Federal Student Grant Program Could Mean Students Work for Less than Minimum Wage this Summer

 In Employment Law

On June 25th, the federal government launched the Canada Student Service Grant (CSSG), a program aimed at encouraging post-secondary students and recent graduates to volunteer with not-for-profit organizations addressing COVID-19 relief.

The CSSG provides students with a one-time payment ranging between $1,000 and $5,000 based on the number of volunteer hours the student completes. The one-time payment is set to be released to participants at the end of the summer, in time for students to pay fall tuition costs for the 2020-2021 academic year. The CSSG pays students $1,000 for every 100 hours of volunteer work completed, up to a maximum of $5,000. That means students are paid just 10$ an hour—an hourly rate $4 lower than Ontario’s minimum wage, and $5 lower than Alberta’s.

The CSSG has also been criticized in the way its payments are calculated according to 100 hour thresholds. In order to be paid for their service, students must complete a full 100 hours of volunteer work. For example, a student who completes 185 hours is eligible to be paid only for the first 100 hours. Accordingly, it‘s very possible that students applying for the CSSG will be paid significantly less than the already low 10$ hourly rate.

Because of its late launch date at the end of June, a student would have to work approximately 50 hours per week over July and August to obtain the program’s maximum grant of $5,000. While the program allows for students to keep volunteering until October 31st, fall tuition is typically due well before that date and the grant can take up to 60 days to arrive once the application is completed.

The federal government described the CSSG as a ‘bonus grant’ to young people who volunteer in their communities. However, with a formal application process and remuneration that corresponds to a number of hours worked, some are arguing that the CSSG renders students employees, as opposed to volunteers.

Viewing CSSG recipients as employees would entitle them to other compensation benefits including pension and employment insurance premiums as well as workplace safety insurance. Students could also make claims under provincial human rights legislation with regards to their below minimum wage rates. Liability could accordingly fall on the not-for profit organizations supplying students with the work.

Ontario employment legislation typically finds an employment relationship where there is a formal application process, set pay based on a number of hours worked, control over the work being done, and a minimum number of hours to work per week. The CSSG possesses each of these attributes.

The combination of low wages with the refusal to consider paid volunteers as employees could create a very precarious work situation for young people among an already unfavorable job market due to the COVID-19 pandemic. It could also create liability-related risk for not-for-profit organizations who supervise paid volunteers and who could accordingly be subject to provincial human rights legislation regarding pay.

Concern with the program has echoed among not-for-profit organizations. WE Charity, the organization responsible for managing and overseeing the program, has resigned from its commitment.

Earlier this week, the federal government announced that it would assume administrative responsibility of the program, and encouraged students to continue to apply for the CSSG. However things have since changed and students set to start volunteering this week have seen placements grind to a halt while the government scrambles to disentangle from WE Charity and co-ordinate the program’s countless administrative elements.

Some 35,000 students and recent graduates have applied to the CSSG program, a telling indication that young Canadians are in need of financial support right now.

Only time will tell how—and whether—the CSSG will help or harm students in the upcoming months. Ensuring that the work of young people is not undervalued, especially amidst the effects of the COVID-19 pandemic, is essential. While volunteerism and service are important values to instill among youth, the acquisition of these values should not come at the expense of basic employment rights and obligations.

We are grateful to Articling Student Sarah Antonious for writing this blog post.  If you have questions, please contactNigel McKechnie, a member of our Employment Law team.  Nigel can be reached at 613-369-0382 or at nigel.mckechnie@mannlawyers.com.

Recent Posts

Leave a Comment

Start typing and press Enter to search