Talent Development Centre

Category Archives: Independent Contracting

All Talent Development Centre posts for Canadian technology contractors relating to independent contracting.

10 Steps to Take Before Becoming an Independent Contractor

Frances McCart By Frances McCart,
Vice-President, Business Development at Eagle

The shift into the “gig economy” in Canada is growing at a very quick rate, especially in the tech sector. More and more people are choosing to become independent contractors and for many good reasons.

  • You decide what you do
  • You decide who you will work for
  • You decide where you should work
  • Opportunity to gain exposure to new work environments with every new contract
  • Exposure to new technologies
  • Exposure to new ways of thinking
  • Freedom to take more time off
  • Opportunity to make a higher income
  • “Potentially” getting away from office politics

With so many people interested in getting on the bandwagon, I am often asked the question “Where do I start?”

The first piece of advice I give to “would be” contractors is to speak to contractors they already know.  Ask them what they like about being an independent contractor and to dig down into what worries them about being independent (ie: not finding a role, too much time off between positions, etc.).

10 Steps to Take Before Becoming an Independent Contractor

Here are 10 additional steps you can take before entering the world of independent contracting:

  1. Risk assessment
    • How long can you afford to be off for between landing gigs?
    • How flexible are you on your rate in order to land a new role and still be financially comfortable?
    • Are you comfortable with uncertainty?
  2. Update your resume – keep in mind you may have to have several different versions depending on the position you are going for.
  3. Set up your company.  While it’s recommended to work through this with an accountant, setting up a corporation is not too difficult.  There are many online guides to point you in the right direction, including a number of resources here on the Talent Development Centre. You’ll also need to get an HST/GST number and set up a corporate bank account.
  4. Consider getting corporate CGL and E&O insurance. You are a corporation and a professional. Not only will this insurance protect you liability-wise, but it can also contribute to proving your independence and help protect you when being audited by CRA.
  5. Set up a website that can act as a resume, complete with testimonials and samples of your work.
  6. Get business cards to market your business and help with networking.
  7. Update your LinkedIn profile and ensure it is tagged, notifying recruiters and would-be employers that you’re seeking new opportunities.
  8. Let your network know you are becoming a contractor and looking for new contract opportunities. Word-of-mouth is a powerful marketing tool, including as an IT contractor.
  9. Align yourself with agencies and get to know them well. Keep them updated as to your status once you land a new role or are becoming available. Ensure you send them an updated resume after each project is completed.
  10. Start networking!! Take every opportunity to get out and meet people. You never know how you will land your next role.

This might seem like a lot to do but it is not. Many contractors have told me that they were reluctant to get into contracting as it seemed daunting to go through the above steps.  However, once they became a contractor and landed their first role, they comment that they should have done this sooner!!

The Benefits of Working Remotely for IT Contractors and their Clients

Crystal Nicol By Crystal Nicol,
Delivery Manager, Eastern Canada at Eagle

Are you looking for a way to improve your work/life balance? Or are you looking for ways to increase your productivity and lower the number of unpaid sick days you have to take? Then maybe the introduction of remote work should be considered. Each day, more and more independent contractors are joining the “working from home” bandwagon.

The reality is that commuters face delays on a regular basis. Whether it’s because buses are late, trains are delayed or cancelled or there is congestion on the roads, it causes our commute times to double or even triple in length. This is one of the strongest reasons why more IT professionals are implementing flexible working schedules and working from home on client projects.

We all know commuting can often be time consuming, stressful and expensive. The modern business model includes more flexibility for their workers. Companies are providing their employees with an incentive to work from home a certain number of days each week, which allows the workers to avoid long commutes and is saving them the transportation costs. So why not do the same for yourself?

In this technological age, even educators are paving the way to learn from home. Students often have the option to listen to seminars remotely or take quizzes online from the comfort of their home. And even though they are doing a large majority of the work from home, they are still successfully graduating, proving that people can be successful from wherever they work.

