The appellant corporation appealed the Minister's determinations that two workers, who were family members of the corporation's shareholders, held insurable employment.
The workers were building managers with significant autonomy, no set schedules, and were paid above-market salaries.
The Tax Court of Canada allowed the appeals, finding that the Minister failed to properly consider the family context and the fact that the workers were beneficiaries of a family trust intended to take over the business.
The Court concluded that the corporation would not have entered into a substantially similar contract of employment with an unrelated person, and therefore the employment was not insurable.
