Master and Servant — Ontario Employment Law
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About Master and Servant
If you are researching Ontario employment law or reading court documents, you might stumble across the phrase "master and servant." While it sounds incredibly archaic and out of place in a modern workplace, it is the foundational common law term for the employer-employee relationship. Before statutes like the Employment Standards Act, 2000 (ESA) or the Ontario Human Rights Code were drafted, the rights and obligations of workers were governed entirely by the common law of master and servant.
Today, Ontario courts and lawyers still occasionally rely on master and servant case law, particularly when dealing with the implied duties built into every employment contract. Under these historical principles, a "servant" (employee) owes an inherent duty of loyalty, fidelity, and good faith to their "master" (employer). This means that even if you never signed a formal contract with a non-compete or confidentiality clause, the common law dictates that you cannot steal your employer's trade secrets, actively sabotage their business, or secretly compete with them while still on their payroll.
Conversely, the master and servant framework also established early rules outlining when an employer has the right to dismiss a worker for serious misconduct, such as dishonesty or theft, which breaches the core trust of the relationship. Modern courts still look back to these foundational cases when deciding whether an employee's actions justify termination for cause, or whether an injunction should be granted to stop a former worker from breaching a restrictive covenant or fiduciary duty.
While the terminology has largely evolved into "employer and employee," understanding your status under these common law rules is critical if you are accused of breaching a duty to your workplace. Because early English and Canadian common law established such deeply entrenched obligations, navigating allegations of disloyalty or contractual breaches can be legally hazardous. Your specific duties depend heavily on the unique facts of your role, making it essential to have a qualified Ontario legal professional review your situation rather than trying to interpret centuries-old legal principles on your own.
Frequently Asked Questions
What does a 'master and servant' relationship actually mean in modern Ontario?
It is simply the traditional legal term for an employer-employee relationship. While modern laws usually use 'employer' and 'employee', the common law principles established under 'master and servant' law still dictate the unwritten, fundamental duties of trust and loyalty between a worker and a company.
Does the master and servant law still apply if I am protected by the Employment Standards Act?
Yes, both apply simultaneously. The ESA provides statutory minimums like minimum wage, vacation pay, and basic notice of termination. The common law of master and servant governs the broader contractual relationship, including implied duties like fidelity and overarching rules for breach of contract.
Do I owe a 'duty of loyalty' to my employer under master and servant rules?
Yes. The common law dictates that all employees owe an implied duty of fidelity and good faith during their employment. This generally means you cannot compete against your employer, share their confidential information, or intentionally harm their business while you are employed there.
What happens if a court finds I breached my master and servant obligations?
If you breach foundational duties like loyalty or honesty, an employer may legally have grounds to terminate you for just cause. In severe cases involving stolen trade secrets or fiduciary breaches, an employer can also sue for damages or seek an injunction to stop your activities.
How do I know if I was a 'servant' or an independent contractor?
Courts use tests originally developed in early master and servant cases to figure this out, heavily focusing on 'control'. If the company dictated how, when, and where you worked, and owned the tools you used, a true employment (master/servant) relationship likely existed, regardless of what your contract called it.
When should I consult a lawyer regarding these types of contractual duties?
You should speak with an employment lawyer immediately if your employer accuses you of breaching confidentiality, violating a restrictive covenant, or failing in your duty of loyalty, as defending against these common law claims requires strict adherence to tight litigation timelines and complex precedents.
Common Scenarios
- A senior manager resigns to start a competing firm, and their former employer files for a court injunction, citing historic master and servant case law to argue the manager breached their fiduciary duty and implied duty of fidelity.
- A worker is fired without severance after the employer discovers they were secretly running a side hustle that directly stole clients from the company, a classic breach of the master and servant duty of loyalty.
- A company attempts to sue a former worker for damages over a poorly drafted non-compete clause, forcing the court to examine foundational common law principles regarding restraint of trade and the fundamental balance of power in the employment relationship.
What You Should Know
- Do not panic if you are reading a legal pleading or older court decision that refers to you as a 'servant'; it is not an insult, but rather historical legal terminology identifying your status as an employee.
- Be aware that you owe a duty of good faith to your employer while employed; you cannot actively compete with them or use their confidential data for personal gain, even if you never signed a written employment contract.
- Keep exceptional records of your actual day-to-day job duties, as common law courts will look closely at your level of authority to decide if you owed basic 'servant' duties or higher-level 'fiduciary' duties.
- If your former employer threatens a lawsuit over a breach of restrictive covenants or common law duties, promptly get advice from an Ontario employment lawyer, as the intersection of archaic common law and modern employment statutes is highly complex.
Featured Cases
G. v Altus
2015 ONSC 6642 (CanLII) · 2015-10-27Wrongful Dismissal: Costs and Substantial Indemnity
This is a costs ruling in a wrongful dismissal case involving a master and servant relationship. The court addressed the calculation of costs, specifically considering an award of substantial indemnity.
Naylor Group Inc. v. C.
1994 CanLII 7425 (ON SC) · 1994-07-21Restrictive Covenants and Fiduciary Relationship in Employment
A case involving restrictive covenants and the fiduciary relationship between an employer and employee. The court considered whether an injunction should be issued related to these terms.
V. v. Lewis Motors (Ottawa) Ltd. et al.
1983 CanLII 1882 (ON CA) · 1983-05-05V. v. Lewis Motors: Disability Insurance Appeal
An appeal to the Court of Appeal for Ontario concerning a dispute over disability insurance benefits in the context of an employment relationship. The case addresses the intersection of master and servant obligations and insurance coverage.
