An independent contractor in BC is a self-employed person who operates their own business and provides services to a company or client instead of working as that company’s employee.
But the label on your agreement does not decide your legal status. If a company controls your work, treats you as part of its business and gives you little genuine independence, you can be an employee under BC law even if your contract calls you an independent contractor and you submit invoices.
That distinction can be worth a significant amount of money. A misclassified employee can have rights to vacation pay, overtime, statutory holiday pay, protected leaves and termination compensation. A contractor who is not an employee but is economically dependent on one company can also have notice rights when the relationship ends.
On This Page:
- 1. What Is an Independent Contractor?
- 2. Employee or Independent Contractor?
- 3. Contractor Misclassification
- 4. Dependent Contractors
- 5. Severance and Termination Rights
- 6. Contractor Agreements and Employment Rights
- 7. What to Do If Your Contract Ends
What Is an Independent Contractor in BC?
A true independent contractor is in business for themselves rather than working as part of someone else’s business as an employee.
Independent contractors usually have meaningful control over how they operate. They can serve different clients, make business decisions, take financial risks and have an opportunity to increase their profit through the way they run their business.
Common signs of a genuinely independent business can include:
- Choosing how and when the work is performed
- Providing important tools or equipment
- Working for multiple clients
- Being able to hire employees, assistants or subcontractors
- Paying meaningful business expenses
- Having a genuine opportunity to make more profit through business decisions
- Taking a real financial risk of loss
No single factor determines the answer. BC’s Employment Standards Branch describes the central question simply: whose business is it?
Does signing an independent contractor agreement make you a contractor?
No. A contract calling you an independent contractor does not automatically make you one under BC law.
The agreement matters, but the actual working relationship matters more. A business can’t avoid minimum employment standards simply by putting a contractor label on someone who is legally an employee.
The same applies if you:
- Send invoices instead of timesheets
- Charge GST
- Have no payroll deductions
- Use some of your own tools
- Use your own vehicle
- Work at more than one job
Those facts can be relevant, but none settles your legal status by itself.
Independent Contractor vs. Employee in BC
The main difference is whether you are genuinely running your own business or performing work as part of the company’s business.
You are more likely to be an employee if the company:
- Sets your work hours or schedule
- Directs how you perform the work
- Supervises you like other employees
- Provides the important tools, systems or equipment
- Requires you to work mainly or exclusively for it
- Prevents you from sending someone else to perform the work
- Pays you regularly without meaningful business risk
- Treats your work as an ongoing part of its normal operations
You are more likely to be an independent contractor if you control the work, operate for different clients, make meaningful business decisions, invest in your business and can increase profits or suffer losses based on how you operate.
For a deeper comparison, read our guide to employee vs. independent contractor status.
Does working for only one company make you an employee?
No, but exclusivity is an important sign that you may not be a truly independent business.
Someone who works full time for the same company for years, relies on it for virtually all their income and is expected to be available like an employee is in a very different position from a consultant serving several unrelated clients.
Even where the relationship does not amount to employment, heavy economic dependence can lead to dependent-contractor rights when the relationship ends.
Independent Contractor Misclassification in BC
Independent contractor misclassification happens when a worker is treated as self-employed even though the legal reality of the relationship is employment.
This matters because true independent contractors are not covered by the ordinary minimum standards in BC’s Employment Standards Act. Employees are.
If you have been misclassified and are actually an employee, employment rights that can become relevant include:
- Minimum wage
- Overtime pay where applicable
- Vacation time and vacation pay
- Statutory holiday rights
- Job-protected leaves
- Termination notice or compensation
- Potentially greater common-law severance rights
You should not assume that years of being paid as a contractor prevent you from challenging your status. Employment classification is based on the legal relationship, not simply how the company processed your payments.
What if you paid your own taxes?
Paying your own taxes does not automatically prove that you were an independent contractor.
Tax treatment is relevant, but employment-law status is determined by examining the full working relationship.
A worker can invoice a company, receive gross payments and handle their own tax remittances while still having an employment relationship for other legal purposes.
What if you incorporated?
Operating through a corporation is relevant, but it does not necessarily end the worker-classification analysis.
Courts can still examine the substance of a long-term working arrangement, including control, integration and economic dependence.
⚠️ Misclassified and no longer working for the company? Act promptly. A terminated employee generally has six months from their last day of work to file a B.C. Employment Standards complaint, and separate legal claims can have different deadlines.
What Is a Dependent Contractor in BC?
A dependent contractor is a worker who has some features of an independent business but is economically dependent on one company or client.
This category is important because worker status is not always simply “employee” or “independent contractor.”
Learn more in our guide: Dependent Contractor BC.
Do Independent Contractors Get Severance in BC?
A true independent contractor does not automatically receive employee severance, but a misclassified employee or dependent contractor can have significant notice or compensation rights.
There are three different situations to consider.
True independent contractor
A genuinely independent contractor usually looks first to the service agreement to determine how the relationship can be ended and what contractual notice or payment is required.
Misclassified employee
If you were legally an employee, you can have the same termination rights that apply to other employees despite the contractor label.
That includes minimum employment-standards protection and, for many non-unionized employees, substantially greater common-law compensation unless an enforceable contract properly limits it.
Depending on factors such as age, position, length of service and the availability of similar work, severance pay in BC for an employee can reach as much as 24 months’ pay.
