North Shore Association for the Mentally Handicapped v. MNR

North Shore Association for the Mentally Handicapped v. MNR Court (s) Database Tax Court of Canada Judgments Date 2003-09-30 Neutral citation 2003 TCC 657 File numbers 2002-4881(EI) Judges and Taxing Officers Michael J. Bonner Subjects Employment Insurance Act Decision Content Docket: 2002-4881(EI) BETWEEN: NORTH SHORE ASSOCIATION FOR THE MENTALLY HANDICAPPED, Appellant, and THE MINISTER OF NATIONAL REVENUE, Respondent. ____________________________________________________________________ Appeal heard on common evidence with the appeal of North Shore Association for the Mentally Handicapped (2002-4882(CPP)) on June 18, 2003 at Vancouver, British Columbia Before: The Honourable Justice M.J. Bonner Appearances: Counsel for the Appellant: Leonard Glass Counsel for the Respondent: Victor Caux ____________________________________________________________________ JUDGMENT The appeal is dismissed. Signed at Toronto, Ontario, this 30th day of September 2003. "M.J. Bonner" Bonner, J. Citation: 2003TCC657 Date: 20030930 Docket: 2002-4881(EI) 2002-4882(CPP) BETWEEN: NORTH SHORE ASSOCIATION FOR THE MENTALLY HANDICAPPED, Appellant, and THE MINISTER OF NATIONAL REVENUE, Respondent. REASONS FOR JUDGMENT Bonner, J. [1] The Appellant appeals from a decision of the Minister of National Revenue (the "Minister") made October 24, 2002 that Tianne Tucker was engaged by the Appellant under a contract of service during the period September 20, 2001 to March 22, 2002. The Minister's decision was based on both paragraphs 6(1)(a) of the Canada Pension Plan ("CPP") and 5(1)(a) of the Employment Insurance Act ("EI"). During the period Ms. Tucker provided respite care to the Buchanan family whose child Rachel suffered from a severe seizure disorder resulting from a problem with the function of her brain. [2] The care was provided within the framework of a respite care program funded by the province of British Columbia. The program is intended to assist families who care at home for a mentally disabled child. The intent is to provide parents with periods of relief from the ongoing burden of care and in that way to reduce stress within the home. The program works by matching families with a screened and qualified caregiver and by paying for a duly authorized quantity of appropriate care. [3] The issue in the appeals is whether Ms. Tucker cared for Rachel as an employee of the Appellant working under a contract of service or whether her work was performed under a contract for services. [4] It is the position of the Appellant that caregivers working within the program are not its employees. Instead, according to the Appellant, caregivers contract with it to provide specific services under regulated conditions. [5] Two witnesses testified at the hearing of the appeals. They were Andrea Janes, a Program Manager employed by the Appellant, and Claire Buchanan, mother of Rachel. Ms. Tucker did not testify. Counsel indicated that it was not practical to call Ms. Tucker, who now lives in Montreal, to attend at the hearing which was held in Vancouver. [6] The Appellant operates the respite care program under a contract, (Ex A-1), with the British Columbia Ministry for Children and Families (the Ministry). The contract calls upon the Appellant to provide services specified in a schedule. It requires the Province to pay the Appellant for the provision of those services. The contract stipulates that the parties must not do anything that would result in personnel hired by the Appellant being considered employees of the Province. The schedule to the contract describes the outcome desired by the Province. It is that the child be safely maintained in the family home, that stress be reduced within the family and that the family be enabled to cope with the demands of child rearing. The schedule calls upon the Appellant to provide or deliver or cause to be provided or delivered a variety of services including the following: "(a) Recruit, interview and screen applicants (b) Hire, select and assign respite caregivers according to NSAMH policy (c) Train qualified caregivers to provide respite to families referred by Ministry for Children and Families (d) Monitor and evaluate respite services (e) Meet the unique and distinctive needs of each family (f) Provide monthly statements which detail the families that have been serviced (g) Billing System: - 0 to 12 hours: bill for hours used daily @ $7.50 for regular contract, $10.00 for more challenging contracts - 12 to 24 hours: bill for 12 hours, overnight rate @ $90.00 for regular contract and $120.00 for more challenging contracts (h) Maximum billable hours per month is $1,884.00" [7] In practice an individual arrangement for the provision of care starts with an application by the family of a child with developmental disabilities. A social worker employed by the Ministry meets with the family and negotiates an "Authorization and Service Plan" which fixes the number of hours of care which the Ministry is prepared to fund. The authorization form permits the family to suggest who the caregiver might be. In this case, the Buchanan family had no suggestion to make and Ms. Tucker, who was known to the Appellant as a result of work she had done as a volunteer, was suggested by the Appellant. Ms. Tucker