CTA: Keep Driver Inc. Companies Out of Federal Large Company Relief Program

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The Canadian Trucking Alliance (CTA) applauded Ottawa’s decision to provide bridge loans to large companies who have exhausted their access to credit as a result of COVID-19. CTA is further encouraged by the Prime Minister’s announcement the government will put conditions to block certain companies from using public money to fund unscrupulous operations.

The federal government this week announced the Large Employer Emergency Financing Facility (LEEFF) program to provide bridge financing to large employers whose needs during the pandemic are not being met through conventional financing. Other programs were already available for small and mid-sized companies.

Prime Minister Justin Trudeau stated that program details will be forthcoming but added that tax compliance will be one of the conditions companies must meet in order to qualify.

“Canadians expect companies that get support from public dollars to have been responsible about paying their fair share of taxes and certainly if we see situations where someone is engaged in aggressive tax avoidance, we will be putting in conditions or work out a way with them to ensure that they pay their fair share of taxes,” Trudeau said.

CTA – which has been working with federal and provincial authorities to stamp out the tax avoidance scheme pervading the trucking industry, known as Driver Inc. – applauded the Prime Minister’s stance and is asking the government to ensure that Driver Inc. participants in the trucking sector will not be allowed to access the program.

“Driver Inc. involves income and payroll tax evasion as well as labour abuse through gross misclassifications, in our sector,” said CTA President Stephen Laskowski. “Unfortunately, there are a significant number of large Driver Inc. companies that could reach the $300-million threshold in revenue to qualify for this program. It’s critical that Driver Inc. carriers not be able to access the benefits of LEEF.

“Thankfully, the government is very well aware of Driver Inc. Through ESDC and CRA, it has been working with CTA to investigate and proactively focus enforcement on Driver Inc. carriers,” Laskowski added.

CTA is also asking all governments to turn their attention to the efforts of Ontario’s Workplace Safety and Insurance Board (WSIB), which in the last 12 months has implemented an aggressive audit campaign against Driver Inc. companies – assessing over 100 fleets with almost $4 million in WSIB premium adjustments alone.

“Ontario’s WSIB enforcement efforts are encouraging; but if anything, they reveal what is just the tip of the iceberg,” said Laskowski. “This problem is real and persistent across Canada. This Ontario enforcement action shows the need to keep such companies out of LEEF.”

CTA has reached out to multiple departments to learn about the development of possible methodologies that could be employed for qualifying and participating in the program.

 

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