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Unintended consequences of remote recruiting

Dec 9, 2021 | HR Tips, Independent Contractor, Recruiting, Remote Work, Workplace

The pandemic has forced employers to adapt their way of doing things. The process to recruit and hire new talent is no exception. This new reality often means the first time you physically meet a new employee is after they have been hired. In some case, a new employee may have been working for months and you have still not met them in person.

Remote recruiting and hiring has certainly offered some interesting challenges for employers. There definitely are few considerations that you need to be aware to ensure that you find the talent you are looking for, but without liability and non-intended consequences for your organization.

Hiring Remote Workers from Other Jurisdictions

You must have heard someone make the statement by now … “I should take my laptop, head up to my cottage or down south to a beach, and work remotely from there.” Really, when you think about it, would it not be a terrific incentive to allow workers to work from paradise rather than on their kitchen table?

Although the idea sounds terrific, it will almost certainly create unwanted consequences. Many companies think that the labour legislation that governs your company and your employees is the legislation in which the company resides. That is not entirely true.

Workplace legislation in Canada, in general, states that the workplace legislation that governs employees is that where the employee resides or where the work is being performed. This can make governing the employee relationship, which includes managing your liability, very difficult for employers.

For example, given the cross-border travel restrictions, many US and Canadian companies are hiring remote workers from the alternative country. In this scenario, a Canadian employer who wished to hire an employee from the United States would be bound by not only U.S. federal workplace regulations but by the specific state laws where the employee resides, which vary widely. In effect, you may have a
workforce being governed by numerous and different sets of rules and regulation. That provides a new layer of coordination and potential liability that companies did not account for when hiring remotely; I would not expect a birthday card from your HR department.

For public or municipal sector companies these types of arrangement become increasingly more challenging, if not impossible, as the vast majority of municipal sector worker are unionized. Even if it were in your management right to look beyond our boarders, or their was an agreement with the union, the complications that would evolve from that scenario merit an entire article alone.

The More You Look, the More You May Fine

Remote hiring has also caused employers to place a different emphasis on background verification and character analysis. Even with all the tools, tests and refined interview processes available to employers today, many employers – if not most to one extent or another if you choose to be honest about it – rely on that ‘feeling’ they get when they interview a candidate in person. It is a feeling that cannot necessarily be replicated by a virtual call.
Many recruiters and human resource people use social media as a readily-available tool to screen employees for ‘fit.’ It is reasonable to make the assumption that this activity has increased over this time of remote recruiting. And, with the increased reliance on a tool which offers a wide lens into a person’s life, there is an increased chance that the employer may make a potential decision not to proceed with a candidate on a basis that is not allowed to be considered (i.e. sex, sexual preference, religion and there are even arguments to be made for someone’s
political views and appropriate expression). This is particularly important in the municipal sector where your employees are also your constituents, and municipal political view points do come into play.

The more interesting twist on remote screening concerns virtual calls or interviews. Not unlike social media screening, virtual interviews can provide a greater glimpse into a candidate’s life; certainly more so then would be gleamed from an in-person, in-office interview.

Raise your hand if you ever had your kid run into the room when on Zoom meeting? Over the past year it has likely happened to all of us. Now, consider the questions you are ‘absolutely’ not allowed to ask when facilitating an interview process in Canada. Do have kids? Are you pregnant? What is your sexual preference?

These are factors that you cannot consider when hiring and typically do not have access to when interviewing a candidate. Interviewing someone in their own home, with their private life as their backdrop, potentially changes that. It is important, especially in a remote recruitment process, for employers to facilitate a process that is free from bias and judgment based on protected grounds. It is wise that
employers use specific, relevant and consistent criteria to judge, grade and ultimately make their decision who is the successful candidate.

Are Remote Employees Consider Contractors

This is a question that has come up often, both as a potential liability but also as an opportunity for employers. Even in the most normal of workplace settings, the discussion concerning the difference between an independent contractor and dependent contractor (employee) has required constant clarification.

Employers prefer to have ‘employees’ in many cases as they have more control of their employees work and they are governed by the jurisdictions’ Act or Code. Employers also may prefer independent operators (I.O.s) as performance is outcome based and the I.O. is not afforded the protections and/or rights under the jurisdictions’ Act or Code.

Many employers and candidates believe that because remote employee are recruited virtually, working from home, using their own equipment in many cases and have the flexibility and/or latitude to set their own hours, that they are in fact an I.O. And, in fairness, all of those factors are considerations when making that determination.
The two primary factors that are typically considered in a determination between a independent and dependent contractor is control and the percentage or time/work dedicated to the principle/employer. On the issue of control, this factor does become more blurred when employees are allowed to work remotely and potentially set their own hours. However, even pre-covid, working from home occasionally, and
alternative work arrangements (flex or condensed work week) were far more predominant than ever before. Control is as much about the process of doing your work, how you work is expected to be done, you expected availability and essentially, etc. as where you do the work. What control is really about, is the employer’s right to ultimately determine, even dictate, details concerning your workplace arrangement and your actual work as they operational see fit, within the parameters of your contact. Working remotely does not meaningfully change that

The amount of time or work you perform for an employer or principle also is a key consideration. Obviously, if you spend 100% of your time for one entity, that would strongly indicate an employee-employer relationship. Even if you spend 75% of your time working for one entity – CRA general rule – there would be strong consideration that you are in fact beholden to that entity and in turn, an employee.

Where many companies and ‘want to be’ independent operators make the mistake is in their faith in the wording of the contract. Many companies will offer I.O. contracts that stipulate that you are free to work for other companies and we do not have any say and/or control where or how often you work. This is a common stipulation whether it be for private or public sector I.O. agreements.

This stipulation does not free you from judgement however. If you are a company who provides an I.O. so much work they could not reasonably have the time to perform work for other companies, then it may be ruled that you ought to have reasonably known that you would ultimately control the I.O.’s time. Further, it may be determined that the I.O. contract was a purposefully means to avoid entering
into an employment relationship and the obligations that come with it.

In my time in the public sector I can tell you this was a common practice, although generally unintended. Municipalities have many varied responsibilities and the use of the tender or RFP process is common. The difference between an contractor and what would be (should be) a temporary employee contract is often times blurred. It is important for municipal administration to consider the appropriate factors.
Revenue Canada and the Ministries of Labour across Canada have I.O. tests you can use to determine the appropriate status. In Ontario, the I.O. test offered by the Workplace Insurance Safety Board (WSIB) is the most thorough in my opinion.
Recruiting and hiring remotely has become a necessity. There a ton on advantages and efficiencies facilitating a remote recruitment process, and for those reasons, I do believe remote hiring is here to stay in one form or the other. However, employers do need to be aware of the questions and potential liability that the remote recruitment process may cause. You may have noticed that a few of the potential concerns highlighted in this article stem from the employers need – due the pandemic – to cast a larger net to find candidates, or broaden the scope in which they screen; both of which are made easier due to remote recruiting. I urge employers not to be tempted by convenience and ensure that they are sticking to the rules that govern the recruitment and hiring processes – remote or otherwise – in Canada.
This article was recognized as the year’s top Feature Story (Magazine), and the author Darcy Michaud, Managing Director of Consulting at HR Covered, was announced as the winner of the Awards for Recognition by Municipal World. 
Contact Darcy Michaud at