and the Buchanan family met. Each was satisfied with the other. [8] Subsequently the Appellant performed a background check on Ms. Tucker and furnished her with a copy of the Appellant's respite program manual. Ms. Tucker was asked to read it. The document is some twenty-two pages in length. It sets out the job description of the respite caregiver. The requirements include the following: "- Obtain all information pertinent to the child and his/her needs prior to providing care. It is also the responsibility of the family to provide this information to the caregiver. - Confirm dates and times of scheduled visits with the family. - According to the requests and specifications of the family, assist the child with all personal routines. (e.g. personal care, preparation of meals, bedtime routines) - Follow all specified programs as outlined by the family. This may include sign language, behaviour management, and physical therapy. Please note that respite caregivers are not expected to act as therapists i.e. they are not expected to develop a behaviour modification plan but would be expected to adhere to any behaviour modification plans that are already practiced within the home. - With an emphasis on socialization and age appropriate activities, provide the child with empathetic and supportive companionship and supervision. - Accurately complete timesheets and submit them to the NSAMH - (the Appellant) - according to deadlines." The program manual notes: "Although caregivers are not entitled to such things as benefits and paid vacation, respite caregivers are covered by the Association's liability policy.... Caregivers are also covered by WCB and the Ministry for Children's and Family Developments insurance policy, which covers individuals for up to one million dollars in liability...." [9] Ms. Janes described the program manual as a philosophical document not similar to an employment manual. In my view the manual is much more than a philosophical document. It sets forth the Appellant's policy on a number of topics related to the operation of the program. It contains specific statements of the Appellant's expectations and detailed procedures which are to be followed by caregivers. The directions relate to such matters as behaviour management, cases of abuse and neglect, providing personal care, hygiene, medication, emergencies, missing children and the reporting of accidents and incidents. [10] Before starting to provide care Ms. Tucker signed a letter of agreement with the Appellant the purpose of which was to confirm her appointment as Rachel's caregiver within the Children's Community-Based Respite Program of the Appellant. The terms of the letter of agreement included the following: "Respite caregivers are independent contractors, providing contracted services and are not employees of the North Shore Association for the Mentally Handicapped. The Respite Care Manual must be reviewed before commencing a respite contract. Caregivers must have access to this manual during every respite shift. Caregivers must adhere to the policies and procedures as outlined in the manual and must uphold the standards and level of performance which are implicit in this document. I have read and agree to the terms of the above agreement. I have read and agree to adhere to the policies and procedures as outlined in the Respite Care Manual." The letter also provided for termination for cause but Ms. Janes explained that it is the family which normally terminates the caregiver. [11] Ms. Tucker was paid by the Appellant for her work as a caregiver following the submission to the Appellant of a timesheet recording the number of hours of care provided. Payment was made at an hourly rate which had been fixed in the authorization and service plan. [12] Caregivers are not paid when they take time off for illness. [13] Ms. Janes indicated that the Appellant does not in practice supervise caregivers. The Appellant might, she said, call the family to ensure that all was well and might also offer to serve as a resource. [14] The workers are not able to increase the revenues earned under the agreement with the Appellant. They may, of course, work extra hours by separate agreement with the family but in such case they had to look to the family for payment. [15] As a practical matter caregivers are not exposed to a risk of loss under the arrangement with the Appellant. The base of care-giving operations is the home of the child. It is the responsibility of parents to provide all toys and supplies required by the child and to pay the cost of any outings in the community. [16] Caregivers are not permitted to employ a substitute. The family selects caregivers subject to the screening and contracting process conducted by the Appellant as outlined above. [17] Ms. Tucker's work schedules were fixed by agreement with the family following discussions held each week. The caregiver job description portion of the manual contemplates that the family will exercise a measure of control and direction over the work of the caregiver. At paragraphs 4 and 5 of the "Respite Caregiver: Job Description" portion of the manual the following is found: "According to the requests and specifications of the family, assist the child with all personal routines. (e.g. personal care, preparation of meals, bedtime