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Citation: 2005TCC39
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Date: 20050121
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Docket: 2004-286(EI)
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BETWEEN:
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JULIE MAYER,
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Appellant,
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and
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THE MINISTER OF NATIONAL REVENUE,
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Respondent.
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[OFFICIAL ENGLISH TRANSLATION]
REASONS FOR JUDGMENT
Deputy Judge Savoie:
[1] This appeal was heard in
Montréal, Quebec, on November 24, 2004.
[2] The issue is whether the
employment of Mélanie Duchesne
("the worker") with the appellant from
February 3 to June 11, 2003 ("the period
in issue") constitutes insurable employment.
[3] On October 29, 2003, the
Minister of Revenue ("the Minister") notified the
appellant of his decision that the worker held insurable
employment.
[4] The Minister relied on the
following assumptions of fact in making the decision:
[TRANSLATION]
(a) the appellant
was the mother of three young children aged 1, 2 and 3;
(admitted)
(b) the appellant
placed an advertisement in a local newspaper seeking the services
of a baby-sitter; (admitted)
(c) the worker
responded to the advertisement and was hired as a
baby-sitter; (admitted with clarifications)
(d) the worker's
tasks consisted of preparing the children's meals,
supervising them, meeting their needs and carrying out certain
housekeeping tasks such as dishwashing; (admitted with
clarifications)
(e) the worker
provided her services at the appellant's residence;
(admitted)
(f) the worker
baby-sat the appellant's children only and could not
baby-sit any others; (denied)
(g) the appellant
determined the worker's work schedule as follows:
(denied)
Monday
9:00 a.m. to 7:00 p.m.
Tuesday
9:00 a.m. to 7:00 p.m.
Wednesday 9:00 a.m. to 9:00
p.m.
Thursday
9:00 a.m. to 5:00 p.m.
Friday
9:00 a.m. to 7:00 p.m.
(h) the appellant
kept a record of the hours that the worker worked; (admitted with
clarifications)
(i) the
appellant set the worker's pay at $250 per week for
50 hours of work; (denied)
(j) the worker
was paid additional money for overtime; (admitted with
clarifications)
(k) the worker
received her pay in cash weekly; (admitted)
(l) the worker
had to follow the appellant's instructions; (denied)
(m) the appellant
communicated with the worker daily; (admitted with
clarifications)
(n) the appellant
regularly went home to ensure that everything was going well;
(admitted with clarifications)
(o) the worker was
not allowed to have anyone replace her and carry out her duties;
(denied)
(p) the appellant
provided the worker with the premises, supplies and equipment;
(denied) and
(q) the worker was
at no financial risk in the performance of her work. (denied)
[5] The evidence disclosed that the
appellant placed an advertisement in the local newspaper seeking
a baby-sitter. The advertisement specified that the required
hours were 7 a.m. to 7 p.m., Monday to Friday, that the pay was
$250 a week and that the worker would be asked for a
receipt. The advertisement also specified that the worker would
need to have his or her own transportation.
[6] The worker responded to the
advertisement by attending an interview at the appellant's
home. During the interview, the worker said that the suggested
schedule was problematic because she had bowling tournaments on
Thursdays at 5:00 p.m. The other problem was that the worker
could not provide her own transportation. The appellant decided
to employ her on a trial basis until the worker could secure her
own transportation. The children liked her so much during the
trial period that a compromise was struck regarding Thursdays.
The compromise enabled the worker to continue pursuing her
bowling activities and make up for the two hours in question
later. The work contract between the worker and the appellant was
an oral contract. The worker was to baby-sit the appellant's
three children, who were one, two and three and a half years of
age respectively. During the period in issue, the worker's
transportation was provided by Sylvain Lessard, the
appellant's husband. Mr. Lessard picked her up every morning
between 9 and 9:30 a.m. This meant that she was driven
over a distance of 30 km a day, free of charge.
The worker's tasks were as follows. She woke the
children, dressed them, took them outside to play in the morning,
prepared their lunch, washed the dishes and prepared the children
for their afternoon nap. The nap was followed by an afternoon
play period outdoors. Later on, the children were placed in front
of the television while the worker prepared supper. After the
children were served supper, the worker washed the dishes and
gave the children their bath.