Many of your clients and their employees are already on board with this way of thinking. An article from WomensPost.ca shows that a 2017 FlexJobs study of 5,500 people found that a work-life balance was critical to the productivity and success of a company. Out of all the survey respondents, 62 percent said they have left or considered leaving a job because of the lack of work flexibility. An even higher response of 66 percent said they were more productive working from a home office as there were less interruptions from coworkers, fewer distractions, less commuter stress, and they were removed from any office politics.

So will you be more productive when working remotely? You’ll be able to work (and therefore bill) extra hours in the time you’re not commuting. The better work-life balance also means you are less likely to get ill in the first place because stress levels are typically lower. And since you are not commuting, you’ll find more time for your activities, such as going to the gym or spending more quality time with your family. According to an article from the Telegraph, a study by Canada Life found that home workers took fewer sick days compared to those based in the office. The study found that employees working in an office took on average 3.1 sick days last year, whilst homeworkers only took 1.8 sick days and employees who have a cold or are mildly sick can still get work done at home, while office workers are more inclined to take the entire day off to avoid leaving the comfort of their home.

There are, of course, some challenges in working from home:

  1. First of all, the job itself must have the necessary tools to allow for remote work.
  2. Secondly, you must be independent and self-directed in order to be productive while working without guidance.
  3. Thirdly, trust is a big factor for this. If there is no trust between you and your client, then they will begin questioning your timesheets and you will lose out on future references.

Personally, I think a mix of both models is best. One in which you work from home on a certain day or days, but otherwise spend time at the client site to connect with the employees and managers for face-to-face meetings and collaboration. Even one or two days out of the work week spent working remotely does wonders for your mental health, morale, and productivity.

The world of work is dramatically changing. In a competitive world, flexible working schedules are creating healthier and happier workers and increasing productivity. The evidence so far suggests that working remotely benefits clients just as much as it benefits their independent contractors.

The Game of Life, Freelancer Edition

Life is a journey, not a destination” — words once spoken by American poet and philosopher Ralph Waldo Emerson, and then sang again by Aerosmith in their song Amazing. It’s definitely a journey — a long, unpredictable, sometimes-good-sometimes-bad journey, and independent contractors are not immune to the volatility.

The classic board game “The Game of Life” makes light of the ups and downs of the average life and how single decisions can impact your future, but Freshbooks felt it still doesn’t portray the life of a freelancer so they created this fun infographic. Sure, there are only 23 steps compared to the thousands you’ll have to take in your career, but it still gives an accurate depiction of independent contracting at a high level that’s easy to understand. If you’re exploring a career as an independent IT consultant, then get started by reviewing this infographic and to see what you’re in for.

Obtaining a Federal Government Personnel Security Screening

All companies and organizations perform some sort of background check on employees and independent contractors before hiring them, but the extent of the check will vary. One organization in Canada known for its checks is the Federal Government, which requires nearly everybody who works with its information or assets to go through a degree of security screening. For IT professionals new to the government, this can be a long, intense and confusing process.

Types of Federal Government Security Screenings

As mentioned, nearly every individual who works for the feds will require some sort of security screening. There are a number of types and levels of screens. The one you will require depends on your role, project and information you’re accessing, but it will typically be one of the following 3:

  • Reliability Status (valid for 10 years and required when accessing Protected A, B or C information, assets or work sites)
  • Secret Clearance (valid for 10 years and required when accessing information classified as Secret)
  • Top Secret Clearance (valid for 5 years and required when accessing information classified as Top Secret)

The Federal Government Security Clearance Process

A federal government security screening should begin as soon as you become employed with a company or organization that will require access to protected or classified information. In theory, for independent contractors, that would be as soon as you start working for your own independent business, and your business should be the organization initiating the clearance through its own organization security clearance. However, due to various process and efficiency concerns, independent contractors will often obtain their personnel clearance through a Recruitment Agency, who will start the process as soon as they verify that you’re a potential fit for government contracts.

