In the recent decision in Cormier v 1772887 Ontario Limited, an Ontario Superior Court judge stated that in some circumstances it would be reasonable to consider an employee’s years of service as an independent contractor in calculating his or her common law reasonable notice period.
The facts of the case were straight-forward. Ms. Cormier worked for the employer as a contractor from 1996 to 2004, at which time she was hired as an employee. Ms. Cormier continued to work for the employer until 2016, when she was terminated without cause.
The employer offered Ms. Cormier five weeks’ working notice of termination plus 29 weeks’ pay in lieu of notice. Ms. Cormier refused that offer and brought an action for wrongful dismissal.
Ms. Cormier claimed that she was entitled to 24 months’ pay in lieu of reasonable notice of termination. Ms. Cormier argued that between 1996 and 2004 she was a dependent contractor and that those years of service ought to be included in calculating her reasonable notice period. The employer argued that Ms. Cormier was an independent contractor between 1996 and 2004 and that her reasonable notice period ought to be calculated without regard to those years of service.
The judge found that Ms. Cormier was a dependent contractor between 1996 and 2004 and awarded Ms. Cormier 21 months’ pay in lieu of reasonable notice of termination.
However, the judge then went on to state that even if he had found Ms. Cormier was an independent contractor between 1996 and 2004, he still would have included those years of service in calculating her reasonable notice period:
“… it would have been wrong in principle to ignore these years of their relationship in determining the reasonable notice period. The court should take all of the circumstances into account and in the immediate case even if I had found Ms. Cormier to be an independent contractor, I would not have ignored those years of their relationship.”
These comments remind employers they should be wary: the line between independent contractor and employee is not clear-cut, and courts will consider the particular characteristics of each employment relationship in determining whether or not an employee is entitled to pay in lieu of reasonable notice of termination.
By Laura Sullivan, DLA Piper
- Corporations Canada and new transparency about federal non-profit corporations under the CNCA and new fees for certain documents - December 21, 2022
- How much should a Canadian registered charity spend on administration? - November 30, 2022
- Finance proposes changes to disbursement quota for charities and some increased transparency - November 11, 2022