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No workers’ compensation for independent contractor

An Ontario newspaper delivery person was an independent contractor and not an employee, the Ontario Workplace Safety and Insurance Appeals Tribunal (WSIAT) has ruled.

The worker started working in 1998 as a driver delivering newspapers and fliers for a publishing company. The worker signed a distribution agreement with the intention of signing a new one every year. This continued until 2007, when she didn’t sign an agreement but continued working. She also didn’t sign a distribution agreement in 2008, when she also started working as a part-time school bus driver.

The worker owned a cargo van with which she delivered papers and was responsible for its commercial licence and gas, unless it exceeded a certain price, at which point the employer would subsidize her. She had a supervisor but only consulted with him when she needed something.

In February 2008, the worker was in her bus driver position when she slipped on some ice, injuring her head and back. She was unable to drive and her licence was revoked for three months. The worker found someone to take over delivering the newspapers until she was able to return to work. Once she was able to deliver papers again, she asked the company to reduce the size of the bundles to ensure she didn’t injure herself again.

In November 2008, the Ontario Workplace Safety and Insurance Board (WSIB) determined she was an independent operator, but the worker requested the newspaper publisher accommodate her by reducing the size of her newspaper bundles. In early 2009, the company provided the worker with a new distribution agreement, but the worker refused to sign it until after she consulted with her lawyer. The company withdrew the agreement and terminated the contractual relationship. This had a significant impact for the worker, who later won loss-of-earnings benefits for her injury, which was now calculated only from her earnings as a bus driver and not her newspaper delivery job.

The worker appealed to the WSIB appeals resolution officer who agreed with the WSIB because the worker had filled out the board’s general questionnaire with responses that confirmed she was an independent operator under a contract for service.

The worker appealed again to the WSIAT, arguing her contract of service was more characteristic of an employment relationship. She took instructions on where and how to deliver the newspapers and the company decided on when she had to make the deliveries.

The tribunal found that while the company dictated the hours and how she did the job, the worker had control over most aspects of her work. She used her own van, didn’t wear a uniform, didn’t have a company logo, nor did she identify herself as an employee. She also turned down extra delivery tasks that were offered to her and she had the option of working other jobs when her delivery was done — as with the bus driving position.

It was also noted that she didn’t have statutory deductions taken from her paycheque and her accountant listed her as self-employed.

The tribunal also found the distribution agreement clearly indicated the worker was hired under a contract of service. The company specifically outsourced its delivery services and had no intention of taking on employees in this capacity. In addition, the company’s employees were unionized, subject to performance management and included in company events and meetings, which the worker was not, said the tribunal.

Though a significant portion of the worker’s time and service was controlled by the company, the tribunal found this didn’t outweigh the other factors that made the worker an independent contractor.

As a result, when the relationship was terminated, it was simply an end to the distribution agreement and her lost earnings from the contract could not be factored into loss-of-earnings calculations.

This article originally appeared in the February/March 2015 issue of COS. 

Jeffrey R. Smith

Jeffrey Smith
Jeffrey R. Smith is the editor of Canadian Safety Reporter and Canadian Employment Law Today, sister publications of COS.
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