The complete screening process and all the requirements are extensive and you can find all of the information here. Reliability Status can take as little as 2 weeks where a Secret or Top Secret clearance is usually a minimum of 6 months and up to 2 years or longer. The length of time depends on the history of you and your immediate family, including the countries in which you lived and/or worked. More specifically, the screening will require:

  • Background checks (5-years for Reliability status and 10-years for Secret or Top Secret clearance)
  • Background checks of your immediate family (Secret and Top Secret clearances)
  • Law enforcement inquiry through the RCMP (fingerprinting)
  • Credit check
  • Loyalty check conducted by CSIS (Secret and Top Secret)
  • Passport photos (Top Secret)

Depending on your history, you may also be required to complete out-of-country verifications, interviews, and provide supporting documents.

Federal Government security screenings are owned by the organization who completed the screening. For example, if you received your clearance through your recruitment agency, it’s your agency who holds it. This also means that they have the ability to terminate your clearance when you no longer work with them. To be safe, many recruiters will ask you to complete a form to duplicate your clearance, meaning their agency will also hold your clearance. This way, if your first agency terminates your Reliability Status or Security Screening for any reason, it will still be valid and active through the second agency.

There’s no doubt that Federal Government Security Screenings can often be complex, confusing and frustrating. The best advice for getting through it is to remain as detail-oriented as possible, be prepared, and work with the Company Security Officer who is helping you obtain it. For more information, you can also visit https://www.canada.ca/en/services/defence/nationalsecurity/screening.html.

Workplace Health & Safety for Independent Contractors

You’re an IT professional working at a comfortable desk in a cozy office, what could possibly go wrong? Compared to working on a construction site, very little; however, health and safety hazards exist in offices and still require attention. From slips, trips and falls to mental health to ergonomics, there are health and safety considerations for all office professionals. Independent contractors need to understand their responsibilities and those of their client.

Who’s Responsible for an IT Contractor’s Health & Safety

To start, please note that this post is not intended to provide legal advice in any way. Our goal is to ensure you’re starting the right conversations and discussing any concerns with your lawyer.

According to OHS Canada, clients can’t necessarily “delegate safety”. At the highest level, all clients and companies always have a responsibility to provide basic human rights, including a workplace free of discrimination and harassment. However, specific health and safety responsibilities between clients and independent contractors can be a grey area and there are various legal cases demonstrating the complexities. Each province across Canada has its own variations of their health and safety laws, with all industries and situations having a number of differing variables.

To protect themselves and their employees, it is not uncommon for clients to include their health and safety regulations as part of their contract agreement with all independent contractors. Such documentation could include all of your responsibilities in protecting yourself and others while on the client site, as well as an outline any hazards of which you should be aware while working there. Clients may also conduct background checks before hiring, specifically to ensure that you will comply with all regulations and are not a risk to their business.

If something goes wrong and coverage is required, independent contractors should air on the side of caution and assume that they will require their own coverage. As an example, in Alberta, the Worker’s Compensation Board does not require clients to provide coverage to any incorporated contractor, regardless of whether you have an account with them or not. Just as important, if you hire an employee in your contracting business, you take on additional responsibility and are required to ensure coverage for them as well.

You already know that as an independent contractor you’re not entitled to the same rights as regular employees of a client. It’s important to note on the health and safety side of that, according to this article from WorkHoppers, this includes the right to file complaints for free to the Ministry of Labour. Instead, IT contractors may incur some legal costs involved in the same complaint process.

What Can IT Contractors Do to Ensure Health & Safety?

There are simple steps you can take to ensure a safe workplace, as well as reduce your risk as an independent contractor:

  • Ask questions before and after starting a contract about policies and procedures, ensuring you have a clear understanding of all hazards and expectations.
  • Make suggestions to your client if you notice the work environment could be better. Concerns may be directed to your supervisor, your client’s HR department, or to your recruiter who can further investigate.
  • Ensure you have your own coverage through your provincial workers’ compensation board. For example, WSIB in Ontario or WCB in Alberta.
  • Help maintain the health and safety of your client’s employees. You’re required to follow your client’s on-site regulations (and you should generally act like a decent human being), plus it’s good business practice and failure to do so could cost you future work.
  • Consult with a lawyer if you have any concerns.

