DSF is Recognized in Best Lawyers 2024 Edition Devry Smith Frank LLP (DSF) is proud to announce that we have been recognized by Best Lawyers in Canada for the 2024 Edition with 7 of our lawyers ranked across various practice areas. The lawyers being recognized are listed below: David Lavkulik – Personal Injury Litigation Diana L. Solomon – Family Law George O. Frank – Personal Injury Litigation Jennifer K. Howard – Family Law Marc G. Spivak – Personal Injury Litigation Marty Rabinovitch – Labour and Employment Law – Recognized for the first time in 2024 edition of Best Lawyers Todd E. Slonim – Family Law We are grateful for this recognition and will continue to strive to provide the best service for our clients. Best Lawyers is the legal profession’s oldest peer-review publication and garners immense respect as the recognition signifies peer approval. Lists of outstanding lawyers arise from thorough evaluations where legal experts confidentially evaluate their colleagues. For over 40 years, this top peer-review publication acknowledges leading attorneys across more than 100 practice areas, chosen for outstanding feedback. “Lawyer of the Year” is awarded to one attorney in each practice area and metropolitan area, further amplifying its significance. Please visit their website for more details: www.bestlawyers.com By AlyssaBlog, Employment Law, Family Law, Labour Law, Personal Injury, UncategorizedAugust 25, 2023August 25, 2023
When can multiple entities be considered a single employer? O’Reilly v. ClearMRI Solutions Ltd., 2021 ONCA 385 (CanLII) Under the common law Doctrine of Common Employer, multiple entities can be considered a single employer under particular circumstances. The O’Reilly case is crucial for clarifying the “common employer” doctrine in Ontario employment law. Specifically, it articulates the need to show intent to create an employer/employee relationship between the employee and the alleged common employer(s). Overview In October of 2014, William O’Reilly commenced a claim for six months’ wages and twelve months vacation pay against his employer(s) via myriad defendants: ClearMRI Solutions Ltd. (“ClearMRI Canada”), ClearMRI Solutions, Inc (“ClearMRI US”), Tornado Medical Systems Inc. (“Tornado”), as well as against individual directors of these corporations.[1] All of the corporations were sued collectively as “common employers.” Tornado was the majority shareholder of ClearMRI Canada which itself had ClearMRI US as its own wholly owned subsidiary.[2] Although William did not have a written employment contract or position with Tornado, he alleged that Tornado—along with the other corporations—were all his common employers.[3] William obtained default judgment against the ClearMRI companies and successfully moved for summary judgment against the other defendants.[4] Tornado appealed.[5] The Ontario Court of Appeal allowed Tornado’s appeal, stating that the motion judge erred in the articulation and application of the common employer doctrine.[6] In doing so, the Court of Appeal confirmed that the motion judge made an extricable error of law in concluding that Tornado was a common employer.[7] The Lower Decision William served as the CEO of ClearMRI Canada.[8] In 2012, William signed an agreement with ClearMRI US confirming the terms of his employment which named ClearMRI US as the employer.[9] William did not hold any formal position with Tornado.[10] Although ClearMRI US was named as William’s employer in the written agreement, the motion judge found that William was also employed by Tornado.[11] The motion judge identified three factors that should be considered in determining whether there was a common employer: the employment agreement itself, where the effective control over the employee resides, and whether there was common control between the different legal entities.[12] Using these factors, the motion judge found that Tornado was a common employer of the plaintiff as Tornado exercised “a sufficient amount of control” over the plaintiff and found that there was common control between Tornado and the different legal entities.[13] Tornado appealed. Ontario Court of Appeal Decision On appeal, the Court of Appeal determined that Tornado was not liable as a common employer. A corporation is not held to be a common employer simply because it is owned, controlled, or was affiliated with another corporation that had a direct employment relationship with the employee.[14] Rather, a corporation will be found to be a common employer only where it can be shown that there was an intention to create an employer/employee relationship between the individual and the related corporation.[15] Where there is a written employment agreement with an entity other than the alleged common employer, the court must assess how such an agreement bears on whether there was an intention to create an employment agreement with the alleged common employer.[16] The Court of Appeal found that the motion judge failed to undertake the required analysis of the effect the written agreement had in determining whether there was intention that Tornado was a party to the employment agreement.