|
Citation: 2003TCC600
|
|
Date: 20030902
|
|
Docket: 2002-1545(EI)
2002-1546(CPP)
|
|
BETWEEN:
|
|
SASKATCHEWAN EXPRESS SOCIETY INC.,
|
|
Appellant,
|
|
and
|
|
|
|
THE MINISTER OF NATIONAL REVENUE,
|
|
Respondent.
|
____________________________________________________________________
REASONS FOR JUDGMENT
Beaubier,
J.
[1] These
appeals were heard together on common evidence at Regina, Saskatchewan, on
August 14, 2003. The Appellant called the following witnesses:
1. Carol Gay Bell, a
founder and the Artistic Director of the Appellant, of Regina;
2. Kirsten Brough,
now a homemaker, formerly a secretary employed by the Appellant in Regina and
the person who typed the contract in question and prepared the Appellant's
cheques for issuing;
3. Laurien Gibson, a
self-employed music instructor who was under contract with the Appellant at
Saskatoon and who knew Landon Peters during the Period;
4. Lorie Rebalkin,
the Appellant's Studio Director in Saskatoon at all material times who
negotiated the contract with Landon Peters, who worked at the Saskatoon studio.
[2] Paragraphs
12 to 16 of the Reply to the Notice of Appeal 2002-1545(EI) outline the matters
in dispute. They read:
12. By letter dated August
15, 2001, the Regina Tax Services Office issued a ruling that the Worker was in
insurable employment with the Appellant for the period February 5, 2001 to June
24, 2001.
13. By a letter received
November 31, 2001, the Appellant appealed to the Minister for a reconsideration
of the ruling.
14. In response to the
appeal, the Minister decided that the employment was insurable as the Worker
was employed by the Appellant under a contract of service for the period
February 5, 2001 to June 24, 2001.
15. In so deciding as he did
the Minister relied on the following assumptions of fact:
(a) the
Appellant operates a musical theatre;
(b) the Worker
was hired as a dance instructor;
(c) the Appellant
and the Worker entered into a written letter of agreement which included the
following:
(i) the Worker
is hired as an instructor for the 2000/2001 season,
(ii) the Worker
is under the direction of the Appellant to follow the outlines of class content
and goals to be achieved,
(iii) the Worker
is to prepare and teach all classes assigned,
(iv) the Worker is
to act as a substitute instructor when necessary,
(v) the Worker is
to attend monthly instructor meetings,
(vi) the Worker is
to assist with content, costumes, props, staging and presentation of the annual
recital,
(vii) the Worker is
to participate in promotional activities and workshops on behalf of the
Appellant,
(viii) the Worker
may work for others as long as there is no conflict of interest,
(ix) the Worker is
expected to be present at least 15 minutes prior to class time,
(x) the Worker
will have access to a photocopier,
(xi) the Worker
will be paid $20.00 per hour, $75.00 for the recital, and $200.00 for the
workshop,
(xii) the Appellant
will cover the travel costs for the workshop,
(d) the Worker
performed his services at the Appellant's premises;
(e) the Worker earned
a set wage of $20.00 per hour;
(f) the Worker
was also paid $75.00 for the recital and $200.00 for the workshop;
(g) the Appellant
set the wage rates;
(h) the Worker
was paid bi-weekly by cheque;
(i) the
Appellant controlled the Worker's hours and days;
(j) the Worker
was required to keep track of his hours and submit a timesheet;
(k) deadlines and
priorities were set by the Appellant;
(l) the Worker's
work was monitored by the Appellant;
(m) the Worker was
required to attend regular meetings;
(n) the Worker's
personal services were required;
(o) the Worker
had to obtain the Appellant's approval for any leave;
(p) the Worker
did not incur any expenses in the performance of his duties;
(q) the Appellant
provided all of the tools and equipment required including a fully furnished
work location;
(r) the Worker
did not have a risk of loss;
(s) the Worker
did not charge the Appellant G.S.T.;
B. ISSUES TO
BE DECIDED
16. The issue to be decided
is whether the worker was employed under a contract of service with the
Appellant during the period of February 5, 2001 to June 24, 2001.
[3] The
following assumptions were not refuted by the evidence, 15(a); (c)(x), (xi),
(xii); (d); (e); (f); (h); (k); and (s).
[4] With
respect to the remaining assumptions:
15(b): Landon Peters (the
"Worker") was hired as an acting instructor. He considered himself to
be an artist and he also proposed to teach his students how to draw Bart
Simpson, to which the Appellant did not object. It is not known if he did this
or not.
15(c)(i): The Worker was only on
contract for less than half the year, from February to June.
15(c)(ii): He only had to prepare
his students for a recital which was agreed by the teachers to be based on
GREASE.
