Worker was engaged in insurable and pensionable employment on basis of common law test

Public Law - Social programs - Employment insurance

Worker began driving taxi leased from company, after selling vehicle that he had previously used as owner-operator for company. Company remitted Employment Insurance (EI) premiums for worker for two years and, when it stopped, he sought determination of employment status. Minister determined that worker was not engaged as employee for Canada Pension Plan and EI purposes under common law test, but that he held insurable employment under s. 5(1)(d) of Employment Insurance Act and 6(e) of Employment Insurance Regulations. Company appealed. Appeal dismissed. In light of worker’s testimony and company’s initial remittance of EI premiums, parties’ common intention was that he would be employee. It was likely that company unilaterally began treating worker as independent contractor upon learning that other taxi corporations were doing so. Worker’s control over manner in which he performed taxi-driving services was subordinate to company’s ultimate control as gatekeeper to dispatch system, as demonstrated by its successful cutting off of worker from taxi operations after he sought determination of status. Company provided all essential equipment and, as lease-drivers incurred little loss and could not sublease taxicabs, factors of chance of profit and risk of loss also indicated that they were more akin to employees than to independent contractors. Worker was engaged in insurable and pensionable employer on basis of common law test. In two lines of jurisprudence following precedent on s. 6(e) of Regulations, which excluded owners of taxi cab business from insurable employment, one distinguished cases based on details of lease-driver arrangements and other excluded all independent contractors under common law test. Latter strict interpretation would defeat purpose of s.6(e) of Regulations of providing some security to cab drivers, particularly in light of how taxi industry was operating to maintain large level of control over drivers outside of traditional employment structures. Worker’s arrangement with company was sufficiently distinguishable from precedent so he was not excluded from insurable employment.

Royal City Taxi Ltd. v. M.N.R. (2019), 2019 CarswellNat 1672, 2019 CarswellNat 1996, 2019 TCC 105, 2019 CCI 105, Robert J. Hogan J. (T.C.C. [Employment Insurance]).

Case Law is a weekly summary of notable civil and criminal court decisions by the Supreme Court of Canada, the Federal Court of Canada and all Ontario courts. These cases may be found online in WestlawNext Canada. To subscribe, please visit

Free newsletter

Our newsletter is FREE and keeps you up to date on all the developments in the Ontario legal community. Please enter your email address below to subscribe.

Recent articles & video

Criminal Lawyers’ Association filling mentor-gap with new online educational series

OBA's taxation law section names first female chairperson, Angela Salvatore

COVID-19 Economic Recovery Act to amend Justices of the Peace Act and Provincial Offences Act

OHRC tells Sudbury landlords they cannot discriminate based on receipt of public assistance

Windsor’s new associate dean to advance Indigenous law in legal education

Ontario and Superior Courts of Justice embark on first phase of reopening

Most Read Articles

Canadian Constitution Foundation suggests amendments to mandatory mask order in Ontario

Windsor’s new associate dean to advance Indigenous law in legal education

Ontario and Superior Courts of Justice embark on first phase of reopening

Patricia Kosseim shares her priorities as the new information and privacy commissioner