Proper record-keeping: protecting your rights when working cash jobs

Cash jobs are extremely prevalent in the community. Many employees are now paid exclusively by cash or partially by cash and partially by cheque or direct deposit. In many such cases, employers may have spotty record keeping and often do not provide proper payroll documents to employees.

While it may seem more convenient to receive payments in cash, as they often avoid source deductions such as EI and CPP premiums, as well as income tax, cash jobs create a situation where the employee is at a serious disadvantage if things go wrong.

Problems Enforcing Employment Rights

Ontario’s Employment Standards Act provides many different rights and protections for employees. The most common and well-known of these include minimum wage (now $11.25 per hour), overtime pay, public holiday pay, vacation pay, and termination pay.

What happens when employers violate these rights? Employees can file a claim to the Ministry of Labour, submit their evidence, and hopefully get an order for the employer to pay the amount owing.

The danger for those working cash jobs is that there is often no paper trail in order to prove how much you were paid or how many hours you worked. As a result, employees have a difficult time proving that they were owed wages in the first place and often lose out on thousands of dollars because they lack sufficient evidence to prove their claims to the Ministry of Labour.

Problems Applying for EI

Another problem that employees have working cash jobs is proving that they have enough hours for EI. Sometimes, an employer might under-report the hours that an employee worked in order to avoid income tax and employer contributions. This results in the employee not having enough hours to get EI, even though they may have worked enough hours in reality. In such a case, the employee should still try to apply for EI and explain the situation, but it is very difficult to prove hours when there is no supporting documentation.

What You Can Do

Often employees don’t have the luxury of choosing an employer that has proper payroll and record-keeping - a job is a job.

However, for employees who are either in a cash job situation or a situation whether the employer is either not reporting or under-reporting your hours, try to keep your own documentation. Write down your daily hours on a calendar or a diary, along with your pay. Try to write down a note every time you receive payment as evidence. If your workplace has shift schedules, try to obtain a copy or take a photo on your photo to keep as records. Also, keep the contact information and names of your co-workers, who could potentially act as witnesses in case a dispute occurs.

In this way, even though the employer is not providing proper records, you protect yourself with supporting evidence in case something goes wrong and there is a dispute over hours or pay. If you are facing a situation where you think your employment rights are being violated, call our clinic immediately for summary legal advice.

Changes to the Employment Standards Act

The Ontario legislature passed the Stronger Workplaces for a Stronger Economy Act a year ago as part of an effort to strengthen employment standards for vulnerable workers. As a result, various provisions of the Employment Standards Act (ESA) have been amended. Below is a summary of the new changes to the ESA that have come into effect in the past year.

Minimum Wage

On October 1 of every year, the minimum wage will be adjusted in accordance to the rate of inflation. The rate of inflation is determined by the Consumer Price Index of the previous year. If the adjustment results in a decrease in the minimum wage, then no adjustment will be made and the minimum wage will remain the same as the previous year.

If a change to the minimum wage rate comes into effect partway through a worker’s pay period, then the pay period will be treated as if it were two separate pay periods and the worker will be entitled to at least the minimum wage that applies in each of those periods.

The current minimum wage rates are:

Minimum Wage Rates

Minimum Wage Rate

Wage Rates Prior to June 1, 2014

Wage rates from
June 1, 2014 – September 30, 2015

Current Rates: Rates as of October 1, 2015

General Minimum Wage

$10.25
per hour

$11.00
per hour

$11.25
per hour

Student Minimum Wage

$9.60
per hour

$10.30
per hour

$10.55
per hour

Liquor Servers Minimum Wage

$8.90
per hour

$9.55
per hour

$9.80
per hour

Hunting and Fishing Guides Minimum Wage

$51.25 /day



$102.50 /day

$55.00/day
Rate for working less than five consecutive hours in a day
$110.00
Rate for working five or more hours in a day whether or not the hours are consecutive

$56.30/day
Rate for working less than five consecutive hours in a day
$112.60
Rate for working five or more hours in a day whether or not the hours are consecutive

Homeworkers Wage

$11.28
per hour

$12.10
per hour

$12.40
per hour

Recovering Unpaid Wages

Elimination of $10,000 Cap

Beginning on February 20th, 2015, there is no longer a $10,000 cap on the recovery of wages that the Ministry of Labour can order an employer to pay. However, this only applies to claims for unpaid wages that become due on or after February 20th, 2015. For claims of unpaid wages that are owed prior to February 20th, 2015, the $10,000 cap still applies and workers can only recover unpaid wages up to $10,000. Generally, wages become due on the employee’s regular pay day or if the employee was terminated, then within seven days of termination or what would have been the employee’s next regular pay day, whichever is later.

Longer Time Limit to File a Claim

The time limit to file a claim has been extended under the ESA. Workers now have two years to file a claim for unpaid wages that become due on or after February 20th, 2015. For unpaid wages that became due before February 20th, 2015, the limitation period to file a claim for unpaid wages is six months. However, there are two exceptions. First, if there are repeated contraventions by the employer, and at least one of the contraventions occurred in the six-month period before the claim was filed, then the worker has one year to file the claim. Second, if the worker is seeking unpaid vacation pay that became due before February 20th, 2015, then the worker has one year to file the claim. 

Time Limits on Claim Period

Under the new amendments to the ESA, workers are now able to claim wages that are due in the two years prior to the date the claim was filed if the wages became due on or after February 20th, 2015. However, if the wages became due prior to February 20th, 2015, then workers can only recover wages that become due within the six month period prior to the date the claim was filed.

Temporary Help Agency Workers

Starting on November 20th, 2015, workers who are hired through a temporary help agency can recover unpaid wages from both the agency and the agency’s client company. Typically, a temporary help agency worker is assigned to work at the agency’s client company, but is paid by the agency.  If the agency fails to pay the worker some or all of the wages including overtime and public holiday pay, the worker can file a claim against the agency and the client company for the unpaid wages at the Ministry of Labour. The Ministry will enforce any order for unpaid wages against the agency and the client company because they are now jointly and severally liable for any unpaid wages under the ESA.

Employers Must Provide Poster on Employment Rights

As of May 20, 2015, employers are required to provide a copy of the most recent version f the Employment Standards poster to employees who are covered under the ESA. If the employees request a copy of the poster in a language other than English, the employer must provide the translated version in addition to the English version.

The employer is also required to post the most recent version of the Employment Standards Poster in a conspicuous place in the workplace. If the majority of the workers speak a language other than English in the workplace, the employer is required to post a copy of the translated version of the poster next to the English version.

Employer Self-Audit

Employment standards officer (ESO) can now require employers to conduct a self-audit of the employer’s records and/or practices to demonstrate to the ESO that the employer is meeting the requirements of the ESA. Regardless of whether the employer reports that it is in compliance with ESA, the ESO retains the power to conduct an investigation or inspection of the employer, and to take enforcement measures as the ESO considers appropriate