[17] Further, the Court of Appeal found that none of the three factors that the motion judge relied on were enough to find that Tornado exercised control over the plaintiff as an employee. [18] Lastly, the Court of Appeal found that the motion judge failed to explain why the existence of a corporate relationship between Tornado and the ClearMRI companies provided an intention that Tornado was a party to the employment agreement with the plaintiff.[19] In all, the Court of Appeal found that there was no intention between the plaintiff and Tornado to contract with Tornado as a common employer. In the absence of evidence that would show an intention to have Tornado as a common employer, the Court of Appeal allowed the appeal and set aside the summary judgment against Tornado.[20] Analysis and Conclusion The Court of Appeal makes it clear that whether an entity is considered a common employer is dependent on the intention of the parties in addition to factors such as the existence of an employment agreement, control over the plaintiff, and existence of a corporate relationship between the entities. The courts will strictly interpret the application of the common employer doctrine to ensure that intercorporate relationships would not be conflated as evidence of a common employer relationship. Employees who provide services for multiple entities should seek legal advice as they may be able to seek recovery from multiple parties. Conversely, employers should be careful of having employees perform services for or take direction from other entities unless the intention is to create a common employer relationship. “This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please see a lawyer. Each case is unique, and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situations and needs.” This blog was co-authored by student-at-law, Abby Leung [1] 2021 ONCA 385 at para 26. [2] Ibid at para 15. [3] Ibid at para 6. [4] Ibid at para 7. [5] Ibid at para 8. [6] Ibid at para 11. [7] Ibid. [8] Ibid at para 19. [9] Ibid at para 20. [10] Ibid at para 19. [11] Ibid at para 35. [12] Ibid at para 31. [13] Ibid at para 35. [14] Ibid at para 50. [15] Ibid. [16] Ibid at para 75 [17] Ibid at para 75. [18] Ibid at para 86. [19] Ibid at para 91. [20] Ibid at para 92. By Fauzan SiddiquiBlog, Employment LawDecember 29, 2022August 15, 2023
Employers Must Exercise Fair and Reasonable Discretion in Awarding Discretionary Bonuses By David Heppenstall and Abby Leung Bowen v. JC Clark Ltd., 2022 ONCA 614 (CanLII) If an employee is terminated without cause, are they entitled to discretionary bonuses? In Bowen v JC Clark Ltd,[1] two portfolio managers at JC Clark were terminated on a without-cause basis and were each given two weeks’ salary plus $577 in lieu of notice. The managers commenced a wrongful termination action against JC Clark, claiming that they were owed $1.3 million in performance fees. The managers argued that this was a term of their employment for the portion of 2014 that they worked prior to their termination. The trial judge dismissed their claim, determining that they were not entitled to be paid performance fees by JC Clark. The portfolio managers appealed the trial decision. The Ontario Court of Appeal allowed the appeal in part. While the Court of Appeal rejected the appellants’ submissions in relation to their entitlement to performance fees, the Court of Appeal found that the trial judge erred in preventing the appellants from arguing their entitlement to a discretionary bonus. In determining what would be considered fair and reasonable calculation of bonuses given the factual context of the case, the Ontario Court of Appeal awarded each appellant $115,000. In making this decision, the Court of Appeal held that employers should exercise their discretion reasonably and in good faith and that the discretionary nature of performance bonuses does not bring with it unfettered discretion. Background The portfolio managers were first hired by a senior investment professional to manage a hedge fund that he created. The fund was sold to JC Clark in 2012 and as part of the sale, the senior investment professional agreed to allow JC Clark to hire the managers to manage the day-to-day activities of the fund. The investment professional entered into an agreement with JC Clark which provided that for four years after the fund’s sale, the investment professional would receive a share of the management and performance fees earned by the fund. The investment professional then entered into side agreements with the managers where he intended to share 50% of his management fees and 100% of his performance fees with them. Subsequently, the managers entered into employment agreements with JC Clark which provided that “at the total discretion of the Company, you may be eligible for a bonus at the end of each fiscal year depending on factors that include your personal performance and the profitability of the Company.”[2] The fund performed exceptionally well during the first half of 2014 under the managers’ supervision—which was when JC Clark terminated their employment without cause. At trial, the judge dismissed the managers’ claim, finding that the investment professional had paid them the performance fees that they were entitled to for the portion of the year they worked in 2014 and that they were not entitled to the share of performance fees directly from JC Clark. In possessing this knowledge, the trial judge determined that the managers signed employment agreements which did not provide for any performance fees that would be paid by JC Clark. The managers appealed. Ontario Court of Appeal’s Decision The Ontario Court of Appeal allowed the appeal in part. In reviewing the employment agreements, the Court of Appeal dismissed JC Clark’s argument that the discretionary nature of the bonus provision in the employment agreements meant that the employer was entirely unconstrained as to how discretion should be exercised. If an employment agreement provides for a discretionary bonus, the employment agreement contains an implied term that discretion will be exercised in a fair and reasonable manner.