REASONS
FOR JUDGMENT
Boyle J.
Introduction
[1]
This appeal requires me to decide whether the
proper characterization of the work done by the Appellant, Leah Hendriks, for
Uprise.FM Inc., formerly named Live in your City Inc., was done by her as an
employee or an independent contractor for purposes of the Employment
Insurance Act — that is, was it pursuant to a contract of service or a
contract for services.
[2]
The work period was from September 3, 2014
to December 12, 2014. It began as full‑time, but was scaled back
considerably during that period. There were no withholdings at source made, nor
was federal or provincial sales tax charged on the invoices for her work. She
received approximately $18,000 in the period. It appears the Appellant may have
avoided the characterization issue altogether by not reporting this income at
all for tax purposes.
[3]
The Canada Revenue Agency (“CRA”) initially
characterized the work as employment in a ruling. Uprise.FM objected and CRA
recharacterized the relationship as independent contractor. The Appellant
appealed to this Court and, oddly, the Respondent’s reply maintained that the
Appellant was an employee until the Respondent moved to amend the reply at the
opening of the first day of hearing. Uprise.FM has intervened.
[4]
The Court heard from the Appellant, Leah
Hendriks, as well as a CRA CPP/EI Appeals agent responsible for this file, and
from Gary Silverman, the President and Chief Executive Officer of Uprise.FM and
the owner of Gary Silverman & Associates Inc., an insurance brokerage firm
in Montreal.
[5]
Uprise.FM was, at the relevant time, in the
business of starting up a music streaming business. The business is run from,
and this work was done in, Montreal.
[6]
The outcome of this case turns largely on a
factual analysis. The testimonies of Ms. Hendriks and Mr. Silverman
regarding the relevant facts have significant differences between them. Not
only are their testimonies not consistent with each other’s, in some respects
they are not internally consistent with their own testimony, nor consistent
with some of the considerable number of documents placed in evidence. Given the
credibility considerations with both key witnesses’ testimonies, the documents
take on a heightened significance in my determination of the facts. In this
case, contemporaneous documents are often the best evidence, unless both sides agree
something recorded is not reflective of reality. That did not happen. Where
only one party disagrees with the accuracy of a contemporaneous writing, I
accept that the document is best reflective of the reality and reject the
witness’s alternate version. Where the contemporaneous documentary evidence
corroborates a witness’s testimony on a material point, I will accept that
witness’s testimony on matters relating to that point.
[7]
As between these two witnesses, where
Mr. Silverman’s testimony on any material point is not corroborated by
contemporaneous documents and is inconsistent with the testimony of
Ms. Hendriks (that is not itself inconsistent with relevant
contemporaneous documents), I accept Ms. Hendriks’ version of events over
Mr. Silverman’s. My concerns with Mr. Silverman’s credibility include
that he told CRA at the Appeals stage that there was no written agreement
produced, created or signed. In fact, he had personally emailed a draft version
of “our standard employment” to
Ms. Hendriks at the very outset of their discussions. I do not accept his
sworn testimony that he guessed he forgot about it because it was not relevant.
This is a very material point and I do not accept Mr. Silverman’s
testimony as being wholly truthful. Other concerns giving rise to my serious
doubts about his credibility are:
•
He said he first heard of the Todoist
application, designed to help create, manage and track performance of to‑do
lists, during the hearing. However, he had earlier referred to it in his communications
with CRA Appeals.
•
He testified he did not care where Ms. Hendriks
worked from, including her home if she wanted. This is at odds with Uprise.FM’s
job posting on Indeed quoted later in these reasons under the heading of
“Subordination and Control”.
•
He testified she was hired on a bring‑your‑own‑computer‑and‑device
basis, but that she later complained after she was already working that she
needed Uprise.FM to buy her a new computer and an improved phone plan. In fact,
he had emailed her twice on September 2, 2014, before her work started,
that he would drop off a company computer that night. In one of those emails,
he suggests Uprise.FM upgrade her phone plan so she does not have to bear any
phone expense.