Have you come across any health and safety issues or concerns in your IT contracting career? If so, we’d love to learn about them and how they turned out. Sharing your experiences will help other contractors understand and prepare for these dreadful situations.

How to Talk Money with Recruiters

Sam Rahbar By Sam Rahbar,
National Training Manager at Eagle

No one likes to discuss salary or rate, it can be an awkward conversation. But as an IT consultant this is a topic that comes up all the time when discussing contract opportunities with recruiters. Rate conversations can often turn into a long drawn out back and forth between the recruiters and consultants. Here are five tips on how to work with a recruiter to avoid the unnecessary lengthy conversations and land the best rate possible:

  1. Customize your resume. Before applying to the role, make sure to include all your relevant experience related to the provided job description, including the nice to haves. Don’t leave any room for assumptions. Competition is fierce and a customized resume is the first step towards getting a more competitive rate.
  1. Remember, you are on the same team! A recruiter’s primary role is to present the best available candidate with the most competitive rate. Work with your recruiter to find out the top end of the rate and the sweet spot where the client likes to hire at. With VMS companies dictating level playing grounds for all recruiting agencies, these days all recruiters work within the same rate brackets and cannot go above or below a certain percentage. This means all recruiters will compete for the best candidate with the most competitive rate.
  1. Ask about market rate. When it comes to current market rates, recruiters have VIP access! There is no one better to educate you on who is hiring at what rate. This is crucial information when it comes to landing your next gig. Ask your recruiter for current market rates, so you are able to position yourself accordingly.
  1. Be flexible. I hear so many times about great candidates that lost out on opportunities due to not being flexible on a couple of dollars an hour. Clients want the job done with the best quality and most reasonable price. Sometimes that 2-3 dollars an hour can put you in a competitive advantage. And when you calculate 2 dollars an hour over a course of a 6 month contract, after taxes, it does not amount to much. It’s definitely not enough to lose out on a chance to work on a project with a reputable brand.
  1. A new project means a new budget. Different clients will have different budgets based on their industry, type of project and market rates. It is normal to have your hourly rate fluctuate 10 dollars, up or down, depending on the end client and type of project. So try not to use your most recent rate as a hard bottom-line for your next contract because that will potentially limit your options.
  1. Consider the BIG picture. When discussing a new opportunity with a recruiter, make sure to consider all angles: length of the contract, possibility of extension, getting exposed to new technology, or a new type of project under your belt. Think about what the positive effects could do for your marketability long term. There are other factors to consider like your hours, commute, company culture, and perks to name a few.

 

Should IT Contractors Charge for Their Breaks?

Should IT Contractors Charge for Their Breaks?Sorry to break this to you, but as critical as your role may be to your project, you’re not that important. Yes, even you deserve and can afford to take a break throughout the day, and you shouldn’t feel guilty about it. In the same way athletes require a break to recharge muscles, so do office professionals to recharge their minds. We recently published a post about the benefits of taking breaks and some tips on maximizing those benefits. As an IT contractor, it all may be a great idea but can raise an additional question — how do you charge your client when you take breaks?

In the simplest and most straight-forward terms, as an independent contractor, you should only charge your client for the time you are working for them. Most clients only require timesheets to say the total hours worked per day (or even a period) but you may come across some who want to see a breakdown of your hours worked. In theory, separating every chunk of time and submitting it to a client would be easiest to demonstrate your productivity; however, that is not a practical solution. Especially if you follow the “microbreak” strategy of time management and take 5-minute breaks every 25 minutes, that is going to be a long, complicated timesheet. It’s more common for independent contractors to charge in increments of 15 minutes and adjust their time for the entire day. For example, if you worked 8-4 with six 5-minute breaks throughout the day, you would only record 8:00 to 3:30, which makes up for the half hour worth of non-productive time.