T. v. BP Oil Ltd.
1979 CanLII 1976 (ON SC) · 1979-12-07Breach of Employment Contract: Damages Claim by Employee
A case involving a breach of contract claim by an employee (master and servant relationship) against their employer, BP Oil Ltd.
R. v. Steelcase Canada Ltd.
1979 CanLII 1751 (ON SC) · 1979-07-30Wrongful Dismissal: Employee Terminated for Dishonesty
A wrongful dismissal case involving an employee who was terminated for dishonesty. The legal issue centers on whether the dismissal was justified under the master and servant relationship.
Bee Chemical Co. v. Plastic Paint & Finish Specialities Ltd. et al.
1978 CanLII 4103 (ON SC) · 1978-03-02Trade Secrets and Master-Servant Obligations
A legal dispute concerning trade secrets and the obligations arising from a master and servant (employer-employee) relationship.
P. v. Township of Oakland
1977 CanLII 1272 (ON CA) · 1977-11-08This is a wrongful dismissal case involving an employee of the Township of Oakland. The dispute centers on the termination of employment and the assessment of damages owed to the former employee.
Manley Inc. et al. v. F.
1977 CanLII 3487 (ON CA) · 1977-11-04An employment law case addressing the liability of a master for breach of fiduciary duty by a servant.
M. v. Channel Seventynine Ltd.
1976 CanLII 798 (ON SC) · 1976-11-30Dismissal Case Involving Lord's Day Act
A dismissal case involving a master and servant relationship, with legal issues centered on the illegality of employment practices under the Lord's Day Act.
Manley Inc. et al. v. F.
1975 CanLII 2596 (ON SC) · 1975-06-03This is an employment law case concerning the fiduciary duties owed by an employee to their employer. The dispute centers on the legal obligations of a 'servant' under the master and servant relationship.
Dominion Al-Chrome Corp. Ltd. v. S. et al.
1974 CanLII 2833 (ON SC) · 1974-05-12Employment Contract: Breach of Duty of Good Faith and Duty to Compete
A case involving a breach of duty of good faith and the employee's duty to compete in the context of a master and servant relationship.
Canadian Aero Service Ltd. v. O. et al.
1969 CanLII 1731 (ON SC) · 1969-10-08This is a wrongful dismissal case concerning the appropriate measure of damages for an employee terminated in breach of their employment contract. The court addressed the calculation of compensation owed to the plaintiff. The case later reached the Supreme Court of Canada (Can. Aero v. O., [1974] SCR 592). The Supreme Court allowed the appeal against all defendants except Wells, finding that O. and Zarzycki breached their fiduciary duty to Canadian Aero Service Limited by usurping a corporate opportunity. Judgment was entered against them and Terra Surveys Ltd. for $125,000.
R. v. W. et al. and two other actions
1969 CanLII 214 (ON SC) · 1969-08-19Vicarious Liability: Sham Lease and Employer Status
This case addresses whether a sham lease agreement between a truck owner and a company established an employer-employee relationship for the purpose of vicarious liability following a motor vehicle accident. The court considered the master-servant test based on control and direction, and whether the de facto relationship determined liability rather than the contractual terms designed to circumvent statutory requirements.
H. v. County of Victoria
1968 CanLII 442 (ON CA) · 1968-04-29This is a wrongful dismissal case involving an employee of the County of Victoria. The legal issues include the application of the Municipal Act, specifically section 358(2), to the employment relationship.
W. v. High-Test Electrical Manufacturing Ltd.
1964 CanLII 300 (ON SC) · 1964-11-05Master and Servant Act Case: Employment Contract Interpretation
A case involving the interpretation or application of the Master and Servant Act, section 4(1), likely concerning the legal obligations or rights of an employee under an employment contract.
C. v. W.
1960 CanLII 148 (ON CA) · 1960-02-19Workplace Injury: Apportionment of Fault in Faulty System of Work
This is an appeal concerning a workplace injury or safety dispute where the legal issues revolve around a faulty system of work and the apportionment of fault between the employer and the employee.
B. and John Mackay Milling Limited v. O. and O.
1953 CanLII 130 (ON SC) · 1953-11-18Employer's Right to Damages for Loss of Employee Services
This is a merits decision regarding an employer's common law right to recover damages from a third party for the loss of an employee's services caused by a tortious act. The court addressed whether the master's cause of action is distinct from the servant's and whether damages can include loss of profits beyond wages paid. The court found insufficient evidence to establish loss of profits or loss on processed grain, but held that demurrage charges were recoverable as proven damages.
M. v. The Canada Skate Manufacturing Company Limited
1951 CanLII 139 (ON CA) · 1951-09-13This is a Court of Appeal for Ontario decision concerning master and servant liability for an employee's injury. The case addresses the legal principles governing an employer's liability for injuries sustained by an employee in the course of employment.
K. v. B. and B.
1946 CanLII 312 (ON CA) · 1946-10-10K. v. B.: Employer Liability & Workers Comp
This appeal concerns a plaintiff injured while assisting in roof construction who claimed status as a workman under the Workmen's Compensation Act. The Court of Appeal for Ontario found that a master-servant relationship existed through implied circumstances and that the defendant wife was liable as an employer under the Act. The court also addressed the negligence of the defendant husband in the construction work.
Y. v. Y. et al.
1945 CanLII 107 (ON SC) · 1945-01-08This is a negligence action involving a plaintiff injured while driving an employer's truck at the employer's direction. The case addresses employer liability for creating a hazardous situation and the application of The Workmen's Compensation Act, alongside tort claims against the driver who struck the truck.