[3] The Court of Appeal held that what constitutes a fair and reasonable exercise of discretion is dependent on the factual context of the case. The managers argued that their discretionary bonus should be calculated in comparison to two similar portfolio managers employed at JC Clark, whose fund did not perform as well as the appellants but received a greater portion of discretionary bonuses in 2014. The portfolio managers provided further evidence that in December of each calendar year, the employer considered the allocation of discretionary bonuses from a pool of funds set aside for that purpose. Distribution of discretionary bonuses was determined by a variety of factors including corporate performance, individual performance, attitude, teamwork, seniority, position within the company, and their length of employment at the company.[4] Taking these factors into account, the Ontario Court of Appeal concluded that a fair and reasonable calculation of bonuses would involve the fund’s performance and bonuses rewarded to other portfolio managers at the time. Ultimately, the Court of Appeal held that the portfolio managers were entitled to a discretionary bonus and awarded each portfolio manager $115,000 in damages. Conclusion This case serves as a reminder for employers that discretion should be exercised in a fair and reasonable manner, taking into account all of the factual context and objective criteria. In doing so, employers are strongly encouraged not to take an unconstrained approach that is inconsistent with exercising discretion in a fair and reasonable manner. In determining how to distribute discretionary bonuses, employers are encouraged to consider objective criteria, including individual performance, position within the company, and whether discretionary bonuses will or were awarded to similarly situated employees. “This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please see a lawyer. Each case is unique, and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situations and needs.” This blog was co-authored by student-at-law, Abby Leung [1] 2022 ONCA 614. [2] 2022 ONCA 614 at para 9. [3] Ibid at para 35. [4] Ibid at para 41. By Fauzan SiddiquiBlog, Employment LawOctober 19, 2022September 26, 2023
My Employer Wants me to Return to Work In-Person. Can I refuse? Probably not. (But There are Exceptions) The end of the COVID-19 pandemic is in sight. Ontario has lifted many public health mandates and restrictions. Many Ontarians are resuming their pre-pandemic lives—including returning to work in-person. Some have welcomed the transition from working-from-home to returning to the office, while others worry about the loss of the advantages of remote work. Remote work offers the possibility of a better work-life balance, flexibility for childcare, and the time and money saved on commuting. As such, many question whether employers have a right to demand continuing to work remotely, and whether employees may have a basis for refusal. In most cases, employers do have the right to demand their employees return to the office, and employees, generally, do not have a right to refuse.[1] However, this principle may not apply to all employment situations as there are a number of factors that must be considered to determine the rights and obligations of both parties to an employment agreement. These factors include the terms of the employment contract, human rights laws, and occupational and health regulations. Employment contract Specific attention should be paid to the express and implied terms of the employment contract. Express terms are those are the clearly outlined in the agreement itself. Examples might include the wage amount, or the starting date of employment. Implied terms are not expressly stated in the agreement, but are implied by law. Thus, implied terms will largely depend on the province in which the employment takes place. An example might be where the employment contract does not provide for a termination notice period, in which case, the minimum standards as set out in employment standards legislation, would be implied into the contract.[2] If the employment contract expressly and unconditionally permits the employee to work from home, then the employer would not have the legal basis to require this employee to return to into-person work, and the employee, in turn, would have a legitimate ground to refuse this demand. Human Rights Laws Human rights laws may also provide employees with a basis of refusal, but it must be on a prohibited ground of discrimination.[3] In Ontario, the Human Right Code lists the following grounds: race, ancestry, place of origin, colour, ethnic origin, citizenship, creed, sex, sexual orientation, gender identity, gender expression, age, marital status, family status or disability.