The much vaunted, long awaited and hoped for Social Assistance Reform Commission was appointed in the fall of 2010. It provided an initial consultation paper last summer and as recently as March 2012, revealed its second discussion paper. Over one hundred and seventy five respondents were posted to the Commission's website on each of these occasions, many of whom will read this blog entry and understand the concept of irony and oxymoron. Many of us have concerns about this review and what is going to happen once it reports back to the government and its recommendations are made public. The latest report by the Commission is that it will complete its said recommendations by the end of this month or early next month, and have the final report released to the public in the fall, likely mid-September.
To give you a bit of history, this review was a key plank in the province of Ontario's Poverty Reduction Strategy, which included Bill 152, the Poverty Reduction Act. This is no lie. All political parties passed this legislation with much fanfare at the time and substantial public support. Part of the legislation was to appoint the Commission, so that it can review all social assistance programs and make recommendations that would reduce the complexity of social programs and reduce poverty in Ontario. However, like the Drummond Report (which reported publicly on February 15th of this year), Social Assistance Reform Commissioners Frances Lankin and Munir Sheikh were given marching orders from an austerity minded government. To me, they were asking Lankin and Sheikh to decide the fate of Solomon, while deferring to the banks, the bondholders, the wealthy corporate elite and the pandering anti tax crowd. In other words, they were asked to become the oxymoron that an austerity agenda would make of any efforts on the part of any government to reduce poverty.
Don Drummond, principal author of the Commission to Review Public Services of Ontario (or the "Drummond Report", for short), Frances Lankin and Munir Sheikh, are all intelligent, well-respected individuals, with grounding both in government and in economics. They know intimately that Ontario cannot cut its way to prosperity, or cut substantial numbers of public sector jobs without having a negative impact on private sector employment. They also know that welfare rules that forbid people to grow assets, build a business or form families, militate against poverty reduction, and as such, given free reign, I do believe that all of these individuals would be making quite different recommendations if they based their analysis solely on best practices and the actual objective of poverty reduction.
However, beholden to an austerity agenda that was neither created by or leading to any benefits whatsoever to the target population of this initiative, Lankin and Sheikh are euphemistically expected to create a miracle by finding so called "efficiencies" in the two social assistance programs in Ontario, namely, the Ontario Works and Ontario Disability Support Program. This story kind of reminds me of the Biblical parable of Jesus feeding the hungry, from a small amount of wheat and a fish, to multiply His Holy offerings over hundreds of people, each of whom had at least a full loaf and fish along with wine. Except this time, there will not be an endless supply of loaves and fish. There may only be one loaf and one fish to cut up in many thousands of parts, while the Ontario government continues to feed the wealthy of this province virtually all of its wine and fine caviar.
The agenda of this Social Assistance Reform was clear from its second discussion document, whereby it seems that the myth of employment being the sole route out of poverty further prevails, whilst neither Commissioner pretends to be instructed to find ways to fix the labour market in order to make this so. A fix of the labour market is not on the Ontario Government's agenda. We only need to look as far as the federal government with its recently planted reforms to the Employment Insurance program, temporary foreign worker program, and related initiatives, such as eliminating employment equity requirements from the Federal Contractor Program and reducing budgets for important enforcement bodies, such as the Canadian Human Rights Commission. As federal Finance Czar James Flaherty stated, "There is no such thing as a bad job", as he relates to his distant past of coaching hockey and driving taxi (likely before his Princeton pedigree education and successful career as a lawyer and politician). I am sure if his government completely had its way, it would eliminate the need for minimum wage and health and safety regulations; they are such an impediment to business anyways.
At the same time our Honourable Minister Flaherty reflects longingly on his early 'careers', both he and the rest of us know he will never have to do a "bad job" again. Lest all the "bad jobs" that Canadians refuse to take because they pay too little, lack any benefits, offer inconsistent and irregular hours, and potentially destroy the soul of the bearer should they even last more than a mere few weeks, are now the new pathway for the poor and unwanted Canadians. Flaherty reassures us that no middle or upper class crust will ever be forced to take these "bad jobs", but if you dare make a claim for Employment Insurance and by extension, social assistance, you may be asked to take one of these jobs, never mind that you are trained as an engineer, a teacher, a social worker, a manager, or even an artist. The poor will get their hands dirty because the middle and upper crust of our society will not have to. Simply put, we are following the ways of the UK, for example, that take the willingness to work and dreams of inclusion by persons with disabilities, and deliver them to the worst jobs that nobody else will take, perhaps for less than minimum wage.
In fact, in the second discussion paper produced by the Social Assistance Reform Commission, it is posited that a substantial raise in Ontario Works and Ontario Disability Program Supports would make it "unfair" to those that already work in these "bad jobs". Poor people on social assistance deserve to be poor because low wage workers in "bad jobs" are also poor, so why should people on social assistance, including people with disabilities have it "better" than those in bad jobs, hence the assumption there are even enough "bad jobs" to go around for everybody in the first place. The federal government refers to "labour shortages", which euphemistically refers to the fact that not enough Canadians are willing to take low wage jobs with no benefits, at a time when housing and other commodity costs have been driven skyward. The answer to reforming social assistance is to get people out of welfare poverty into working poverty ... as if this will accomplish a damned thing! So much for the Poverty Reduction Act, as the Ontario Government can just say it can't be done because we have to pay back this massive deficit their wealthy friends helped to create. Never mind thinking outside the box and asking why we have so many "bad jobs" to begin with ...
Another theme that is repeated throughout the second discussion paper is to divide people with disabilities up between those who can and those who cannot work, as if it were that simple. As an academic that had developed both employment and self employment initiatives at the provincial and federal level, I can tell you there is no "test" that will positively affirm somebody as being "able to work" or "unable to work". Ability to work in fact is not related to the severity of one's disability, but more the social, economic and attitudinal barriers held towards persons with various kinds of disabilities. I once wrote in this blog about how accessibility begins at my front door. People believe that the installation of a ramp, widening doors in buildings and setting desks lower to suit persons in wheelchairs, will make this whole group of people, voila -- instantly employable. This alone is not taken into consideration that somebody will have to get to the workplace each day, and reliably so, on their own power and be able to remain consistent. There is no test for this, nor can this be determined based on the type of disability or diagnosis one has. Two people with the exact same disability and limitations may have a very different set of opportunities and barriers. Virtually none of these issues are properly reflected in the report, as this bears upon "fixing" the labour market.
Nevertheless, the above constraints are ill considered when such "tests" have been issued in other jurisdictions. Persons dying of terminal illness, blind persons, quadriplegics and others, even if they can just move their thumbs, can be deemed employable, simply by showing up on time for the so called "test" - of course, disregarding the probable trouble, substantial efforts and barriers one likely had to go through just to get out the door as well as probable help received for the same that cannot be relied upon again and again, if one were to replicate this reliability in a real job. In the UK, those deemed employable lost a substantial portion of their income benefits, even if they cannot find a paying job. There is no rationale for lowering the incomes of people deemed employable, as I have yet to see housing prices, grocery prices, transportation costs, and so forth, lower accordingly. All this does is spell an imminent crisis for many people, and in tune with this, hundreds of people subject to this re-evaluation have died, many by their own hand. For example, if we drop the already inadequate allowances of $1,064 monthly income for persons with disabilities to the welfare level of $599 per month, what do you think is going to happen?
When I discussed this with some people who I randomly encounter or meet with who have never experienced this level of desperation, they told me they believe they will just "get a job". If this was in any effect true, if they were looking for work while receiving $1,064 a month, their chances of finding a job would certainly not change once their income drops, and as a matter of fact, they might be less likely to find work, given that it costs so much to conduct a good job search. Interview clothing, stable housing, a telephone contact, references, transportation, and so on, are not free the last time I checked. Henceforth, when I asked further of these same individuals, many of whom are themselves employers, if they would hire any of these folks, and almost universally I am told, they would not hire social assistance recipients. If they will not hire them, why do they think somebody else will? It is my belief that unless government somehow forces employers to hire people from the Ontario Works or ODSP rolls, and to accommodate all disabilities, it will never happen on its own. The marginalized will always be marginalized unless the labour market gets a true "fix" and employment opportunities are created for everyone that wants and needs a job.
