As work patterns change in the modern era, the line between
independent contractor and employee can often become blurry.
A recent decision by the Superior Court of Justice underscores the
heavy potential cost for an employer that attempts to retain
workers as independent contractors – and finds itself on the
wrong side of the line.
In Keenan v. Canac Kitchens, the Court was asked
to determine whether a husband and wife (the
"Plaintiffs") were employees or independent contractors
of an installer of kitchen cabinets (the
"Defendant"). The husband had worked for the
company since 1976 and the wife since 1983. It was not in
dispute that the Plaintiffs were employees up until October
In 1987, the Plaintiffs were called into a meeting with upper
management and told that their engagement would continue as
independent contractors and they should incorporate.
The Plaintiffs did so and began to work under this new
The Plaintiffs were responsible for engaging and paying
The installers engaged by the Plaintiffs would use their own
The Defendant would set the rates to be paid to the
The Plaintiffs would be paid gross piecework rates, without
source deductions, in addition to the amounts they were to pay to
The Plaintiffs were required by contract to devote their
full-time attention to the Defendant's business;
Other than a brief period where a minority of work was
performed for a competitor, the Plaintiffs worked exclusively for
the Defendant for 22 years; and
The installers working under the Plaintiffs identified
themselves as employees of the Defendant.
The Court considered these factors and found that the Plaintiffs
were dependent, rather than independent contractors. The
Court was particularly focused on the relationships between the
parties "on the ground" and the fact that the benefit of
the relationships was almost completely enjoyed by the
As the Court held that the Plaintiffs were dependent
contractors, the Court found that they were entitled to reasonable
notice. Given their long service, the Court awarded a
remarkable 26 months of notice.
Despite good faith and best intentions on both sides, and even a
well-crafted and explicit independent contractor agreement, the
courts are increasingly willing to let the "facts on the
This decision underscores the importance of proceeding carefully
and with legal advice prior to engaging workers under an
independent contractor arrangement.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
To print this article, all you need is to be registered on Mondaq.com.
Click to Login as an existing user or Register so you can print this article.
The new Sexual Violence and Harassment Action Plan Act (Bill 132) imposes a range of new duties in regard to workplace harassment. These include requiring employers to amend their programs to implement workplace harassment policies and establish new rules for the investigation of workplace harassment incidents or complaints.
Receive expert guidance from experienced employment lawyers as to how your organization can comply with this new law painlessly and address workplace harassment effectively
This past year has been marked with significant changes to employment legislation, and watershed decisions that will affect employers for years to come. We've designed this year's conference to deliver a practical and digestible review of what you need to know to manage your employees effectively.
Unfortunately, reasonable accommodation for employees in the workplace continues to be the source of significant litigation and even today we continue to see outrageous examples of employers behaving badly.
A former teacher at Bodwell High School has learned a valuable lesson from the B.C. Human Rights Tribunal— it is not discriminatory for an employer to offer child-related benefits to only employees with children.
We are now beginning to see reported cases involving charges and subsequent fines laid against employers for failing to provide information, instruction and supervision to protect a worker from workplace violence.
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).