Are virtual cashiers a smart choice for employers?

After news spread of Freshii hiring virtual cashiers from Nicaragua, questions arose regarding employer hiring practices and the legality of paying employees less than the minimum wage in Canadian provinces. Is this practice permissible?

Jon Pinkus, a Toronto employment lawyer and partner at Samfiru Tumarkin LLP spoke to the Canadian HR Reporter on the dilemma and insists Freshii’s decision is legal.

Pinkus explains that much like a call centre that employs people in another country, Freshii is within its rights to hire cashiers from outside of Canada.

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“You are only obligated, as a general rule, to comply with the employment standards of the country in which the employee lives. The only exception would be if an employee working in Ontario, for example, went to work somewhere else with the same employer. If that work is a continuation of the work that they had originally started doing in Ontario, then the Ontario Employment Standards Act may apply,” Pinkus states.

As Pinkus goes on to explain, the issue lies with the optics of this decision for many Canadians.

“I think the controversy is the fact that this is a position that has not normally been outsourced. And that’s just a reality of the advancement of technology. So I think that the outrage that you see… is, I think, best contextualized and understood in the context of disagreement with positions being outsourced, in general,” Pinkus states.

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A labour shortage crisis could also have factored into this decision, and Pinkus states it is important to determine the reason businesses have chosen to change their hiring practices.

“Maybe the government and companies need to better communicate why they do this, why it is necessary. If it is, for example, just for cost-cutting, that’s one thing; if, on the other hand, it’s because they had difficulty filling these particular kinds of positions, maybe that would change public impressions,” Pinkus says. “If there is a mistake, it doesn’t appear to be a legal mistake, but it does appear to be a public relations error.”

There are other concerns and questions that this decision has illuminated for many, such as the rights of employees now that remote work has become so prominent and many employees can apply for jobs in regions they do not reside in.

“How are we going to navigate a situation where someone is doing the exact same job, doing the same work, but all kinds of different laws may apply, simply depending on where they are situated? So that I think is the next frontier, if you will, in employment law,” says Pinkus.