15(c)(iv) and (v) are wrong. They are in
the written contract but it was not adhered to by these parties or other
teachers.
15(c)(vi): The Worker was only
involved in the staging and presentation.
15(c)(vii): The Worker did not do
this. Rather he promoted himself with flyers and arranged with the Appellant to
be able to rent its studio to teach any students he might be able to contract
with privately. He may have taught outside the Appellant's contract, as other
teachers under contract did on their own or for competing studios. He did substitute
teach in the Public School System in Saskatoon. He was highly qualified as an
actor and had a Bachelor of Education Associated Arts/Theatre, Film. (Exhibit
A-3).
15(c)(viii): See above.
15(c)(ix): The Worker was always
just in time or late for his classes.
15(g): The wage rates were
negotiable. The Worker accepted the Appellant's first offer of $20.00 per hour.
15(i): Is wrong. At the
beginning of each year the teachers say when they will be available. They all
teach by the hour after regular school hours. Class times are set according to
the teachers' own schedules. Landon Peters replaced a teacher and assumed those
vacant class hours.
15(j): Is correct. Much was
made of the lack of an "invoice". But the time check sheet was filled
out and signed by the Worker, unlike an employee, whose time is recorded by an
employer without employee input.
15(l): The Appellant did not
monitor or supervise the Worker except to see that he arrived for class. His
class content and output was up to him. However his class had to be ready to
perform whatever he specified they were to perform in the annual recital.
15(m): This was in the contract,
but there were only two meetings per year and only one when the Worker was at
the Studio.
15(n): This is wrong. The
Worker could send a substitute of his own choosing. The substitute would be
paid directly by the Appellant.
15(o): The Worker had to notify
the Appellant of his absence and of a substitute or the need for a substitute.
15(p): The Worker had to supply
any props for his class; for example, any thing they might require to draw Bart
Simpson or to act out a character.
15(q): The only things that the
Appellant supplied were studio space, the use of a photocopier and the space
for the annual recital.
15(r): A conscientious Worker
might lose, depending on the props supplied and the hours of teaching worked.
All preparation was unpaid and on the Worker's own time.
15(s): The Worker did not
charge G.S.T., nor is there any evidence that he complained about the lack of
deductions of income tax, Employment Insurance, Canada Pension Plan or Workers'
Compensation premiums. Ms. Bell testified that the Worker would not have made
enough to warrant registering for G.S.T.
[5] Using
the primary tests set out in Wiebe Door Services Ltd. v. The Minister of
National Revenue, [1986] 3 F.C. 553 (C.A.) on the facts in evidence:
1. Control
The Appellant did not tell the Worker how
to do anything. Nor did it inspect his conduct in class. He merely had to
appear or send a substitute to conduct a class for the set time in the
Appellant's studio and prepare the class for its performance as proposed and
arranged by the Worker in the GREASE recital. In other words, the Worker was to
produce a product or production by his class. "How" he did it was up
to him. Because he arrived late in the year, "when" was already
determined as was "where".
2. Ownership of Tools
Any props were the Worker's. The studio
and photocopier were the Appellant's.
3. Chance of Profit and Risk of
Loss
Poor management of preparation time or
costly props could cause the Worker to lose. His hourly rate of teaching time
was fixed at $20.00 per hour.
4. Integration
Except for the actual recital, there was
no time integration into a combined operation by the Appellant. What and how
the Worker taught was very much up to him. Other teachers and substitutes were
readily available to the Appellant. There was no curriculum that had to be
followed or continued upon by a teacher or a substitute. The "Bart Simpson"
drawing had nothing to do with acting. Ms. Rebalkin thought it would build a
students' confidence; but so would acting, which is what the students were
there for. Bart Simpson drawings were far removed from the Studio's purpose,
but much in tune with what the Worker wanted to do.
[6] Ultimately
the question is, was the Worker in business for himself. On the evidence he
controlled his work and course and merely turned out a product – his portion of
the GREASE recital. He supplied his own tools except for space and a
photocopier. He did have a risk of loss. He need not appear but could send his
own substitute. He was merely an accessory to produce a small, severable, part
of GREASE. He could work for direct competitors of the Appellant or compete
with the Appellant and rent its studio space.
[7] The
Worker was in business for himself. He and the Appellant could and did supply
business services to each other, each for a fixed fee - time by the Worker, and
the provision of and offer of space by the Appellant. Each could do his or its
business without the other, or each could do business with the other, as they
chose.
[8] The
Worker was not employed under a contract of service with the Appellant during
the period February 5, 2001 to June 24, 2001.
[9] The
Appellant is awarded such costs and disbursements as are granted under the Employment
Insurance Act.
Signed at
Saskatoon, Saskatchewan, this 2nd day of September 2003.
Beaubier,
J.
Email this Content