Dental Practices on Notice as New Platform Tackles Payroll Compliance

TORONTO, ON – March 24, 2026 – A seismic shift is underway for Canadian dental practices that rely on temporary staff, as increased scrutiny from the Canada Revenue Agency (CRA) on worker misclassification converges with a new technological solution aimed at mitigating a multi-million-dollar risk. In response to a looming government crackdown, workforce management platform Fairly Staffing has partnered with embedded payroll provider Nmbr to launch what they call a first-of-its-kind system designed to bring the dental industry's temporary staffing practices out of the shadows and into full compliance.

For decades, dental clinics have navigated staffing shortages by bringing in temporary hygienists and assistants, often paying them as independent contractors to avoid the complexities of payroll. However, this common practice is now directly in the crosshairs of federal regulators, forcing a day of reckoning for an industry-wide “dangerous myth” that has left thousands of practices exposed to significant financial penalties.

The Closing Net: CRA Targets Worker Misclassification

The federal government’s Budget 2025 put a clear and firm notice on the table: the era of lax enforcement on worker misclassification is over. The budget specifically allocates millions to the CRA to intensify its efforts in auditing and penalizing employers who incorrectly classify their employees as independent contractors. This initiative is a direct response to the growing 'gig economy' bleeding into professional sectors, where the lines of employment have been blurred, often to the detriment of worker protections and government tax revenues.

The CRA's position is not new, but its intent to enforce it is. The agency determines a worker's status based on the reality of the working relationship, not the title on a contract. Key tests include the level of control the payer has over the worker, who provides the tools and equipment, and whether the worker assumes any financial risk or has an opportunity for profit. For a temporary hygienist working in a clinic, using the clinic’s chair and instruments, and following a schedule set by the office manager, the CRA's interpretation is almost always clear: they are an employee, not a contractor.

The financial consequences of getting this wrong are severe. A CRA reassessment can force a practice to pay years of retroactive employer and employee portions of Canada Pension Plan (CPP) and Employment Insurance (EI) premiums, plus interest and steep penalties. Critically, under Canadian law, the directors of the corporation can be held personally liable for these unremitted source deductions, putting their personal assets at risk. This doesn't even account for potential liabilities under provincial employment standards, including unpaid vacation, statutory holiday pay, and termination pay.

Dentistry's Decades-Old Compliance Problem

Within the dental industry, the reliance on temporary staff is not a luxury but a necessity to manage last-minute sick calls, vacation schedules, and chronic staffing shortages without cancelling patient appointments and losing revenue. This operational reality has given rise to the widespread, albeit incorrect, practice of treating these temporary professionals as self-employed contractors.

This approach has been perpetuated by long-standing myths, such as the false notion that a worker only becomes an employee after working a certain number of shifts. In reality, employment status is determined from the very first hour of work. The administrative simplicity of paying an invoice instead of running a one-day payroll has been a powerful, yet dangerous, incentive for busy clinic owners and managers.

“Temporary staffing has always been essential to dentistry, but the industry has never had payroll infrastructure designed specifically for it,” said Amir Reshef, CEO of Fairly Staffing, in a recent press release. “Payroll systems can’t help clinics find staff, and they aren’t built to pay someone for a single day of work. Temp platforms can help clinics find a professional, but they don’t run compliant payroll.”

This disconnect has created a significant compliance gap. While clinics could technically use traditional payroll providers like ADP or Ceridian, these systems are not integrated into the staffing workflow and require the clinic to correctly classify the worker and manage the administrative burden of onboarding them for a single shift—a process so cumbersome that most practices simply opt for the riskier, but easier, contractor payment.

A Technological Fix for a Systemic Challenge

Fairly Staffing and Nmbr are proposing a solution that tackles the problem at its source by embedding compliant payroll directly into the staffing platform clinics already use. When a dental office books a temporary hygienist through the Fairly Staffing platform, the system is now designed to handle the entire process compliantly. Powered by Nmbr’s embedded payroll engine, it automatically classifies the worker as an employee for the shift, calculates all required deductions—CPP, EI, and income tax—and remits them to the CRA. The worker receives a direct deposit for their net pay, and both the clinic and the worker receive the proper payroll documentation.

This integration is a prime example of the power of embedded finance, where complex financial services are seamlessly woven into the software that businesses use daily. Nmbr, as Canada’s first dedicated embedded payroll provider, offers the API-driven infrastructure that allows vertical-specific platforms like Fairly Staffing to build these customized, compliant solutions without having to become payroll experts themselves.

“Payroll compliance is becoming increasingly important as regulators tighten enforcement around worker classification,” noted Simon Bourgeois, CEO of Nmbr. “The embedded payroll infrastructure that we offer allows companies to handle those requirements directly inside the software that businesses already use. Fairly is a great example of how vertical platforms can solve real operational challenges while ensuring payroll is handled compliantly from day one.”

For dental practice owners, this combined offering promises a single, streamlined workflow for both finding and paying temporary staff, transforming a high-risk, high-admin task into a simple, automated, and compliant process. The platform effectively removes the temptation to misclassify by making the correct way the easiest way.

Beyond Risk Mitigation: A Fairer Framework for Workers

While the primary driver for dental clinics to adopt such a system may be the avoidance of CRA penalties, the shift has profound implications for the temporary workers themselves. When misclassified as contractors, these professionals are denied access to the fundamental protections of employment.

They do not contribute to CPP, impacting their retirement security, nor do they pay into EI, leaving them without access to benefits for unemployment, sickness, or parental leave. They are also not covered by provincial workers' compensation boards in case of a workplace injury. Proper classification ensures these dental professionals receive the same rights and protections as their permanent counterparts, fostering a more equitable and stable professional environment.

By automating compliance, the new platform helps legitimize the vital role that temporary professionals play in the healthcare system. It ensures that the flexibility required by dental practices does not come at the expense of worker rights or regulatory adherence. As the CRA continues to ramp up its enforcement, solutions that bridge the gap between operational needs and legal obligations are no longer just a competitive advantage; they are becoming an essential tool for survival in a rapidly changing regulatory landscape.