Putting more people out into the labour force to look for jobs is not going to create more openings. In fact, all that will happen is there will be more and more unemployed persons looking for the same number of vacancies. Statistics Canada recently reported that there are between three to six and a half unemployed persons (meaning people who are already currently looking for work) for every single job vacancy. That means if we filled every single job vacancy that exists, there will still be another two to five or six people without work for every filled vacancy once all the jobs are taken. The Social Assistance Reform Commission is supposed to look at ways to make sure these remaining people do not lose their homes, their health or their families, but instead, it appears by the tone of its second discussion paper, the Commission intends to answer to wealthy corporations that are feeling a "shortage of labour" in its lowest paying, most unstable positions, as opposed to trying to find ways to make all jobs "good jobs". Working poverty is becoming more and more of a problem without any apparent attempt at a resolution. A good friend of mine had a heart attack after she attempted to juggle three minimum wage jobs to support herself and her three children; now, she cannot juggle any job and was forced off on ODSP. With enough "bad jobs", it is inevitable that the human soul will be crushed and no longer able to function in such a capacity, leaving labour market reform an absolute must if the Social Assistance Reform Commission, any government of the day, or even the business community as whole, wants to see less people on "the dole".
Another set of recommendations appears to make ODSP operate more like Ontario Works; in fact, one of the proposals is to combine ODSP and Ontario Works into one program. That means punitive rules as they exist for people on ODSP will never be changed, regardless of the negative impact these rules have with respect to maintaining people in legislated poverty and preventing their reasonable chances of escape. One example many in the disability community want to see changed about ODSP is when a person receiving ODSP marries or lives common law with somebody, the income and assets of their partners should not be considered when evaluating one's continued eligibility for ODSP. As somebody who has worked in the advocacy community, I see how this particular rule has forced many persons with disabilities to remain with abusive partners. In some cases, they are cut off when their partner or spouse refuses to cooperate by not handing over pay stubs to ODSP officials. Eliminating the necessity of this would allow more people to form relationships, as well as provide the person with a disability a way out if that relationship becomes toxic.
Henceforth, I have noted that relationships between ODSP recipients who are largely unable to work, with a partner or spouse who does work at a more than minimal basis, rarely last. Their health worsens, as they are not permitted to stop working, or take breaks, or get sick themselves ... lest they risk losing a lot of money, leaving their bills, including their rent or mortgage unpaid for several months until adjustments are made, as earnings deductions are made for income earned currently in sometimes a few months' time when there is no longer any work income coming in. I have represented landlords at the Landlord and Tenant Board, where these kinds of relationships have broken down in the way I describe above, and almost always, an eviction is inevitable. With the current loss of Community Start Up and Maintenance Benefit, it will only be that much harder for the person on ODSP, either on their own, or with their newly unemployed or ill spouse, to find a new place to live. Sadly, I have seen it go the way where when the spouse splits, they become under employed or sick themselves, and thus a new benefit unit is created as a result - which only costs more money, two shelter allowances as opposed to one. The last I heard, homelessness is not cheaper than housing somebody, even at full cost. I am sure any austerity minded politician does not intend for more good money to go after bad; in other words, would it not be more cost effective to prevent the heavy costs that homelessness, persistent poverty and long term unemployment are bound to create?
Merging ODSP with Ontario Works is certainly going to cement these very counter productive rules that do not serve people with disabilities or encourage them to fully develop to their potential. I will accept spousal income being included to determine the income of the other spouse when ALL people who are paid by public funds have to deal with it. Premier McGuinty's income should be split in half and taken from his wife, if she works, regardless of where or how much she makes. Spouses that are eligible for CPP, WSIB, OAS, and any myriad of other programs of various types should also lose their benefits if their spouse works, even a little bit. If you see what it does to a family with a disabled spouse, you can only imagine the chaos that would ensue if this rule were universally applied, including politicians, civil servants, as well as others that work in jobs paid for by tax dollars, such as the postal worker, the bus driver, the teacher, the police officer and so forth. No more double income, no kids, folks ... everybody will have to live on a single cut down income, and continue to pay for rising costs. If you think the divorce rate is bad now ...
Finally, there were a number of proposals concerning employment supports. While I share the concern that employment and education supports are very important and that a goal should be to get as many people into good jobs as possible, or training for good jobs of the future, I fear the proposals will not result in this. There are merits to consolidating all employment supports under either Employment Ontario or through a local service agency, but the devil is usually in the details. One would want to know what this means. Does it mean the monies that are currently spent on the most effective programs will now be further spread out, thus slicing the pie even thinner for more participants? Or does it mean a continuation of the same flawed formula used for ODSP's employment supports programs that appear to encourage or reward service providers that can most quickly get candidates into a job ... any job, even one that is beneath the person's talents, aspirations and educational attainment? In my discussions with people, it appears we have to move cautiously on this one: we want to make sure that everybody who is seeking employment or to advance their education and training, has access to the necessary programs that will help them do so. We must see the full range of employment candidates served, ranging from the most needy, vulnerable and inexperienced, to the most well educated, but currently unemployed person seeking a career-based job. Greater use must be made of head hunting agencies that are experienced in placing professionals into jobs; perhaps, contracting with them to assist qualified OW and ODSP recipients in accessing the higher paid jobs, while supports for disability and other related issues can be provided by other agencies.
This means service coordination, something we were once allowed to do as Employment Supports Service Providers, where we can work with other providers to achieve best outcomes for single clients, while sharing the fees for service for the direct services provided by each partner to the client. Somehow, this has become lost under the new delivery model, whereas each Employment Service Provider takes on the full range of services and as such, may not be able to service some persons that tend to be lost or fall between the cracks in most of these situations. People with good educations are told they can't be served and are often told they have "more qualifications" than the employment support worker has. They get told to negotiate their own accommodations, to negotiate their own job descriptions. This means the job seeker that cannot drive a vehicle for disability reasons has to confront an employer to try to address the job description that seems to ubiquitously require one to have a driver's license and personal vehicle. In other words, you must already have a job and the financial means to own and maintain a reliable vehicle at commercial insurance rates; if you are disabled and cannot drive, but can otherwise fulfill the other parts of the job, you are toast.
To me, if one is working in this field and is delivering employment supports, it is up to the employment supports worker to negotiate job descriptions and so forth, even before a candidate is proposed to the employer, so that the employer becomes more aware of his or her obligations under the Human Rights Code. It is not the job seeker's responsibility to do this, because when this is done, if ever, the employer will only select the next person on their list that isn't as difficult to place, e.g. somebody who drives. There are Employment Supports Service Providers that have successfully placed professionals and executives in positions, although they are not as common as those that work in disability specific areas.
If the Social Assistance Reform Commission and Ontario Government truly want to reduce poverty, increase participation in the paid labour force by all persons, including persons with disabilities, it must be a voluntary and well supported initiative, not based on a threat to the person of loss of benefits or reduction in income supports. Earnings disregards should be designed to ensure that the person is always much better off taking the job, or working in self employment. Persons who are not likely to engage in paid work should still receive sufficient benefits to allow them to not have to live in poverty. If there is concern that low wage workers will not perceive this to be "unfair", then serious labour market reform is a must, which should include increases to minimum wage, easier rules to develop and organize unions or other workplace structures that encourage mobility and advancement. However, if we are to persevere on the so called "unfairness" of raising social assistance rates versus how low wage workers are treated, neither group is ever going to advance and any poverty reduction goals, as well as saving well earned health care dollars, and so forth, will all be for naught.
Showing posts with label self-employment. Show all posts
Showing posts with label self-employment. Show all posts
Monday, June 25, 2012
Tuesday, May 15, 2012
Small Business is Part of the 99%
Occupiers, take heed!
Small businesses are are part of the 99%. As entities, we have not received corporate tax subsidies, large corporate tax breaks, or any kind of hand out. When we get under attack, generally nobody cares because we are just "small potatoes". Yet, virtually every person who works with small businesses, other than other small or even to some extent, medium sized business, has no clue as to how the small business sector is under attack from all corners of society.