There may also be a grey area in what is considered a “break” and what is billable. For example, some independent contractors eat lunch at their desk and deem that time as working so do not record a lunch break. In these cases, you must ask yourself how available and productive you actually are. Although you are sitting at a desk, if you’re busy eating and ignoring phone calls or emails, it is technically a break. On the other side of the coin, everybody’s day consists of a couple quick personal phone calls and of course “nature breaks”. Should your client really nickel and dime you for such situations? Finally, when you take a quick 5-minute walk to clear your mind, you’re sure to return more energized and productive. Given that quick bit of exercise was in your client’s best interest, can you charge them for it? How you respond to those questions is a combination of your personal ethics and the agreement between you and your client, but it is important to be aware of your activity.

Tracking your breaks can be an eye-opening experience, on both extremes. You could learn that you are over-charging your client or realize that you should add some breaks into your day. Tracking that time is as simple as keeping a spreadsheet or notebook. You can also download a time management app that lets you quickly turn on and off your work time. Though you’re unlikely to charge your client 6 hours, 41 minutes, 4 seconds, seeing that final time will hopefully make you think twice before billing out an even 8 hours.

An honest and open time management system is crucial to a working, trusting relationship with clients and staffing agencies. No ethical independent contractor is out to rip of their client, nor do they want to rip off themselves by undercharging or failing to take care of themselves with proper breaks. How do you manage breaks and time entry with your clients?

How IT Contractors Can Take Better Breaks

All IT contractors can relate to how easy it is to get caught up in a project and let time fly by. You pour back coffee and energy drinks to keep moving towards your end goal and eventually hours have flown by and you haven’t left your computer. You may end those days thinking you maximized your productivity, but did you really? Even if you did, was it enough to justify the negative consequences of skipping a break? According to a ton of recent research, you’re not doing yourself any favours.

Taking a Break is a Good Thing

Study after study has proven that taking a break throughout your day is indeed a good thing. On top of simply being refreshed physically, when you step away from a task that requires a lot of thinking power, it gives your analytical processing skills a break. When you return, your renewed energy — both mentally and physically — allows you to solve problems faster, which in return, boosts your productivity.

But delivering a better solution to your client shouldn’t be your only motivation to take a break. A pause from work is important to your own well being. Accepting that you should have time away from your desk means you’ll open up more time to exercise and eat properly through your day. You can also run some personal errands and tasks, which will free up your evening, ease a stressed out mind, and maximize work-life balance.

How to Take the Best Breaks

We understand. Taking a break is much easier said than done, especially in the IT industry when you have to deal with emergencies, outages and tight deadlines. IT contractors can’t just get up from your desk and leave… or can you? Keep in mind that you are a contractor, and not an employee — you are entitled to work any hours you please as long as you continue to honour the agreement between you and your client. Here are a few tips to take the most effective breaks:

  • Fully detach. When you take a break, turn your mind off completely from the task-at-hand and change your train-of-thought.
  • Move around. This will help with the previous point. Get away from your desk, go outside, and get some exercise.
  • Be social. Breaks are better with others and the social aspect will help you recharge. Just be careful not to distract your client’s employees.
  • Avoid all screens. When you go outside to recharge your batteries and get your mind off things, your phone is going to be a hinderance. If you must bring it with you, put it on silence and turn off email alerts.
  • Take a nap. Research has proven that a quick 20-30 minute nap can have significant health benefits for some people. Meditation is also an option that will clear your mind.
  • Do something else. Perhaps you don’t want to take a full break. Completing entirely separate, irrelevant tasks will let you stay productive AND temporarily break from your current project.
  • Take Microbreaks. Often when we think of a break it’s the traditional 1-hour lunch break, but productivity experts also encourage microbreaks throughout the day. For example, 90 minutes on/20 minutes off or 25 minutes on/5 minutes off.
  • Try any one of these 51 ideas to do when you need a break from The Muse.

Taking breaks isn’t just important at work but everywhere in life. Home DIY projects get done with more care when there are breaks, gamers see more success when they let their mind rest for a few minutes, and resumes are written much more clearly when you review them with a fresh set of eyes. How often do you take a break?

