Throughout Canada, every employer is governed by some type of employment legislation, usually called the Employment Standards Act (in Ontario and British Columbia, for example) or the Employment Standards Code (in Alberta, for example). Such employment standards legislation is generally similar throughout Canada and is designed to provide protection to employees from would-be unscrupulous employers by, for example, providing a right to minimum notice on termination of employment, a right to a minimum wage and overtime rates as well as providing various mandatory types of leave to employees, such as maternity leave.
The vast majority of charities simply could not exist without the dedicated work of an army of volunteers. Volunteers generally provide voluntary work for which they are not paid. Volunteers are not subject to the protections afforded by employment standards legislation. It is not always easy, from a legal perspective, however, to distinguish between an employee and a volunteer and definitions of the term “employee” in employment standards legislation can be quite wide. Not-for-profit organizations and charities need to be aware of the risks which may arise if the distinction is blurred in any given case. Both parties will undoubtedly start their relationship with the best of intentions but, if the relationship turns sour, a disgruntled volunteer could easily file a (usually free of charge) claim with the relevant Employment Standards office, claiming to have been an employee, rather than a volunteer. If the Employment Standards office agrees with the individual that he/she was an employee rather than a volunteer, the not-for-profit “employer” could find itself facing huge liabilities under employment standards legislation for, by way of example:
- Wages (and a failure to pay minimum wage)
- Overtime pay
- Vacation pay
- General holiday pay
- Termination pay
- Failure to maintain proper records
- Failure to provide applicable rest periods.
Even if the not-for-profit organization is successful in defending any such claim, the costs and time involved in such a defence can be extraordinary and there is usually no right to recover any such costs. In addition, other legislation such as human rights legislation or workers compensation legislation may also be applicable to employees but not volunteers.
There is no fail-safe way of avoiding the risk of a court deciding that a volunteer was in fact an employee. However, with a few simple steps, not-for-profit organizations can minimize the chances of a volunteer being held to have been an employee:
- Document the relationship at the outset. Although not conclusive, a contract, letter or other written document which sets out the voluntary nature of the relationship will be highly persuasive. Ideally this would be in the form of a written document signed by both parties before an y voluntary activities were commenced but even an email to the individual setting out the terms on which the voluntar y activities are to be provided, is better than nothing.
- Avoid any indicia of employment. Do not provide employment benefits to volunteers, for example. If the volunteer has a title or a business card, make sure it correctly describes the individual as a volunteer. If the volunteer has an email address, consider having the reference “(volunteer)” after their name. An y website listings should clearly list volunteers as such.
- Keep employees and volunteers separate. If the organiza tion engages both volunteers and emplo yees, then keep their roles as separate and distinct as possible. If employees provide voluntary support at any stage then make sure tha t the voluntary (and unpaid) nature of such activities is clearly set out in writing prior to the activities taking place.
- Be consistent. If one type of work is generally carried out by employees then try to avoid having volunteers carry that out, if at all possible. This is particularly important if a volunteer carries out duties which were previously performed by an employee.
- Make sure the work is truly voluntary. If the individual could not have declined to carry out the activities, are they really volunteering? Document any occasions when the individual did decline to provide support.
By following a few simple rules, not-for-profit organizations can limit the chances that they may be found liable for significant payments to former employees who were always considered by them to have been volunteers.