In Rizak v. M.N.R.(2013 TCC 273), the Tax Court of Canada
considered this question and determined, on the facts, that a
graduate student performing research at the University of British
Columbia was an employee for the purposes of the Employment
In Rizak, the taxpayer was a grad student in neuroscience at
UBC. Before starting his studies, the taxpayer was hired as an
employee by a professor who needed assistance with lab research.
After his grad studies commenced, the taxpayer performed the same
lab research but, instead, received an annual stipend rather than
an hourly wage. After he withdrew from the grad program, the
taxpayer was once again hired as an employee to perform the
same lab research for several months.
Subsequently, the Minister of National Revenue determined the
taxpayer's work while he was a grad student was not insurable
employment for the purposes of subsection 5(1) of the Employment
Insurance Act. The taxpayer appealed to the Tax Court.
I am not required to determine whether Mr. Rizak was an employee
or an independent contractor as neither party took the position
that Mr. Rizak was an independent contractor. I simply have to
determine whether the dominant characteristic of the payments that
Mr. Rizak received was compensation for the work he did or student
assistance. I do not find [the Wiebe Door factors] to be useful in
reaching that determination.
The Tax Court concluded that the dominant characteristic of the
stipend paid to the taxpayer was compensation for work and, thus,
he was an employee. There was a clear correlation between the
stipend and the work performed by the taxpayer and he received the
money because he agreed to work in the professor's lab. The
taxpayer was required to do the specific work expected of him.
Further, the taxpayer performed the same work as an employee both
before and after his time as a grad student.
In obiter, the Tax Court also noted that, for the purposes of
the Income Tax Act, the taxpayer had earned employment income
rather that exempt (or partially exempt) scholarship income
and the Court, therefore, suggested that the taxpayer had
tried to "have his cake and eat it too" by claiming not
to be an employee for income tax purposes while at the same time
claiming to be an employee for employment insurance purposes.
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