Date: 20010718
Dockets: 2000-4821-EI,
2000-4984-EI
BETWEEN:
SHIRLEY HIPSON,
CLARK & PARTNERS
Appellants,
and
THE MINISTER OF NATIONAL REVENUE,
Respondent.
Reasonsfor Judgment
Somers, D.J.T.C.C.
[1] These appeals were heard on common evidence in Montreal, Quebec, on June 14, 2001.
[2] The Appellants are appealing from a decision made by the Minister of National Revenue (the "Minister") that the employment held by Shirley Hipson, the Appellant, with Clark & Partners, the Payor, during the period from July 14, 1999 to April 11, 2000, was insurable employment because she was working under a contract of service and the relationship was one of employer-employee.
[3] Paragraph 5(1)(a) of the Employment Insurance Act reads as follows:
"5.(1) 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;
..."
[4] The burden of proof is on the Appellants. They must show on a balance of probabilities that the Minister erred in fact and in law in his decision. Each case stands on its own merits.
[5] In arriving at his decision the Minister relied on the following allegations of fact which were admitted.
"a) The Payor was a new private law firm offering legal services to the public. (admitted)
b) Me Eric Clark and Me Andrew Penhale were the associates in this firm. (admitted)
c) The Appellant was a consultant in office management services and was registered under the name of "Harris Office Management Services". (admitted)
d) On or about July 14, 1999, the Appellant signed a contract with the Payor. (admitted)
e) The contract was signed between the Payor and "Harris Office Management Services" to provide office services by the Appellant. (admitted)
f) The Appellant provided services to the Payor under a written agreement during the first two months and under a verbal agreement during the rest of the litigation period. (admitted)
g) The contract specified that the Appellant had to work 7 hours per day, 5 days a week; after approximately 4 months, the Appellant worked only 3 days per week for the Payor. (admitted)
h) The Payor required that the Appellant rendered services during the regular office hours since one of the obligations of the Appellant was to answer the phone. (admitted)
(i) At the beginning, the appellant worked on administrative tasks and after a few months she worked as secretary-receptionist: she answered the phone, provided bookkeeping and other administrative tasks. (admitted)
j) During the litigation period, the Appellant performed her duties in the Payor's office and used all the equipment of the Payor. (admitted)
k) The Appellant received a fixed salary of $25 per hour; she submitted a bill of the hours worked on a bi-weekly basis to the Payor. (admitted)
[6] The Payor was a private law firm which retained the services of Shirley Hipson to act as a secretary-receptionist, by answering the phone, providing bookkeeping and other administrative work.
[7] Shirley Hipson, operating under the registered name of Harris Office Management Services signed an agreement with the Payor (Exhibit A-1). The contract was for a duration of two months: from July 14 to September 10, 1999 for a minimum of seven hours per day, five days a week at $25 per hour and was to be re-negotiated after September 10, 1999.
[8] According to Shirley Hipson, she was hired to do some secretarial work for the Payor. She testified that she received directions from Caroline Schatz, an employee of the Payor. Her duties consisted in answering the phone, attending to the accounts, photocopying and all other duties consistent with work performed in a law firm.
[9] She submitted invoices (Exhibit I-2), which were paid by the Payor, claiming various amounts for office clerical and secretarial work. She had to inform Caroline Schatz of the type of work performed.
[10] Shirley Hipson registered her business name operating under a sole proprietorship on March 3, 1999 (Exhibit I-1). She admitted not having an employee. However, she sold Avon products and also did some work for her husband, Brian P. Hipson, who operated a management company.
[11] In a letter (Exhibit I-5) dated May 16, 2000 to the Chief of Appeals, Canada Customs and Revenue Agency, Shirley Hipson described her factual arrangement with the Payor.
[12] Case law has established a series of tests to determine whether a contract is a contract of service or for the provision of services. The Federal Court of Appeal, in the case of Wiebe Door Services Ltd. v. M.N.R., 87 D.T.C. 5025, set out four tests most commonly referred to, in order to make the proper distinction. The tests are:
a) The degree or absence of control exercised by the alleged employer;
b) ownership of tools;
c) chance of profit and risk of loss;
d) integration of the alleged employee's work in the alleged employer's business.
[13] The parties above cannot conclude a contract and simply decide that the contract is one for the provision of services. It is the whole of the circumstances relevant to the work performed which determine whether or not it is self-employment or an employer-employee relationship.
