What is considered a casual employee in Canada? It’s a question many employers and employees face when work is irregular or part-time. While some think “casual” simply means occasional, the law says looks at it differently.
A recent Alberta court case shed light on how Canada’s court’s view “casual” employment and why someone working on and off for decades may still be considered a permanent employee. The decision underscores how courts examine the ‘true” nature of the working relationship vs how the employer chooses to label the relationship.
If you are unsure whether you are a “casual” worker or a permanent worker with the same rights as a full-time employee, here is what you need to know.
What is a casual employee?
Given that there are not minimal case law surrounding the subject of casual employee vs permanent employee, it may be difficult to determine whether an employee can be classified as a casual employee or a permanent employee.
In a recent Alberta case, the court determined that an individual who worked on and off with their company for nearly 25 years was not considered a casual employee. The Court of King’s Bench emphasized that the term “casual employee” has no precise definition under common law, and that the determination of whether an employee is considered a casual employee or a permanent employee is based on a holistic review of the entire employment relationship itself. Given the employee’s length of service, her managerial responsibilities, and role within the company, the Court of King’s Bench determined that these circumstances warranted providing her with a separation package as if she were a permanent employee.
Casual vs permanent employees: What courts consider
Given the absence of common law cases addressing this issue, courts have turned to a non-exhaustive list of factors to assist with determining whether an employee is considered a casual employee or not. Some of these factors include:
- Whether there is a written employment agreement;
- The existence of a regular work schedule
- The nature of the employee’s duties and responsibilities
- How the employee is paid and whether they are enrolled in the benefit plan
- Whether the employee can refuse work
- The degree of integration of the employee in the workplace
- The expectation of parties involved in the employment relationship
- Any relevant regulatory issues and tax treatment
While no single factor is determinative, a regular work schedule, managerial duties and long service tend point towards a permanent employee versus a casual employee.
What does the law in Ontario say regarding casual employees?
Under the Ontario Employment Standards Act ( ESA), an employee includes a person who supplies services to an employer for wages and are considered to have the same ESA rights as full-time employees.
Best practices for employers
Employers must be cautious with respect to determining whether an employee is considered a casual employee or not. While a casual employee is typically entitled to a shorter notice period, the above factors can significantly affect the overall notice period that an employee may be entitled to.
To minimize risk, employers should:
- review their employees’ employment agreements
- consider the factors surrounding the employee’s employment prior to deciding on the amount for their separation package.
- Consult an experienced employment lawyer to determine the appropriate separation package for the employee in question.
How Whitten & Lublin can help
If you are an employer with concerns regarding crafting an appropriate separation package for an employee, we can assist. If you are an employee who believes they have been wrongfully classified, we can provide insight and advice.
Contact us for further information regarding your entitlements online or by phone at (416) 640 2667.
Author – Abby Leung
How do I know if I’m a casual employee in Canada?
If your hours are irregular, you can refuse shifts, and you’re not integrated into company operations, you may be a casual employee. However, long service and steady work patterns may mean you’re actually a permanent employee under the law. Each case is different and will depend on the holistic review of your circumstances.
Do casual employees get termination pay in Ontario?
Yes. Under the Ontario ESA, all employees including casual ones are entitled to termination pay if they meet eligibility requirements.