Bill 148: What Independent Contractors Need to Know

David O'Brien By David O’Brien,
Vice President, East Region & Government Services at Eagle

The Ontario Government introduced a sweeping legislation last fall regarding work and the ESA (Employment Standards Act). Many of the changes came into effect on January 1, 2018 with additional pieces that took effect April 1, 2018 and more to come on January 1, 2019.

Bill 148 covers an array of components. In addition to the headline-grabbing dramatic increase of minimum wage, there are changes to vacation entitlement, personal emergency leave, equal pay and termination of assignment pay for temporary employees, union certification rules and many others. All of these components have very significant impacts to employers and employees alike.

However, another very significant impact of Bill 148 that directly impacts independent contractors is employee misclassification. The new bill introduced a reverse onus provision whereby employers must demonstrate that any independent contractors they have engaged are not in fact employees.  Bill 148 shifts a substantial new burden of risk to employers and employment staffing agencies and will potentially have several unintended consequences as a result. As is often the case with activist governments, it is the unintended consequences of legislation that can be the most impactful.

In Ontario, it is estimated that about 12.5% of the total workforce of 5.25 million identify as self-employed, which is about 630,000 contingent workers. It is further estimated that of this group about 55,000 are knowledge workers in the IT, Engineering, Finance and Healthcare sectors, who bring significant economic impact to many of Ontario’s private and public sector organizations. The majority of these knowledge workers are independent, incorporated contractors. As the nature and notion of work transforms to a more project or engagement-based ideation, these knowledge workers are critical. With the modernization of our economy and overall productivity and competitiveness, our governments should be looking for ways to adapt to this new reality.

With the new legislation, when there is a question about whether an individual is an employee or independent contractor, the reverse onus provision is triggered. This means the burden lands on the employer or agency to prove the individual engaged with them is an independent contractor, not an employee and as such would be excluded from ESA coverage. As experience indicates, work moves offshore when employers are faced with impediments like this. Employers losing access to these valuable resources on a contingent basis should be very concerned.

Employers and staffing agencies are now looking at ways of assessing individuals to understand the true nature of relationships early on in engagements to ensure this risk is mitigated. These early assessments will help determine whether such individuals are properly classified as independent contractors.

As an independent contractor, there are a number questions you can ask to help establish the nature of your relationship with your clients. Here are a few of them to keep in mind:

  1. Are you providing services through a corporation?
  2. Have you registered with CRA for GST/HST?
  3. Do you carry business insurance, such as commercial liability or errors and omissions insurance?
  4. Do you market your services as a business, for example with a website, business cards, etc.?
  5. Do you have a corporate bank account, use business invoices in the corporate name and maintain corporate books and records?
  6. Do you have a written contract engaging your business? Is it for a fixed term period or completion of a project?
  7. Do you have the ability to determine how the services are provided?
  8. Have you invested his or her own financial resources into their business?
  9. Is there risk of loss or financial loss if the services are not successfully completed?

The answers to these questions will also help employers and agencies assess an individual’s status. There are numerous others that will have to be asked to help ascertain answers for all parties and ensure against employee misclassification. And just as important, independent contractors will need to be prepared to self-assess. Those who wish to be independent incorporated contractors should seek advice. Govern yourself as a business would and avoid acting or being treated as an employee.

Quick Poll Results: Taking Steps to Prove Independence

Being able to distinguish yourself as an independent contractor as opposed to an employee has been an ongoing issue in our industry for years. Sometimes certain headlines and trends bring it to the front-line of concerns and that’s exactly what happened when the Ontario Government’s Bill 148 became law in late 2017.

As the topic regained popularity and concerns once again grew relevant, we decided to ask our readers to review what they’re doing to protect themselves and make it part of our February quick poll and the results are positive. Although there is no single step that every independent contractor takes, it’s clear that many professionals are already doing some great things!

Quick Poll Results: How do you show that you're an independent contractor?