Many occupiers associate small business as the petite bourgousie, or a miniaturized version of the capitalists they all hate. While most small business owners are capitalists, they have more in common with the 99% than many realize. After all, when was the last time YOU were given a hand out from the government to help your business grow?
I want to talk about the many things that get done to us as small business from various corners of society, and then you, the reader, you can judge whether it is even worth it anymore to set up shop and pretend to be some kind of merchant, entrepreneur, practitioner, or whatever, that avails its goods and services to the public. Is it really worth it? Why do people even bother? It is time people know the truth about how most small businesses experience life as a small business owner:
1. Through Their Customers:
While most customers are good and are a joy to have around, there is the small percentage that create 90% of the problems that small businesses often complain about. Enough of these customers at the wrong time can make life for a business owner, entrepreneur, solo practitioner, or whatever, miserable. These are people that come into the business, spell out their expectations and are eager to pay when asked, but shortly thereafter, complain about the amount of money the goods or services are costing (while, of course, ignoring the fact it costs money to produce or to provide goods and services). These are the types of customers that string people along, make changes to their order or instructions, and expect instant results. When things do not turn out the exact way they envision after the 149th day, they blame the proprietor. After all, the proprietor is the only one that was providing these goods or services, right? No thought is given that the customer may be at least partly to blame, as they failed to provide changes in writing, or listened to the provider to see if their new choice is even possible or financially feasible on the budget they seemed to assign to the project. Despite warnings that things may not turn out very well if we push this to whatever the person is asking, we get blamed anyways. These people typically underpay and know it too, and act shocked when they are asked for additional funds to put the changes necessary in their work.
2. Another type of customer is the rubber cheque writer. They can't seem to write cheques that stick, and then they seem to wonder why services stop or goods are not shipped, once the bounced cheque is discovered. People can't work for nothing. I am sorry. If you still want the product or the service ordered, go back and pay in cash or money order and add whatever administrative charge that might apply. After all, it is a pain in the neck to track bounced cheques, to contact the cheque writer and wait for re-issue. In the meantime, the entrepreneur, business owner, practitioner or whatever, is not earning any money from you, so why would they continue doing anything for you, until the money is made up? There is a small sub group of rubber cheque writers that are truly fraudulent. Most of them that I met are truly honest people who made a mistake, and will correct it, particularly if they are also small business people, or once were. However, a very small sub-group of these people will do this on purpose. They do this by marking their project as urgent. Perhaps, a defence has to be filed by tomorrow morning, or the clay model has to be delivered by the end of next week for the showing of their home. Many business owners, entrepreneurs and practitioners will accommodate urgent requests, sometimes by asking for a little more money so they can afford to set aside other paying work to accommodate this job which has to be done very quickly. So, the cheque gets written, and then deposited, only for the business owner, entrepreneur or practitioner to find out a few days later, it bounced. My question to these people is, "How fast would you complain about your employer to the Ministry of Labour if your weekly or biweekly pay cheque bounced?" Why should business owners be any more tolerant? I am myself moving to a 'no personal cheques' policy, which leaves some people out, but too bad. I have to eat too, and can't be bothered chasing cheque bouncers around town.
3. Another "ace" type customer is those that like to waste your time with frivolous and vexatious tasks, and then complain loudly when you won't comply. I know one fellow that owned a computer store that was put on a wild goose chase by a customer who swore up and down he had a certain part, and that this part was essential to make his machine run better, and when the business owner went back to the customer to explain there was no such part, or that it would have to be purchased from India, the customer immediately filed a Better Business Bureau complaint and threatened to sue the business. Nobody needs these "ace" customers, as they not only waste your time with their original requests, they continue to waste it when you try to explain why their request is either going to be very expensive or difficult to fill. I get people in my office seeking to sue on this kind of basis, which I tell them they have no case.
4. The next category of customer are the chintzers or the skinflints. These are people that also come in, often in an urgent situation, and waste your time, only to haggle with your fees. If you are offering a professional service, you are not a flea market or a used car dealership where haggling is expected. There are various ways in which these people act. In one example, the fellow went out of my office under the guise of obtaining the funds to pay his retainer, only to supposedly phone a few friends who allegedly told him the fees were too high and excessive. When I told him I do not bill by opinion poll, he became upset, and said that a "friend" of his who happened to be a lawyer said it was too high. The only solution for somebody like him is to tell him if his lawyer is going to charge him less, go there. I know they are not going to get a better deal over there, as many times chintzers and skinflints have returned to my office, only to pay the fee that I asked to begin with, likely after discovering they can't really get a "deal". I wouldn't recommend shopping for professional services on price alone anyways. I've seen the results of that as well, as many of these cases do turn up in my office with far too many corners cut, work done without permits, without proper license, etc.
5. The next kind of customer is the kind that knows more than you do about your product or service. These people are willing to pay you to do the work, but do not expect to accept any of your expert advice. They argue with you at every stage of the job. In my view, if they know so much, return the file to them and tell them to finish it on their own. They hate this. These are also the kinds of people who like to file complaints, but if they knew so much about the job, why did they bother with you anyways? I had one guy like that a few years back, who became angry with me because I refused to include the former vehicle owner in a suit against a dealer. The tort was obviously originating from the dealer, and they also have insurance to cover these kinds of issues, but he wanted me to go after some poor eighty year old lady, which was not going to happen. Fortunately, I managed to obtain a decent settlement from the dealer. Despite this, this guy was still fuming because the previous owner "got off scott free".
6. There are also the customers that want your product or service, but do not have the money to pay. In my profession, we are supposed to try to provide access to legal services when we can, but the difficulty is, many of these people will not pay, even a bit at a time. In my opinion, they should be seeking legal services, or other services from a publicly funded agency where people who are on salary are available to assist in these cases. I am not on salary. I cannot afford to work for free, or to wait for long stretches for my payments. Some people seem to forget that self employed people do not get salaries, or any other kind of "income security", for lack of a better term. They can't afford to give away a lot of their time or their products. People hear about "free consultations" provided by some boutique law firms, and then assume every last lawyer or paralegal is somehow obligated by law to give "free consultations". Sure, I can give free consultations, but somebody at the end of the day is going to have to pay my bills. Those at the boutique law firms that do this are usually on some form of salary, or are earning very good money already that they can afford to give away some of it for "free". This is the same as "free samples" in a department store. They allow you to take one or two to try, but if you go there and grab a whole handful, this would not be appreciated by the store. The real reason I no longer provide free consultations is because too many people came, picked my brain, and then went across the street to see somebody else for another "free consultation", and so on.
In addition to customers, there are abuses by government and regulators:
1. Just about every business has some type of regulation. The bigger you are, the more government regulations you need to worry about. However, professional practices of even one person are regulated to the same degree that large firms of the same type of professionals are, which needs to be reviewed. Regulations are good for the public, and to some extent, good for the business too, so they can adhere to known standards and become the best they can be. However, there is such a thing as over-regulation. I hear about it from bars that move two doors down and have to re-apply and wait for months for their liquor license to come through. I hear about various businesses trying to set up innovative projects and design taking months, only to have the city turn them down on some minor technicality. I have seen businesses having to rip entire fire alarm systems out and replace them, simply because they did not get a permit to install the first set. I have seen businesses being forced to take their signs down because they were too close to the road, or they were too big. These things are all part of starting a business. You have to know all the by-laws, affected regulations, and so forth, before you open your doors ... even before you go inside and start refinishing your property for the business you intend to run. Yes, I like to know that my food is safe, my water is tested, and that my house is not going to cave in on me, but do we really need all of those other regulations? I think it is time that small businesses actually have the opportunity to tell the government how much certain regulations, though not all, are hurting their bottom line.
