I was working as an independent (Canada incorporated) IT consultant for a major banking client in Toronto via an Agency

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Customer: Hi,
I was working as an independent (Canada incorporated) IT consultant for a major banking client in Toronto via an Agency from Oct 2018 - July 2020 (21 months). I am currently in the pause period (from Aug – Oct 2020 for 3 months followed by banks, after every 2 yrs contractual tenure) to resume my assignment with the same banking client on a new contract.
During a recent discussion with my Hiring manager (at the same banking client), I was notified that there is a binding b/w the agency and the banking client that states agency continue to own my engagement rights with the banking client for 6 months following expiry of my contractual tenure (July 2020). Note: this binding b/w the agency and the banking client was not disclosed by agency during my contractual agreement. To add, this is also preventing me from serving the banking client via any other agency (that are ready to offer better rates to resume) starting Nov 2020; thus leaving this agency with negotiation autonomy (safe guarding higher profit margin), even in the new contract.
I am looking forward to know, the following:
1. Is it legal for an agency to bind an independent contractor exclusive rights with a client for a certain period esp. following contractual expiry with the agency?
2. Is it mandatory for agencies to pay CPP and EI on behalf of the contractor to CRA?
3. Can agencies prevent contractors from engaging in full-time position (should the client offer) during a contractual tenure?
Thanking you,
Murali
+1 –(###) ###-#### JA: The Lawyer can help you determine if that's legal. Before I connect you, is there anything else you'd like the Lawyer to know?
Customer: No more Thanks.
Answered by Debra in 10 mins 1 year ago
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Debra
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Jessica

Jessica

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Debra, Expert

Hello and Welcome to JustAnswer. My name is***** will be working on your question today and I am looking forward to our conversation.

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Debra, Expert

Please note that the experts don’t text so there may be a bit of a delay. If you don’t answer back for a while I may not be online when you do but I will never desert you and will check back often. As well, as I am working from home it is possible that I will be interrupted but I will always return back as soon as I can.

I am sorry to hear of this difficult situation.

When you signed your contract with them initially did you agree to a non-competition provision?

Customer
No
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Debra, Expert

Then they cannot possibly impose this requirement now. You can compete so long as you're competing fairly unless you've agreed not to.

So as that is not the case then they just have no right whatsoever to even try to convince you to do this.

Does that help?

Customer
I had 2 more questions, can I get answers for them too?
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Debra, Expert

They are follow-up questions please ask them here. If not, let me know and I will explain how you can post your next question so that you can be sure it will be directed to me.

Thanks

Customer
Is an independent contractor entitled for EI / CPP deposit from agent to CRA... as I read a ruling in b/w Procom and a contractor that , independent contractors are actually employees of the agent ...
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Debra, Expert

If you're paying taxes as an independent contractor you would be contributing to CPP on your own and you could elect to contribute to EI. But there is no obligation for the client to make contributions when you are not an employee.

Customer
Ok thnx
Customer
Pls. Note I was referring to Agent not end client
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Debra, Expert

I know but they there is no obligation unless you were employed by the agent.

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Debra, Expert

Thank you for trusting us to help you here at JustAnswer. I am marking this post as complete. If you would like to ask me more questions please start a new post and if you do if you say “This is only for Debra” I will be sure to give your post top priority.

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