•
He testified that there was no discussion of
vacation pay or benefits. However, his cover email with the standard employment
contract raises the addition of benefits after the probationary period — which,
along with vacation pay, is also set out in the agreement he sent her.
•
He said that after starting work, she started
making other demands, like an employment contract. Again, she had asked in writing
for a digital copy of the contract on September 2, 2014 and he sent her the
Uprise.FM standard employment agreement on September 4, 2014.
Overall, I conclude Mr. Silverman was somewhat
more concerned with telling his story in a way that best served his interests
than he was with its accuracy.
[8]
At the relevant time, Uprise.FM’s business was a
start‑up music streaming site. The work the Appellant was hired to do had
two principal aspects. Firstly, she was to be the executive assistant to the CEO,
Gary Silverman. Secondly, she was to be involved in reaching out to media
artists, agents and fans, etc. in a media relations role. I find that in her
role as executive assistant to the CEO, her work was dictated, delegated and
supervised by Mr. Silverman, and by his needs as perceived by others at
Uprise.FM. I also find that Ms. Hendriks was wholly supervised in her
media relations activities by Lisa Mac on behalf of Uprise.FM, as well as at
times by Mr. Silverman. It does not matter whether the supervising staff
were themselves employees or independent contractors of Uprise.FM. Their
supervision, control and dictates were those of Uprise.FM.
[9]
Much was made of the fact that Ms. Hendriks
may also have continued to carry on yoga instructor activities and/or her yoga
studio while working for Uprise.FM, and that she appeared less than candid with
the CRA and the Court about those facts. This is simply not material because,
given the nature of her yoga activities and the times she was available for
them, they were not inconsistent with her being an employee. Mr. Silverman
was generally aware of them and did not think yoga instruction or its scope was
relevant to her Uprise.FM position that was to be 37.5 very largely weekday
office hours. The evidence does not support a finding that any yoga instruction
was done in the course of her work days at Uprise.FM. Canadians have all sorts
of reasons for gaps in their resumés that they try to creatively fill in. On
these facts the existence of yoga activities being offered outside Uprise.FM’s
work hours is not material or relevant to the extent any occurred. It will not
assist in characterizing the work relationship as either employment or
independent contractor. It is relevant to Ms. Hendriks’ credibility on the
material points and is among the reasons I have not simply accepted her version
of events.
The Applicable Law
[10]
In Romanza Soins Capillaires et Corporels
Inc. v. M.N.R.,
I set out the applicable law in cases such as this as follows:
18 Insurable employment under the EI Act is
defined in paragraph 5(1)(a) of that Act to be as follows:
INSURABLE
EMPLOYMENT
5.
(1) Type of insurance employment — Subject to
subsection (2), insurable employment is
(a) employment in Canada by one or
more employers, under any express or implied contract of service or
apprenticeship, written or oral, whether the earnings of the employed person
are received from the employer or some other person and whether the earnings
are calculated by time or by the piece, or partly by time and partly by the
piece, or otherwise;
19 Article 2085 of the Civil Code of Québec
(the “Civil Code”) defines contract of employment as follows:
CHAPTER VII
CONTRACT OF EMPLOYMENT
Art. 2085. A contract of employment is a contract by which a person, the
employee, undertakes for a limited period to do work for remuneration,
according to the instructions and under the direction or control of another
person, the employer.
20 In contrast, article 2098 defines a
contract of enterprise or for services as follows:
CHAPTER VIII
CONTRACT OF ENTERPRISE OR FOR SERVICES
SECTION I
NATURE AND SCOPE OF THE CONTRACT
Art. 2098. A contract of enterprise or for services is a contract by which a
person, the contractor or the provider of services, as the case may be,
undertakes to carry out physical or intellectual work for another person, the
client or to provide a service, for a price which the client binds himself to
pay.
21 Article 2099 provides as follows:
Art. 2099. The contractor or the provider of services is free to choose the
means of performing the contract and no relationship of subordination exists
between the contractor or the provider of services and the client in respect of
such performance.
