Landmark case on determining that a Dependent Contractor is entitled to “Reasonable Notice”

Posted By | 2017-12-05T17:19:43+00:00 October 30th, 2017|

McKee v. Reid’s Heritage Home Limited

  • This case determines that a contractor is entitled severance if that contractor works “exclusively” for that employer
  • The case was appealed to the Ontario Court of Appeal and the appeal was dismissed and it was held that the trial award was reasonable
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Case Summary

McKee was a real estate agent for Reid’s Heritage Homes. In their first contract, Reid’s agreed to provide the plaintiff with 69 homes to sell in exchange for commission. The contract also contained an exclusivity clause and a mutual termination clause of 30 days. After this contract, McKee continued to work for Reid’s without a new contract. McKee was promoted to Senior Sales Manager and hired his own sub-agents. Twenty years later, Reid’s restructures and after negotiations collapse between the two parties, McKee sues Reid’s for wrongful dismissal.The Trial Judge found in favour of McKee, and found her to be an employee of Reid’s. She was awarded 18 months severance in lieu of damages. The case was appealed to the Ontario Court of Appeal. The issue at bar was whether McKee was an employee of Reid’s or a dependent contractor, illuminating whether McKee had a duty to mitigate damages by accepting another offer by Reid’s. The appeal was dismissed and it was held that the trial award was reasonable.

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