Transport Committee on Nov. 6th, 2025

[Philip Lawrence, Conservative, Northumberland—Clarke, ON]

Mr. Long, what's the difference between an independent contractor and an employee?

[Wayne Long, Liberal, Saint John—Kennebecasis, NB]

I was a small business guy. We used both. I would pay employees. They would deduct—

[Philip Lawrence, Conservative, Northumberland—Clarke, ON]

How is a truck driver supposed to know whether he's an independent contractor or an employee if the secretary of state for CRA doesn't know what it is?

[Wayne Long, Liberal, Saint John—Kennebecasis, NB]

Can you repeat that question?

[Philip Lawrence, Conservative, Northumberland—Clarke, ON]

What is the difference between an independent contractor and an employee?

[Wayne Long, Liberal, Saint John—Kennebecasis, NB]

An employee is paid through your payroll. There are deductions taken.

[Philip Lawrence, Conservative, Northumberland—Clarke, ON]

How are you supposed to—

[Wayne Long, Liberal, Saint John—Kennebecasis, NB]

An independent contractor is an independent contractor; he's an independent business person. He'd be incorporated. He makes his own deductions. He pays his own salary. The issue has been that T4As haven't been issued.

Is that what you mean?

I was a small business guy—

[Philip Lawrence, Conservative, Northumberland—Clarke, ON]

Some of these folks are bad actors, but some of them just don't know whether they are an independent contractor or employee.

What are the distinguishing points between an independent contractor and an employee?

[Wayne Long, Liberal, Saint John—Kennebecasis, NB]

Once we solve the T4A issue that Stephen Harper created in 2011, independent contractors will get issued a T4A. The Harper government put in a moratorium in 2011 to lift penalties.

[Philip Lawrence, Conservative, Northumberland—Clarke, ON]

How much time do I have?

[The Chair, Liberal, Peter Schiefke]

You have 25 seconds.

[Wayne Long, Liberal, Saint John—Kennebecasis, NB]

The issue between an employee and an independent contractor couldn't be more different.

[Philip Lawrence, Conservative, Northumberland—Clarke, ON]

I will take the last 25 seconds.

I'll just end here. Thank you, Minister.

It is clear that the minister does not know the difference between an independent contractor and an employee, yet he's going to be fining business people who, in some cases, are just innocently attempting to run their businesses.

If the guy who is in charge of the entire department doesn't know this, what chance does a truck driver have?

[The Chair, Liberal, Peter Schiefke]

Than you very much, Mr. Lawrence.

Next we'll go to Ms. Nguyen.

The floor is yours for five minutes, please.

[Chi Nguyen, Liberal, Spadina—Harbourfront, ON]

Good morning, everyone. Thank you to my colleague for being here this morning and to the officials from the ministry.

We have heard throughout this study from many witnesses who have called for reinstating the T4A reporting penalties. As we all know, we have this opportunity with budget 2025 to do just that.

Can you tell me about what this change will mean in terms of compliance expectations and enforcement timelines? How do we send a really strong signal to the bad actors—not the folks who are paying their taxes, doing all of the appropriate things as independent contractors and complying appropriately—through the compliance mechanisms that this is not acceptable?

[Wayne Long, Liberal, Saint John—Kennebecasis, NB]

Thank you for the question.

I would say that the first step is to take the initiatives that we're taking in budget 2025.

That's the first step. We are going to lift the moratorium on issuing T4As. Why the Harper government did that in 2011 is beyond me. It's created a problem.

Our new government was elected in April and I was sworn in in May, and we're going to address the problem. There are many layers to the problem.

From a shipper's standpoint, for a shipper who ships beef, plays by the rules and uses a trucking company that plays by the rules, that's how it should be. They should compete against others like those in this example—other beef shippers and other trucking companies—but when you have instances of companies that are, number one, encouraging Drivers Inc. and you have drivers calling legitimate companies and asking if they will accept Drivers Inc. companies, you have, number two, a multi-layered problem. It lessens competition, creates havoc in the industry and rewards unfair players.

It's no secret that we're a big country. It's no secret that we have distribution problems. I've lived that. It's tough to get products from coast to coast to coast in an efficient price-competitive manner.