Dependent contractor
A dependent contractor can be entitled to reasonable notice or compensation when a highly dependent relationship is terminated without sufficient notice.
The amount is fact-dependent and should not simply be assumed to equal an employee’s severance calculation.
Can a misclassified contractor claim wrongful dismissal?
Yes. If you were actually an employee and the company ended your employment without providing proper notice or compensation, you can have a wrongful dismissal claim.
Learn more about wrongful dismissal in BC and the compensation available when an employer fails to provide proper severance.
Independent Contractor Agreements and Rights in BC
An independent contractor agreement is important, but it can’t turn an employee into a genuine contractor simply by using the right words.
The agreement should reflect how the relationship actually operates.
Important terms can include:
- The services you will provide
- How and when you are paid
- Who controls how the work is performed
- Who provides tools and pays expenses
- Whether you can work for other clients
- Whether you can use subcontractors
- How the contract can be terminated
- Confidentiality and post-contract obligations
The termination section deserves particular attention. A true independent contractor’s rights when the relationship ends can depend heavily on what the parties agreed to.
Can the company change you from employee to contractor?
Your employer can’t simply take an existing employee relationship, rename it “independent contractor” and erase your employment rights.
A genuine change to self-employment would require the substance of the working relationship to change—not merely the paperwork.
If an employer asks you to resign as an employee, incorporate and immediately continue doing the same work under the same control, get legal advice before agreeing to the change.
Are gig workers independent contractors in BC?
Not all gig workers can be treated like ordinary independent contractors under B.C. employment standards.
BC has special rules for prescribed app-based ride-hail and delivery workers. For purposes of the Employment Standards Act, those online platform workers are treated as employees of the platform operator and receive specific employment-standard protections.
If you drive passengers or make deliveries through an app, do not assume that a contractor agreement removes those statutory rights.
What Should You Do If Your Contractor Relationship Ends?
If a company terminates your contractor relationship, determine your true legal status before accepting that you are owed nothing.
Keep:
- Every version of your contractor agreement
- The termination notice or email
- Invoices and payment records
- Schedules and instructions showing how your work was controlled
- Company policies you were expected to follow
- Records showing what equipment you used
- Information showing whether you were allowed to work for other clients
- Records showing what percentage of your income came from the company
That evidence can help determine whether you were an independent contractor, a dependent contractor or an employee.
Should you sign a contractor termination release?
Don’t sign a release until you understand which legal rights you are giving up.
A proposed payment based only on the contractor agreement can be inadequate if you were actually an employee or if the relationship created dependent-contractor notice rights.
Once a valid release is signed, you can lose the ability to pursue additional compensation.
Can you complain to BC Employment Standards if the company says you are a contractor?
Yes. The Employment Standards Branch can determine whether you were actually an employee covered by the Act.
If your employment has ended, an Employment Standards complaint generally needs to be filed within six months after your last day of work. The Branch can examine the working relationship rather than simply accepting the company’s contractor label.
Employment standards are minimum rights. If you were actually an employee, a civil claim can involve greater common-law termination compensation, so do not assume an Employment Standards calculation represents your full entitlement.
Independent Contractor BC: Frequently Asked Questions
Can an independent contractor get vacation pay in BC?
A true independent contractor is not entitled to employee vacation pay under BC’s Employment Standards Act. If you were misclassified and are actually an employee, statutory vacation rights can apply despite the contractor label.
Do independent contractors get overtime in BC?
True independent contractors do not receive overtime rights under the ordinary BC Employment Standards Act rules. A worker who is actually an employee can be entitled to overtime where the statutory requirements apply.
Can an independent contractor be fired?
A company can end a genuine independent contractor relationship in accordance with the contract and applicable law. But if you are an employee or dependent contractor, additional notice or compensation rights can apply.
Does having a business number make you an independent contractor?
No. Having a business number, charging GST or submitting invoices does not determine your employment status on its own. The actual relationship still has to be examined.
Can you be both an employee and an independent contractor?
A person can have different legal relationships with different businesses, but one company cannot avoid employee obligations merely by describing part of an ordinary employment relationship as contracting. Each relationship must be assessed based on how it actually operates.
What is the biggest sign that I have been misclassified?
A major warning sign is having very little real business independence despite being called a contractor. If the company controls your hours, duties and methods, provides the tools, expects ongoing exclusive service and treats you like its employees, your status should be reviewed.
Can independent contractors get EI?
True self-employed contractors do not normally receive regular EI on the same basis as employees simply because a client ends a contract. If you were misclassified as an employee, your insurability can need to be reassessed. Self-employed Canadians can also opt into a separate EI program for certain special benefits if they meet the applicable federal requirements.
Get Help With Independent Contractor Rights in BC
Being called an independent contractor does not necessarily determine what you are owed when the relationship ends.
Samfiru Tumarkin LLP helps workers determine whether they are true independent contractors, dependent contractors or employees and whether a company has improperly denied termination compensation or other employment rights.
Our BC employment lawyers can review your agreement, examine how the relationship actually operated and determine what compensation you can pursue.
Workers in Vancouver and the Lower Mainland can also speak with our Vancouver employment lawyers about contractor misclassification and termination rights.
The contract label is only the starting point. Your actual working relationship determines your rights.