[7] The worker carried out her duties
at the appellant's home because this was what the appellant
required. The appellant and her husband are both artisans.
They work in their studio, located 50 feet from their home.
The worker's schedule was established by the appellant. It
was stipulated in the appellant's newspaper advertisement,
though certain minor changes were made as discussed above.
The appellant and the worker wrote the worker's hours on
the calendar. The worker worked at least 50 hours a week,
plus overtime. Her base pay was $250 a week for 50 hours in
accordance with the established schedule. She was paid additional
money for her overtime. She was not paid for her sick days.
The pay was set by the appellant and was stated in the
advertisement that she had placed in the paper.
[8] The worker was paid each week in
cash and gave the appellant a receipt. She left her
employment because she was unable to agree with the appellant on
her vacation period.
[9] At the hearing, on the subject of
supervision, the worker said the appellant came to visit the home
once or twice during the morning, and in the afternoon, and that
she occasionally came to do errands. However, the appellant
claimed that the latter visits were much less frequent.
The worker had to perform the services for the appellant
personally.
[10] The evidence disclosed that the worker
set the children's hours and activities on her own but
prepared the menu in consultation with the appellant.
[11] The evidence disclosed that the
appellant allowed the worker to baby-sit her spouse's
children at the appellant's home along with the
appellant's children. But the appeals officer reported
being told by the appellant that the worker did not have
permission to baby-sit other children at her home. In her
testimony, the appellant denied making such a statement,
however.
[12] The worker filled out a form related to
the Action-Emploi program. It describes her as
self-employed, but she admits that she was unaware of the
difference between self-employed persons and salaried employees
at the time. The worker had 12 years of experience in this
type of work.
[13] The appellant visited the premises
briefly every day. She was in touch with the worker on a regular
basis during working hours. While working in her studio, she
would communicate with the residence through an intercom.
[14] The appellant provided the premises,
supplies and equipment for carrying out the work. Thus, the
worker incurred no expenses in performing her duties.
[15] Upon analysis, the Minister determined
that the worker held insurable employment based on the following
tests set out in Wiebe Door Services Ltd. v.
Minister of National Revenue, [1986] 3 F.C. 553 (C.A.):
control; ownership of tools; chance of profit and risk of loss;
and integration.
[16] With respect to the first test, the
Minister determined that the work was carried out under the
appellant's control. The workplace and schedule were
established by the appellant, who kept a journal of the hours
worked. In addition, the worker was required to perform the
services personally. The appellant was in regular contact
with the worker during work days.
[17] In his analysis regarding the ownership
of tools, the Minister determined that the appellant provided the
premises, the supplies and all the equipment for carrying out the
work. As to the chance of profit and risk of loss, the Minister
determined that the worker received a base salary of $250 a week
for 50 hours of work, plus additional amounts for overtime. The
Minister also determined that the worker incurred no expense, and
therefore incurred no financial risk, to do her work.
[18] As to the integration test, the
Minister determined that since the work was not carried out as
part of a commercial enterprise, the test did not apply.
[19] Two cases were brought to the
Court's attention at the
hearing: Thériault v.
Canada(Minister of National Revenue),
[1998] T.C.J. No. 193, and Mohr v.
Canada(Minister of National Revenue), [1997]
T.C.J. No. 1252.
[20] I have chosen to reproduce certain
excerpts from Mohr because the circumstances in that case
are more similar to ours than those in Thériault.
In addition, based the facts in Mohr, the worker
Shelly enjoyed more independence than the worker Stéphanie
Guénette did in Thériault.
[21] At this stage, it is appropriate to
reproduce certain excerpts from the decision in Mohr:
. . .
In January 1994, the Appellant and her husband entered into an
arrangement with Shelley to provide childcare to the three
children as follows. Shelley would come to the house of the
Appellant and her husband each weekday at 7:30 a.m. and remain
there until 5:30 p.m. During that ten-hour day, Shelley had the
sole custody of the three children and was responsible for their
physical and emotional care and needs. She fed them meals, took
them out to the park and to the library. She could take them to
her own home which was an apartment, but the daycare had to be
provided in the home of the Appellant because it was not
convenient to take the children to Shelley's apartment.
