Date: 20021004
Dockets: 2002-721(EI)
2002-720(CPP)
BETWEEN:
CONRAD L. HYSWICK,
Appellant,
and
THE MINISTER OF NATIONAL REVENUE,
Respondent.
REASONS FOR JUDGMENT
Rowe, D.J.T.C.C.
[1] The appellant appeals from
decisions of the Minister of National Revenue - (the
"Minister") both dated November 20, 2001 - wherein the
Minister confirmed assessments issued against the City of
Abbotsford - a municipality in British Columbia - for
employment insurance premiums and Canada Pension Plan
contributions in respect of certain named workers - including the
appellant - for the 1997 and 1998 taxation years. The assessments
- issued pursuant to the Employment Insurance Act (the
"Act") and the Canada Pension Plan
(the "Plan"), respectively - were based on a
finding that the appellant had been employed by the City of
Abbotsford (City) pursuant to a contract of service.
[2] At the outset, the appellant was
permitted to file various documents - as Exhibits A-1 to A-19,
inclusive - on the basis he would refer to them directly at some
point during his testimony and/or they were otherwise relevant to
the appeals.
[3] Conrad Lee Hyswick testified he
resides in Abbotsford, B.C. and during 1997 and 1998 operated his
own home-based business which he started in 1996. He was working
in conjunction with an individual who owned a franchise for
Housemaster, a home-inspection business. Pursuant to an agreement
- Exhibit A-1 - dated December 18,
1996 - between Hyswick, the City, and the Abbotsford Police Board
(Police Board) - the appellant agreed to provide his services as
a "By-Law Enforcement/Police Liaison" to the City and
the Police Board during the period from January 1, 1997 to
December 31, 1999. The appellant stated the end date was inserted
in error as the parties had agreed the contract would cover a
period of two years and should have terminated on December 31,
1998. Pursuant to paragraph 4 of the agreement, Hyswick could
control his own hours - including evenings and Saturdays -
according to service requirements as agreed upon between the
parties. The appellant's duties as a Bylaw Enforcement Officer
were set forth in paragraph 3 of the agreement including
responsibility for enforcing all municipal bylaws, investigation
of complaints and follow-up and, if necessary, gathering evidence
and participating in the process of laying charges against
offenders, appearing in court to give evidence and otherwise
assisting in the prosecution of persons who had violated
municipal bylaws. Hyswick testified he paid his wife a salary of
$1,000 per month to assist him in carrying on the home-inspection
referral business as well as for performing research in
connection with his duties for the City by checking for zoning
infractions or lack of a proper building permit in respect of a
particular property. The appellant stated he devoted most Mondays
and Tuesdays to the business relationship with Housemaster and
worked for the City Wednesday through Saturday, inclusive. He
used his own cell phone in connection with both activities. He
used his own vehicle for Housemaster business and, even though
the City supplied him with a vehicle to be used in connection
with his enforcement duties, there were instances when he chose
to use his personal vehicle so as to be less obtrusive in the
course of conducting an investigation. If he used his own
vehicle, he absorbed the cost. The City installed a telephone
mechanism that forwarded calls to his cell phone. Hyswick stated
he had worked as a Bylaw Enforcement Officer for the District of
Matsqui which was amalgamated with the City of Abbotsford in
1999. City council appointed the appellant as a Bylaw Enforcement
Officer in accordance with the usual procedure for swearing in a
person possessing powers of investigation and enforcement. The
appellant stated he invoiced the City for his services which were
charged out at the hourly rate of $26.61 - an amount resulting
from adding 10% - in lieu of all benefits - to the ordinary rate
of $24.19 payable to an Enforcement Officer, as set out at
paragraph 7 of the contract (Exhibit A-1). Hyswick added GST
to the billable amount and referred to a typical invoice -
Exhibit A-19 - issued to the City for services rendered during a
certain period. Hyswick had registered his home-based business
for purposes of the Goods and Services Tax (GST) and considered
himself to have been a self-employed individual not only in
connection with his home-inspection referral activity but also in
respect of his contractual arrangement with the City as stated at
paragraph 6 of the contract between the parties. In Hyswick's
view, said paragraph - together with paragraphs 8 and 9 - made it
abundantly clear he was not an employee of the City and was not
entitled to benefit from any superannuation plan nor have any
right to severance pay other than for monies actually earned on a
fee-for-services basis which remained unpaid at the time of
termination. Either party could terminate the agreement upon 45
days written notice. Hyswick explained that it was sometimes
necessary to respond to a situation after normal working hours or