22 Article 1425 is relevant to the
interpretation to the contract and it provides as follows:
Art. 1425. The common intention of the parties rather than adherence to the
literal meaning of the words shall be sought in interpreting a contract.
23 It is apparent from several decisions of
the Federal Court of Appeal, including Le Livreur Plus Inc. v. Canada
(Minister of National Revenue), 2004 FCA 68, that the traditionally common
law criteria or guidelines mentioned in Wiebe Door Services Ltd. v. M.N.R.,
[1986] 3 F.C. 553, 87 DTC 5025, are points of reference in deciding whether
there is between the parties a relationship of subordination which is characteristic
of a contract of employment or whether there is instead a degree of
independence which indicates a contract of enterprise under the Civil Code. It
is also the case that the parties’ mutual intention or stipulation as to the
nature of their contractual relations should be considered and may prove to be
a helpful tool in interpreting the nature of the contract for purposes of
characterizing it under the Civil Code. See for example the decisions of the
Federal Court of Appeal in D & J Driveway Inc. v. Canada (Minister of
National Revenue), 2003 FCA 453, and in Grimard v. Canada, 2009 FCA
47, 2009 DTC 5056, wherein the intention of the parties is described as an
important factor to be considered in characterizing a contract for purposes of
the Civil Code. The comments of the Federal Court of Appeal regarding the
intention of the parties in these Quebec cases is consistent with its more
recent comments regarding the significance of intention at common law in 1392644
Ontario Inc. (Connor Homes) v. Canada (M.N.R.), 2013 FCA 85 below.
24 The traditional common law tests or
guidelines for a contract of service/employment versus a contract for
services/independent contractor are well‑settled. Insurable employment is
to be resolved by determining whether the individual is truly operating a
business on his or her own account. See the decisions in Market
Investigations, Ltd. v. Minister of Social Security, [1968] 3 All E.R. 732
(Q.B.D.), in 671122 Ontario Ltd. v. Sagaz Industries Canada Inc., 2001
SCC 59, [2001] 2 S.C.R. 983, and in Wiebe Door Services Ltd. v. M.N.R.,
[1986] 3 F.C. 553, 87 DTC 5025.
25 This question is to be decided having
regard to all of the relevant circumstances and having regard to a number of
criteria or useful guidelines including: 1) the intent of the parties; 2)
control over the activities; 3) ownership of tools; 4) chance of profit or risk
of loss. There is no predetermined way of applying the relevant factors and
their relative importance and their relevance will depend upon the particular facts
and circumstances of each case.
26 The antinomy between civil law and common
law analyses of insurable employment for EI purposes is detailed by the Federal
Court of Appeal in Grimard, at paragraphs 27 through 46. I would refer
in particular to paragraph 43:
33 As important as it may be, the
intention of the parties is not the only determining factor in characterizing a
contract: see D&J Driveway Inc. v. Canada (M.R.N.), 2003 FCA 453; Dynamex
Canada Inc. v. Canada, 2003 FCA 248. In fact, the behaviour of the parties
in performing the contract must concretely reflect this mutual intention or
else the contract will be characterized on the basis of actual facts and not on
what the parties claim.
…
36 In Wolf v. The Queen,
[2002] 4 F.C. 396, our colleague Mr. Justice Décary cited the following
excerpt written by the late Robert P. Gagnon in his book entitled Le droit
du travail au Québec, 5th ed. (Cowansville: Les Éditions Yvon Blais, 2003),
page 67, and clarifying the content of the notion of subordination in Quebec
civil law:
[TRANSLATION]
Historically, the civil law first
developed a so‑called strict or classical concept of legal subordination
that was used as a test for the application of the principle of the civil
liability of a principal for injury caused by the fault of his agents and
servants in the performance of their duties (art. 1054 C.C.L.C.; art. 1463
C.C.Q.). This classical legal subordination was characterized by the immediate
control exercised by the employer over the performance of the employee’s work
in respect of its nature and the means of performance. Gradually, it was
relaxed, giving rise to the concept of legal subordination in a broad sense.
