To determine whether someone is an employee or an independent contractor, there are several tests and factors considered.
First, there is the ‘four-fold’ test:
- Control
- Ownership of the tools
- Chance of profit
- Risk of loss
Second, there is the business integration test, which looks at whether the work done is an integral part of the business which points to employee status. If the work done is not integrated to the business or simply an accessory to it, that points to independent contractor status.
The Supreme Court has since consolidated the two tests in Sagaz (6711122 v Sagaz Industries Canada Ltd):
“The central question is whether the person who has been engaged to perform the services is performing them as a person in business on his account. In making this determination, the level of control the employer has over the worker’s activities will always be a factor. However, other factors to consider include whether the worker provides his or her own equipment, whether the worker hires his or her own helpers, the degree of financial risk taken by the worker, the degree of responsibility for investment and management held by the worker, and the worker’s opportunity for profit in the performance of his or her tasks.”
The table below outlines some of the factors courts and labour boards will consider in determining a person’s employment status:
| Factors that make the worker look more like an employee | Factors that make the worker look more like an independent contractor |
| The company sets working hours and assigning work | The worker has considerable discretion over when and how to perform work |
| The company owns the tools needed to do the job | The worker owns the tools needed to do the job |
| The company controls how the work is done and closely supervises the work | The worker receives little direct supervision by the company |
| The customers/clients are the company’s | The worker has a variety of customers/clients |
| The worker works exclusively for the company | The worker advertises his or her services on the open market |
| The work is performed at the company’s premises | The worker has his or her own office and pays own expenses |
| The worker has no personal assets invested in the company | The worker has invested his or her own money in the business so is at risk of loss but could also earn a profit |
| The worker must perform assigned tasks himself or herself | The worker can hire others to perform work |
| Regular employee deductions are made from pay | The worker issues invoices to the company; no employee deductions are made |
David J Doorey, “The Law of Work: Common Law and the Regulation of Work,” 21.
The Queen’s Film & TV Research Group are not lawyers, and this is not legal advice! For more information on labour and employment law, please see the Labour & Employment Law section of this site. Find out more about Queen’s Law on their website, and Pro Bono Queen’s at the PBSC Queen’s site.