to liaise with the City Police and he did so because
- under the agreement - he was able to control his own
hours depending on service requirements. As an Enforcement
Officer, he dealt with complaints concerning matters dealing with
private property and the City Police had jurisdiction over
situations occurring on public property. The appellant stated the
parties to the contract had agreed upon the necessity for
flexibility in working hours because - on many occasions -
contact with complainants was undertaken after regular working
hours at City Hall. The appellant stated he would often meet with
property owners - following an appointment - because many of them
did not reside in Abbotsford. Pursuant to paragraph 5 of the
agreement, he was responsible and accountable to the Manager of
Inspection Services (Manager) or his designate - both employees
of the City - and was required to follow directions given by said
Manager for the purpose of carrying out his responsibilities set
forth in the contract. In the event a complaint proceeded to the
laying of charges and instituting the process required to bring a
matter to court, the Manager became involved but of the 700
complaints a year handled by Hyswick, only a small fraction ever
reached that point and even less required attendance in court for
the purpose of testifying in a prosecution. When carrying on his
home-inspection referral business, Hyswick stated he billed the
sum of $62.50 together with GST for each contract obtained
whereby Housemaster could undertake a home inspection which would
be carried out by the owner of that franchise. The contract
- Exhibit A-1 - expired on the true date of December 31, 1998 and
was not renewed by the City. By letter dated March 12, 1999 -
Exhibit A-2 - the City notified the appellant that, although it
had been using his services on a month-to-month basis since
January 1, 1999, said services would no longer be required after
March 31, 1999. The appellant received a letter
- Exhibit A-3 - dated October 1, 1999, from Revenue
Canada - predecessor of Canada Customs and Revenue Agency (CCRA)
- advising that his income tax returns for the taxation years
1997 and 1998 were under review. By letter
- Exhibit A-4 - dated November 10, 1999, the
appellant replied to CCRA explaining that he had been an
independent contractor while providing enforcement services to
the City. During the relevant period, the appellant stated he
could arrange for a substitute to perform his duties provided
that his replacement was qualified and possessed the appropriate
authority to enforce City bylaws. In that event, the City would
be billed directly by the substitute worker and would issue a
cheque. On July 9, 2001, the appellant returned a completed
Questionnaire - to CCRA - concerning the circumstances of his
working relationship with the City and details of his business
relationship in respect of the home-inspection referral activity
he had been conducting at the same time. On November 20, 2001,
the appellant received a decision - Exhibit A-12 - from the
Minister confirming a previous assessment - issued against the
City - on the basis he had been an employee working pursuant to a
contract of service. Additional details concerning the reasons
for having issued said decision were sent to the appellant in a
letter - Exhibit A-13 - dated December 11, 2001. The
appellant filed a Notice of Appeal
- Exhibit A-14 - and proceeded to answer
the questions posed in Pamphlet rc4410 - Exhibit A-15 - published
by CCRA - concerning the analysis to be undertaken in order to
assist people in arriving at a conclusion concerning the true
characterization of the relevant working relationship. The
appellant stated he had not been a union member nor were any
hours of work pre-determined within any particular period. In
that sense, his remuneration was not ascertainable and became a
known quantity only at the point when he submitted an invoice for
services rendered - every two weeks - to the City. The City had
established a work order number so the accounts payable
department could pay his invoices and summaries of said invoices
for the years 1997 and 1998, respectively, were filed as
Exhibit A-16 and Exhibit A-17. Hyswick estimated that
30% of all files opened by him in the course of his duties were
generated as a result of research undertaken by himself and/or
his wife or from personal observation within the municipality of
Abbotsford. The City provided access to computers and a database,
office equipment and supplies, and the appellant was reimbursed
for any items he purchased in order to carry out his tasks. The
appellant stated that since there was no guaranteed revenue
flowing from his contract with the City, the generation of income
depended on his skill and effective management of time. Further,
he incurred certain expenses from the operation of his in-home
office - equipped with computers, scanner, printer, fax and
telephone - including the monthly salary paid to his wife. A
statement of invoices - plus GST - billed to the City in 1997 and
1998 and to Housemaster - in 1998 - was filed as Exhibit A-18.