The diversification and specialization of occupations and work techniques often
mean that the employer cannot realistically dictate regarding, or even directly
supervise, the performance of the work. Thus, subordination has come to be
equated with the power given a person, accordingly recognized as the employer,
of determining the work to be done, overseeing its performance and controlling
it. From the opposite perspective, an employee is a person who agrees to be
integrated into the operating environment of a business so that it may receive
benefit of his work. In practice, one looks for a number of indicia of
supervision that may, however, vary depending on the context: compulsory
attendance at a workplace, the fairly regular assignment of work, imposition of
rules of conduct or behaviour, requirement of activity reports, control over
the quantity or quality of the work done, and so on. Work in the home does not
preclude this sort of integration into the business.
37 This excerpt mentions the notion
of control over the performance of work, which is also part of the common law
criteria. The difference is that, in Quebec civil law, the notion of control is
more than a mere criterion as it is in common law. It is an essential
characteristic of a contract of employment: see D&J Driveway, supra,
at paragraph 16; and 9041-6868 Québec Inc. v. Canada (Minister of National
Revenue), 2005 FCA 334.
38 However, we may also note in the
excerpt from Mr. Gagnon that, in order to reach the conclusion that the legal
concept of subordination or control is present in any work relationship, there
must be what the author calls [translation] “indicia of supervision”, which
have been called “points of reference” by our Court in Le Livreur Plus Inc.
v. MNR, 2004 FCA 68 at paragraph 18; and Charbonneau v. Canada (Minister
of National Revenue – M.N.R.) (1996), 207 N.R. 299, at paragraph 3.
39 For example, under Quebec civil
law, integration of a worker within a business is an indicator of supervision
that is important or useful to find in order to determine whether legal
subordination exists. Is that not also a criterion or a factor that is used in
common law to define the legal nature of an existing employment contract?
40 Likewise, as a general rule, it is
the employer and not the employee who makes the profits and incurs the losses
of the business. In addition, the employer is liable for the employee's
actions. Are these not practical indicators of supervision, indicating the
existence of legal subordination in Quebec civil law as well as in common law?
41
Finally, is the criterion of the ownership of work tools that is used by the
common law not also an indicator of supervision that would be useful to
examine? Depending on the circumstances, it may reveal the degree of an
employee’s integration into the business or his or her subordination to or
dependence on it. It may help to establish the existence of legal
subordination. In a contract of employment, more often than not, the employer
supplies the employee with the tools required to perform the work. However, it
seems to me to be much more difficult to conclude that there is integration
into a business when the person performing the work owns his or her own truck
with his or her name advertised on the side and containing some $200,000 worth
of tools to perform the tasks that he or she does and markets.
42 It goes without saying, in both
Quebec civil law and common law, that, when examined in isolation, these
indicia of supervision (criteria or points of reference) are not necessarily
determinative. For example, in Vulcain Alarme Inc. v. Canada (Minister of
National Revenue – M.N.R.), [1999] F.C.J. No. 749, (1999), 249 N.R. 1, the
fact that the contractor had to use expensive special detection equipment
supplied by the client to check and gauge toxic substance detectors was not
considered to be sufficient in itself to transform what was a contract for
services into a contract of employment.
43 In short, in my opinion there is
no antinomy between the principles of Quebec civil law and the so-called common
law criteria used to characterize the legal nature of a work relationship between
two parties. In determining legal subordination, that is to say, the control
over work that is required under Quebec civil law for a contract of employment
to exist, a court does not err in taking into consideration as indicators of
supervision the other criteria used under the common law, that is to say, the
ownership of the tools, the chance of profit, the risk of loss, and integration
into the business.
