What trade rules and worker questions should I check before buying a hair salon in Canada?

A hair salon depends on the people who work in it. Two questions sit ahead of most others when you consider buying one: what the province requires of the stylists, and how each stylist is engaged. The first is set provincially, so it varies. The second is decided on the facts of the working relationship. Both are worth settling before you rely on the salon’s revenue.

Check the trade rules where the salon is

Trade rules for hairstyling are provincial. Skilled Trades Ontario says Hairstylist is a compulsory trade in Ontario. It says that to legally practise the trade you need to hold a Registered Training Agreement, a Provisional Certificate of Qualification or a Certificate of Qualification, appear on Skilled Trades Ontario’s Public Register, and renew your Certificate of Qualification annually. Other provinces run their own bodies. The Saskatchewan Apprenticeship and Trade Certification Commission, for example, publishes its own Hairstylist trade page. Ask the salon’s provincial body what applies.

Ask who holds what

Ask the seller for a list of stylists with the credential each holds, and confirm each one with the provincial trade body where it offers a way to check, such as Skilled Trades Ontario’s Public Register. If the salon’s income depends on a few stylists, ask which of them plan to stay after the sale. Ask your lawyer what it would mean for the salon if a stylist lacks a credential the province requires.

Ask how stylists are engaged

Ask the seller whether each stylist is an employee or self-employed, for example renting a chair. The Canada Revenue Agency says that, outside Quebec, it examines the total relationship between the worker and the payer, using a two-step approach. It first asks what the parties intended, then asks questions to verify whether that intent is reflected in the facts. In Quebec, it says it uses a three-step approach. Ask to see the written agreements and how the arrangement works day to day, then raise any gap with your accountant. For the rest of the purchase, see Buying a salon in Canada.