Control
[14] The Appellant was under the direct supervision of Caroline Schatz, an employee hired by the Payor. Even if the lawyers were not always present in the office, the Appellant was still under the control of the Payor. It is not so much the immediate control of the Payor or of another authorized person that is the determining factor but it is the right to exercise a control. Even though the Appellant had a certain flexibility in setting her hours or vacations, she had to perform her duties at a minimum of seven hours per day, five days a week. Considering these facts there was a sufficient amount of control to conclude that the Appellant was employed under a contract of service.
Ownership of tools
[15] The Appellant performed her duties with the facilities offered by the Payor. Being so, the Court must conclude to the existence of a contract of service.
Profit and loss
[16] The Appellant was paid on an hourly basis at a rate of $25. She submitted invoices setting out the number of hours worked plus the overtime. There being no chance of profit or risk of loss, it was a contract of service that existed between herself and the Payor.
Integration
[17] The Appellant worked regular hours at the office of the Payor performing duties related to work in a law partnership. Those duties were essential for the good operation of the law firm. Being integrated in the operation of the legal office reflects a contract of service.
[18] Taking into consideration all of the circumstances, the Court is of the opinion that the Appellant worked during the period in question for the Payor under a contract of service. The Appellant, Shirley Hipson, was engaged by the Payor in insurable employment within the meaning of the Employment Insurance Act.
[19] The appeals are dismissed.
Signed at Ottawa, Canada, this 18th day of July 2001.
"J.F. Somers"
D.J.T.C.C
.COURT FILE NO.: 2000-4821(EI)
STYLE OF CAUSE: Shirley Hipson and M.N.R.
PLACE OF HEARING: Montreal, Quebec
DATE OF HEARING: June 14, 2001
REASONS FOR JUDGMENT BY: The Honourable Deputy Judge J.F. Somers
DATE OF JUDGMENT: July 18, 2001
APPEARANCES:
Counsel for the Appellant: Eric L. Clark
Counsel for the Respondent: Claude Lamoureux
COUNSEL OF RECORD:
For the Appellant:
Name: Eric L. Clark
Firm: Clark & Partners
Montreal, Québec
For the Respondent: Morris Rosenberg
Deputy Attorney General of Canada
Ottawa, CanadaCOURT FILE NO.: 2000-4984(EI)
STYLE OF CAUSE: Clark & Partners and M.N.R.
PLACE OF HEARING: Montreal, Quebec
DATE OF HEARING: June 14, 2001
REASONS FOR JUDGMENT BY: The Honourable Deputy Judge J.F. Somers
DATE OF JUDGMENT: July 18, 2001
APPEARANCES:
Counsel for the Appellant: Eric L. Clark
Counsel for the Respondent: Claude Lamoureux
COUNSEL OF RECORD:
For the Appellant:
Name: Eric L. Clark
Firm: Clark & Partners
Montreal, Québec
For the Respondent: Morris Rosenberg
Deputy Attorney General of Canada
Ottawa, Canada
2000-4821(EI)
BETWEEN:
SHIRLEY HIPSON,
Appellant,
and
THE MINISTER OF NATIONAL REVENUE,
Respondent.
Appeal heard on common evidence with the appeal of Clark & Partners (2000-4984(EI)) on June 14, 2001 at Montreal, Québec, by
the Honourable Deputy Judge J.F. Somers
Appearances
Counsel for the Appellant: Eric L. Clark
Counsel for the Respondent: Claude Lamoureux
JUDGMENT
The appeal is dismissed and the decision of the Minister is confirmed in accordance with the attached Reasons for Judgment.
Signed at Ottawa, Canada, this 18th day of July 2001.
|
"J.F. Somers" |
D.J.T.C.C.
2000-4984(EI)
BETWEEN:
CLARK & PARTNERS,
Appellant,
and
THE MINISTER OF NATIONAL REVENUE,
Respondent.
Appeal heard on common evidence with the appeal of Shirley Hipson (2000-4821(EI)) on June 14, 2001 at Montreal, Québec, by
the Honourable Deputy Judge J.F. Somers
Appearances
Counsel for the Appellant: Eric L. Clark
Counsel for the Respondent: Claude Lamoureux
JUDGMENT
The appeal is dismissed and the decision of the Minister is confirmed in accordance with the attached Reasons for Judgment.
Signed at Ottawa, Canada, this 18th day of July 2001.
|
"J.F. Somers" |
D.J.T.C.C.