27 Similarly, this has been addressed by the
Federal Court of Appeal in Livreur Plus Inc., at paragraphs 18 through
20 as follows:
18 In these circumstances, the tests
mentioned in Wiebe Door Services Ltd. v. M.N.R., 87 D.T.C. 5025, namely
the degree of control, ownership of the work tools, the chance of profit and
risk of loss, and finally integration, are only points of reference: Charbonneau
v. Canada (Minister of National Revenue - M.N.R.) (1996), 207 N.R. 299,
paragraph 3. Where a real contract exists, the Court must determine whether
there is between the parties a relationship of subordination which is
characteristic of a contract of employment, or whether there is instead a
degree of independence which indicates a contract of enterprise: ibid.
19 Having said that, in terms of
control the Court should not confuse control over the result or quality of the
work with control over its performance by the worker responsible for doing it: Vulcain
Alarme Inc. v. The Minister of National Revenue, A‑376-98, May 11,
1999, paragraph 10, (F.C.A.); D & J Driveway Inc. v. The Minister of
National Revenue, supra, at paragraph 9. As our colleague Décary
J.A. said in Charbonneau v. Canada (Minister of National Revenue - M.N.R.),
supra, followed in Jaillet v. Canada (Minister of National Revenue -
M.N.R.), 2002 FCA 394, “It is indeed rare for a person to give out work and
not to ensure that the work is performed in accordance with his or her
requirements and at the locations agreed upon. Monitoring the result must not
be confused with controlling the worker”.
20 I agree with the applicant's
arguments. A subcontractor is not a person who is free from all restraint,
working as he likes, doing as he pleases, without the slightest concern for his
fellow contractors and third parties. He is not a dilettante with a cavalier,
or even disrespectful, whimsical or irresponsible, attitude. He works within a
defined framework but does so independently and outside of the business of the
general contractor. The subcontract often assumes a rigid stance dictated by
the general contractor's obligations: a person has to take it or leave it.
However, its nature is not thereby altered, and the general contractor does not
lose his right of monitoring the results and the quality of the work, since he
is wholly and solely responsible to his customers.
28 The Federal Court of Appeal similarly
wrote in D & J Driveway Inc. as follows:
2 It should be noted at the outset
that the parties' stipulation as to the nature of their contractual relations
is not necessarily conclusive and the Court which has to consider this matter
may arrive at a contrary conclusion based on the evidence presented to it: Dynamex
Canada Inc. v. Canada, [2003] 305 N.R. 295 (F.C.A.). However, that
stipulation or an examination of the parties on the point may prove to be a
helpful tool in interpreting the nature of the contract concluded between the
participants.
29 The Court in
D & J Driveway Inc. went on to acknowledge at paragraph 4 that the
criteria developed in Wiebe Door Services can be referred to in
assessing whether a relationship of subordination exists under the Civil Code.
[11]
Consistent with the line of cases I referred to
in Romanza Soins Capillaires et Corporels, is NCJ Educational
Services Limited v. Canada (National Revenue), a decision of the Federal
Court of Appeal which the Respondent’s counsel raised in argument. In that
case, the Court wrote:
55 In Wiebe Door Services Ltd. v. Canada
(Minister of National Revenue – M.N.R.), [1986] 3 F.C. 553, our Court
emphasized the importance of the criterion of control both under the civil law
as it stood at the time (the Civil Code of Lower Canada) and under the
traditional common law. It stated at paragraph 6 and in footnote 1 of
the decision:
6 The traditional common-law
criterion of the employment relationship has been the control test, as set
down by Baron Bramwell in Regina v. Walker (1858), 27 L.J.M.C. 207, at
page 208:
• It seems to me that the difference
between the relations of master and servant and of principal and agent is
this:-- A principal has the right to direct what the agent has to do; but a
master has not only that right, but also the right to say how it is to be done.
That this test is still
fundamental is indicated by the adoption by the Supreme Court of Canada in Hôpital
Notre-Dame de l'Espérance and Théoret v. Laurent, [1978] 1 S.C.R. 605, at
page 613, of the following statement: “the essential criterion of
employer-employee relations is the right to give orders and instructions
to the employee regarding the manner in which to carry out his work.”1.
______________________
1 Although
this is a civil-law case, the Court’s expressed view is that that law is in
this respect the same as the common law.
