronto what a joke 5,000 members what a joke look how many trucks are on the road what a joke have a nice day should get a different job because most of you media guys write nothing but lies I’m fifth generation 40 years in this stuff come on over to my house I’ll tell you the truth
Michael
This appears to be the BIG TRUCKING UNION lobbying to break the option of independent truck drivers from becoming a free independent operator by forming a company, much like carpenter framers, to sub-contract work.
CRA rules state it is illegal not to pay taxes, but its not illegal to find legal ways to avoid/reduce paying taxes.
Canada does endorse the free enterprise system, which according to the authors story the Trudeu government is being lobbied to destroy.
Ron
Canadia trucks got started off the backs of US owner operators and nafta. That was the biggest handout
Back in the 60s and 70s before you were handed everything that American truckers built. Mexican trucks looked like Cadillacs compared to the junk you had up north. Now you’re Billy big riggers. Personally, I think it should cost Canadia trucks 3 bucks a mile when your traveling in the US. Destroying our roads.Where is reciprocity for infractions when you drive like lunatics down here. When you start getting impounded for infractions US roads will be a whole lot safer. Better idea than that. Your not US citizens so stay in Canada and haul your own freight. Maybe the Alberta dirt haulers will give you an education. Ask them, I’m sure they’d oblige you. American people don’t want you here. Stay home, or buy boats and float all your freight north on either coast. For a substantial fee of course. We don’t owe you folks nothing. Freeloaders
Day day
That happen in Canada but what about the Dispatch broker in America brokers are double dipping act like dispatchers when there are dispatchers low balling carriers and take A big share of the rate that sure be pay to the carriers post rate on load board that sure be 260 a mile for 53 cents then ppl wonder why they can some goods
Mark
Well this is not totally true, about driver inc. there is more of a problem that these groups don’t want to admit, after 40 years of this industry I’ve watched these big companies and ota and now the cta get caught with aiding politicians, the real truth is these companies don’t want to pay the drivers what they are worth, then you go to get a job at one of these companies it is forced dispatch they will say if you don’t do it we will just bring in more immigrants to take your place, mean while the cost of living went and the drivers wages don’t come close to the realities of survival, if the government would stop immigrating truck drivers flooding the market these companies.like TFI and challenger and many more that pay the lobbies off to get free labor maybe our roads would be safer. Instead of being overwhelmed with a language and education barrier.
No I’m not culture deficient I just know that many people coming to Canada says I going to school ends up in the trucking industry opening a freight company and good paying loads and get friends and other immigrants to haul them for cheaper rates.
This is only the tip of the iceberg I could fill you in with more details.
Anthony
This is 30 years overdue! It’s about time companies are forced to pay proper wages. Truck driving should be classified as a skilled trade and paid accordingly.!