Hyswick stated that work space had been provided to him at City
Hall but it was shared with other people. The office was equipped
with a computer and an answering machine capable of forwarding
calls to his cell phone. Because others were providing the same
service, the appellant stated his own contribution was not vital
to the enforcement department which - itself - constituted only a
small portion of the overall operations of the City.
[4] In cross-examination by counsel
for the respondent, Conrad Hyswick stated he had been working -
since 1990 - as a Bylaw Enforcement Officer for the District of
Matsqui and had always provided his services of the basis of
having been an independent contractor. Following amalgamation
with the municipality of Abbotsford, he performed the same task
pursuant to the terms of the contract - Exhibit A-1 -
and then continued on a month-to-month basis until March 31,
1999. He explained that the Manager of Inspection Services was in
charge of five departments including bylaw enforcement. The
appellant was referred to his business card - Exhibit R-1 - upon
which he was identified as C.L. (Kelly) Hyswick, By-Law
Enforcement/Police Liaison and the City logo was prominently
displayed together with the address, phone and fax numbers at
City Hall. The appellant stated his referral activity with
Homemaster was carried on during 1997 but revenue therefrom was
produced only during 1998. He earned the sum of $4,176.74 from
this source - as shown on Exhibit A-18 - and said amount
constituted the entire revenue earned from this particular
activity. His business card for Housemaster was filed as Exhibit
R-2. The appellant agreed that 100% of his reported business
income during the 1997 taxation year was derived from his work
for the City. During the relevant period, four other individuals
were involved in bylaw enforcement for the City; one was assigned
to parking compliance, another performed secondary suite
inspections and two individuals performed work similar to the
appellant but did so as employees of the City and were
remunerated in accordance with the union rate of $24.19 per hour.
Hyswick's rate of pay was $26.61 per hour - as set forth in his
contract with the City - and he stated the City had chosen to
characterize the 10% increase to the standard union hourly rate
as being in lieu of benefits. The appellant agreed the office at
City Hall was available for general use by all bylaw enforcement
personnel. A clerk - with a variety of duties to perform -
assisted the Bylaw Enforcement Officers in carrying out their
tasks. The appellant stated he left his cell phone turned on
until 8:00 p.m. or 9:00 p.m. and would respond to a call
immediately if it were important or if the complainant or alleged
offender was about to leave Abbotsford for a holiday or otherwise
for a significant period. The appellant estimated that he worked
about 30 hours per week - on average - during the relevant
period but the precise hours were recorded in the sheets -
Exhibit A-16 and Exhibit A-17. Hyswick stated that if he had to
write a report he would note details, enter a case file number
taken from a log at City Hall and City staff would enter it into
the database. Sometimes, he would perform his work by utilizing
forms and documents prepared by the City. If a complaint had not
been resolved and the party under investigation refused to comply
with the bylaw, then the file would receive the attention of the
Manager and/or counsel retained by the City. In this event, the
appellant stated he continued to be involved in the process since
he was required to sign affidavits and to assist in the
furtherance of any prosecution. Hyswick acknowledged that he used
a car provided by the City - about 50% of the time - and could
have used it on a full-time basis but preferred to use his own
vehicle while carrying out his duties since he had already
obtained insurance coverage for business use. He attended one
conference concerning bylaw enforcement but had considered
himself to be ineligible to attend conferences of municipal
workers because he was not an employee of the City. Hyswick
stated he had been shown how to use the City database and had
been assigned an authorization code. He carried photo
identification bearing his signature - and that of a
representative of the City Police - identifying him as a Bylaw
Enforcement Officer for the City of Abbotsford. The appellant had
been issued a pass card and was provided with the alarm
deactivation code so he could enter City Hall after regular
business hours. In the event he was required to purchase film or
video cassettes for use in the course of an investigation or for
presentation in court - perhaps two or three times a year - he
was reimbursed. Hyswick stated City officials were not aware that
his wife assisted him in the performance of his duties and the
monthly salary - in the sum of $1,000 - paid to her was not
attributed to work done either in relation to bylaw enforcement
or to the Housemaster activity. The appellant explained that he
was often able to obtain compliance with a particular bylaw
merely by speaking to the owner or occupier of the property in
question. Other times, a letter would be issued or perhaps a
warning ticket - from a numbered book provided by the City -
would be written.
