Switch from employee to contractor examined in Quebec decision
A Quebec employer's decision to pay vacation compensation it didn't legally owe ended up shielding the company from an $11,125 overtime claim.
The November 2025 ruling highlights how informal payments to independent contractors can create binding settlements.
Justice Sylvie Lachapelle of the Court of Quebec rejected snow removal foreman Patrick Poirier's claim, finding that vacation payments issued via three invoices of $1,625 each (for a total of $4,875) had resolved all disputes over additional hours worked.
From employee to contractor
Poirier began working for snow removal company Les Entreprises Michel Gauthier in June 2022, when he was hired as night foreman at $1,350 per week for 50 hours of work. In September 2022, he incorporated Les Entreprises Patrick Poirier Inc., transforming the relationship from an employer-employee arrangement to a contractor relationship.
The court heard that as night foreman, Poirier supervised employees and handled emergencies including equipment breakdowns and fuel supply to ensure smooth snow removal operations overnight. Administrative supervisor Kim Tran managed daytime operations in this division of responsibilities.
The reclassification proved critical to the case outcome. Because Poirier was no longer an employee, Quebec’s workplace standards body Commission des normes, de l'équité, de la santé et de la sécurité du travail (CNESST) declined to represent the contractor in the dispute, forcing the claim into small claims court.
Overtime issues and contract terms
Poirier claimed he worked between 60 and 96 hours weekly after Eric Gauthier, the company president, went on medical leave. He testified that Michel Gauthier, who temporarily ran the company during his son's absence, asked him to assume Eric's responsibilities and that calls meant for Eric were redirected to him day and night.
The contractor submitted invoices for 33 supplementary hours in June 2023, then later added another claim for 62 hours from 2022, bringing his total claim to $11,125. However, the defence witnesses unanimously contradicted Poirier's version of events.
Eric Gauthier testified that Poirier did not accumulate two positions, explaining that the contract provided a fixed weekly salary of $1,350 regardless of whether he worked closer to 20 or 50 hours in a given week. The court found the contract provided fixed weekly remuneration with no provision for hourly pay or overtime.
Payment made outside of contract
Michel Gauthier acknowledged the payment was made outside contractual obligations. During testimony, he spontaneously stated he agreed to the arrangement with Poirier "to be nice," believing it might resolve the contractor's demands.
The company paid three weeks and two days presented as vacation compensation, reflected in three separate invoices of $1,625 each, for a total of $4,875. Poirier accepted these payments, which were confirmed in a June 27, 2023 letter signed by Michel Gauthier.
Justice Lachapelle concluded the parties had reached a transaction under articles 2631 and following of Quebec's Civil Code, writing that “the parties have reached a settlement for the purpose of resolving the issue of overtime claimed by the plaintiff.”
The claim was rejected with legal costs awarded against the contractor, and the court noted that the existence of this settlement also prevented the employer from recovering the vacation payments through its own counterclaim.
