Can an employer unilaterally change your contract from employee to that of an independent contractor? I work in the real estate business and my employer has just changed my contract stating that I am now an independent contractor, in essence making me a subcontractor. I have been informed that I must pay my full 10% pension and the company will no longer contribute its 5%. Further they have told me that I can either pay in full for my health insurance, which is part of the group policy, or the company will cancel my policy. I have also been told that I must pay $750 for my part of the company’s trade and business licence fee. I don’t understand why I have to pay this if I am forced to be a subcontractor. I have never heard of employers proportioning out their trade and business licensing fees to employees or for that matter “independent contractors”.
I have also been told that the company will be deducting the full 10% pension from my commission check to pay for the pension as the company needs to show the pension is paid up in order to renew its trade and business licence. Again, if I am considered an independent contractor (subcontractor) why do I have to remain on the company’s pension plan and pay pension in order for the company to get its T&B licence?
Please let me know if any of this is legal and, if not, do I have any recourse besides walking away from a job I love?
Auntie’s answer: As with most readers’ questions concerning employment issues, I asked the Department of Labour and Pensions (DLP) for help. It seems that your circumstances would be best discussed with a lawyer.
And here’s why. The Labour Law (2011 Revision) deals with the relationship between employer and employee but not an independent contractor. However, the department official pointed to Section 6 (3), explaining, “any material change in the terms of employment as set out in a statement of working conditions, should immediately be furnished to the employee by the employer in the form of an amended statement”.
As much as I hate assuming, I get the impression from your question that no such statement was given to you; that the change was simply included in a new contract. The labour official suggested that you might want to seek legal counsel about the terms of your contract being changed, and I would also ask about all the additional contributions being asked (demanded?) of you.
On the pension question, it was advised that you email a pension officer to discuss your situation in more detail with someone at the DLP.
The law mentioned in this column can be found on the CNS Library