Short answer: Ontario’s Private Security and Investigative Services Act is built around two roles: investigators employed by licensed agencies, and licensed agencies themselves. There is no third category for an investigator who invoices agencies as an independent business on an individual licence alone. And under the Employment Standards Act, the label on your contract does not decide anything; your classification is determined by how the relationship actually operates. If you hold a licence and someone offers you “contractor” work, this article explains what both frameworks require, because the consequences do not only land on the agency.
If you hold an Ontario private investigator licence and you are looking for work, you will eventually get some version of this offer:
“We pay so much per hour, you invoice us, you’re an independent contractor. Use your own vehicle and camera. No deductions, you handle your own taxes.”
For a new investigator this sounds like a normal industry arrangement, and in practice it is common. But common and compliant are not the same thing. Depending on how the relationship actually operates, that offer can put you offside the PSISA, and put the agency offside both the PSISA and Ontario employment law.
What the PSISA actually says about who can work
The starting point is section 6 of the Private Security and Investigative Services Act, 2005. Stripped of the legislative wording, it says you cannot act as a private investigator, or hold yourself out as one, unless you hold a valid individual licence and one of the following is true:
- You are employed by a licensed agency, or by a registered employer that uses in-house investigators, or
- You are the sole proprietor or a partner of a licensed agency, that is, you hold an agency licence yourself.
Notice what is missing from that list: there is no category for “independent contractor holding only an individual licence.” The Act is built around two roles, employees of licensed entities and licensed entities themselves. Section 7(1) separately provides that anyone in the business of selling the services of private investigators requires an agency licence. When you invoice an agency as an independent business, you are, on the face of it, selling investigative services, which is agency territory.
This is the part of the arrangement that many investigators, and frankly some agencies, do not examine closely. The practical rule of thumb:
- If you want to work as a true independent contractor, subcontracting your services to one or more agencies, the compliant path is to obtain your own agency licence as a sole proprietorship or corporation, carry the insurance the Act requires of agencies under section 30, and meet the agency-level obligations described below.
- If you do not hold an agency licence, the PSISA contemplates you working as an employee of a licensed agency. Full stop.
Non-compliance under the PSISA is not a slap on the wrist. Under section 45, an individual convicted of an offence faces a fine of up to $25,000, imprisonment for up to one year, or both; a business entity faces a fine of up to $250,000. Section 44 adds that every director, officer or partner who authorizes, permits or acquiesces in the entity’s offence is guilty of an offence themselves. Just as importantly for you as a working investigator: your licence is your livelihood, and the Registrar considers conduct and compliance history. A classification arrangement that seemed like the agency’s problem can become a mark against your own professional record. For where Ontario’s review of this legislation may take these rules next, see our companion piece on what the PSISA review could mean.
Employee vs. contractor under Ontario employment law
The PSISA question is only half the picture. The other half is the Employment Standards Act, 2000, and here the key principle is simple: your classification is determined by the substance of the working relationship, not by the label on your contract. An agency cannot make you a contractor by calling you one, having you invoice them, or skipping source deductions. Section 5.1 of the ESA states it directly: an employer shall not treat a person who is an employee as if the person were not an employee under the Act.
When a classification is disputed, the Ministry of Labour, the courts and the CRA look at the same core factors:
- Control. Does the agency direct when, where and how you work? Do they assign your files, set your schedule, dictate your reporting format and supervise your methods? In surveillance work they almost always do: client instructions flow through the agency, and the agency controls the file.
- Tools and equipment. Who supplies the vehicle, cameras and software? Using your own gear points toward contractor status, but it is one factor, not a trump card. Plenty of employees supply their own vehicles.
- Chance of profit and risk of loss. Can you genuinely profit from efficiency, negotiate your rates per file, subcontract the work, and take a loss on a job? Or do you simply earn an hourly rate the agency sets?
- Integration and exclusivity. Are you part of the agency’s operation: their case management system, their team briefings, their client-facing identity? Do you work substantially or exclusively for one agency?
If those factors point to employment, you are an employee under the ESA regardless of the contract, entitled to minimum wage, overtime, vacation pay, public holiday pay, protected leaves, and termination notice or pay.
Ontario law also recognizes a middle category worth knowing: the dependent contractor. If you operate as a contractor but rely almost entirely on one agency for your work and income, courts have held, most notably in Keenan v. Canac Kitchens, that you are entitled to many of the same protections as an employee, including reasonable notice of termination. Many “independent” investigators who work full-time hours for a single agency for years fall squarely into this category without knowing it.
One procedural note: for a few months under Bill 148, employers bore the burden of proving a worker was not an employee. That reverse onus was repealed in late 2018. Today, if you challenge your classification, you will generally need to build the factual case yourself, which is a good reason to keep records of how the relationship actually operates: who assigns work, who sets rates, whose equipment and procedures govern the file.
“Can I work as a contractor?” The honest answer
Yes, but only in a specific way, and it is more involved than agencies sometimes suggest.
The compliant contractor path means becoming a licensed agency yourself: registering a business, applying for an agency licence with the Private Security and Investigative Services Branch, carrying the required insurance, keeping records to the ministry’s standard, and being available for compliance inspections after licensing. It is real overhead. It is also what makes subcontracting between agencies legitimate, and it is the foundation of a genuinely independent investigative practice.
