http://decision.tcc-cci.gc.ca/tcc-cci/decisions/en/item/100766/index.do 
CanHorizon Inc. v. M.N.R. (January 23, 2015 – 2015 TCC 19, Campbell).
Précis: CanHorizon was engaged in the business of providing information technology consulting services by way of web-based training. It was owned by Enming Wang and operated out of his home. In 2011 he married the Worker, Lihua Zheng, who moved to Canada in May of 2012. The period of employment was from December 1, 2012 to December 31, 2013 when Ms. Zheng took maternity leave and had a baby in February of 2014. During her period of employment she was involved in recruiting Chinese students for educational institutions in Canada and maintaining the corporate web site. She was paid at a low rate and somewhat sporadically. After she took maternity leave the position was not replaced. The Court held that the terms of her employment were not those that would have been applicable in an arm’s length relationship and, accordingly, she was not engaged in insurable employment.
Decision: This was an EI appeal where the Worker, Lihua Zheng, was employed by CanHorizon Inc., a corporation owned by her husband, Enming Wang:
[1] This is an appeal of the decision of the Minister of National Revenue (the “Minister”) in which the ruling by the CPP/EI Rulings Officer was confirmed. That ruling determined that Lihua Zheng (the “Worker”) was not engaged in insurable employment with the Appellant because they were not dealing with each other at arm’s length within the meaning of paragraph 5(2)(i) of the Employment Insurance Act (the “Act”). The Minister concluded that the parties would not have entered into a substantially similar work relationship if they had been dealing with each other at arm’s length. The period under appeal is from December 1, 2012 to December 31, 2013.
[2] The Appellant is an incorporated company engaged, since its inception on July 3, 2002, in the business of providing information technology consulting services by way of web-based training. The Worker’s husband, Enming Wang, is the sole shareholder of the corporation and he controlled all of the day-to-day corporate business activities and operations. The Worker and Mr. Wang married on May 13, 2011 and the Worker immigrated to Canada from China on May 1, 2012. Mr. Wang owned a property in Mississauga, Ontario, which was the couple’s personal residence as well as the business address and location of the Appellant company. It was from this same property that the Worker performed all of her work-related duties.
Her duties were to act as a student recruiter and maintain the corporate web site:
[3] … The Worker was hired, pursuant to a verbal agreement, to act as a student recruiter and liaison with Chinese students and their families. The Worker was provided some training and eventually she maintained the Appellant’s website, distributed promotional pamphlets and assisted Chinese students with applications.
The Worker’s rate of pay was comparatively low and she was paid somewhat sporadically:
[9] The Appellant paid the Worker a monthly base salary of $2,000. Mr. Wang testified that the Worker was to also receive 40 percent of any commission paid by the schools as a result of placements. Both Mr. Wang and the Worker stated that there was no documentation to support their agreement respecting the split of commissions and that, during the period under appeal, as well as up to the date of the hearing, the Worker had never received any payment in this regard. Neither the Appellant’s nor the Worker’s Questionnaire made any reference to this commission split. While the Respondent contended that the Worker was paid substantially less than education consultants were earning in the Toronto area, Mr. Wang testified that the Worker was not proficient in the English language and this would be a handicap to her earning the salary equivalent of an education consultant. In addition, he stated that it ignored their verbal agreement concerning the commission split. He stated that the company paid a low rate of pay because the business was new and the monthly base salary of $2,000 was all that the company could afford.
[10] The Respondent assumed that the Worker’s pay was delayed occasionally due to the Appellant’s cash flow problems and that the Appellant’s financial position, at any given time, dictated that frequency and timing of the Worker’s payments. Mr. Wang agreed that the Worker’s salary was irregular and delayed on a few occasions due to cash flow problems and tight profit margins. He admitted that he was busy working on other projects and that, although he could have paid on time, he “… didn’t pay much attention to that.” (Transcript, page 17). Mr. Wang also stated that “Sometimes I am a little loose in writing cheques for her pay.” (Transcript, page 44). He admitted that he did not worry about delaying the Worker’s payments because she was his spouse. Mr. Wang testified that “If she was a different person, a stranger, then I would pay … I would not let another person wait for two months.” (Transcript, page 71).
When she left for maternity leave the position was not replaced:
[14] No replacement was hired when the Worker left on her maternity leave because, according to Mr. Wang, he could not locate a qualified replacement. The Respondent contended that no qualified person would accept the employment on the same terms that the Worker had accepted. At another point in his testimony, Mr. Wang submitted that he did not hire a replacement because he no longer needed one as the Appellant now had all the contact information from the Worker.
The appeal was dismissed:
[27] The Appellant did not introduce any new facts that were not before the Minister when the determination was made, nor is there any evidence that would support my interference with the Minister’s finding based on a misunderstanding by the Minister of the facts on which the determination was based. Consequently, based on all of the evidence that was before me, I have not been persuaded that the Minister’s decision was unreasonable. There is nothing to warrant any conclusion to the contrary.
[28] The appeal is dismissed, without costs, because I am satisfied that the Minister’s conclusion, that the parties would not have entered into a substantially similar contract of employment had they been dealing at arm’s length, was reasonable.
In a quite unusual digression the Court added a postscript sharply criticizing a student-at-law who represented the Crown and appeared to attempt to withdraw an admission, contained in the Reply, that the Worker was an employee.