2. Just as I like my water to be tested, my food to be safe, and the streets safe to walk at night, I also appreciate having employment standards. However, I have found ways these standards can be abused by employees, as well as by employers. I have witnessed situations where an employee quits their job, then claims the employer harassed them or threatened them, when no such thing happened. Bringing the regulators in creates an onerous environment where the employer can feel victimized. Too many times, certain people are taken at their word, when in fact an examination of the employer's overall practices would deny such harassment or discrimination. This sort of thing makes great business for people like me to help employers with such things as documentation, and follow through, but to a small employer this can become more of an annoyance. I know there are many employers out there that don't follow the law, but to me I am witnessing more aggravation from the other side as well.
3. Environmental Regulations:
Another common vigilante attack on small business is so called environmental regulations. Of course, I want the food that I buy to be safe, free of pesticides, etc. I want the water that I drink to be as pure as possible, instead of a complicated chemical formula that can fill a Bible. I want garbage and refuse dealt with in a way that can be diverted from landfill, where possible, and the places where I do business to be clean and healthy. However, there are vigilante activists who are trying very hard to protect that tree, that green space, that wetland, that trail, or even that brownfield, and they will try to fight any business that can take over this land, even if the business itself takes steps to protect these things. Facilities like waste management plants, gas fired plants, energy companies, nuclear plants and similar structures are often targets of protests. Many environmentalists are proponents of alternative forms of energy. So am I. However, time needs to pass to enable these alternatives to develop in a cost effective fashion. Because the average person does not want to pay higher hydro costs, most feel that small businesses can therefore shoulder more of these costs. Certain types of businesses have gone under in the past few years since environmental alternatives have been promoted, especially at the substantial cost that they have. A happier balance needs to be found.
There are also private regulators that can create additional costs to small businesses:
1. While I support regulation by the Law Society for practicing lawyers and paralegals, additional requirements for each member have been added during the years, which increases the costs of maintaining a practice. For example, we need to carry insurance, pay Law Society dues (which have gone up each year since I joined), carry on business in a particular manner (which involves added technology, added time in accounting tasks, added time in filing tasks), and continuing education. All of these things are good things, and most of it is in place to help maintain the excellence of service and professionalism of each member of the Law Society. However, regulation has brought with it substantial costs to my office, which means I have to charge my clients more for my services than I once was able to. The discussion has now turned away from how we protect the public, to how we can provide the public with accessible, affordable legal services. In addition, training and support to the smaller firms is badly needed, as some of the requirements can be time consuming for sole practitioners and small firms (under five persons), while larger firms have the resources to hire staff to wholly manage many of these requirements.
2. Consumer Protection Laws:
These are very broad and often industry specific regulations. We have laws against curbsiders, which are allegedly people selling vehicles without a dealer's license. Regulators scan Auto Trader, Kijiji and the like, to find people selling used cars, and they often phone to make inquiries. Often times, a curbsider gives it away by asking, "Which one?" The fines are heavy for this kind of thing. Jail terms can even be handed out. Yes, there are industry scum out there that need to be hung out to dry, but this law is catching some people that have no intentions of defrauding or hurting anyone. There are taxi regulations, which are usually set by one's municipality including the definition of a "taxi". Advertising a ride sharing service can readily capture some people not intended to be captured under the taxi regulations. How do municipalities tell the difference between a ride share service, which is primarily volunteer (although the person sharing the ride pays the driver for gas), and an illegal taxi service? Ride sharing once used to be an acceptable practice. You book your travel plans on a bulletin board, and somebody else who happens to be going that way contacts you and offers to share the ride. The business PickUpPal.Com got into some hot water recently because they were advertising ride sharing services from one city to another, until the bus companies found out and took them to the Highway Transportation Board for providing an "illegal service". Land use is also affected by regulation. Right now, a gentleman who owns property in the country had decided to use part of his land for an archery club, until the Conservation Authority decided they did not like the idea. To the best of my knowledge, this landowner is still fighting this in court. I wonder somehow what kind of harm this man was doing by offering the use of his own land to a popular sporting activity, which included charitable contributions for the brain injured to participate.
All of these things and more contribute to the hardship felt by many small businesses, and why so many of them end up shutting down, or restricting their practices. This is in addition to the attitudes of some people that small business owners are wealthy, and are believed to be able to take advantage of the same largesse big companies are able to. None of this true. The average small business owner earns 30% less in income than their salaried counterparts doing the same thing. Retail business owners put up with theft, robbery, fraud and breakage. This comes out of the owner's pockets. Service businesses put up with chintzes, skinflints, rubber cheques, chronic complainers, know-it-alls, etc. The price of dealing with these people comes from the regular paying customers' and the owners' pockets.
Nobody thinks about when they try to haggle a price down from a small business owner. Are you also going to offer to haggle the price of their insurance, their memberships, their staff salaries, etc.? These people pay the same expenses, regardless of how much money they take in. By haggling or thinking they can drop their prices, you are taking the food out of their families' mouths. Most small businesses are locally owned and staff are local residents. Yet, many of the above actions done by customers, government, regulators and the like, lead to higher costs for them and for the rest of us. It may also put many people out of business. There are many other issues that are going on that also reduce the chances of a small business surviving. In my world, I shop as much as I can at locally owned small businesses, and I pay my bill when due. I do not haggle or try to get the owner to cut the bill because I know they need the money. I also do not make frivolous complaints to, or about, the business. If I have a concern, I take it directly to the business and work it out with the owner, rather than waste their time or mine with a formal complaint (unless it was of a very serious nature that has remained unaddressed, but to tell you how rare this is, I only had to do that twice in my life). I follow the Golden Rule. I treat others as I would want to be treated, but unfortunately, as a small business owner/professional practitioner, I have felt the impact of others that do not follow the Golden Rule, do not appreciate the time or effort in putting out a product or a service, or the value of my work. I can only help but wonder if these people had ever themselves been self employed. I bet not.
Your thoughts?
Sunday, March 27, 2011
MAKING LIFE BETTER FOR ONTARIO'S CITIZENS WITH DISABILITIES
Last December, the province announced a comprehensive Social Assistance Review. This is part of the all party supported Poverty Reduction Act, passed approximately two years prior. The purpose of this review is to achieve the following objectives:
Review Objectives
The review commission will create a concrete action plan to reform Ontario's social assistance system. A reformed system will:
■help get people back to work
■be part of a larger income security system that includes municipal, provincial and federal programs
■share responsibility for improving the outcomes of low-income Ontarians with municipal and federal governments as well as the people who rely on social assistance
■be simple to understand and access, and provide people in need with basic income support in a fair and equitable way
■work well with other municipal, provincial and federal programs outside of social assistance - including education, training, housing, child care and health benefits - to support employment
■respect the autonomy, responsibility and dignity of individuals and recognize that clients are best placed to decide how to spend their money to meet their needs
■be efficient, financially sustainable and accountable to taxpayers, and
■meet its intended purpose as a system of last resort
Unfortunately, there is no stated objective to reduce poverty among those that receive, or must rely on these social programs to survive. Also, while a stated objective, the present system does more to discourage work than it does to encourage and maximize the benefits from paid work for such individuals and families.
Among my colleagues, there is as much fear and trepidation as to what this review might recommend, or result in, as there is excitement. This concern was outlined in a previous blog entry of mine. Treating persons with disabilities as part of the welfare system is the first biggest mistake of our social safety network, as this effectively prevents individuals from forming families and those with families from getting ahead financially.
As of the time of the 2006 Census, 68.6% of all families consist of two married persons, while an additional 15.5% of families in the 2006 Census were living in a common law relationship. Accoding to the Ministry of Community & Social Services, as of February 2011, 77.3% of the entire ODSP caseload consists of individual persons living alone, while an additional 8.75% are single parents with dependents under the age of eighteen years of age. This means approximately 84% of ODSP recipients are unattached, while a roughly equal number of non-recipients are attached in some way.
According to the National Council of Welfare, the greatest risk of poverty falls on to those who are unattached. When risk of poverty was selected by family type, unattached individuals, married couples and families, were compared, unattached individuals were at least five or six times as likely to live in poverty than those who were attached, or were a part of a family.
