Mayer c. M.R.N.

Mayer c. M.R.N. Court (s) Database Tax Court of Canada Judgments Date 2005-01-21 Neutral citation 2005 TCC 39 File numbers 2004-286(EI) Judges and Taxing Officers Sylvio J. Savoie Subjects Employment Insurance Act Decision Content Docket: 2004-286(EI) BETWEEN: JULIE MAYER, Appellant, and THE MINISTER OF NATIONAL REVENUE, Respondent. [OFFICIAL ENGLISH TRANSLATION] ____________________________________________________________________ Appeal heard on November 24, 2004, at Montréal, Quebec Before: The Honourable S.J. Savoie, Deputy Judge Appearances: Counsel for the Appellant: Pierre Robillard Counsel for the Respondent: Emmanuelle Faulkner ____________________________________________________________________ JUDGMENT The appeal is dismissed and the Minister's decision is confirmed in accordance with the attached Reasons for Judgment. Signed at Grand-Barachois, New Brunswick, this 21st day of January 2005. "S.J. Savoie" Deputy Judge Savoie Translation certified true on this 4th day of April 2005. Jacques Deschênes, Translator Citation: 2005TCC39 Date: 20050121 Docket: 2004-286(EI) BETWEEN: JULIE MAYER, Appellant, and THE MINISTER OF NATIONAL REVENUE, Respondent. [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. "S.J. Savoie" Deputy Judge Savoie Translation certified true on this 4th day of April 2005 Jacques Deschênes, Translator CITATION: 2005TCC39 COURT FILE NO.: 2004-286(EI) STYLE OF CAUSE: Julie Mayer and M.N.R. PLACE OF HEARING: Montréal, Quebec DATE OF HEARING: November 24, 2004 REASONS FOR JUDGMENT BY: The Honourable S.J. Savoie, Deputy Judge DATE OF JUDGMENT : January 21, 2005 APPEARANCES: For the Appellant: Pierre Robillard For the Respondent: Emmanuelle Faulkner COUNSEL OF RECORD: For the Appellant: Name: Pierre Robillard Firm: Boivin & Deschamps Laval, Quebec For the Respondent: John H. Sims, Q.C. Deputy Attorney General of Canada Ottawa, Canada