https://decision.tcc-cci.gc.ca/tcc-cci/decisions/en/item/406682/index.do
AE Hospitality Ltd. v. M.N.R. (May 17, 2019 – 2019 TCC 116, D’Auray J.).
Précis: This is a lengthy (217 paragraphs), erudite and factually complex decision involving 218 workers. The taxpayer, AE Hospitality Ltd. (AE), provided staff to two catering companies owned, in whole or in part, by related individuals. The Minister found that all of the employees were engaged in insurable and pensionable employment in 2016. The Court, after an extensive analysis agreed with the Minister’s position (without the necessity for recourse to the Minister’s alternative “placement agency” argument). An appeal in respect of two individuals in 2015 was allowed in part.
Decision: This is very instructive case in terms of reviewing the salient principals for identifying insurable and pensionable employment. In essence however the Court distilled the position of the vast bulk of the employees into a single paragraph:
[158] Taking into account the facts, I am of the view that the workers were employed by AE. Although the intention of the workers may have been to be independent contractors, the facts do not substantiate such intention. I will not repeat what I have already stated in the analysis of the factors. The factors assisting in determining if a worker is an employee or an independent contractor, namely the control, the chance of profit and risk of loss and the integration factor all point to an employment relationship. In my view, the workers are not operating a business on their own account. The only parties that are operating a business and bear business risks are AE and the catering companies.