One would think logically, then why don't more ODSP recipients get married or involved in a common law union? The answer is obvious, if you are either one of the many unattached ODSP recipients, or one of the 16% of the caseload that is part of a marriage or common law union. If one member of the couple works, their income cannibalizes the recipient's income proportionately, regardless of whether the recipient has earnings of his or her own or not. The non-disabled spouse is obligated to fully support the disabled spouse to an extent that is beyond what is required by law in non-welfare situations. For example, if the disabled spouse was in receipt of worker's compensation, CPP Disability, Long-Term Disability, or any other income, even earnings, these sources of income are completely unaffected by the non-disabled person's income and assets, even though in those cases, the non-disabled person has an equal obligation under law to support their spouse. That means the working spouse goes to work, gets taxed on every dollar they make, and after that, they lose an additional 50% of their income to ODSP. In effect, they are paying more taxes than are required of millionaires!
If a spouse wants to bring their family out of poverty, they must either work in a job that pays them at least $70,000 or $80,000 a year, with benefits, or work the equivalent of 2.5 jobs to keep their family OFF benefits. Conversely, the person with the disability loses more and more of their independence the more money their spouse earns. This is setting people up for some pretty horrible situations: Many times, spouses do not feel obligated to report their income to ODSP, and thus will not disclose their income to their disabled spouses and thus will not declare their income, getting the disabled person in trouble with ODSP. Henceforth, this type of intrusion in the family unit results in a large number of break-ups. In virtually all of the break-ups I have seen for this reason, resulted in ODSP forcing the non-disabled spouse, now separated from them, to pay support - even if they have to sue. Now the non-disabled spouse does not only have to support themselves, they now have to support a second household, while the disabled person does not net a single penny more than they would if they were on ODSP alone.
When this issue is raised in some parts of the community, some common retorts come back about why should well-paid lawyers or teachers or business people be able to keep all of their income if they marry somebody on ODSP? The answer is simple. These people get to keep all of their income if their spouse is working, is on WSIB, is on CPP, is on LTD, or whatever else, apart from ODSP. The tax system takes care of any alleged inequities. If they split up with their ODSP recipient partner, they would still have to pay support as they always would have, regardless of the lower income spouse's source of income. Under the current law, working spouses are required to do more than their obligation under family law, and suffer greater penalties if the relationship does not work. That is why there are so very few people married or living common law that receive ODSP. Thus, their opportunity to escape poverty by marrying somebody is closed to them.
Self-employment is often an option for persons with disabilities that cannot fit in the regular workplace. Many people who start their own businesses carry on and become quite well off, as a result of their own efforts and subsequently, the business supports them. Unfortunately, for those in receipt of ODSP, the rules prohibit any moves that can help get a recipient out of poverty. The self-employment directive, or Directive 5.4, has been set up to keep a recipient and/or their family in poverty and relying on ODSP in perpetuity. Less than 2% of those on ODSP are receiving self-employment income (reports from Ministry sources). Many people who were self-employed have stopped working in their businesses, once the barriers put into place by ODSP are discovered and affect them.
First, the self-employed person cannot hire anybody to assist them. The person is supposed to be the sales person, the accounts recievable, accounts payable, receptionist, researcher, delivery person, service provider, etc. For businesses beyond being a dog walker, babysitter, crafts person, or writer, the business is going to need to grow to accommodate increased business and service demand. A business owner can't tell its customers that "No I can't serve you because if I do, I will need to hire somebody else to help me and I am not allowed to, so I have to keep my business small and non-profitable". First, a business person would be stupid to admit this, as customers would not patronize a business that is known to be operated by somebody with a disability ... due to stigma. Second, this business is not permitted to write off expenses to attend networking sessions with peers, or to purchase career related clothing to help present a positive and business like image to their customers.
If the business person is any good, the customer base WILL grow, and it is beneficial to ODSP for it to do so, as over time, the earnings will increase and in many cases, eventually take the person and/or their family off ODSP. By sticking to the original directive, the person ends up working very long hours every day, often risking exhaustion and then possibly compromising product or service quality as a result of not having paid help to take care of the administrative matters. In a decent business, the telephone might ring twenty to twenty-five times a day. There may be as many as thirty to forty e-mails. Somebody needs to respond to them, or the customers calling or emailing will be upset. However, responding to the calls or the email does not result in billable time, so the time spent doing these items takes away from time that is paid.
ODSP's objection is they don't want taxpayers to subsidize a business. This objection is moot given multi-billion dollar handouts to corporations each year, as well as regularly FUNDED programs for consumer/survivor initiatives, as well as a number of other "community economic development initiatives". Any employee funded under a business operated by an ODSP recipient would be paid for from the business' earnings, unlike the consumer/survivor businesses, such as those run or started by groups like OCAB, or Ontario Council of Alternative Businesses. While this is not an objection to these types of organizations, the government needs to be consistent with its policy applications and objections. If they do not want to let ODSP recipients that operate private businesses hire employees, then stop handing out money to banks, insurance companies, automakers, etc. and discontinue funding for all alternative businesses.
Because the above actions are not going to stop for various policy-based reasons, then the rule against hiring employees must cease.
With this policy in place, we are forcing vulnerable persons to work very long hours, completing all tasks associated with the operations of a business, and replete with limitations imposed on them by their disability. They are expected to be superhuman. Even people without disabilities that operate a business have their limits, and will definitely seek to hire a helper at some point when their business starts to grow. Instead of deducting the money paid out as 100% and thus, risking the family's base income, ODSP should connect these self-employed persons to business consultants to help ensure they hire the right kind of help, obtain the best marketing assistance, and so forth to ensure the business works well. Income that goes to the owner is still declared, but all income going to other workers, or to other purchases should be exempt as it would under Canada Revenue Agency rules.
A further complication of this issue is when one starts or is involved with a business subject to special regulations, such as the Health Profession Regulations Board, the Teacher's College, the Ontario College of Social Workers and Social Service Workers, or the Law Society of Upper Canada, there are other regulations imposed on the business in order for it to keep running, such as continuing education regulations, conference attendances, technological training workshops, and so forth, that ODSP also fails to exempt. The directive only allows conferences where income is being earned. These workshops are necessary to meet the conditions of one's license. At the present time, I know of a few contractors, tradesmen, a registered nurse that practices naturpathic medicine, a self-employed counsellor, a couple of lawyers, and a trades writer, all of whom are considering quitting working altogether because of the ODSP rules restricting their businesses. ODSP needs to ask itself if it is better to keep them working, or to have them sit at home and continue to collect ODSP in perpetuity.
One of my contractor clients has been unable to break the barrier because of this, as in order to be considered credible and able to bid on large contracts, he needs to have paid help. He can't make an adequate living on "Joe jobs" like painting window sills, and installing the odd set of blinds. He needs to be able to access and utilize the labour of other workers in order to even take on larger residential jobs. Another client wants to set up a limousine company, but will run into significant difficulties if he is unable to acquire more than one vehicle for his business and to hire somebody else to do the work, when he needs a break, or wants to grow his business beyond small jobs. In particular, these regulations also apply to the non-disabled spouses of ODSP recipients. Why? What purpose does this serve? How do these regulations help the self-employed recipients or spouses of recipients earn more money, grow their businesses (thus make them a more secure source of income over time), or improve their working conditions?
Some recipients live in subsidized housing, and for these people, it is impossible to start or become involved in self-employment anyways, due to regulations in subsidized housing that irrationally prohibit this. Again, over 70% of businesses that operate outside the home (e.g. operate in a commercial office or industrial space) started in the home or in a garage. Without the chance to start, these would be entrepreneurs are not going to be working, thus setting a further precedent in terms of time spent in subsidized housing and thus increasing the wait list for others waiting to move in. For these recipients even working is severely curtailed. In a report, our own John Stapleton reported on the insanity of these regulations governing earned income and subsidized housing, when it crosses over from income from social assistance. In this case, the recipient was in supportive housing, and as she worked more, her rent went up by a ridiculous amount. She soon fell into arrears, and the only way she was able to budget was to quit her job, and stay on ODSP only. How does that help people return to the workforce?
