Navigating new Labour Code provisions: What trucking companies need to know

As of February 1, 2024, amendments to Part 3 of the Canada Labour Code will usher in pivotal shifts affecting termination procedures for federally regulated trucking firms.

Who does it affect? All road transport services spanning provincial or international territories — essentially, if a company provides trucking services interprovincially or to the U.S., they’re within the Code’s purview.

What’s changing?

• Previously, staff with a three-month tenure were eligible for two weeks’ notice (or equivalent pay) if terminated without cause. Come February 1, this extends to three weeks, progressing annually to a cap of eight weeks.
• A noteworthy addition requires companies to issue a comprehensive benefit statement upon termination. It should detail vacation privileges, remuneration, severance, and other entitlements. Timing? Two weeks before the termination for those given prior notice, and by the termination day for others.

The fine print: employee vs. owner-operator

It’s imperative for companies to craft distinct contracts for employees and owner-operators. Practical engagements should not blur the line between independent contractor and employee status. Misclassification could result in owner-operators being entitled to notices or compensations.

Mitigating risks

A critical aspect of this change is an ongoing commitment to periodic review of employment contracts, especially in light of recent Ontario jurisprudence (Waksdale v. Swegon North America Inc., 2020 ONCA 391). Any deviation from the Code’s standards might invalidate termination clauses, potentially hiking compensations during no-cause terminations.

For companies collaborating with owner-operators, clarity is non-negotiable. Contracts should unambiguously define them as independent contractors. Tangible distinctions Owner-operators should retain autonomy over work hours, fuel and insurance costs, manage vehicle upkeep, and more.

As labour laws change, staying informed is not just ideal; rather, it’s essential. As you navigate these upcoming changes, allow Westland to be your guide.