David Doorey

Written by David Doorey

If you aren’t listening to the podcast Hustled by the great Toronto Star journalist Sara Mojtehedzadeh’s, you should be. The third instalment is entitled simply “Oshidashi”. This title is based on a conversation I had with Sara for the podcast. Let me explain.

I was invited earlier this year, before the plague descended upon us, to address an Ontario Bar Association conference on the question of employment status and the gig economy. If you’re interested, here is the paper that accompanied by talk. The talk and paper were called “Legal Oshidash, Labour Law’s Boundaries, and Law’s Response“.

As readers of this blog will know well, gig companies like Foodora, Uber, and the like treat their drivers as “independent contractors” (IC) in order to avoid costs associated with treating those workers as “employees”. If the drivers are IC, then they are not covered by all of the laws that we have developed over the past century designed to protect “employees”.

We protect employees because we want a labour market that produces safe jobs that permit workers to earn sufficient money not just to purchase food, clothing, and shelter (i.e. to survive), but also to participate more broadly in the economic market to further more economic activity creating more jobs. However, we learned early in days of the market economy that an unregulated labour market does a very poor job of producing these outcomes. So governments in Canada and most other places began passing laws designed to guarantee basic minimum wages, safer workplaces, caps on hours, and so forth. The “employment” relationship is among the most highly regulated relationships of all.

However, these laws designed to protect employees and produce policy outcomes such as decent working conditions don’t apply to ICs. That’s because the law assumes that IC have sufficient bargaining power to look after themselves. IC are running businesses themselves and employment law has nothing to say about the relationships between businesses. That’s a matter for business law.

Since we created this legal fiction that divides “employment” from “entrepreneurship”, we needed a way to distinguish between an employee and an IC. How do we know when a worker is really an entrepreneur and not just an employee in disguise?

I discuss the evolution of the various tests that have been applied by courts and tribunals in Canada in chapter 4 of my book The Law of Work (“What is Employment?”), and I discuss them briefly in the attached OBA paper. At the end of the day, the SCC has basically told us that you need to gather all the facts about the relationship, stand back, and assess whether the person more closely resembles an employee or a entrepreneur running their own small company.

How the contract defines the relationship isn’t very important, otherwise the more powerful entity could simply add into the contract a clause saying “you are NOT an employee” and that would be that. Every company in Canada could add a clause like that and we’d suddenly have no employees at all, just millions of little businesses. It’s more important to identify the extent to which the worker acts like an entrepreneur: do they advertise their services, do they have control over the prices they charge, are they free to hire their own employees to do the work, are they subject to rules and possibly discipline for performance issues, have they invested capital in their business, can they grow their business, and so forth.

And here is where many companies that treat workers as IC, including gig companies, run into trouble. They want to call the workers IC because it is cheaper not to comply with laws designed to protect employees. However, they also want to tightly control the worker to ensure that the company’s brand and reputation is preserved. Therefore, they impose rules and forms of discipline when those rules are violated. The podcast explains some of the ways that Foodora controls its drivers, for example. The companies want control over the worker and how the work is performed, just not the responsibility of treating the worker as an employee.

I use oshidashi to explain this dynamic. In sumo wrestling, the objective is to push the opponent outside of a “ring”, or circle. Oshidashi is a move in which the wrestler pushes the opponent outside of the circle while maintaining hand contract at all times. This perfectly describes what many companies, including virtually all gig companies, are attempting to do with their workforce. They are trying to push the workers outside of the boundary of employment law while at all times maintaining control and contact over them.

As I note in the OBA paper, the big policy debate today is whether this legal oshidashi should be permitted to succeed. When I presented the OBA talk on February 5, I told the audience that the OLRB would soon find that Foodora workers were employees for the purposes of the Labour Relations Act in a case that had been argued earlier. Some of my panelists disagreed. On February 25, the OLRB released its decision confirming my prediction.

My prediction was based on my experiences way back in the early 1990s when I worked with the union RWDSU helping to organize Toronto taxi drivers who were found to be “employees” in Ontario, and on my later experiences representing taxi drivers as a lawyer, including a taxi driver who argued that he was an employee under workers’ compensation legislation. I discuss that latter case and the law of employment status more generally in this video/podcast I put together recently for my Law of Work mini-lecture series.

To my mind, there isn’t much substantive difference between taxi drivers who get their work through a radio dispatch service and are subject to rules imposed by the dispatch company and gig workers who get their work through an App and are subject to rules imposed by the App company. The technology is different, but the nature of the work and the relationship is the substantially similar. It certainly helps that the Labour Relations Act expressly states that “employee” includes a “dependent contractor”, but the OLRB has also applied the scope of “employee” broadly under the Employment Standards Act too, even though that legislation does not expressly incorporate “dependent contractor”.

Ultimately, though, the issue about employment status should be revisited by our legislators. It’s time to return to the original purpose of employment protection statutes which is protecting vulnerable workers who are economically precarious.

I ended the OBA paper with this:

The struggle over the boundaries of Labour Law has attracted considerable policy attention over the past two decades as more and more workers find themselves performing work under non-standard arrangements, including being labeled as “independent contractors”. The emergence and expansion of “gig” work has put this tension under the microscope because it demonstrates so clearly how the manner in which work is structured can mask worker vulnerability and precariousness.  If the purpose of Labour Law is to protect economically precarious and vulnerable workers from harsh labour market forces, then a narrow scope of application of protective legislation and common law doctrine based on an out-dated legal fiction known as “employment” will becoming increasingly difficult to justify.  The oshidashi of Labour Law will be resisted in order to protect precarious workers from being pushed outside of Labour Law’s boundaries.  

David Doorey, “Oshidashi: How Sumo Wrestling Explains the Dilemma of Gig Companies” Canadian Law of Work Forum (June 1 2020): http://lawofwork.ca/?p=12587