The Dangers of Paying Cash for Work

One question that we are asked all the time at Breakaway is: “Do you pay cash for your work?”

The answer to this question is NO!

We have a payroll department within Breakaway that does an amazing job of paying all of our associates by cheque or direct deposit each Friday.

While it is not technically illegal for an employer to pay an employee in cash for their work it does cause problems for both the worker and the employer if a business chooses to operate this way.

If your employer is offering to pay you in cash you should beware of the potential dangers of accepting this type of work.

paying cash

Dangers of Paying Cash for Work

More often than not these companies are offering to pay you cash to avoid reporting their money to the government and avoid Canadian labour laws.

Being paid cash means that you are probably not documented as a legitimate worker within the company which means you may not be afforded the same rights as a regular worker.

For employees, cash payments can seem like a great deal. You are getting paid immediately with cash in hand and not losing money to taxes.

BUT BEWARE!! Just as employers can get major fines and even jail time for tax fraud, you could encounter the same problems!

If you are being paid cash but are not reporting your earnings to the government/paying your taxes each year you can be heavily fined or even sent to jail for these practices. Additionally, if you are being paid cash and are not a documented worker at the company you will have no proof of income or employer, meaning it can be much more difficult to make large purchases such as a car or a home and can cause problems when trying to acquire government services.

The dangers of paying cash strongly outweigh the benefits to both the employer and the employee.

A legitimate business should have no problem paying you via cheque or direct deposit through proper payroll channels.

Beware of any companies offering cash for work and protect yourself and your loved ones by only working with legitimate companies in Canada that have the best interest of their employees and their company at heart.