Workers’ plight stumps government

…if the province wanted to stop the exploitation of workers it could start by enforcing its own franchise law, called the Arthur Wishart Act.

The Toronto Star
September 10, 2007

Workers’ plight stumps government
No legislation addresses the concerns of labourers who lost thousands in office-cleaning ‘partnership’
Rita Daly

Is it an illegal franchise? A business scam? A company violating labour laws and the basic rights of workers? Or is it all, or none, of the above?

Ontario government officials are scratching their heads over how to address the questionable activities of a Mississauga cleaning operation known as Countrywide that has resulted in numerous complaints to various regulatory authorities over the years and dozens of small- claims-court lawsuits.

The victims, mainly low-wage working immigrants, signed contracts and paid as much as $12,000 for the unfulfilled promise of commercial cleaning work after responding to a newspaper ad and then lost their investment.

Many paid with their life savings or borrowed the money.

Complaints date back to 2001 and the business, run by ex-Toronto police officer and real estate broker Tom Morrissey, continues to operate. Morrissey, in an earlier interview, has said there is nothing illegal or unethical about his business. He has declined further comment.

Last month, following a Star investigation into Countrywide, officials from the government services and labour ministries met to discuss whether any existing legislation could be applied to this or similar cases. The government services ministry is responsible for Ontario's franchise law and the Consumer Protection Act, while the labour ministry is responsible for the Employment Standards Act guaranteeing basic rights to workers.

According to John Mitsopoulos, acting deputy minister of the consumer protection services division: "To date the ministry has not uncovered appropriate legislation to deal with this business-to-business transaction."

Government Services Minister Gerry Phillips subsequently sent a letter to federal Industry Minister Jim Prentice, responsible for the Competition Bureau, to see what, if anything, Ottawa could do. The Competition Bureau had also received complaints about Countrywide back in 2002 when one of its companies went bankrupt, and then resumed operations under another of its companies' names.

The bureau told cleaners at the time that it does not deal with contractual disputes.

Nearly 100 unsecured creditors of the bankrupt company lost money, again mainly immigrants who had paid for the unfulfilled promise of a cleaning job.

"I am asking that the federal government assess its legislation, including the Competition Act or the Criminal Code, to identify legislative gaps and better protect consumers and small businesses," Phillips wrote.

But is Countrywide's contract with people seeking work really a business-to-business transaction? According to workers' rights' lawyer Elizabeth Bruckmann, absolutely not.

"Regardless of the way money is changing hands and the promises that are being made, what's being exploited is people's labour," she said.

"The first thing people might say is, ‘This is a business scam.’ Certainly Morrissey has come up with a great business model that allows him to flourish, but he's doing it not just by exploiting other business people. He's doing it by exploiting labourers who ought reasonably to be protected as workers."

Bruckmann, with Parkdale Community Legal Services, has filed several claims against Countrywide with the labour ministry and said only an amendment to the Employment Standards Act or new legislation will address the growing problem of Ontario workers being charged fees to work and being labelled "independent contractors" with no labour protection.

Countrywide operates by having "partners" invest $12,000 to set up a related cleaning company. They are then supposed to sign up "sub-contractors" who must pay a fee, often thousands of dollars, for the promise of regular office-cleaning jobs.

Morrissey has claimed there are many happy partners and cleaners, but declined to provide any names.

Morrissey also has said it is not a franchise operation, although Toronto franchise lawyer Ben Hanuka disagrees.

Hanuka, who has offered to defend former workers of Countrywide in a possible joint legal action, said if the province wanted to stop the exploitation of workers it could start by enforcing its own franchise law, called the Arthur Wishart Act.

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