Also, by having Shelley come to the Appellant's home, all of
the facilities were there for looking after small children, such
as bottles, toys and supplies like clothes, diapers and laundry
facilities. The arrangement was that Shelley would do laundry and
light housekeeping so that the parents would not come home at
night to find an accumulation of soiled children's clothing.
Shelley had great freedom during the daytime so long as the
children were cared for in a responsible manner. She could go
pretty well where she wanted. . . .
. . .
The Appellant argues that Shelley was an independent
contractor because, apart from the duties assigned by the
Appellant and her husband, she had considerable freedom in taking
on other similar work. For example, in 1994, a child by the name
of Amanda Walton who was eight or nine years of age needed
childcare since her parents worked. An arrangement was made
with Amanda's parents that she could go to the Mohr home at
12:00 noon to have lunch prepared by Shelley and also go there in
the afternoon from 3:30 p.m. to 5:30 p.m. to be under
Shelley's care until Amanda's parents were able to pick
her up. The Appellant stated that she had no knowledge of what
the compensation arrangement was between Shelley and Amanda's
parents because she thought that was not her concern. She
did note, however, that Amanda came to the Mohr home and she had
no objection to that.
Similarly, in 1995, Shelley looked after two other children
named Ben and Heidi, a brother and sister.
. . . when the Appellant became aware of this
additional arrangement, she did not object because Shelley seemed
to be able to handle two more children . . . The
Appellant was not aware of what compensation was being paid to
Shelley by the parents of Ben and Heidi.
. . .
The Appellant put forward these examples . . . to
show the flexibility that Shelley had . . . and to
put Shelley more in the position of being a person engaged in a
business with clients . . .
. . .
On the question of control, that test favours employment over
independent contractor because the hours were laid down by the
Appellant, the service was to be performed to the convenience of
the Appellant and her husband, namely, from 7:30 a.m. to 5:30
p.m. The duties were assigned by the Appellant and had to be
performed to her satisfaction both with regard to the physical
care such as providing meals, cleaning the children, doing the
laundry . . .
With regard to the ownership of the tools, my first reaction
is that tools were never thought of in connection with services
like this. Tools in the workplace usually relate to either hand
tools, like the carpenter's hammer and saw, or a
machinist's tools, like a lathe and a drill press. One does
not think of tools in connection with childcare but, if the word
is to be given a broader meaning, that is the properties that
would permit a service to be rendered, those personal properties
would be dishes and cutlery to feed the children, a stove to warm
their food, toys with which they played, diapers for infant
children because they are necessary items for the care of a very
small child . . . Since all of these
"tools" were owned by and provided by the Appellant,
that test favours employment.
The third test is the chance of profit and risk of loss. In
this regard, the Appellant argues that Shelley's opportunity
either to take on additional children like Amanda, Ben and Heidi
and Nicholas, or decline, is a chance for her to enhance her
earnings or not. There is no question that she had that
discretion with the permission of the Appellant, but I do not
think that is the relevant fact in applying the test of chance of
profit or risk of loss. I see no risk of loss at all because as
long as the assigned duties were performed, the compensation of
$50 per day would be paid. Although it was not fixed like an
hourly rate, it was just as secure as any hourly wage or a daily
or weekly salary that might arise in other service situations. I
see the chance of profit and risk of loss as being in favour of
employment because there was an assured compensation and no risk
of loss. . . .
[22] Since the circumstances in the instant
case are very similar to those described in Mohr,
supra, this Court agrees with the analysis of Judge Mogan
of this Court and adopts his conclusion.
[23] Specifically, this Court does not
believe that it is appropriate to intervene, and remains
satisfied that the Minister's decision continues to appear
reasonable having regard to the evidence obtained at the
hearing.
[24] Consequently, upon analysis, this Court
must find, as did Judge Mogan in Mohr, supra, that the
worker Mélanie Duchesne held insurable employment
within the meaning of the Employment Insurance Act during
the period in issue.
[25] The appeal is dismissed and the
Minister's decision is confirmed.
Signed at Grand-Barachois, New Brunswick, this 21st day of
January 2005.
Deputy Judge Savoie
Translation certified true
on this 4th day of April 2005
Jacques Deschênes, Translator
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