The Canada Revenue Agency set its sights last summer on the industrial bakery at the centre of an undercover Star investigation into temp work, according to internal Workplace Safety and Insurance Board emails obtained by the Star.

Fiera Foods, along with at least 13 temporary employment agencies that supplied the factory’s production lines, were identified in emails obtained under freedom of information laws as companies the workers’ compensation board “may wish to look at” because they were facing scrutiny from the CRA.

“They may be of interest to us given CRA is investigating them … just a thought,” reads an email from a WSIB project manager to the board’s assistant director of stakeholder compliance sent last June, after the tax agency requested information from the compensation board about the companies.

In a statement to the Star, CRA spokesperson Etienne Biram said the agency couldn’t comment on investigations that it “may or may not be undertaking” and could only provide “general information regarding the criminal investigations process.”

“The CRA takes any allegation of non-compliance very seriously and investigates suspected cases of tax evasion, fraud and other serious violations of tax laws,” Biram said. “Where the evidence gathered during the course of an investigation suggests there are reasonable grounds to believe a tax offence has been committed, the file is referred to the Public Prosecution Service of Canada recommending for the laying of criminal charges.”

David Gelbloom, Fiera Foods’ general counsel, said the company could not comment.

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Last year, a Star reporter worked as a temp at Fiera and was paid in cash at a payday lender without any of the required documentation or deductions. The temp agency, Magnus Services, refused to provide a pay stub or record of employment. Magnus — whose owner Aleksandr Ostrovsky refused to answer questions for this story — is not listed as one of the temp agencies under CRA investigation in WSIB emails.

Toronto Star reporter Sara Mojtehedzadeh went undercover for a month at Fiera foods, an industrial bakery where Amina Diaby died in 2016 in an accident.

The 13 temp agencies apparently under CRA scrutiny supplied Fiera with workers between 2011 and 2014, according to the records obtained by the Star. Most of the agencies listed office addresses that were in fact UPS mailbox services. Seven were in debt to the compensation board, the documents showed. At the time they were being discussed by WSIB employees, four had already closed down, two of them leaving $200,000 in “bad debt” to the board; six were open but owed the board over $642,352; and three were in good standing with the board.

The Star was unable to reach 12 of the 13 temp agencies for comment. Nine of the UPS stores where the temp agencies had registered addresses said the mailboxes had not been active for at least a year. One UPS employee said the director of one of the temp agencies, Vista Group, closed the mailbox and “disappeared” without paying the final bill around two years ago.

In two cases, the temp agencies were registered at offices whose occupants or building managers said they had never heard of the businesses or their directors. Another office was an empty, unmarked unit in a Vaughan office complex.

The Star was able to locate just one of the 13 temp agencies’ listed directors, at his small apartment in North York. He said he had no connection to Fiera Foods except that in 2005 or 2006, after moving to Canada from Moldova, he worked there for one day. He left because he did not like the work environment. He had never heard of Boris Serebryany, one of Fiera’s owners.

But he said around five years ago, a man he knew only as “Vladimir” approached him at a billiards hall about a “good job” opportunity. He said Vladimir told him all he had to do was set up a temp agency and later accompanied him to start a bank account, where he recalls Vladimir depositing around $1,000 to $2,000.

Nothing materialized from the partnership with Vladimir, he said, so he tried to close the agency down — but learned the account was thousands of dollars in debt, which he could not afford to pay. He said when he tried to contact Vladimir, he was unable to find him. He said he had no idea if the agency ever sent workers to Fiera or elsewhere.

After the Star’s investigation was published in September, Fiera Foods told the Star it had hired independent experts to conduct two separate internal audits. The first would examine the industrial bakery’s health and safety policies and procedures, while the other would review the various temp agencies that supply the company with workers. Fiera would not disclose the names of the independent experts conducting the audits or any other details about their internal reviews.

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“Fiera Foods sets high standards for its staffing agency partners and requires they follow best practices for records keeping and following applicable laws,” Gelbloom wrote in a statement. “In cases where that has not been the case, we have ended relationships with some staffing agencies.”

Fiera said its internal audits led to a series of “improvements,” including the creation of a confidential, third-party hotline for workers to “raise questions or voice concerns at any time.” The company would not disclose who was operating the third-party hotline. Fiera said it developed a supplier code of conduct and standards for temp agencies “to ensure our partners meet the high standards we set. This includes a requirement that suppliers and temp agencies provide clear pay stubs and keep proper records.”

As of two months ago, Fiera was using workers supplied by Magnus, at least some of whom still pick up their wages at a payday lender with no pay stubs or statutory deductions, according to five Fiera workers interviewed by the Star.

Ontario law requires employees to be paid at the workplace or some other place agreed to in writing by the employee. All workers, whether or not they are employed by a temp agency, are entitled to a pay stub and record of employment. It is not illegal to pay employees in cash, but statutory deductions — such as income tax, employment insurance and Canada Pension Plan — must be made by their employer.

One Fiera temp worker who declined to give her name because she feared she would lose her job told the Star in February she was hired through Magnus after calling a number on a bus-stop advertisement. She said she received just a few minutes of safety training on her first day at the factory. But her biggest frustration was the hour-long bus trip to pick up her money from a payday lender. She says she never agreed to be paid off site and would much prefer to pick up her money at the factory.

Like many temp workers, she has also faced problems sorting out who is ultimately responsible for her employment. On one occasion, she said her pay was short by about $50, but when she complained, the man on the other side of the window at the payday lender said it “wasn’t his job” to verify workers’ hours. He told her to talk to her agency. But she says she has never met or spoken to anyone from Magnus. “I don’t know who they are,” she said.

Gelbloom said the company has always encouraged any employee to notify them of any concerns. “In addition to our strong health and safety standards, we continue to require all temporary help agencies to provide clear pay stubs for employees in a manner that complies with the Employment Standards Act,” he wrote in an email response to questions from the Star in March.

Temp workers make up approximately 70 per cent of Fiera Foods’ workforce, according to internal WSIB documents from 2017. The documents also revealed that the board’s regulatory databases “show investigation files related to 10 different non-compliant temporary employment agencies that are known to regulatory services as having been utilized by … Fiera.”

As previously reported by the Star, an internal WSIB audit found that temp agencies in Ontario “create significant challenges” for the compensation board and are significantly more likely than other employers to misreport their payroll and avoid paying mandatory insurance premiums.

The audit also found that some 871 temp agencies closed between 2013 and 2016 — and that 51 per cent of them were audited before shutting down. But some appeared to subsequently re-invent themselves: the audit found that 25 per cent of new temp agencies opening during the same period shared “similar tombstone information” with previously existing agencies.

Last year the Star surveyed 450 temp agencies in the GTA and found more than a hundred that appeared to be residential addresses, including suburban homes or condo buildings. Around a dozen were simply a P.O. box or were registered to a UPS mailbox service. At least one listed address was an empty plot of land.

smojtehedzadeh@thestar.ca, 416-869-4195

bkennedy@thestar.ca, 416-869-4192

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