Contracts

[Fred Lewis]

The Helicopter Association of Canada appears to be preparing templates for two contracts that will impact pilots. They are a contract to bind pilots to a training bond and a contract to cast the relationship between contract pilots and operators in such a way that contract pilots are considered to be contractors and not employees.

 

There is nothing wrong with contracts provided both parties completely understand precisely how contracts bind them. Any party planning to sign a contract is well-advised to obtain legal advice to ensure they are not entering into an unintended relationship.

 

Both Labour Canada and the Canada Revenue Agency have guidelines to determine if a worker is a contractor or an employee. Except in rare cases, it does not appear that pilots can qualify as contractors.

 

It is advantageous for a pilot to be considered an employee:

• Employment insurance can be collected if and when an employee is laid off;
• Employees are not liable for damages in the same way contractors are;
• Payroll deductions are made at source;
• Employees have no incorporation expense;
• Accounting expenses can be considerable for a corporation;
• Corporations have reporting obligations which can be time consuming;
• Some tax deductions that are available to a contract pilot are also available to an employee pilot;

 

In any event, it is not possible for any party to contract out of its legal obligations. The Canada Labour Code at section 168.(1) is specific about this. In fact, if the CLC is not complied with, any parts of a contract that are in breach will probably be nullified and perhaps the whole contract will be considered void.

 

Apparently, some helicopter workers have complained to Labour Canada with a view to recovering unpaid wages due to overtime worked and work done on general holidays.

 

Suppose a pilot contracts for a wage of $400 a day. Labour Canada will almost certainly consider that the wage is for an 8 hour day and therefore that the hourly wage is $50 an hour. Labour Canada again will almost certainly conclude that when a worker is under the direction and control of an employer, he is at work. If a pilot is in a camp and his employer has directed him to be ready to fly at any time during a 14 hour day, those 6 hours in excess of the standard 8 hour day may well be considered overtime. If such is the case, the employer owes the pilot time and a half for those 6 hours at $50 an hour or an additional $450 a day. If a pilot was to work 42 consecutive 14 hour days under such an arrangement, he could well be owed $18,900.

 

If a pilot stands a 14 hour day on a general holiday, of which there are 9 defined by the CLC, then he is entitled to time and a half in addition to his regular pay. That’s 21 hours at $50 an hour or $1,050 in addition to the $400.

 

The employer will probably argue that the $400 a day is an all inclusive wage such that it includes pay for overtime and general holidays. This argument has been tested on appeal and it failed. Two cases of interest are Pe-Ben Oilfield Services (2006) Ltd. v. Kellerman and Quality Travel Inc. v. Labo.

 

A helicopter pilot can enter into an all-inclusive contract if he wants but the daily rate should be well over $1000 a day.

 

If an operator has written contracts with several pilots there will almost certainly be differences in these contracts regarding wages. In some cases these differences will be sensible, if, for instance, the differences in wages are based on experience. However, one pilot whose experience is equal to another’s may strike a better deal. This will lead to bad blood.

 

This is one of the main reasons employees engaged in collective bargaining. There is a far greater chance that all involved get a fair shake.

 

As previously mentioned, written contracts can be a good thing, just be very careful you know into what you are getting if you sign one.

 

The ordinary man is the most important part of society. Those who seem to think that businesses are the life blood of everything in capitalistic societies are wrong. Ordinary women and men will always be able to exist without business, but business cannot exist without ordinary women and men.

[Harmonic_Vibe]

 

The ordinary man is the most important part of society. Those who seem to think that businesses are the life blood of everything in capitalistic societies are wrong. Ordinary women and men will always be able to exist without business, but business cannot exist without ordinary women and men.

 

How true. It was so much better during the feudal period when everyone had 9 children because only 3 lived to adulthood. Even back during my parents' era (which my mother always refers to as "the good ol' days") when people scratched themselves riding their bike and died of sepsis 4 days later was a kinder, gentler time. The way that mercantilism led to this hectic modern era, with people now living three times as long as they once did, with far greater expectation of good health for their entire life cycle is just a ploy by corporations to enslave us!

 

Kidding aside, the fact is that companies have far more to lose from employing contract pilots and engineers than the individuals do. Some recent court cases are very much in parallel with what Fred is saying about that. With very few exceptions though Fred, the individuals want to go contract in order to minimize tax and maximize earning potential. I know it has been going on for years but I suspect that may all come to a crashing halt in the near future. Personally, I think everyone should be an employee with all the protection and benefits that provides. There is more flexibility to being a contractor but there is also a lot more risk.

 

HV

[Twin Helix]

I would think that in the same way that a shoddy operator can develop a reputation and find it tough to find pilots/contracts, someone who contacts the labour board (even if they're right) could develop a reputation among operators as a trouble-maker...thus making it harder to get a position.

 

Ideally operators would take into account stat holidays, standby time and pay accordingly. In return no one would be unduly greedy on the pilot side of things. Unfortunately the ideal scenarios never seem to play out.

 

Thanks for the caveats, Fred. I assume that these templates would only serve as a potential resource for employers, rather than a move towards an industry standard.

[Harmonic_Vibe]

Ideally operators would take into account stat holidays, standby time and pay accordingly. In return no one would be unduly greedy on the pilot side of things. Unfortunately the ideal scenarios never seem to play out.

 

All too true I suspect... I have been on both sides and have been betrayed on each side of the net... by people who no doubt felt they were the ones betrayed.... the problem with being human is that everyone else is also human.... Now where did I leave my cowboy boot??

 

HV

[deuce bigalow]

All too true I suspect... I have been on both sides and have been betrayed on each side of the net... by people who no doubt felt they were the ones betrayed.... the problem with being human is that everyone else is also human.... Now where did I leave my cowboy boot??

 

HV

 

Dude!! You gotta go slow with that boot. I,m starting to worry about you.

 

DB

[Bif]

I think this is the first thread I've read where the first half-dozen posts didn't immediately jump down Fred's throat!

Either the regular contributors are busy flying, or we've evolved!