Everything short of that, invoicing an agency while holding only an individual licence, leaves you in a gray zone at best. At worst you are simultaneously working in a manner the PSISA does not contemplate, misclassified under the ESA and forfeiting entitlements you are legally owed, and exposed personally on the tax side, because the CRA can reassess the relationship and pursue unpaid CPP contributions and EI premiums, with interest and penalties for the employer and headaches for you.
What agencies owe you: employer responsibilities
If you are evaluating an agency as a place to work, it helps to know what the law requires of them. Under the PSISA and its regulations, a licensed agency must:
- Hold a valid agency licence and ensure every investigator working under it holds a valid individual licence
- Carry the insurance required of agencies under section 30 of the Act
- Comply with the Code of Conduct regulation, O. Reg. 363/07, which governs professional behaviour for both the agency and its investigators
- Maintain records to the ministry’s prescribed standard and make them available for inspection
- Notify the Registrar of changes to the business within the prescribed timelines
Under the ESA and related employment law, an agency employing investigators must provide minimum wage for all hours worked, including report writing and briefings, not just on-target time; overtime pay where thresholds are met; vacation and public holiday pay; protected leaves; proper pay statements; and lawful notice or pay on termination. Depending on the agency’s classification with the WSIB, workplace insurance coverage obligations may also apply, which matters in a job that involves driving long hours and working alone at night.
An agency that shortcuts these obligations with its investigators is telling you something about how it will handle its obligations to clients, to evidence, and to the courts.
Red flags when you’re offered “contractor” work
- You are told you are a contractor, but the agency sets your schedule, assigns all files, and controls your methods and reporting
- The agency requires exclusivity, saying you cannot work for other agencies, while also calling you independent; that combination is the classic dependent-contractor profile
- No written agreement at all, or an agreement that disclaims an employment relationship in one clause and imposes employee-style control in the next
- The agency cannot or will not confirm its agency licence number, insurance, or WSIB status when asked; a legitimate agency expects these questions, and here is how to verify any Ontario agency’s licence, including ours, 30000432, which we publish for exactly this reason
- You are paid only for surveillance hours, with report writing, briefings and travel treated as free
- Nobody has mentioned that invoicing as an independent business, without your own agency licence, raises a PSISA problem
If you think you’ve been misclassified
Start by documenting the reality of the relationship: schedules, assignment emails, rate discussions, equipment requirements, reporting procedures. Then get advice from an employment lawyer, or file a claim through the Ministry of Labour, Immigration, Training and Skills Development, which can order retroactive entitlements such as vacation pay, overtime and termination pay. Classification disputes are decided on facts, and investigators are better positioned than most workers to document facts. Use that skill on your own behalf.
What to do next
This is the second entry in The First Year, our series on beginning investigative work; the first covered choosing a camcorder for surveillance work. If you are weighing an offer right now, read the contract against the factors above before you sign, and ask the licence, insurance and WSIB questions directly. And if you want to work for an agency that takes its obligations to investigators as seriously as its obligations to clients, Private Solutions recruits licensed and licensable candidates across Ontario. See our Careers page for current openings and requirements.
Frequently asked questions
Can a private investigator work as an independent contractor in Ontario?
Only in a specific way. The PSISA is built around two roles: employees of licensed agencies, and licensed agencies themselves. If you want to genuinely subcontract your services to agencies, the compliant path is to obtain your own agency licence, carry the insurance that comes with it, and meet agency-level obligations. Invoicing agencies while holding only an individual licence fits neither role.
Can an agency make me a contractor just by having me invoice them?
No. Under section 5.1 of the Employment Standards Act, 2000, an employer shall not treat a person who is an employee as if they were not an employee. Your classification is decided by the substance of the relationship: who controls the work, whose equipment and systems govern the file, whether you can genuinely profit or take a loss, and how integrated you are into the agency’s operation.
What is a dependent contractor?
A category Ontario courts recognize between employee and independent contractor. If you operate as a contractor but rely substantially or exclusively on one agency for your work and income, decisions such as Keenan v. Canac Kitchens have held that you are entitled to reasonable notice of termination much like an employee. Many investigators who work full-time hours for a single agency for years fall into this category without knowing it.
What happens if an agency misclassifies its investigators?
Several regimes can bite at once. The Ministry of Labour can order retroactive entitlements such as vacation pay, overtime and termination pay. The CRA can reassess the relationship and pursue unpaid CPP contributions and EI premiums. And under the PSISA, individuals convicted of an offence face fines up to $25,000, imprisonment for up to a year, or both; business entities face fines up to $250,000, and directors or partners who authorize or acquiesce in an offence are themselves guilty of one.
Should report writing and briefings be paid time?
Yes. If you are an employee, the ESA’s minimum standards apply to hours worked, and report writing, briefings and required meetings are work. An arrangement that pays only for on-target surveillance hours and treats reporting as free is a red flag about the classification and about the agency.
This article is intended as professional development for licensed private investigators and is general information, not legal advice. Employment classification and licensing compliance depend on the specific facts of each working relationship. If your situation is unclear, consult an employment lawyer, or contact the Ministry of the Solicitor General and the Ministry of Labour, Immigration, Training and Skills Development directly.