Employer Refutes Worker’s Claim that he was an Employee who was Discriminated Against

Written on behalf of Peter McSherry
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We have previously written about the distinguishing factors when determining whether a worker is considered to be an employee or an independent contractor. With the rise in gig economy work, and the availability for people to have side hustles outside of their main jobs, this is a distinction that is crucial to understand as a worker’s job classification can have significant implications on both the worker and the employer. This classification will impact things such as employment insurance benefits and the employer’s ability to terminate a worker.

In a recent decision from the Federal Court of Canada, an individual who worked for a delivery company alleged that he was terminated from his employment due to his age and health, which caused him to file a human rights complaint. When the Human Rights Commission decided that the worker was not an employee and had not been discriminated against, the worker appealed the decision to the Federal Court of Canada.

Worker claims he was terminated due to age and health

In Fick v. Canada (Human Rights Commission), the employer conducted business as a cross-border package and parcel shipping company. The employer hired the appellant worker as an owner-operator at the company. The worker told the Court that he was hired by the employer one year later as a driver in a different community where he and his family relocated to. He became the employer’s sole representative in this new area. Despite his claim that he was hired as an employee, the worker conducted business under a registered business name and was paid a daily all-inclusive rate of $500. Before this, he was a unionized owner-operator.

Worker suffers heart attack; employer reduces worker’s daily rate

In January 2016, the worker suffered a heart attack, and he could not continue providing services to the employer. However, the employer told the worker that he would retain his employment when he was able to return to work.

In March 2016, the employer advised the worker that his daily rate would decrease upon his return to work. Seven days later, the worker sent a letter to the local manager, vice-president, and the company president, in which he alleged various issues within the employment relationship and claimed that he was forced to accept these new terms. The employer disagreed with the allegations in this letter, and subsequently advised the worker that his contract was being terminated.

Worker files complaint against employer

The worker quickly filed a complaint against the employer, claiming unjust dismissal under the Canada Labour Code. The matter was heard by an arbitrator who found that she lacked jurisdiction under the Canada Labour Code because the worker was not an employee of the company. The arbitrator added that if the worker was an employee, he would have to pursue his grievance under the employer’s collective bargaining agreement with its other employees.

The Court granted the worker leave for judicial review of this decision.

Worker files complaint with Human Rights Commission

At the same time, the worker filed a complaint under the Canada Labour Code; he also filed a complaint with the Human Rights Commission. In this complaint, he alleged the employer had discriminated against him following his heart attack and leading up to his termination.

The Officer who heard the matter concluded that the worker had experienced adverse treatment linked to his disability but that there was an outstanding question as to what the employment relationship between the parties was. The Canadian Human Rights Tribunal (the “Tribunal”) was tasked with determining whether or not the Human Rights Commission had jurisdiction to hear the matter.

Worker unable to establish prima facie case of discrimination

In its decision, the Tribunal noted that section 7 of the Canadian Human Rights Act states that the worker bears the onus to establish a prima facie case of discrimination. To satisfy this onus, the worker must establish that it is more likely than not that:

  • he had a characteristic that the Canadian Human Rights Act protects;
  • he experienced an adverse impact with respect to employment; and
  • the protected characteristic was a factor in the adverse impact.

The Tribunal found that, while the first part of the test was satisfied as the worker’s heart attack constituted a disability, however, his age was not relevant to his termination. The second part of the test was also satisfied because the worker’s termination resulted in an adverse impact. He was not able to find a new job for four months following his termination, and he made approximately $20,000 less annually than he did in his previous role.

When considering whether the worker satisfied the third part of the test, the Tribunal asked whether the heart attack was a factor in the employer’s decision to terminate the worker. Ultimately, the Tribunal found that the worker failed to produce sufficient evidence to establish a connection. The Tribunal also heard from witnesses who stated that the pay reduction was being implemented for all drivers.

Court finds worker was not an employee

In asking whether or not the worker should be considered an employee, the Tribunal focused on determining whether there was “control exercised by an employer over working conditions and remuneration and corresponding dependency on the part of the worker.” This factor was established by the Supreme Court of Canada in McCormick v. Fasken Martineau DuMoulin LLP.

Looking at the employment relationship, the Tribunal concluded that the worker was not an employee but was instead an independent contractor. The Tribunal arrived at this decision after noting that the worker did not have any deductions taken from his flat rate pay, he did not receive any benefits from the employer, and all expenses incurred by the worker were deducted on his tax returns. The Tribunal also acknowledged that the worker was able to provide delivery service to other customers while providing services to the employer in this case.

In considering whether the worker had a successful chance at appeal, the Federal Court found the Tribunal provided a justified, transparent, and intelligible analysis of the key considerations and evidentiary record. Therefore, the appeal was dismissed.

Contact Peter A. McSherry Employer Lawyer in Guelph for Advice on Employee Classification and Discrimination in the Workplace

The experienced employment law lawyers at Peter A. McSherry in Guelph help workers navigate various employment law disputes, including cases of employee classification and human rights complaints. We advocate for clients and protect their interests throughout the negotiation and settlement process, including litigation, if necessary. If you have questions regarding employee classification or discrimination in the workplace, contact us online or call us at 519-821-5465 to schedule a confidential consultation with one of our team members.