[4] Employers cannot force an employee to return to work, if it would be discriminatory to do so. For example, if an employee cannot return to in-person work due to a disability (which is a prohibited ground of discrimination), the employer has a duty to accommodate, and this accommodation may be allowing for continued remote employment. Occupational Health and Safety Regulations Employers have a statutory duty to safeguard the health and safety of their employees pursuant to the Occupational Health and Safety Act (OHSA).[5] By law, an employer must take every reasonable precaution to maintain a safe working environment.[6] These steps include following any remaining COVID-19 public health guidance in good faith. Employees generally have a right to refuse work which they have a “reasonable basis” to believe is unsafe or a danger to their health.[7] This being said, the reasonableness of this belief is ultimately decided by a government inspector, who would be called to evaluate the working conditions should the employer and employee be unable to address and redress such concern before-hand, and on their own.[8] The standard of review for such decision is that of correctness, and based on the conditions at the time the work was refused.[9] The following situations are examples of unsafe working conditions granting a right to refuse work: driving a vehicle, which by certain characteristics, is not safe to operate;[10] or failure to provide roofing employees with anchoring technique/guard in case of fall.[11] Courts have not tested whether simply attending a physical workplace during a pandemic qualifies as an unsafe working condition. Arguably, a workplace could be unsafe where the employer does not follow public health official guidelines, mandates, or restrictions. However, this alone may not necessarily be sufficient to refuse to attend the workplace. Every situation and workplace is different. It is important for employers to carefully strategize through their return-to-work plans and ensure they are aware of each and every one of their various obligations. It is also important for employees to be aware of their rights to refuse unsafe work — despite the uncertainty as to what that could mean during a global pandemic. Conclusion Employers do have the right to demand their employees return to the office, and employees, generally, do not have a right to refuse. However, the employment contract, human rights legislation, and occupational health and safety regulations, each prove an added layer of complexity to that statement. If an employment contract expressly and unconditionally permits the employee to work from home, then the employee would have a legitimate ground to refuse an employer demand to return to the workplace. Additionally, employers cannot force an employee to return to work, if it would be discriminatory and a violation of human rights to do so. Finally, employees have the right to refuse unsafe work — but there remains uncertainty as to what qualifies as an unsafe workplace during the pandemic. “This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please see a lawyer. Each case is unique, and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situations and needs.” [1] Geoff Nixon, “Why your options may be limited if your employer wants you back in the workplace”, CBC News, 4 July 2022, online: https://www.cbc.ca/news/business/canada-employers-wfh-office-return-1.6507545 [2] Employment Standards Act, 2000, S.O. 2000, c. 41, ss 57-58. [3] Ontario, Human Rights Commission, COVID-19 and Ontario’s Human Rights Code – Questions and Answers, (News Report), 18 March 2020, online: https://www.ohrc.on.ca/en/news_centre/covid-19-and-ontario%E2%80%99s-human-rights-code-%E2%80%93-questions-and-answers [4] RSO 1990, c H.19, s 2. [5] RSO 1990, c O.1 [OHSA]. [6] Ibid, s 25(2)(h). [7] Ibid, at s. 43(3). [8] Government of Ontario, Part V: Right to refuse or to stop work where health and safety in danger retrieved from: https://www.ontario.ca/document/guide-occupational-health-and-safety-act/part-v-right-refuse-or-stop-work-where-health-and-safety-danger [9] Fletcher v Canada (Treasury Board – Solicitor General Correction Service), 2002 FCA 424. [10] Morey v CAT, 2022 ONSC 4621. [11] Ontario Ministry of Labour) v Vixman Construction Ltd, 2019 ONCJ 955. By Fauzan SiddiquiBlog, Employment LawOctober 11, 2022July 5, 2023
When Volunteers are Actually Employees: Ontario Court Sets a New Precedent and Approves Settlement Reclassifying Volunteers as Employees Montaque v. Handa Travel Student Trip Ltd., 2020 ONSC 3821 In 2017, several college-age students thought they were signing up for a “job of a lifetime” as trip leaders with S-Trip to travel and assist with executing activities, excursions and parties.[1] While the students were told to expect 14-hour workdays, evening shifts, and long hours, trip leaders did not receive a paycheque and were called “volunteers” in internal documents. S-Trip would only pay the students a small honorarium — well below the province’s minimum wage. A class action lawsuit was launched against S-Trip and its affiliates with the suit alleging that the trip leaders were wrongfully classified as volunteers while doing the work of an employee. It was contested whether the students were entitled to receive benefits for employees as specified under the Employment Standards Act (“ESA”)[2]. An Ontario court has approved the settlement between the former trip leaders and the organization with the firm’s Toronto-based parent company, I Love Travel. The court has agreed to a $450,000 settlement and reclassifying staff on future trips as employees rather than volunteers.