An Ontario arbitrator found that an employment agency was the true employer of agency employees brought in to perform sanitation work after the employer’s entire sanitation department was laid off in Gate Gourmet Canada Inc. v Teamsters Local Union 647, 2014 CanLII 1163. The contract between the agency and the employer specified that the agency was an independent contractor and that the personnel supplied by it were its own employees or sub-contractors subject only to its direction, policies and procedures.

Despite the presence of some elements suggesting an employment relationship between the employer and the agency workers, the sanitation employees took their direction entirely from the agency. It provided on-site supervisory staff and a working supervisor for each shift in order to provide that direction. The arbitrator concluded that the agency exercised fundamental control over the working lives of its personnel and was the employing entity. The work of the employer had been legitimately contracted out.