[5] The respondent did not call any
witnesses.
[6] The appellant submitted he was an
independent contractor carrying on his own business which he
viewed as akin to performing a public relations service to the
City rather than merely providing services concerned with strict
bylaw enforcement. In the appellant's view, the contract with the
City specifically provided that he was not to be considered an
employee and the parties had acted throughout the working
relationship in a manner consistent with that agreement which
should be respected as being determinative of his working
status.
[7] Counsel for the respondent
submitted the appellant was performing a specific function
flowing from bylaws of the City and/or from provincial
legislation delegating certain powers to municipalities. Counsel
pointed out that all necessary tools were provided by the City
and any extra expenses were reimbursed. As such, there was no
room for profit and the appellant could earn additional revenue
only by working extra hours at the same rate. Counsel submitted
the evidence disclosed the appellant was integrated into the
business infrastructure of the City by having access to the
database, office space and related equipment, and had the ability
to enter City Hall after regular hours; although he enjoyed some
flexibility in terms of working hours, that was not unusual in
the modern labour market. Further, counsel submitted that
although the appellant could work - to some extent - on a
flexible basis and used his own vehicle approximately 50% of the
time, that did not transform him into an independent contractor
carrying on business on his own account.
[8] The Supreme Court of Canada - in a
recent decision - 671122 Ontario Ltd. v. Sagaz Industries
Canada Inc., [2001] S.C.C. 59; 274 N.R. 366 - (Sagaz)
dealt with a case of vicarious liability and in the course of
examining a variety of relevant issues, the Court was also
required to consider what constitutes an independent contractor.
The judgment of the Court was delivered by Major, J. who reviewed
the development of the jurisprudence in the context of the
significance of the difference between an employee and an
independent contractor as it affected the issue of vicarious
liability. After referring to the reasons of MacGuigan, J.A. in
Wiebe Door Services Ltd. v. M.N.R., [1986] 2 C.T.C. 200
and the reference therein to the organization test of Lord
Denning - and to the synthesis of Cooke, J. in Market
Investigations, Ltd. v. Minister of Social Security, [1968]
3 All E.R. 732 - Major, J. at paragraphs 45 to 48,
inclusive, of his judgment stated:
Finally, there is a test that has emerged that relates to the
enterprise itself. Flannigan, ... ("Enterprise control: The
servant-independent contractor distinction" (1987), 37
U.T.L.J. 25, at p. 29) sets out the "enterprise test"
at p. 30 which provides that the employer should be vicariously
liable because (1) he controls the activities of the worker; (2)
he is in a position to reduce the risk of loss; (3) he benefits
from the activities of the worker; (4) the true cost of a product
or service ought to be borne by the enterprise offering it.
According to Flannigan, each justification deals with regulating
the risk-taking of the employer and, as such, control is always
the critical element because the ability to control the
enterprise is what enables the employer to take risks. An
"enterprise risk test" also emerged in La Forest
J.'s dissent on cross-appeal in London Drugs where he stated
at p. 339 that "[v]icarious liability has the broader
function of transferring to the enterprise itself the risks
created by the activity performed by its agents".
In my opinion, there is no one conclusive test which can be
universally applied to determine whether a person is an employee
or an independent contractor. Lord Denning stated in
Stevenson Jordan, ... ([1952] 1 The Times L.R. 101) that it
may be impossible to give a precise definition of the distinction
(p. 111) and, similarly, Fleming observed that "no single
test seems to yield an invariably clear and acceptable answer to
the many variables of ever changing employment relations..."