routines) Follow all specified programs as outlined by the family. This may include sign language, behaviour management, and physical therapy. Please note that respite caregivers are not expected to act as therapists i.e. they are not expected to develop a behaviour modification plan but would be expected to adhere to any behaviour modification plans that are already practiced within the home." [18] Both counsel made extensive and helpful references to the authorities on the distinction between employment contracts and contracts for services. It was common ground that at this time the leading authority dealing with the distinction is 671122 Ontario Ltd. v. Sagaz Industries Canada Inc. 2001 SCC 59. In that case the Supreme Court considered the distinction in the context of the rule which attaches to an employer vicarious liability for the tortious actions of an employee. Following a review of the relevant case-law, and in particular, the decision of the Federal Court of Appeal in Wiebe Door Services Ltd. v. M.N.R. [1986] 3 F.C. 553. Major J., speaking for the Court, said the following: "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, supra, 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, supra, 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." [19] Counsel for the Appellant took the position that the caregivers are independent contractors. He argued in the alternative that caregivers, if employees, were employees of the Province. He submitted that the Appellant did not have the right to control Ms. Tucker for it did not dictate the time when she worked and it permitted caregivers to decline the offer of a contract. Counsel pointed out that monitoring the results of a worker's efforts does not constitute the exercise of control. He noted that tools are not required for the provision of care. He pointed out in relation to the chance of profit factor that caregivers are entitled to accept or refuse work. He relied heavily on the decision of this Court in Family Services Perth-Huron v. M.N.R., [2000] TCJ No. 2, a case where the facts were said to be similar to the present. [20] In my opinion Ms. Tucker was an hourly rated worker employed by the Appellant. She took no financial risk, used no tools of her own and apparently made no investment in respect of the provision of care. It was not suggested that she was able to negotiate in respect of compensation. The rate of pay was fixed in the authorization and service plan, a document to which she was not a party. She was not in a position to manage her work as caregiver in any way which would have an effect on the financial outcome. As noted already, she was subject to control with respect to the manner in which the work was to be performed. The Appellant's manual governed the entire approach to the work and Ms. Tucker was obliged to follow it. [21] It is true that Ms. Tucker's care-giving schedule was to be worked out between her and the Buchanan family but I do not regard this fact as indicative of the absence of a master-servant relationship. It is not at all uncommon for persons who are clearly employees to work in accordance with a schedule negotiated with a view to meeting the needs of both employer and employee. [22] The job description at page 3 of the program manual states that the caregivers "are under contract and are not employees of the Association". The view taken by the parties with regard to the nature of the relationship is not determinative.[1] [23] When the arrangement between the Appellant and Ms. Tucker is viewed as a whole it is evident that it is not directed toward the exchange of money for a defined result as is often the case in a contract for services. Rather the arrangement is one which required Ms. Tucker to place her time and labour at the disposal of the Appellant and that, as I see it, is typical of a contract of service. When the relationship is viewed as a whole there is, in my opinion, virtually nothing which suggests that Ms. Tucker, in providing her labour, did so as a person in business on her own account. [24] Finally with respect to the decision of this Court in Family Services Perth-Huron v. M.N.R. (supra) I will note that there appear to be major factual differences between the two cases, particularly in the area of control of the manner in which the worker was to carry out his or her duties. [25] It is clear on the evidence that it was the Appellant and not the Province which employed Ms. Tucker. The Province did not authorize the Appellant to hire employees to work for the Province nor did the Appellant purport to do so. [26] The appeals will therefore be dismissed. Signed at Toronto, Ontario, this 30th day of September 2003. "M.J. Bonner" Bonner, J. CITATION: 2003TCC657 COURT FILE NO.: 2002-4881(EI) and 2002-4882(CPP) STYLE OF CAUSE: North Shore Association for the Mentally Handicapped and M.N.R. PLACE OF HEARING: Vancouver, British Columbia DATE OF HEARING: June 18, 2003 REASONS FOR JUDGMENT BY: The Honourable Justice M.J. Bonner DATE OF JUDGMENT: September 30, 2003 APPEARANCES: Counsel for the Appellant: Leonard Glass Counsel for the Respondent: Victor Caux COUNSEL OF RECORD: For the Appellant: Name: Firm: For the Respondent: Morris Rosenberg Deputy Attorney General of Canada Ottawa, Canada [1] See M.N.R. v. Emily Standing, 147 N.R. 238