Another issue is savings. Even if somebody on ODSP was miraculously able to work and put away some money, they are limited to a total of $5,000 in "liquid assets", meaning that if they do not qualify for the generous provisions of the Registered Disability Savings Plan, only issued to those with very severe and visible disabilities, they will retire poor. They will rely only on government provisions for retirement, and given that most of these people live alone, they will definitely be living below the Statistics Canada poverty line. A non-disabled spouse has to drain ALL of their retirement savings in order for their disabled spouse to qualify for ODSP, and after that, cannot replenish this fund, no matter how hard they work. What good does this do? How does this help the economy? This is yet another reason why ODSP recipients cannot get into relationships.
A final issue is earnings themselves. The government was good to increase the amount of money one can keep from working by increasing the percentage of earned income one can keep, and adding a $100 work benefit to offset the small percentage of workers that would lose out on the 50% proposal alone. However, this new policy does not exempt any income. The fifty percent starts from the very first dollar earned, until the person earns enough to migrate off ODSP. For many people who accept minimum wage employment, for example, they feel they are losing, as they are bringing in what they see as less than minimum wage for every hour they work. One Conservative MPP recognized this issue, and attempted to push for an exempted earnings bracket of $500 per individual, and if that person is married, $700 (although as a Coalition, we proposed $1,000 if they still keep the benefit unit). This money would be exempt from any deductions until after they earn more than that amount, then the 50% deduction will kick in.
The province will bitch and complain about the size of their deficit. Don't let them do this, or white wash this deliberate ploy to keep people with disabilities under their thumbs. As long as they keep pouring money into tax cuts for businesses, regardless of whether they hire anybody or not, or worse yet - handing out money like they did with the auto sector, or paying for frills like eHealth, the OLG, multi-million dollar consultants, and so forth, there are NO excuses. Their existing policies and directives keep people in poverty, regardless of how hard they work, or how they try to organize their financial affairs. Normal exits from poverty such as a job or business, or moving in with a spouse, are not available to this population like it is for other people.
Yet the government has a policy on its books that ODSP recipients and beneficiaries can recieve up to $6,000 a year in gifts from "family and friends". There is a lot wrong with this. It is presumptuous: it assumes that all recipients have family members that are only itching to pour their hard-earned monies into the accounts of their loved ones on ODSP. In my experience working with ODSP recipients, I can count the number of recipients that have family that is that supportive on my left hand. Most recipients that have family at all cannot benefit from this, as their own families are also on ODSP (e.g. genetic disabilities), too old or frail themselves, or dead. Others are too far away. A few have families that have completely written them out of their lives, and fail to contact them, let alone provide "gifts". Why can't an ODSP recipient who is able and willing to earn make up this $500 per month for themselves, particularly if they are unable to access any "gifts" from family and friends?
Further, this whole "gifts" policy treats persons with disabilities as some type of charity case. Many do not want to be considered a charity case. When people come into my office to appeal their ODSP benefits, most are tearful, upset and ashamed of being required to ask for these benefits in the first place. Must we punish them some more to make them look like society's Timmy and Tammy? This is not a request to remove this provision, but to equalize earnings, or perhaps make earnings even more exempt because of the cost of obtaining these earnings. As far as I am concerned, a non-disabled spouse should be exempt - period, or at worst, exempt in terms of $500 per month per member of the benefit unit, including themselves, if they are going to be kept as part of the benefit unit ... at least that way, they are providing a "gift" from family of sorts, that should be equivalent to a gift from say, one's parents or siblings. Why is a "gift" from a parent or sibling exempt, but not exempt if it comes from a working spouse? The inconsistencies and ideologies that mount these policies are not only confusing, but unfair for many groups.
The final issue is definition of disability. This is one of the concerns that has led to rifts within the legal community about these programs. Ontario does have a fairly generous program compared to other programs in other provinces. A disability program should not require one to be "permanently unemployable" or "severely disabled", but must present proof that they have a verifiable disability that leads to substantial restrictions in a number of areas, such as working, caring for oneself, engaging in relationships, interacting in the community, etc. but not all of them. The existing definition works fine, with some cases to be reviewed in a set period of time, if it appears the disability is of a time limited nature. Others are long term, and should be subject to rapid reinstatement if a job does not work out. Restricting the definition of disability only results in more long term cases on Ontario Works, or people cycling in and out of Ontario Works without ever getting permanently back into the labour force. I know many people who are on OW for years at a time, simply because they lack a family doctor to assist them with their ODSP application, or they have unrecognized barriers. For example, an inability to drive, in itself, as long as the reason for it is medical, should be deemed a substantial restriction that should qualify one for disability benefits.
People who consider themselves fiscal conservatives will consider the cost of these proposals, and scream. However, the cost of NOT doing these things will keep people on ODSP for life, and the numbers of those with earnings will continue to remain very low. Indirectly, medical costs associated with depression, poverty, isolation and social exclusion will more than make up for what has been "saved" by keeping them on this punitive system.
Your thoughts?
Review Objectives
The review commission will create a concrete action plan to reform Ontario's social assistance system. A reformed system will:
■help get people back to work
■be part of a larger income security system that includes municipal, provincial and federal programs
■share responsibility for improving the outcomes of low-income Ontarians with municipal and federal governments as well as the people who rely on social assistance
■be simple to understand and access, and provide people in need with basic income support in a fair and equitable way
■work well with other municipal, provincial and federal programs outside of social assistance - including education, training, housing, child care and health benefits - to support employment
■respect the autonomy, responsibility and dignity of individuals and recognize that clients are best placed to decide how to spend their money to meet their needs
■be efficient, financially sustainable and accountable to taxpayers, and
■meet its intended purpose as a system of last resort
Unfortunately, there is no stated objective to reduce poverty among those that receive, or must rely on these social programs to survive. Also, while a stated objective, the present system does more to discourage work than it does to encourage and maximize the benefits from paid work for such individuals and families.
Among my colleagues, there is as much fear and trepidation as to what this review might recommend, or result in, as there is excitement. This concern was outlined in a previous blog entry of mine. Treating persons with disabilities as part of the welfare system is the first biggest mistake of our social safety network, as this effectively prevents individuals from forming families and those with families from getting ahead financially.
As of the time of the 2006 Census, 68.6% of all families consist of two married persons, while an additional 15.5% of families in the 2006 Census were living in a common law relationship. Accoding to the Ministry of Community & Social Services, as of February 2011, 77.3% of the entire ODSP caseload consists of individual persons living alone, while an additional 8.75% are single parents with dependents under the age of eighteen years of age. This means approximately 84% of ODSP recipients are unattached, while a roughly equal number of non-recipients are attached in some way.
According to the National Council of Welfare, the greatest risk of poverty falls on to those who are unattached. When risk of poverty was selected by family type, unattached individuals, married couples and families, were compared, unattached individuals were at least five or six times as likely to live in poverty than those who were attached, or were a part of a family.
One would think logically, then why don't more ODSP recipients get married or involved in a common law union? The answer is obvious, if you are either one of the many unattached ODSP recipients, or one of the 16% of the caseload that is part of a marriage or common law union. If one member of the couple works, their income cannibalizes the recipient's income proportionately, regardless of whether the recipient has earnings of his or her own or not. The non-disabled spouse is obligated to fully support the disabled spouse to an extent that is beyond what is required by law in non-welfare situations. For example, if the disabled spouse was in receipt of worker's compensation, CPP Disability, Long-Term Disability, or any other income, even earnings, these sources of income are completely unaffected by the non-disabled person's income and assets, even though in those cases, the non-disabled person has an equal obligation under law to support their spouse. That means the working spouse goes to work, gets taxed on every dollar they make, and after that, they lose an additional 50% of their income to ODSP. In effect, they are paying more taxes than are required of millionaires!