In the mainstream, there are 300,000 truckers in this country. When that industry is thrown into havoc by truckers and trucking companies that compete against bad actors, it weakens those companies. We saw at this committee the stories from family-owned companies that are literally telling their kids to get out of the business. That's pretty sad to see. We see some of that in New Brunswick too.

We want to strengthen that industry. We want those companies that are family-run good businesses to thrive and to be competitive, but we're undermining it by keeping that moratorium in place.

I've identified the problem. I like to think that I take action when I see issues. I'm not perfect all of the time. I want to try to fix this. It's a problem, and we're going to fix it.

We're going to fix it through the budget. We've allocated money. The CRA is now going to be equipped to enforce...and we're going to lift that moratorium so that we can make sure that companies know that: “Hey, I'm going to issue T4As now, because if I don't, I'm going to be penalized”.

We want to strengthen the industry. If we strengthen the industry, we'll be competitive. It strengthens our economy. I'm proud of the measures we're taking. Hopefully, the Conservatives will support our budget.

[Chi Nguyen, Liberal, Spadina—Harbourfront, ON]

This is just a quick question: What do the penalties look like for bad actors? I'm curious if you know what that might look like.

[Wayne Long, Liberal, Saint John—Kennebecasis, NB]

There would be fines involved, obviously on the scale of the incident. If there's one small company and one T4A, or a larger company that's encouraging it, the fines would scale. In the end, we want to move forward. We want to up enforcement measures.

Passing the budget is going to require opposition members, hopefully, to support it. We have a lot of great measures in the budget. It's a generational budget that's going to transform our country. We're going to build our economy. We're going to invest in each other. Thankfully the Conservatives will come on board and support it.

[The Chair, Liberal, Peter Schiefke]

Thank you, Ms. Nguyen.

Thank you, Mr. Secretary.

Mr. Barsalou‑Duval, you have the floor for two and a half minutes.

[Xavier Barsalou-Duval, Bloc, Pierre-Boucher—Les Patriotes—Verchères, QC]

Thank you, Mr. Chair.

Mr. Secretary of State, according to Employment and Social Development Canada, non-compliant companies simply disappear as soon as they see auditors coming. They vanish into thin air reappear under a different name. That makes it hard to catch them at fault.

That's why I was asking you to automatically audit all new trucking companies that have no employees.

That said, another deterrent could be taken to prevent companies from systematically reappearing under another name. It would be to publish the names of directors and companies that are involved in this type of activity. The Canada Revenue Agency doesn't currently have a policy of publishing the names of businesses that have been caught.

Do you intend to change that measure?

[Wayne Long, Liberal, Saint John—Kennebecasis, NB]

There are privacy issues, obviously, that the CRA or we would have to respect. A blanket disclosure of names would go against privacy, and there are probably better ways of enforcement. Again, this is clearly a measure that's going to—

[Xavier Barsalou-Duval, Bloc, Pierre-Boucher—Les Patriotes—Verchères, QC]

I understand your point of view, but I'm going to take the liberty of strongly disagreeing. If the offending companies continually reappear under another name, we're not solving the problem. However, we know that this is a common practice in the field.

Secretary of State, in the last five years only one company has been convicted of tax evasion in court, and that was the last time it happened, five years ago.

On the one hand, I find that totally unacceptable. On the other hand, you should know that, while the government is twiddling its thumbs, we have lost 1,000 jobs in the trucking industry in Quebec. These are honest people. These are businesses that used to operate within the law and are now struggling to survive because of these companies.

I find that unacceptable, and I find it hard to understand how this situation can happen, for there to be so little intervention by the government and the authorities if there's no political directive behind it.

I would just like some reassurance. Have you issued any political directives to prevent any coercion?

[Wayne Long, Liberal, Saint John—Kennebecasis, NB]

We're going, first and foremost, to pass this budget. We recognized that there was an issue and we're addressing the issue. We're putting money in our budget. We're going to have $77.6 million and $19.2 million each year after that for enforcement. I'm very confident and comfortable in the ability of the CRA to enforce.... Obviously, we're going to respect privacy issues, but—

[Xavier Barsalou-Duval, Bloc, Pierre-Boucher—Les Patriotes—Verchères, QC]

So no heads are going to roll. You're happy with that outcome.