Canada: Keeping Up With The Keenans: Dependent Contractors Entitled To 26 Month Notice Period

In Keenan v Canac Kitchens Ltd.,1 the Ontario Court of Appeal awarded damages in lieu of 26 months' notice to two dependent contractors. The decision offers insight into the nature of dependent contractors and the circumstances in which they may be entitled to such lengthy notice periods on termination.


Mr. and Mrs. Keenan initially worked for Canac Kitchens Ltd. as employees. Mr. Keenan joined Canac in 1976 as a kitchen cabinet installer and became a foreman in 1983. Mrs. Keenan was hired on as a foreman in 1983. In 1987, the Keenans were told that they would carry on their work as contractors and that the following changes would be made to their job responsibilities:

  • they would pay installers directly;
  • they would be held responsible for any damage to cabinets that occurred in transit; and
  • they would be paid for each unit installed, as before, except the amount would be increased to reflect the fact that they were paid in gross, without deductions for taxes, employment insurance and CPP.

This working relationship continued to be the status quo and the Keenans worked almost exclusively for Canac until 2007, when they began doing work for one of Canac's competitors. In 2009, Canac terminated the Keenans' contracts without notice or pay in lieu of notice.

The Keenans commenced a claim for wrongful dismissal. The trial judge held that the Keenans were dependent, rather than independent, contractors and ordered Canac to pay both Mr. and Mrs. Keenan damages in lieu of 26 months' notice. Canac appealed on two grounds: first, that the Keenans did not exhibit sufficient exclusivity to be characterized as dependent contractors; and second, that the Keenans' awards of 26 months' notice were not appropriate.

Issue 1: Characterizing the Keenans

To determine whether a worker is an employee, dependent contractor or independent contractor, Ontario courts apply the two-step analysis from McKee v Reid's Heritage Homes Ltd.:2

  1. Is the worker a contractor or employee?

    • This step involves a multi-factor, contextual analysis that looks to the "total relationship" of the parties.3
    • For a detailed discussion of the factors considered in characterizing a worker as an employee or independent contractor, see "Employee or Independent Contractor (Self-Employed)?"4
  2. If the worker is a contractor, is he or she independent or dependent?
    • This step involves consideration of the contractor's degree of exclusivity.
    • According to McKee, a contractor's degree of exclusivity will be determinative of the dependent contractor relationship.5 In other words, a contractor working exclusively for a person or company will likely be characterized as a dependent contractor.

In the second branch of the McKee analysis, the Court considered the "full history" of the Keenans' relationship with Canac.6 The Court did not get hung up on the fact that nearly 30% of the Keenans' revenues were attributable to Canac's competitor at the time of termination, instead it emphasized that the substantial majority of the Keenans' work continued to be done for Canac after 2007 and that approximately 97.5% of the Keenans' income, between 1987 and 2007, relate to work performed for Canac. The Court upheld the trial court's finding of exclusivity and its characterization of the Keenans as dependent contractors.

Issue 2: Assessing the Appropriate Notice Period

Like employees, dependent contractors are entitled to reasonable notice on termination. Once it was confirmed that the Keenans were dependent contractors, it became necessary to assess whether the notice periods that they were awarded at trial were appropriate.

The Court stated that "the reasonable notice period is a case-specific determination and there is no absolute upper limit on what constitutes reasonable notice," but acknowledged that "generally only exceptional circumstances will support a notice period in excess of 24 months."7 The Court then considered the Keenans' respective ages (Mr. Keenan was 63 and Mrs. Keenan was 61), their respective lengths of service (32 years for Mr. Keenan and 25 for Mrs. Keenan), the supervisory character of their positions, and their reliance on income from Canac to support themselves during the entirety of their working lives. Despite the failure of the trial judge to explicitly indicate that the circumstances were "exceptional," the Court upheld the trial-level decision and stated that the circumstances justified awards of damages in lieu of 26 months' notice.

Takeaways for Employers

Determining whether a worker is an employee, dependent contractor, or independent contractor can be highly fact-specific. Employers must remember that exclusivity is not assessed using a "snapshot" approach. In this case, the level of exclusivity at the time of termination was not determinative of the characterization of the relationship. The total history of the parties must be kept in mind in assessing exclusivity and whether a contractor is dependent. As in Keenan, failure to correctly characterize an employment relationship may lead to substantial liability on termination.

It is imperative that employers take care when arranging and terminating worker relationships. If you are unsure about the nature of your workers and their potential entitlements on termination, it is best to seek the advice of an employment lawyer.


1 2016 ONCA 79 ("Keenan").

2 2009 ONCA 916 ("McKee") at para 34.

3 671122 Ontario Ltd. v Sagaz Industries, [2001] 2 S.C.R. 983 at para 46.

4 Available at

5 McKee at para 34.

6 Keenan at para 25.

7 Ibid at para 30, citing Lowndes v Summit Ford Sales Ltd. [2006] O.J. No 13 (C.A.) at para 11.

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

Click to Login as an existing user or Register so you can print this article.

In association with
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
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).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


From time to time Mondaq may send you emails promoting Mondaq services including new services. You may opt out of receiving such emails by clicking below.

*** If you do not wish to receive any future announcements of services offered by Mondaq you may opt out by clicking here .


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.