If a spouse wants to bring their family out of poverty, they must either work in a job that pays them at least $70,000 or $80,000 a year, with benefits, or work the equivalent of 2.5 jobs to keep their family OFF benefits. Conversely, the person with the disability loses more and more of their independence the more money their spouse earns. This is setting people up for some pretty horrible situations: Many times, spouses do not feel obligated to report their income to ODSP, and thus will not disclose their income to their disabled spouses and thus will not declare their income, getting the disabled person in trouble with ODSP. Henceforth, this type of intrusion in the family unit results in a large number of break-ups. In virtually all of the break-ups I have seen for this reason, resulted in ODSP forcing the non-disabled spouse, now separated from them, to pay support - even if they have to sue. Now the non-disabled spouse does not only have to support themselves, they now have to support a second household, while the disabled person does not net a single penny more than they would if they were on ODSP alone.
When this issue is raised in some parts of the community, some common retorts come back about why should well-paid lawyers or teachers or business people be able to keep all of their income if they marry somebody on ODSP? The answer is simple. These people get to keep all of their income if their spouse is working, is on WSIB, is on CPP, is on LTD, or whatever else, apart from ODSP. The tax system takes care of any alleged inequities. If they split up with their ODSP recipient partner, they would still have to pay support as they always would have, regardless of the lower income spouse's source of income. Under the current law, working spouses are required to do more than their obligation under family law, and suffer greater penalties if the relationship does not work. That is why there are so very few people married or living common law that receive ODSP. Thus, their opportunity to escape poverty by marrying somebody is closed to them.
Self-employment is often an option for persons with disabilities that cannot fit in the regular workplace. Many people who start their own businesses carry on and become quite well off, as a result of their own efforts and subsequently, the business supports them. Unfortunately, for those in receipt of ODSP, the rules prohibit any moves that can help get a recipient out of poverty. The self-employment directive, or Directive 5.4, has been set up to keep a recipient and/or their family in poverty and relying on ODSP in perpetuity. Less than 2% of those on ODSP are receiving self-employment income (reports from Ministry sources). Many people who were self-employed have stopped working in their businesses, once the barriers put into place by ODSP are discovered and affect them.
First, the self-employed person cannot hire anybody to assist them. The person is supposed to be the sales person, the accounts recievable, accounts payable, receptionist, researcher, delivery person, service provider, etc. For businesses beyond being a dog walker, babysitter, crafts person, or writer, the business is going to need to grow to accommodate increased business and service demand. A business owner can't tell its customers that "No I can't serve you because if I do, I will need to hire somebody else to help me and I am not allowed to, so I have to keep my business small and non-profitable". First, a business person would be stupid to admit this, as customers would not patronize a business that is known to be operated by somebody with a disability ... due to stigma. Second, this business is not permitted to write off expenses to attend networking sessions with peers, or to purchase career related clothing to help present a positive and business like image to their customers.
If the business person is any good, the customer base WILL grow, and it is beneficial to ODSP for it to do so, as over time, the earnings will increase and in many cases, eventually take the person and/or their family off ODSP. By sticking to the original directive, the person ends up working very long hours every day, often risking exhaustion and then possibly compromising product or service quality as a result of not having paid help to take care of the administrative matters. In a decent business, the telephone might ring twenty to twenty-five times a day. There may be as many as thirty to forty e-mails. Somebody needs to respond to them, or the customers calling or emailing will be upset. However, responding to the calls or the email does not result in billable time, so the time spent doing these items takes away from time that is paid.
ODSP's objection is they don't want taxpayers to subsidize a business. This objection is moot given multi-billion dollar handouts to corporations each year, as well as regularly FUNDED programs for consumer/survivor initiatives, as well as a number of other "community economic development initiatives". Any employee funded under a business operated by an ODSP recipient would be paid for from the business' earnings, unlike the consumer/survivor businesses, such as those run or started by groups like OCAB, or Ontario Council of Alternative Businesses. While this is not an objection to these types of organizations, the government needs to be consistent with its policy applications and objections. If they do not want to let ODSP recipients that operate private businesses hire employees, then stop handing out money to banks, insurance companies, automakers, etc. and discontinue funding for all alternative businesses.
Because the above actions are not going to stop for various policy-based reasons, then the rule against hiring employees must cease.
With this policy in place, we are forcing vulnerable persons to work very long hours, completing all tasks associated with the operations of a business, and replete with limitations imposed on them by their disability. They are expected to be superhuman. Even people without disabilities that operate a business have their limits, and will definitely seek to hire a helper at some point when their business starts to grow. Instead of deducting the money paid out as 100% and thus, risking the family's base income, ODSP should connect these self-employed persons to business consultants to help ensure they hire the right kind of help, obtain the best marketing assistance, and so forth to ensure the business works well. Income that goes to the owner is still declared, but all income going to other workers, or to other purchases should be exempt as it would under Canada Revenue Agency rules.
A further complication of this issue is when one starts or is involved with a business subject to special regulations, such as the Health Profession Regulations Board, the Teacher's College, the Ontario College of Social Workers and Social Service Workers, or the Law Society of Upper Canada, there are other regulations imposed on the business in order for it to keep running, such as continuing education regulations, conference attendances, technological training workshops, and so forth, that ODSP also fails to exempt. The directive only allows conferences where income is being earned. These workshops are necessary to meet the conditions of one's license. At the present time, I know of a few contractors, tradesmen, a registered nurse that practices naturpathic medicine, a self-employed counsellor, a couple of lawyers, and a trades writer, all of whom are considering quitting working altogether because of the ODSP rules restricting their businesses. ODSP needs to ask itself if it is better to keep them working, or to have them sit at home and continue to collect ODSP in perpetuity.
One of my contractor clients has been unable to break the barrier because of this, as in order to be considered credible and able to bid on large contracts, he needs to have paid help. He can't make an adequate living on "Joe jobs" like painting window sills, and installing the odd set of blinds. He needs to be able to access and utilize the labour of other workers in order to even take on larger residential jobs. Another client wants to set up a limousine company, but will run into significant difficulties if he is unable to acquire more than one vehicle for his business and to hire somebody else to do the work, when he needs a break, or wants to grow his business beyond small jobs. In particular, these regulations also apply to the non-disabled spouses of ODSP recipients. Why? What purpose does this serve? How do these regulations help the self-employed recipients or spouses of recipients earn more money, grow their businesses (thus make them a more secure source of income over time), or improve their working conditions?
Some recipients live in subsidized housing, and for these people, it is impossible to start or become involved in self-employment anyways, due to regulations in subsidized housing that irrationally prohibit this. Again, over 70% of businesses that operate outside the home (e.g. operate in a commercial office or industrial space) started in the home or in a garage. Without the chance to start, these would be entrepreneurs are not going to be working, thus setting a further precedent in terms of time spent in subsidized housing and thus increasing the wait list for others waiting to move in. For these recipients even working is severely curtailed. In a report, our own John Stapleton reported on the insanity of these regulations governing earned income and subsidized housing, when it crosses over from income from social assistance. In this case, the recipient was in supportive housing, and as she worked more, her rent went up by a ridiculous amount. She soon fell into arrears, and the only way she was able to budget was to quit her job, and stay on ODSP only. How does that help people return to the workforce?
Another issue is savings. Even if somebody on ODSP was miraculously able to work and put away some money, they are limited to a total of $5,000 in "liquid assets", meaning that if they do not qualify for the generous provisions of the Registered Disability Savings Plan, only issued to those with very severe and visible disabilities, they will retire poor. They will rely only on government provisions for retirement, and given that most of these people live alone, they will definitely be living below the Statistics Canada poverty line. A non-disabled spouse has to drain ALL of their retirement savings in order for their disabled spouse to qualify for ODSP, and after that, cannot replenish this fund, no matter how hard they work. What good does this do? How does this help the economy? This is yet another reason why ODSP recipients cannot get into relationships.
A final issue is earnings themselves. The government was good to increase the amount of money one can keep from working by increasing the percentage of earned income one can keep, and adding a $100 work benefit to offset the small percentage of workers that would lose out on the 50% proposal alone. However, this new policy does not exempt any income. The fifty percent starts from the very first dollar earned, until the person earns enough to migrate off ODSP. For many people who accept minimum wage employment, for example, they feel they are losing, as they are bringing in what they see as less than minimum wage for every hour they work. One Conservative MPP recognized this issue, and attempted to push for an exempted earnings bracket of $500 per individual, and if that person is married, $700 (although as a Coalition, we proposed $1,000 if they still keep the benefit unit). This money would be exempt from any deductions until after they earn more than that amount, then the 50% deduction will kick in.
