The Canada Student Service Grant has been overshadowed by controversy due to the federal government’s decision to award the contract for its management to WE Charity, an organization with ties to the family of Prime Minister Justin Trudeau and now-departed finance minister Bill Morneau. However, there are more pressing concerns about the program – in particular, whether it opens the door to potential volunteer misclassification and the exploitation of students and recent graduates. These are concerns that strike at the core of the program, far more than the question of who administers it.
The misclassification of employees – whether as independent contractors, unpaid interns, volunteers or otherwise – is a significant problem in the Canadian economy. It denies misclassified workers basic protections such as minimum wage and overtime pay, and starves our Canada Pension Plan, employment insurance and workplace compensation systems of contributions on behalf of these misclassified workers. Since the government has started to respond more vigorously to unpaid intern misclassification, anecdotal evidence suggests that the misclassification of employees as volunteers is now on the rise.
The Canada Student Service Grant raises significant concerns in this regard. In particular, the program raises concerns with respect to potential employee misclassification for participants, for charities and NGOs, and for the government itself:
- First, the program potentially exposes its participants to workplace exploitation and misclassification. Whether someone is a “true volunteer” is a legal determination that rests on more than whether a hiring entity labels them a volunteer, and the structure of the program raises legitimate concerns as to whether these individuals are “true volunteers.”
- Second, this arrangement exposes charities and not-for-profits to potential liability for wage and hour claims through employment standards complaints, small claims court actions, and even potential class actions brought by the so-called “volunteers” participating in this program.
- Third, the Government of Canada could potentially find itself entangled in these legal disputes, either as an alleged common employer or an alleged labour supply agency given its role as paymaster and in connecting volunteers with placements through its “I Want to Help” portal.
But aside from these legal concerns, the Canada Student Service Grant also raises concerns about fairness and the type of support that the government should provide for students and recent graduates. These concerns include the following:
- First, the rate of pay provided through this program is significantly less than minimum wage under the applicable employment standards legislation. Setting aside the legality of this arrangement, it raises fairness concerns and sends a message that the government doesn’t value these workers’ labour.
- Second, mandatory volunteer placements are inferior to paid employment in terms of the doors they open and what that work experience means for a young worker on their resume. To the extent that one of the goals of this program is to support students and recent graduates in their career paths by ensuring they have meaningful summer work experiences, the program as structured fails to deliver.
- Third, the program makes what is already a very challenging job market in the non-profit and charitable sector even harder for new entrants by flooding the market with tens of millions of hours of volunteer labour, potentially displacing what could otherwise be paid positions.
- Fourth, this program is seemingly at odds with this government’s efforts to crack down on the exploitation of workers through unpaid internships, including the Standards for Work-Integrated Learning Activities Regulations set to come into force on Sept. 1.
- Finally, this program places onerous demands on students, who must work 500 hours between June 25 and Oct. 31 in order to obtain the full $5,000 grant. This translates to working more than 50 hours per week between June 25 and the end of August in order to hit 500 hours before school starts, or working an average of more than 27 hours per week from the start of the program until the end of October, potentially interfering with these students’ studies during the first two months of their school year. These concerns are heightened given the unique financial, family and childcare responsibilities Canadians are facing during the COVID-19 crisis.
For all of these reasons, the Canada Student Service Grant has serious design flaws that give rise to the exploitation and potential misclassification of students and recent graduates, and is in need of a serious overhaul. At this point in time the best way to try and salvage the program is to completely remove the mandatory volunteerism requirement and convert the existing positions to paid jobs through the Canada Summer Jobs program. Given the ongoing uncertainty with the program and the significant time pressures faced as the summer winds down and the fall 2020 semester approaches, the remaining funds should be redirected to expanding the Canada Emergency Student Benefit in order to ensure that students and recent graduates receive the financial support they so desperately need.
Joshua Mandryk is a labour and class actions lawyer at Goldblatt Partners LLP and a past executive director of the Canadian Intern Association. He is counsel in the first proposed volunteer misclassification class action in Canada.