(p. 416) Further, I agree with MacGuigan J.A. in Wiebe Door,
at p. 563, citing Atiyah, ...(Vicarious Liability in the Law of
Torts. London: Butterworths, 1967) at p. 38, that what must
always occur is a search for the total relationship of the
parties:
[I]t is exceedingly doubtful whether the search for a formula
in the nature of a single test for identifying a contract of
service any longer serves a useful purpose... The most that can
profitably be done is to examine all the possible factors which
have been referred to in these cases as bearing on the nature of
the relationship between the parties concerned. Clearly not all
of these factors will be relevant in all cases, or have the same
weight in all cases. Equally clearly no magic formula can be
propounded for determining which factors should, in any given
case, be treated as the determining ones.
Although there is no universal test to determine whether a
person is an employee or an independent contractor, I agree with
MacGuigan J.A. that a persuasive approach to the issue is
that taken by Cooke J. in Market Investigations, supra. The
central question is whether the person who has been engaged to
perform the services is performing them as a person in business
on his own account. In making this determination, the level of
control the employer has over the worker's activities will
always be a factor. However, other factors to consider include
whether the worker provides his or her own equipment, whether the
worker hires his or her own helpers, the degree of financial risk
taken by the worker, the degree of responsibility for investment
and management held by the worker, and the worker's
opportunity for profit in the performance of his or her
tasks.
It bears repeating that the above factors constitute a
non-exhaustive list, and there is no set formula as to their
application. The relative weight of each will depend on the
particular facts and circumstances of the case.
[9] I will examine the facts in
relation to the indicia set forth in the judgment of Major J. in
Sagaz.
Level of control:
[10] The appellant was able to control his
own hours according to service requirements as agreed by the
parties to the contract. He was not monitored or supervised in
the performance of his daily duties and could generate files on
his own initiative using his own resources. However, he was
responsible and accountable to the Manager of Inspection Services
or his designate and was required to follow any directions given
by said Manager for the purposes of carrying out his duties
pursuant to the written agreement. Further, the appellant had to
obtain permission from the Manager in order to proceed with the
laying of charges and thereafter was required to provide such
assistance as the Manager and/or counsel required in furtherance
of any prosecution. Certain forms had to be used and the opening
of a file - in connection with an investigation - had to be
logged into the City database.
Provision of equipment and/or helpers
[11] The City provided a vehicle for the
appellant's use. He made a personal choice to use his own vehicle
- about 50% of the time - and was not reimbursed for any expense.
He had his own cell phone which was also used for purposes of his
business activity with Housemaster. The telephone answering
system at City Hall had been specifically programmed to forward
calls to his cell phone. All necessary documents and forms were
provided by the City and he had access to the computers and
database into which his own investigation and compliance files
were logged. He was provided with an office at City Hall - shared
with other enforcement officials - and had the use of all related
equipment and supplies. The appellant paid his wife a salary of
$1,000 per month to assist him in the course of his enforcement
duties for the City and also in relation to the home-inspection
referral business. There was no apportionment of salary between
these two tasks. The City had not required the appellant to
provide any helpers and officials were not aware of the
arrangement between the appellant and his wife. The appellant was
an officially designated Bylaw Enforcement Officer for the City
and anyone assisting him or substituting for him - in order
to provide the enforcement service - had to be similarly
qualified by City council, probably in conjunction with the
Police Board. There are many occasions when end users of a
service are not aware of the internal policy of the service
provider with respect to the identity or number of workers
involved in the overall performance of the requisite tasks - nor
should they be - but an individual cannot transform himself into
an entrepreneur merely by engaging in the legitimate practice of
income-splitting with a spouse for purposes of reporting income
pursuant to the Income Tax Act. The appellant had
access to secretarial assistance at City Hall and chose to
perform some of the research and issue correspondence from his
own in-home office utilizing the skills of his wife.
Degree of financial risk and responsibility for investment
and management
[12] The appellant did not incur any
financial risk in the conduct of his work for the City. He was
reimbursed for expenses except for those associated with his own
personal choices such as the cost of a cell phone, use of his
personal vehicle or the salary to his wife. He was not required
to manage any workers nor was he required to make any capital
investment in order to be in a position to provide the
enforcement service. The City infrastructure - including the
equipment and office staff - was adequate for the purpose of the
functions carried out by Hyswick in accordance with his mandate
as an authorized City official.