The province will bitch and complain about the size of their deficit. Don't let them do this, or white wash this deliberate ploy to keep people with disabilities under their thumbs. As long as they keep pouring money into tax cuts for businesses, regardless of whether they hire anybody or not, or worse yet - handing out money like they did with the auto sector, or paying for frills like eHealth, the OLG, multi-million dollar consultants, and so forth, there are NO excuses. Their existing policies and directives keep people in poverty, regardless of how hard they work, or how they try to organize their financial affairs. Normal exits from poverty such as a job or business, or moving in with a spouse, are not available to this population like it is for other people.
Yet the government has a policy on its books that ODSP recipients and beneficiaries can recieve up to $6,000 a year in gifts from "family and friends". There is a lot wrong with this. It is presumptuous: it assumes that all recipients have family members that are only itching to pour their hard-earned monies into the accounts of their loved ones on ODSP. In my experience working with ODSP recipients, I can count the number of recipients that have family that is that supportive on my left hand. Most recipients that have family at all cannot benefit from this, as their own families are also on ODSP (e.g. genetic disabilities), too old or frail themselves, or dead. Others are too far away. A few have families that have completely written them out of their lives, and fail to contact them, let alone provide "gifts". Why can't an ODSP recipient who is able and willing to earn make up this $500 per month for themselves, particularly if they are unable to access any "gifts" from family and friends?
Further, this whole "gifts" policy treats persons with disabilities as some type of charity case. Many do not want to be considered a charity case. When people come into my office to appeal their ODSP benefits, most are tearful, upset and ashamed of being required to ask for these benefits in the first place. Must we punish them some more to make them look like society's Timmy and Tammy? This is not a request to remove this provision, but to equalize earnings, or perhaps make earnings even more exempt because of the cost of obtaining these earnings. As far as I am concerned, a non-disabled spouse should be exempt - period, or at worst, exempt in terms of $500 per month per member of the benefit unit, including themselves, if they are going to be kept as part of the benefit unit ... at least that way, they are providing a "gift" from family of sorts, that should be equivalent to a gift from say, one's parents or siblings. Why is a "gift" from a parent or sibling exempt, but not exempt if it comes from a working spouse? The inconsistencies and ideologies that mount these policies are not only confusing, but unfair for many groups.
The final issue is definition of disability. This is one of the concerns that has led to rifts within the legal community about these programs. Ontario does have a fairly generous program compared to other programs in other provinces. A disability program should not require one to be "permanently unemployable" or "severely disabled", but must present proof that they have a verifiable disability that leads to substantial restrictions in a number of areas, such as working, caring for oneself, engaging in relationships, interacting in the community, etc. but not all of them. The existing definition works fine, with some cases to be reviewed in a set period of time, if it appears the disability is of a time limited nature. Others are long term, and should be subject to rapid reinstatement if a job does not work out. Restricting the definition of disability only results in more long term cases on Ontario Works, or people cycling in and out of Ontario Works without ever getting permanently back into the labour force. I know many people who are on OW for years at a time, simply because they lack a family doctor to assist them with their ODSP application, or they have unrecognized barriers. For example, an inability to drive, in itself, as long as the reason for it is medical, should be deemed a substantial restriction that should qualify one for disability benefits.
People who consider themselves fiscal conservatives will consider the cost of these proposals, and scream. However, the cost of NOT doing these things will keep people on ODSP for life, and the numbers of those with earnings will continue to remain very low. Indirectly, medical costs associated with depression, poverty, isolation and social exclusion will more than make up for what has been "saved" by keeping them on this punitive system.
Your thoughts?
Friday, November 2, 2007
SELF-EMPLOYED - ALL I WANT IS RESPECT!
Welcome to the new economy!
It seems that more and more people today are becoming or desiring to become entrepreneurs. There are whole sections of newspapers, news information shows and small business fairs going on to try to encourage and guide those that wish to become self-employed.
First, if you have never been self-employed, you probably think being self-employed is wonderful:
I hope that those that are reading this that use professional services at all in any market begin to understand where I am coming from.
Your thoughts?
It seems that more and more people today are becoming or desiring to become entrepreneurs. There are whole sections of newspapers, news information shows and small business fairs going on to try to encourage and guide those that wish to become self-employed.
First, if you have never been self-employed, you probably think being self-employed is wonderful:
- You believe that self-employed business people can deduct almost all of their business expenses and hardly pay any taxes. For the self-employed, that is true - but you have to EARN then money first before you can deduct it. If you are in business and have all of these expenses, the bills must be paid whether or not YOU get paid.
- You can work when you want, how you want and for whomever you want. Again, nice in theory, but doesn't work in practice. For every hour I can bill a client for, there are at least two or more hours of work that I can't bill that client or anybody else for. In my line of work, I have to maintain three business-related accounts, including a trust account. The trust account must always draw off to zero after subtracting the monies clients put in for advance payments. If you are a penny off, you better find it and reconcile the accounts, including all client sub-accounts. While employed people clock out and go out for a beer, I am still trying to balance the trust account and do transfers/reconciliations in the general account. There are lots of other bureaucratic disasters to prevent and look after too: GST, PST (for some businesses), invoicing, collection, marketing, production of marketing materials, attendance at various networking functions, as well as client record keeping and filing functions. This does not include the endless phone calls, many of which do not result in business ...
- You can work from your home. Do you REALLY want to work from home? Do you really want to be sitting at home watching the hockey game, cracking open a beer and then receiving a phone call from an angry customer? If you run the type of business where customers come to see you, do you really want to have to keep your home sparkling clean all the time, fearing prospective clients will walk past your dirty laundry, the kitty litter and a sink full of dirty dishes on their way in to see you? Also, in some types of businesses, if you are dealing with individual situations (e.g. personal counseling), do you really like the idea of some of your less balanced clients knowing where you live?
- You can charge whatever you feel your worth, or what the market will bear. That's true. You CAN set your own fees; however, many critical factors go into setting that fee. What are your competitors charging? What are your suppliers charging you? How much does it cost you to engage in your business? Do you live in a region like I do where people expect you to work for nothing, or next to it? Are there aspects of your business that set you apart from your competitors? If so, you can set your fees accordingly. However, while you can set fees all you want, ten percent of your clients will cost you eighty percent of your time ... and these people may not want to compensate you for it. There are also others that may bounce cheques, skip town or otherwise refuse to pay you. People who are not self-employed do not understand that if they engage your services, they have to pay for them - period. Doesn't YOUR boss have to pay YOU the wages that YOU signed up for, including any benefits and bonus?
- Customer service is all you need to worry about ... it's a free market. Forget this one - period. My business is highly regulated. It is expensive to operate because I have to pay regulatory fees, licensing fees, related practice fees, continuing education, conference fees, membership dues, insurance (errors and omissions, liability, commercial, etc.), office, transportation, search/court/filing fees, subcontracting fees, professional fees, etc. This adds up to a "pretty penny" (and oh boy, a penny is nothing!). Add this to the regular business fees of office supplies, telephone, advertisements, stationary, computer technology, reporting service, etc. Without any profits or paying any salaries, I am already $40,000 - $50,000 in the hole! I have to pay these costs whether I get paid by my customers or not. If you are employed, after some taxes, the rest of your paycheque is YOURS! I still haven't paid ME yet!
- What about benefits? If you are employed, you probably get medical and dental benefits, and possibly long-term disability benefits and/or retirement. Guess what? I get NONE of that. First, I am un-insurable on my own (as individual coverage is very hard to get unless you are perfectly healthy, young and are as free as possible of other health risks, such as being a non-smoker and your work being relatively low risk). In a workplace, your health history usually doesn't matter. Second, even if I could get this type of insurance, I don't have the cash - period. I have ZERO retirement savings.
I hope that those that are reading this that use professional services at all in any market begin to understand where I am coming from.
Your thoughts?
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