Politicians call for protection from scams

Elisabeth Bruckmann, of Parkdale Community Legal Services, said the province has to stop taking a hands-off, consumer-beware approach when it comes to people trying to earn an honest living. "There's got to be a political will to enforce the laws to pursue people who violate them, to ensure workers get the wages that are owed them."

The Toronto Star
July 31, 2007

Politicians call for protection from scams
Calls for reform follow Star series on office-cleaning ‘partner’ scheme
Rita Daly

Federal and Ontario politicians yesterday called for toughening up laws to protect low-wage workers against unethical and illegal activities in the workplace.

Calls for reform followed a series of Star stories about a Mississauga commercial cleaning business known as Countrywide that since 2001 has been charging workers thousands of dollars in fees for the promise of office-cleaning work, then refuses to give back their money and tells them to go to court.

"This kind of activity is far more widespread than I think most of us believe or understand, " said federal Liberal consumer affairs critic Dan McTeague (Pickering-Scarborough East).

"I'm sure I'm not the only MP who has had this pattern of complaints from people who in good faith invest their savings" only to find people taking advantage of what appear to be legislative loopholes absconding with their money, he said.

Over the years, workers complained about Countrywide to federal and provincial authorities and to police but were ignored. Dozens took Countrywide to small claims court, but few have recovered their money.

In the coming months, McTeague said he'd like to pull together a task force of federal and provincial politicians to review the federal Bankruptcy Act and Competition Act, along with provincial franchise, consumer protection and employment standards laws to figure out how to close the loopholes.

"It's quite rife out there, it's disgraceful," said NDP MPP Michael Prue (Beaches-East York). "These people are hungry to work and put their life savings on the line."

Countrywide president Tom Morrissey has said his business is not a franchise operation and is doing nothing illegal or unethical. However, the business operates like a franchise, attracting investors or "partners," who pay $12,000 to set up their own cleaning companies, and cleaners or "subcontractors," who also pay thousands in upfront fees for the promise of work.

Prue, the NDP's government services critic, said he and other NDP members have raised the issue of questionable franchise operations a number of times in the Legislature, but the government has shrugged them off.

Toronto franchise lawyer Ben Hanuka, who recently negotiated a $2 million settlement for franchisees in a class-action lawsuit against Quiznos Sub, reviewed Countrywide's documents and came to the conclusion it is a franchise that ought to be subject to the law. But the law as it now stands lacks any enforcement, he said.

"It's horrible. All these people losing money. These are not rich folks; these are labour-class immigrants who invest their life savings."

Hanuka said he is willing to meet with former partners and cleaners of Countrywide to try to get their money back.

Elisabeth Bruckmann, of Parkdale Community Legal Services, said the province has to stop taking a hands-off, consumer-beware approach when it comes to people trying to earn an honest living.

"There's got to be a political will to enforce the laws to pursue people who violate them, to ensure workers get the wages that are owed them."


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