Employer's only knowledge of contractor's work was when she submitted monthly time sheets
An Ontario foster care support worker was an independent contractor, not an employee of a foster care program, the Tax Court of Canada has ruled.
Quinte Children’s Homes (QCH) is a provider of foster care and treatment for children in Belleville, Ont. QCH manages 35 foster care homes and places children in those homes, receiving compensation for its services from the Ontario Ministry of Community and Social Services.
The organization contracted child and youth workers to provide support for treatment plans for each child. Sara Fobear started working with QCH as part of a co-op program at her college and after she graduated, QCH asked her to start working full-time with it. She was presented with a consulting services agreement, which stated Fobear would be retained as an independent contractor. However, Fobear didn’t read the full agreement and wasn’t aware she would be an independent contractor, nor did QCH explain the arrangement.
The contract allowed Fobear to subcontract her services, but only to people who had been approved by QCH.
QCH provided Fobear with operations manuals outlining what she was and wasn’t supposed to do when interacting with foster children, how she was to file reports, what training she would have to do, and when performance reviews would occur. These were not QCH policies, but rather were required under Ontario legislation and the ministry.
QCH didn’t assign specific children to Fobear and other support workers; rather, foster parents picked them and used them as necessary. Fobear recorded her hours on an invoice and, at the end of each month, she submitted the invoice to QCH to get paid. QCH paid Fobear only for the hours she worked, not any benefits or vacation pay.
Fobear used her car to take children to and from activities and appointments, and QCH reimbursed her on a per-kilometer basis. QCH also made the computers in its office available to her, but she usually used computers at the foster parents’ homes.
When Fobear began working full-time for QCH, she was under the belief that she was an employee and, when she filled out her 2012 income tax return, she indicated she had earned employment income rather than business income. The Minister of National Revenue found that she was engaged in insurable employment and QCH must make appropriate deductions and payments to the ministry. QCH appealed the decision.
The court found that even though Fobear didn’t fully understand the contract and didn’t have it explained, it was the intention of QCH for her to be an independent contractor. While QCH provided a substantial amount of instruction on how she was to do her job, it was part of the regulated industry and not for the benefit of QCH, said the court. The control was not QCH’s, but rather it was “simply engaging workers to perform services in accordance with the law.”
The court also found the way in which Fobear was paid suggested she was an independent contractor. Monthly invoices she submitted for only the hours she worked was more consistent with an independent contractor relationship, said the court.
QCH also had policies on lateness, conflicts of interest, intellectual property, off-duty conduct, computer use, and dress code, which were applicable to employees and independent contractors, though they weren’t applied to support workers. The court found “the mere presence of these types of policies” was indicative of an employment relationship, as was the fact QCH conducted performance reviews that went further than ministry requirements.