[3] This case is the first volunteer misclassification class action in Canada.[4] In addition to setting a new precedent, the case has the potential to significantly impact employment law moving forward. Background Despite the fact that S-Trip advertised full-time salaried positions on their job board, S-Trip trip leaders were required to sign contracts specifying that they were volunteers providing services to the company and that no employment relationship was established between the trip leader and the company.[5] Trip leaders were responsible for performing various tasks related to pre-trip planning and procedure, travel organization, airport and flight procedures, briefing sessions, and return trip organization and procedures.[6] While staff were granted an honorarium, it was calculated by the number of trips they completed and differentiates based on position.[7] Income tax, employment insurance, and Canadian pension plan deductions were not deducted from the honorarium.[8] The Class Members argued that the following factors established an employment relationship: The Class Members are the main point of contact between the customers and S-Trip; S-Trip’s operations along with the duties performed by the Class Members serve no civic, religious or charitable purpose; S-Trip is a for-profit company; Class Members are subject to a six-step interview process, which includes a Garda Pre-Employment Background Check; Class Members are provided with extensive guidelines and manuals; Class Members are assigned mandatory duties and working schedules; The duties assigned to Class Members are obligatory and not voluntary; Class Members are compensated for their work – e., the honorarium; and The compensation provided to Class Members increases with seniority.[9] Settlement Approval The Ontario Superior Court of Justice approved the proposed settlement in the all-inclusive amount of $450,000. Justice Morgan first reviewed the principles in which the court must take into account in assessing the reasonableness of a settlement including the likelihood of success, the presence of good faith, and the future expense and likely duration of litigation.[10] In applying these principles to the settlement, Justice Morgan found that the settlement proposal was reasonable and provided several benefits including that it avoided delays associated with trial and appeals, provided for pro-rata payments based on the length of the trips taken by class members, and it achieved behaviour modification as the defendants agreed to reclassify class members as employees for future trips.[11] Justice Morgan further noted that the settlement struck a balance between individual compensation of class members and an efficient and expeditious overall distribution.[12] The court concluded by noting that the settlement achieved was a good one as it will put money in the pocket of class members that they would not likely be able to achieve on their own.[13] Conclusion As Justice Morgan noted, this is the first volunteer misclassification class action in Canada and will have a significant impact in labour and employment law moving forward. The case is significant for employers in particular as it reflects what type of resolution in class proceedings would fall within the “zone of reasonableness” required by the Class Proceedings Act, 1992.[14] While a settlement is not a binding precedent in law, the Court’s approval of the settlement provides a cautionary tale for employers. For example, employers would be well-advised to carefully consider if the volunteers in their organization may actually be considered employees by law. Further, class actions are becoming a more effective method for employees to seek claims against employers as it provides class members with a less expensive and more efficient litigation vehicle to pursue their claims. “This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please see a lawyer. Each case is unique, and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situations and needs.” This blog was co-authored by student-at-law, Abby Leung [1] Lauren Pelley, “S-Trip accused of exploiting volunteer ‘trip leaders’ who work long hours” CBC August 24, 2017: https://www.cbc.ca/news/canada/toronto/s-trip-employees-1.4246725 [CBC]. [2] SO 2000, c. 41 [3] 2020 ONSC 3821 at para 6 [Montaque]. [4] Ibid at para 13. [5] CBC, supra note 1. [6] Montaque, supra note 3 at para 3. [7] CBC, supra note 1. [8] Ibid. [9] 2020 ONSC 3821 [Statement of Claim, Plaintiff at para 40]. [10] Montaque, supra note 3 at para 5. [11] Ibid at para 6. [12] Ibid at para 8. [13] Ibid at para 13. [14] S.O. 1992, c.6. By Fauzan SiddiquiBlog, Employment LawSeptember 27, 2022June 10, 2023