[Emphasis
added.]
56 The history of the concept of
subordination in the Civil Code of Québec is found in Robert P. Gagnon, Le
droit du travail du Québec, an author, now deceased, often cited by our
Court (Wolf v. The Queen, [2002] 4 F.C. 396, per Décary J.A.; 9041-6868
Quebec Inc., par. 12; Michel Grimard v. The Queen, 2009 FCA 47,
para. 36). The history he gives is strikingly in the same lines as the
development shown in the common law (see Lord Wright in Montreal (City) v.
Montreal Locomotive Works Ltd., [1947] 1 D.L.R. 161 (P.C.) at pages 169‑170
(the Montreal Locomotive Works case).
57 The difficulty raised by the application
of the concept of subordination in modern times is well explained by
Marie-France Bich, Le Contrat de travail, Code civil du Québec,
chapitre septième, (Articles 2085-2097, C. c. Q.) La
Réforme du Code civil, Obligations, contrats nommés, 1983, Les
Presses de l’Université Laval, p. 752.
58 While the test of control and the
presence or absence of subordination are the benchmarks of a contract of
service, the multiplicity of factual situations have obliged the courts to
develop indicia of analysis in their search for the determination of the real
character of a given relationship.
59 In the most recent edition of the book of
Robert Gagnon (6e édition, mis à jour par Langlois Kronström Desjardins, sous
la direction de Yann Bernard, Audré Sasseville et Bernard Cliche), the indicia
(underlined below) have been added to those found in the earlier 5th edition.
Those added indicia are the same as those developed in the Montreal
Locomotive Works case and applied by this Court in Wiebe Door.
92 –
Notion – Historiquement, le droit civil a d’abord élaboré une notion de
subordination juridique dite stricte ou classique qui a servi de critère
d’application du principe de la responsabilité civile du commettant pour le
dommage causé par son préposé dans l’exécution de ses fonctions (art. 1054
C.c.B.-C.; art. 1463 C.c.Q.). Cette subordination juridique classique était
caractérisée par le contrôle immédiat exercé par l’employeur sur l’exécution du
travail de l’employé quant à sa nature et à ses modalités. Elle s’est
progressivement assouplie pour donner naissance à la notion de subordination
juridique au sens large. La diversification et la spécialisation des
occupations et des techniques de travail ont, en effet, rendu souvent
irréaliste que l’employeur soit en mesure de dicter ou même de surveiller de
façon immédiate l’exécution du travail. On en est ainsi venu à assimiler la
subordination à la faculté, laissée à celui qu’on reconnaîtra alors comme
l’employeur, de déterminer le travail à exécuter, d’encadrer cette exécution et
de la contrôler. En renversant la perspective, le salarié sera celui qui
accepte de s’intégrer dans le cadre de fonctionnement d’une entreprise pour la
faire bénéficier de son travail. En pratique, on recherchera la présence
d’un certain nombre d’indices d’encadrement, d’ailleurs susceptibles de varier
selon les contextes : présence obligatoire à un lieu de travail,
assignation plus ou moins régulière du travail, imposition de règles de
conduite ou de comportement, exigence de rapports d’activité, contrôle de la
quantité ou de la qualité de la prestation, propriété des outils,
possibilité de profits, risque de pertes, etc. Le travail à domicile
n’exclut pas une telle intégration à l’entreprise.
[Emphasis
added.]
Analysis
Intention of the Parties
[12]
Ms. Hendriks wanted an employment position
at the outset, to the extent that she understood the difference between
employment and independent contractor. Mr. Silverman testified that he
always intended it to be an independent contractor position and that
Ms. Hendriks agreed to that.
[13]
Mr. Silverman points to Ms. Hendriks’
email of late September 2014, weeks after her work period started, wherein she
proposed reduced work hours for a finite contract. This was after the work
period had started and was clearly a reflection of Uprise.FM’s expressed
dissatisfaction with her work productivity. In his testimony,
Mr. Silverman tied this to his wanting to reduce her hours and her hourly
rate of pay. It is clearly not the proposal pursuant to which she commenced to
work for Uprise.FM.
