Ontario intends to make client employers liable for injury-related cost of temporary agency workers

On November 6, 2014, the Ontario legislature passed The Stronger Workplaces for a Stronger Economy Act, 2014 to help protect vulnerable workers, including temporary agency workers.

The biggest change in the provisions for temporary workers—and the one that got the most publicity—amended the province’s Employment Standards Act to make temporary help agencies and their client employers jointly liable for regular wages, overtime pay and public holiday pay. The legislation addressed some of the shortcomings reported in the United Way/McMaster University research report, It’s More Than Poverty and the Law Commission of Ontario report Vulnerable Workers and Precarious Work.

However, the Act contained a lesser-known provision that amends Ontario’s Workplace Safety and Insurance Act to give the provincial government the authority to create a regulation that would help motivate client employers to better protect temp agency workers. The regulation would require the Workplace Safety and Insurance Board (WSIB) to attribute to client employers, under its experience rating programs, the costs associated with the work-related injuries of temp agency workers.

The need for such a change was brought to light, in part, by the research led by IWH Scientist Dr. Ellen MacEachen. In 2011 and 2012, her research was indicating that low-wage temporary agency workers were falling through the cracks of the occupational health and safety system. The complex employment relationship between temporary agency workers, temp agencies and client employers was creating loopholes and incentives that left low-wage temp agency workers more vulnerable to workplace injuries.

In particular, because temp agencies are considered the employers under Ontario’s Workplace Safety and Insurance Act, they are the ones subject to experience rating surcharges when worker injuries occur—not client employers who actually control the worksite. MacEachen’s research team recommendation based on their findings was that experience rating prevention incentives be applied to client employers.

Minister acknowledges research pointed out current limitations

This recommendation was acted on in the passing of Bill 18, The Stronger Workplaces for a Stronger Economy. In an article by OHS Canada magazine, a leading publication in Canada serving the OHS profession, Minister of Labour Kevin Flynn acknowledged that IWH research helped point out the limitations of the current system: Input from the Workers Action Centre and the Institute for Work and Health suggests that employers have been outsourcing the riskiest jobs to temporary-help agencies, the Minister added.

The research was also mentioned in the provincial legislature when Flynn brought Bill 18 forward for third reading on November 5, 2015. As noted in the Ontario Hansard, MPP Peggy Sattler (the NDP member for London West) said the following when she spoke in support of the bill [emphasis added]:

Clarifying legislative responsibility for temp workers who are injured during a job placement by attributing costs to the employer where the injury occurred and assessing wages with reference to income earned by the agency was regarded as a positive step forward by workers’ advocates. Research studies by the Institute for Work and Health have shown that client companies frequently bring in temp workers when they do not want their existing workers to be exposed to hazardous and unsafe workplaces.

Because the WSIB is currently reviewing its experience rating system, the regulation making client employers liable in the event of a temporary agency worker being injured on the job has not yet been put into effect. However, it is expected that this intent will be reflected in future changes to the experience rating program.

Publication date: 

December 2015

Type of impact: 

Type 2: Evidence of research informing decision-making