Highlights of Noteworthy Decisions
- Corporation (piercing corporate veil)
- Independent operator
- Class of employer (finish carpentry)
The Board classified the employer in Rate Group 719, CU 7799-002, for finish carpentry, designing services. The employer appealed, claiming that it should be classified in Rate Group 958, CU 7799-001, for miscellaneous business services. The employer also appealed a finding that seven subcontractors were workers rather than independent operators. Rate Group 719 applied to employers in interior designing services who also take contracts to perform an inside finishing business activity. That described the employer in this case, notwithstanding that the employer subcontracted the work. The Board correctly classified the employer in Rate Group 719. Regarding worker status, the fact of incorporation of the subcontractor is of central relevance. It may be appropriate to pierce the corporate veil in some circumstances and to find that the substance of a relationship is between an individual as a worker and a principal rather than between the corporate entity and the principal, but there must be evidence to support such a finding. The Vice-Chair was of the view that, when a person has incorporated and the contract is entered into between the principal and that business, this is strong evidence that the individual is operating a business in its own right and that the individual is actin in the business affairs as an executive officer of the corporation. Even in a one-person corporation, the fact of incorporation is important evidence of the independence of the relationship between the principal and the contractor. In general, there should be substantive evidence that the substance of the relationship is to the contrary in order to make a contrary finding. In this case, the Vice-Chair was satisfied that the subcontractors were executive officers of their corporations. The appeal was allowed in part.