[14]
On September 2, 2014, Mr. Silverman
wrote to Ms. Hendriks that his legal department would get her a copy of
her contract that day or the next and assured she would not have any issues
with it as he was tailoring it for her.
[15]
On September 6, 2014, Mr. Silverman
emailed the Appellant attaching “our standard
employment contract” and specifying that her contract started
September 3, 2014. The attachment was named “LIYC – Hendriks
employment.doc”.
[16]
The employment agreement describes the position
as “Assistant to the CEO, Gary Silverman”. One of
the recitals states that these are the “terms and
conditions under and pursuant to which the Employee shall perform his duties
and obligations under this employment agreement”. Article 1.1 provides
for a probationary period from September 1 to December 31, 2014 for a
$25 hourly rate for a 37.5‑hour week. Article 1.2 headed “Employment”
specifies that she would be hired as a full‑time employee for a $26
hourly rate and get three weeks of vacation time if the work period continued
after the probationary period. Mr. Silverman refers to this specifically
in his one‑page, five‑point cover email to her. Throughout this
employment agreement, the relationship is described as one of employment and
Ms. Hendriks as an employee. Mr. Silverman had no explanation for this
but to blame his lawyer.
[17]
In these circumstances, it appears that there
was either a shared intention that the relationship would be employment by both
Mr. Silverman and Ms. Hendriks, or that Mr. Silverman wanted to
mislead Ms. Hendriks for his own interests into believing he would be
hiring her as an employee.
[18]
It appears that this agreement may never have
been signed by the parties. That does not preclude me from my finding that it
sets out the terms upon which the work relationship was agreed to verbally at
the outset between Ms. Hendriks and Uprise.FM.
[19]
Whether or not this employment agreement was
ever signed, I find that it is the basis upon which Ms. Hendriks started
her work for Uprise.FM. It is described in Mr. Silverman’s cover email as
their standard employment contract, which suggested that there was to be no
negotiation. This is consistent with the fact that his cover email says “as of January 1, 2015 — you and I will negotiate a new
contract which will include group benefits” — this would follow a
successful probationary period. There is no reference to negotiating this
contract. Further, this is the contract that was produced within days of the
start of work pursuant to an ongoing request for such a contract.
[20]
I conclude that Mr. Silverman was incorrect
in his assertions that he never produced or created an employment agreement.
[21]
I will carry on to consider the traditional Wiebe
Door criteria given that in these circumstances it appears unwise to place
much weight upon a shared intention which may have been intentionally
misrepresented by Mr. Silverman for his own purposes.
Subordination and Control
[22]
In her role as assistant to the CEO, it is not
surprising that the evidence very largely supported Ms. Hendriks’ work
being directed and supervised as to what was to be done, how it was to be done,
when it was to be done and whether it was done correctly, by
Mr. Silverman. The emails in evidence amply attest to this and support Ms. Hendriks’
version of events.
[23]
Similarly, in her role as what has been described
as media relations (or in the job posting on Indeed as artist
relations/customer service) the documents clearly demonstrate the extent of the
supervision and control by Lisa Mac of Uprise.FM, along with
Mr. Silverman, over Ms. Hendriks’ work, including what was to be done
and when, the order in which things were to be attended to, and approval for
adequacy of work to go on to Mr. Silverman or to go out to Uprise.FM’s
contacts or clients.
[24]
Again this is consistent with the job posting on
Indeed that says that her job tasks will have her working “under the digital media producer and CEO (we’re both
cool)” (emphasis added).
[25]
There is no evidence to support the suggestions
that any real work was to be done outside of Uprise.FM’s premises by
Ms. Hendriks. It was virtually all done at the shared La Commune loft co‑op
being used by Uprise.FM at the time. I believe there were two very distinct
exceptions acknowledged by Ms. Hendriks, one day being when there was no internet
at the loft space so she went to a café and the other day being when there was
some construction activity at the loft while calls were to be made so she
worked from home. Her work was expected to be done during normal office hours
between Monday and Friday at Uprise.FM’s premises.
