Barbeau v. M.N.R. (May 22, 2015 – 2015 TCC 131, Hogan J.).
Précis: The appellant operated a form of placement agency for cleaners. The Minister ruled that they were engaged in insurable employment because they operated under the control of the appellant’s clients. The Tax Court found that was not correct as a matter of fact. In the alternative the Minister argued that the cleaners were employed by the appellant. The Court permitted the Minister to make this alternative argument but ruled that the onus was on the Minister to adduce facts to support that argument. The Court applied the well known tests for distinguishing between employees and self-employed individuals and concluded that the cleaners were not employees. The evidence that the appellant exercised control over the cleaners was “inconclusive and contradictory”. Since the onus was on the Minister to support the alternative argument the appeal was allowed as the Minister had not met that onus. The cleaners were thus held not to be employees.
Decision: The Crown’s principal argument was based on paragraph 6(g) of the Employment Insurance Regulations dealing with placement agencies:
 For paragraph 6(g) of the Regulations to apply, the following criteria must be met: (i) there must be a placement or employment agency; (ii) a person must be placed in employment by a placement or employment agency to perform services for a client; (iii) the person must be under the direction and control of a client of the agency; and (iv) the person must be remunerated by the agency:
6 Employment in any of the following employments, unless it is excluded from insurable employment by any provision of these Regulations, is included in insurable employment
. . .
(g) employment of a person who is placed in that employment by a placement or employment agency to perform services for and under the direction and control of a client of the agency, where that person is remunerated by the agency for the performance of those services.
The Court held that this provision was inapplicable since, on the evidence, the homeowners where the cleaners worked did not direct or control the work of the cleaners:
 In his written submissions, the Minister, without further explanation, stated that the workers were under the direction and control of the clients as it [Translation] ‟is clear from the evidence that the clients could tell the [w]orkers what to do even if they did not necessarily tell them how to do it.ˮ
 In my opinion, the evidence did not support this conclusion.
 The workers often cleaned the clients’ houses jointly, but the clients did not decide what task would be done by Mr. Martineau or Ms. Hamel or how to do it.
 The workers each testified that the clients were rarely present when they performed their work. Ms. Hamel stated that the clients did not give her orders because they trusted her and because she knew what to do.
 In 2010 and 2011, the workers provided cleaning services for Geneviève Horlings, a client of SEMO. Ms. Horlings was not present when the workers came to do the cleaning. Before the Court, she stated that she initially met with Ms. Hamel to show her the house, but she did not tell her how to do her job. According to Ms. Horlings, she did not have to give orders because [Translation] ‟they are the professionals.ˮ Ms. Horlings knew that Ms. Hamel worked with Mr. Martineau, but admitted that she never met or spoke with him.
 The relationship between the workers and Ms. Horlings was not unique. According to the testimonies heard at the hearing, there was generally a lack of control by the clients over the SEMO workers.
The Court permitted the Minister to make the alternative argument that the cleaners were employees of the appellant but ruled that in this instance the onus of proof was on the Minister:
 According to counsel for the Minister, when the alternative argument is based on the same facts as those that served as the basis for the Minister’s decision, there is no need to reverse the burden of proof. She submits that a reversal of the burden of proof may only take place when the alternative argument is based on new facts.
 I do not agree with the respondent’s opinion on this issue. As noted above, first Ms. Lacoste, CRA rulings officer, decided that the work of the workers was insurable owing to the fact that they were self-employed workers serving the appellant’s clients and that the appellant acted as a placement or employment agency. Ms. Lacoste concluded that the workers were subject to the direction and control of the appellant’s clients as a result of a delegation of the power of control. This allegation of fact was essential for the Minister to conclude that the workers’ employment was insurable under paragraph 6(g) of the Regulations.
 Ms. Lacoste’s decision was upheld by the Minister, who reached the same conclusion by reiterating in his decision that the workers were subject to the direction and control of the appellant’s clients. Therefore, the respondent’s alternative position is partly based on facts that contradict those assumed by the Minister when he upheld Ms. Lacoste’s decision. Accordingly, the Reply to the Notice of Appeal is inaccurate and incomplete when it states, at paragraph 14 in docket 2012-4560(EI) and at paragraph 15 in docket 2013-2811(EI), that the Minister determined that the workers held insurable employment based on the assumptions of fact set out at paragraphs 14(a) to (r) in docket 2012-4560(EI) and at paragraphs 15(a) to (u) in docket 2013-2811(EI).
 Indeed, based on my reading of the foregoing decisions, I find that the Reply failed to mention that the Minister assumed that the workers were under the appellant’s direction and control rather than under the direction and control of the appellant’s clients. Accordingly, I find that the burden of proof is on the respondent to establish, based on a balance of probabilities, that the workers were subject to the appellant’s direction and control.
The Court found that the evidence that the cleaners were under the direction and control of the appellant was unsatisfactory:
 In my view, an analysis of the factual relationship between the appellant and the workers shows that they performed their work under a contract of enterprise.
 The indicators of supervision considered above are inconclusive and contradictory.
 Thus, it is the application of the control test that will make it possible to settle the dispute. The burden of proof was on the Minister in that regard, and since the Minister failed to establish that the workers were under the appellant’s direction and control, I must allow the appeals.