Opportunity for profit in the performance of tasks
[13] The appellant testified he was able to
generate about 30% of his overall income by using his own
initiative to discover matters within the municipality requiring
enforcement action of some sort in order to obtain compliance
with the relevant bylaws. Hyswick preferred to rely on his own
modus operandi which was primarily based on a spirit of
cooperation and education of the potential offender as to the
precise nature of the bylaws rather than proceeding prematurely
to institute strict enforcement procedures. Pursuant to the
agreement, he was paid at an hourly rate of $26.61 which had been
arrived at by taking the union rate for his particular
enforcement function and adding 10% because he had waived any
entitlement to benefits available to other City workers. An
opportunity for profit may have been present had he agreed to
accept a flat rate for all enforcement activities - within a
specified period - and then managed his time and efforts in such
a way that he could devote more hours to developing and carrying
on his home-inspection referral business. In the within appeals,
if he worked additional hours, he billed them at the agreed-upon
rate. According to a spreadsheet forming part of
Exhibit A18, his income from the City was relatively steady
during 1998. During the first quarter, he earned $8,994.19,
followed by the sums of $10,258.17, $11,468.93, and $12,706.28
for the next three quarters, respectively.
[14] The appellant had been a Bylaw
Enforcement Officer - since 1990 - when he began working for the
District of Matsqui. Later, he continued with the City and had
never been considered by either municipality as other than an
independent contractor. He relied on his agreement with the City
- clearly stating that to be the case - as being contractually
capable of determining his working status. In the case of
Minister of National Revenue v. Emily Standing, 147 N.R.
238, Stone, J.A. at pages 239-240 stated:
...There is no foundation in the case law for the proposition
that such a relationship may exist merely because the parties
choose to describe it to be so regardless of the surrounding
circumstances when weighed in the light of the Wiebe Door
test ...
[15] The appellant relied on the decision of
Judge Rip, Tax Court of Canada, in the case of Family Services
Perth-Huron v. Canada (Minister of National Revenue -
M.N.R.), [2000] T.C.J. No. 2 in which special service
providers were found to be independent contractors while carrying
out their work. In that case, the appellant non-profit
corporation acted as an agency in providing a variety of services
including marriage counselling, credit and debt management,
in-home support services, respite services, programs for seniors
and services for children with disabilities. The agency was
funded from several sources including donations, fees for
services and agreements with three levels of government. In that
case, a service provider applied to the agency and was placed on
a list. Then, the agency arranged a meeting between a family in
need of service and a provider. Only if the family and the
putative provider agreed to form a working relationship was there
any future administration undertaken by the agency co-ordinator
who would arrange for a psychologist or social worker to prepare
a program for the client that was to be followed by the provider
in servicing the client. The providers were paid a fixed rate per
hour and had to maintain time sheets and travel expenses. They
had to maintain records and submit reports and a job description
was attached to each contract. In arriving at the conclusion the
particular worker was not an employee of the agency, Judge Rip
found there had been minimal control exercised, although the
worker had been required to attend training sessions and to
prepare reports on the progress of her clients. However, the
worker had the freedom to accept or reject working with a
particular family and was free to exercise his or her own
discretion and judgment when providing services to the families.
In Perth-Huron the agency had no tools and provided
no office within its own facility to the provider in order to
perform any of his or her functions. The work was done in the
home of the client. In Perth-Huron, Judge Rip found the
provider's profit was determined by the number of hours worked
with a client and the number of clients a provider wished to
serve. He also found that the provider could elect whether or not
to purchase supplies and tools for any recipient of the service,
thereby diminishing personal earnings. The provider was paid only
for the hours he or she worked.