[26]
Again, these are consistent with the Indeed job
posting which says: “You enjoy the freedom of flexible
work hours with a steady paycheck. At Uprise, we believe in the work/life
balance so although we want you [to] work at the office most of the time,
you can work from home also sometimes too.” (emphasis added). The
posting also says “You . . . work well in an
open concept office in a cool loft space”.
[27]
Lisa Mac required Ms. Hendriks to be signed
into Google Chat and to be logged onto Todoist to manage and supervise her planned
and completed activities and her work times. I reject Mr. Silverman’s suggestion
that Lisa Mac was probably monitoring these for her own knowledge as if it were
distinct from Uprise.FM’s.
[28]
These considerations lean very strongly towards
an employment relationship.
Tools and Supplies
[29]
The tools and supplies needed for
Ms. Hendriks to complete her work for Uprise.FM were provided by
Uprise.FM. That includes the rented La Commune shared loft space in which she
was expected to complete her work, and the necessary computer, two computer
monitors and telephone headset, all of which were acquired by Uprise.FM for her.
[30]
Ms. Hendriks used her own phone but the
phone plan was reimbursed by Uprise.FM. In his September 2, 2014 email to
her about the contract she wanted from him, Mr. Silverman wrote he wanted
to update her phone plan so she would not have to bear any expense.
[31]
I find this consideration leans more towards
employment than self‑employment.
Financial Risk and Opportunity
[32]
Ms. Hendriks was paid a fixed hourly rate
for hours worked. She could only make more money by working more hours or
getting a raise, neither of which were in her control. Mr. Silverman of
Uprise.FM controlled both the hours and rate of pay and exercised that through
regular reductions in both throughout her period of work.
[33]
The employment agreement specifically required
loyalty and precluded Ms. Hendriks from working for others in this sector.
[34]
There is no suggestion that Ms. Hendriks
had the ability to subcontract any or all of her work to another person.
[35]
This consideration also leans strongly in favour
of an employment relationship.
Conclusion
[36]
Having considered all of the relevant facts as
they relate to the parties’ intention and the indicia or considerations of
subordination and control, tools and supplies, and financial risk and
opportunity, I conclude that the relationship between Ms. Hendriks and
Uprise.FM was an employment relationship.
[37]
Given especially the extent of Uprise.FM’s
direction of the performance of the work duties and its actual monitoring and
approval rights and requirements in practice, and given the very limited
financial risks to the worker, the absence of any financial investment by
Ms. Hendriks and her relatively fixed financial rewards by which she could
only generate more income by working more hours, these particular facts and
circumstances considered as a whole quite strongly give rise to an employment relationship
that constitutes insurable employment under the Employment Insurance Act.
[38]
The decision by CRA CPP/EI Appeals to reverse
the ruling that this relationship was employment was entirely inappropriate and
the findings or concerns of the Appeals agent are inconsistent with the
evidence before this Court. The Appeals agent was concerned that (i)
Ms. Hendriks may have misrepresented her yoga activities and (ii)
Ms. Hendriks was inconsistent in her answers as to whether the employment
agreement was ever signed. These were the credibility concerns given by the
Appeals agent for instead accepting Mr. Silverman’s version of the facts
and events. This is very surprising given that it is apparent from the Appeals Report
that Mr. Silverman misled CRA by saying he never produced or signed an
employment agreement, or in the words of the Appeals agent that he never
created one. Given that a digital unsigned version was provided to the Appeals agent
by Ms. Hendriks along with its cover email indicating it was Uprise.FM’s
standard employment agreement, it is surprising the Appeals agent did not
recognize Mr. Silverman’s credibility as an issue. The Appeals agent never
dealt with this in reaching her decision. There was no satisfactory explanation
for this.
[39]
The appeal is allowed.
Signed at Edmonton, Alberta, this 8th
day of March 2018.
“Patrick Boyle”
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