Employment relationships in Canada take many forms. Some workers are employed under common law, while union agreements govern others. A person may work as an employee or as an independent or dependent contractor. In rare cases, however, a worker may not even realize they have an employment relationship at all.
One such case involved a superintendent of an apartment building who, upon termination, discovered that the new building owner did not consider him an employee. This raised a significant legal question: was he truly an employee entitled to protections under Ontario employment law, or merely a tenant?
Superintendent Loses Job After Apartment Building Sold
In the case at issue, 13862615 Canada Inc. v. John Cicci, the respondent worked as the superintendent of a 46-unit apartment building in Thorold, Ontario, starting in 2016. In exchange for his services—maintenance, groundskeeping, and emergency duties—he received rent-free accommodation in the building.
The building was sold in August 2021, with a closing date set for December 15, 2021. The superintendent continued working in his role. However, on May 2, 2022, the new owner sent him a letter terminating his employment immediately. The letter stated that while he could remain in his apartment, he would have to start paying rent. In other words, the employer no longer recognized him as an employee but as a tenant. The superintendent subsequently signed a tenancy agreement and became a paying tenant.
Employment Standards Officer Ruled Superintendent Was an Employee
The superintendent filed a complaint with an Employment Standards Officer, who determined that he had been an employee under Ontario’s Employment Standards Act (ESA). The ruling stated that his free accommodation was considered wages under the ESA.
The Employment Standards Officer also determined that since the new owner purchased the building and continued to operate it, they were considered a successor employer under section 9(1) of the ESA. As a result, the new owner was required to provide severance pay in accordance with the superintendent’s entire period of employment (six years and one month). An order was issued for the new owner to compensate the superintendent accordingly.
New Building Owner Challenges Decision, Claiming Superintendent Is Only a Tenant
The new owner applied to the Ontario Labour Relations Board for a review of the Employment Standards Officer’s decision under section 116 of the Employment Standards Act. The new owner argued that:
- The Residential Tenancies Act should apply, not the Employment Standards Act. They claimed the superintendent was simply a tenant, not an employee.
- They had not purchased a business, only a building. As a result, they argued that the ESA’s successor employer provisions did not apply.
- They had never employed the superintendent. Instead, they claimed they had merely inherited a tenant, not a worker.
Understanding How the Employment Standards Act Applies to Superintendents
This case reviewed how the Employment Standards Act applies to workers like the superintendent.
Definition of an Employee Under the ESA
The Employment Standards Act defines an employee as someone who works for or provides services to another entity in exchange for wages. Wages include monetary payments as well as allowances for room and board.
Key provisions of the ESA relevant to this case include:
- Section 3: The ESA applies to all employees working in Ontario.
- Section 5: Employers cannot contract out of ESA obligations, meaning employment agreements that contradict the ESA (such as paying below minimum wage) are unenforceable.
- Section 9: If a business is sold and the new owner continues employing existing workers, employment length is considered continuous. This prevents new employers from evading severance obligations.
In other words, even if an employer tries to argue that an employee is not covered under the ESA, if the employee meets the definition of an employee, the law will still apply.
Superintendents and Employment Status
Although superintendents live in the buildings they manage, their employment is still governed by the ESA. Receiving free accommodation does not exempt them from employment standards protections. Since the superintendent provided services in exchange for room and board, he qualified as an employee.
Ontario Labour Relations Board: Superintendent Entitled to Compensation
The Ontario Labour Relations Board ruled in favour of the superintendent, affirming that the dispute was one related to employment (under the Employment Standards Act), not residential tenancy (under the Residential Tenancies Act). The superintendent’s free accommodation counted as wages under the ESA.
The Labour Relations Board further confirmed that the new building owner was a successor employer. Therefore, they were responsible for honouring the ESA’s severance and termination provisions and must provide severance pay based on the superintendent’s full six-year tenure.
Was the Purchase of the Apartment Building a Business Acquisition?
The employer argued they had not purchased a “business” and were not bound by section 9 of the Employment Standards Act. However, the Labour Relations Board disagreed.
The Board applied a broad and liberal interpretation of section 9, consistent with the ESA’s purpose of protecting employees. Since the new owner continued to collect rent and operate the building as a rental property, this qualified as a business. Further, the new owner knew of the superintendent’s role before purchasing the building and formally terminated his employment, demonstrating that they had assumed responsibility for the building’s operations.
Given these factors, the Board ruled that the new owner was indeed a successor employer and liable for the superintendent’s severance.
Important Employment Lessons for Superintendents and Residential Building Owners
The Ontario Labour Relations Board’s decision in 13862615 Canada Inc. v. John Cicci offers several lessons for residential building owners and apartment workers.
Apartment superintendents are employees under the Employment Standards Act.
If they receive accommodation in exchange for services, they qualify as employees, not just tenants.
Successor employers/building owners inherit employee obligations.
If a new owner takes over a building and continues operations, they must honour employee rights under the ESA.
The ESA takes precedence over private arrangements.
Employers cannot evade ESA obligations by labelling an employee a tenant.
Purchasing a rental property can constitute buying a business.
Even if a buyer thinks they are just acquiring a building, they may still be responsible for the related business and, most importantly, its workers.
Contact Haynes Law Firm for Exceptional Employment Law Advice in Toronto
The Cicci case underscores the importance of understanding employment rights in unique situations where workers may appear to have an ambiguous employment status. At Haynes Law Firm, we understand how Ontario employment law applies to cases involving non-traditional employment relationships. Paulette Haynes has dedicated her entire legal career to representing employers and employees in all varieties of working arrangements. Her innovative, experienced advice helps employers avoid costly mistakes and preserve employees’ rights.
Based in the heart of downtown Toronto, Haynes Law Firm has provided top-tier employment law services for over 30 years. To discuss your case with our team, please call (416) 593-2731 or contact us online.