[16] In the case of Saskatchewan Deaf and
Hard of Hearing Services Inc. v. Canada (Minister of National
Revenue - M.N.R.), [2001] T.C.J. No. 38, Judge Porter, Tax
Court of Canada held that interpreters working off a roster
system were not employees of the organization but were
independent contractors. In that case, if the organization
received a request for services, it would turn to its list of
qualified interpreters and proceed to contact someone. An
interpreter, once contacted, had the right to accept or refuse
the assignment and would then make his or her own arrangements
with the recipient of the service. Depending on their level of
experience, they were paid at an hourly rate by the organization
and the interpreter would submit an invoice at the end of the
month showing the number of hours worked. Judge Porter also held
that the appellant in that case was in the business of providing
many different services to its consumer group of which
interpretation services were only one. Judge Porter also found
the workers considered themselves as professionals - able to
choose whether or not to work for clients - and held that the
relevant worker/interpreter was not "enveloped into the
business of the Appellant, but was retained as an outsider to
provide services to their clientele. That is the
distinction" (see paragraph 35).
[17] As stated by Major, J. in Sagaz,
supra, in paragraph 47 of his judgment:
...The central question is whether the person who has been
engaged to perform the services is performing them as a person in
business on his own account...
[18] Due to rapid change brought about
mainly by technological advances in communication and utilization
of data, one should be alert to new methods of delivering
products and services. The traditional notion of working - at the
same plant, mill, mine or public service cubicle for 35 years
- is rapidly disappearing. Stability in the workplace in
the past decade is almost laughable when shares in giant
corporations - once heralded as dazzling darlings of stock
exchanges - plummet to a scant fraction of their former value and
a huge factory can be closed - or relocated - practically
overnight. Today, people may have the status of employees -
perhaps telecommuting from an in-home office - or in the course
of holding down several part-time jobs. An employee may have a
full-time job at a regular workplace but - after hours - becomes
an entrepreneur while operating a business in order to produce
additional revenue. Others are operating businesses on their own
account providing services that were previously associated with
an employer/employee relationship. Governments - at all levels -
and quasi-governmental organizations and Crown corporations have
begun to depart from the traditional method of obtaining
necessary services and there are issues arising daily over the
concept of contracting out services to outside persons or
entities rather than relying on employees. The working
relationship in the within appeals was entirely satisfactory to
the appellant and to the City. From Hyswick's perspective, he had
always provided his bylaw enforcement services as a freelancer
rather than as a member of a regular municipal staff. However, I
have not been persuaded on the evidence before me that this
arrangement - albeit workable - conforms with the applicable
jurisprudence. One must remember that Hyswick was an enforcement
official - sworn in pursuant to City Council procedures - and was
a person carrying out a function recognized by the Police Board,
a body constituted under the Police Act of the Province of
British Columbia. In the absence of proof that the contracting
out of this important law enforcement position is legally
permissible, I think the more reasonable approach - taking into
account the jurisprudence referred to earlier - is to find that
the discharge of this special function can occur only within the
context of an employer/employee relationship. It may be that some
North American jurisdictions have privatized various institutions
- including jails - and some multinational corporations owning
parking lots across Canada may have been given powers to write
parking tickets to alleged offenders but the exercise of a bylaw
enforcement function - together with carrying out duties
requiring liaison with a municipal police force - does not seem
to fit into this category without a valid legislative foundation
to support such a radical proposition.
[19] In the within appeals, there is no
doubt the appellant believed he was carrying on the business of
bylaw enforcement and was providing that service as well as a
police liaison service to the City within that context. In fact,
he had been operating in the same fashion for nine years -
without encountering any opposition - when providing services to
the District of Matsqui and the municipality of Abbotsford.
However, when the situation is examined closely, there were not
two businesses being carried on, one on the part of the appellant
and the other on the part of the City. In order that the
appellant could carry out his function, he had to be sworn in as
a duly authorized law enforcement officer and thereafter - apart
from some flexibility in terms of hours and days worked - had to
conform with the requirements dictated by the infrastructure and
operating policy of a sophisticated urban municipality engaged in
the business of governing the affairs of its residents in
accordance with powers delegated by provincial legislation.
[20] Having regard to the evidence and the
relevant jurisprudence, I find the decisions issued by the
Minister on November 20, 2001 to have been correct because the
appellant was engaged in both insurable and pensionable
employment with the City of Abbotsford during the relevant period
by virtue of having been employed pursuant to a contract of
service.
[21] The decisions of the Minister having
been confirmed, both appeals are hereby dismissed.
Signed at Sidney, British Columbia, this 4th day of October
2002.
D.J.T.C.C.
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