Waksdale Prevails: Ontario Court of Appeal Overturns Enforceability of Illegal Termination Provisions in Rahman In Rahman v Cannon Design Architecture Inc, 2022 ONCA 451, the Ontario Court of Appeal recently overturned a lower court decision which upheld an otherwise illegal termination provision because the employee sought legal advice prior to signing her employment contract. A divergent approach to the one taken in Waksdale v Swegon North America Inc, 2020 ONCA 391. The Waksdale Decision On June 17, 2020, the Ontario Court of Appeal in Waksdale ruled that a contract’s termination provisions must be read as a whole, to the effect that if any aspect of the termination clause is found to contravene the Employment Standards Act, 2000 (“ESA”), the entire clause will be rendered null and void for all purposes, despite the existence of a severability clause. The Case of Rahman Facts Farah Rahman was employed by Cannon Design Architecture Inc. (“CDAI”) as a Senior Architect, Principal and Office Practice Leader for over four years. She was given four weeks of base salary when her employment was terminated, without notice or cause. Prior to the commencement of her employment, Rahman sought independent legal advice and negotiated the terms of her employment agreement, including the termination provisions. With the help of legal counsel, Rahman negotiated “material improvements” to the terms of her severance package under her contract. Rahman signed two employment contracts with distinct termination provisions. The first was an “Offer Letter” asking Ms. Rahman to join CannonDesign, a subsidiary company wholly owned by CDAI, as a “Principal”. The second was an “Officer Agreement” between The Cannon Corporation (a corporate entity separate from CannonDesign and CDAI) and Ms. Rahman, to become Cannon Corporation’s Senior Vice President and Principal Officer. The Offer Letter referred to the Officer Agreement, stating that the latter also formed the basis of her employment. It provided that in the event of a conflict between it and the Officer Agreement, the Offer Letter would govern. After her dismissal, Rahman brought an action for wrongful dismissal. She argued that, in accordance with the decision in Waksdale, the termination provisions of the employment agreement were not enforceable because the “just cause” provision would allow for termination without notice in situations in which the ESA still required notice to terminate an employment contract. The termination provision: “CannonDesign maintains the right to terminate your employment at any time and without notice or payment in lieu thereof if you engage in conduct that constitutes just cause for summary dismissal.” Rahman argued that according to Ontario Regulation 288/01, an employee can be terminated without notice only where they have been “guilty of wilful misconduct, disobedience or wilful neglect of duty that is not trivial and has not been condoned by the employer”— a standard Rahman argued was higher than “just cause” at common law. In addition, Rahman argued that the provisions of the initial “Officer’s Agreement” that had been sent to her before the employment agreement violated the ESA. The Officer’s Agreement and the employment agreement contained different termination provisions, and Rahman had not negotiated the Officer’s Agreement’s provisions. Ontario Superior Court of Justice The motion judge found that the contractual provision in the employment agreement which denied entitlements upon termination for just cause did not amount to an attempt to contract out of the Employment Standards Act, 2000 because the employer and employee had equal bargaining power in negotiating the employment agreement. The basis for the motion judge’s decision was that he found Rahman to be “reasonably sophisticated” as she received independent legal advice prior to entering into the contract. The Court found the termination provision to be valid and enforceable. The Court of Appeal On Appeal, the question before the Court was whether the motion judge erred in concluding that the termination provisions of the employment contracts govern the termination of her employment. Justice Gilese reasoned: [24] In my view, the motion judge erred in law when he allowed considerations of Ms. Rahman’s sophistication and access to independent legal advice, coupled with the parties’ subjective intention to not contravene the ESA, to override the plain language in the termination provisions in the Employment Contracts. By allowing subjective considerations to distort and override the wording of those provisions, the motion judge committed an extricable error of law reviewable on a correctness standard: Amberber v. IBM Canada Ltd., 2018 ONCA 571, 424 D.L.R. (4th) 169, at para. 65. It is the wording of a termination provision which determines whether it contravenes the ESA – even compliance with ESA obligations on termination does not have the effect of saving a termination provision that violates the ESA: Wood v. Fred Deeley Imports Ltd., 2017 ONCA 158, 134 O.R. (3d) 481, at paras. 43-44. [28] The wilful misconduct standard requires evidence that the employee was “being bad on purpose”: Render v. ThyssenKrupp Elevator (Canada) Limited, 2022 ONCA 310, at para. 79, citing Plester v. Polyone Canada Inc., 2011 ONSC 6068, 2012 C.L.L.C. 210-022, aff’d 2013 ONCA 47, 2013 C.L.L.C. 210-015. For example, in Oosterbosch v. FAG Aerospace Inc., 2011 ONSC 1538, 2011 C.L.L.C. 210-019, the court awarded damages for ESA notice and severance after holding that the employer had just cause to terminate the employee for persistent carelessness that did not meet the wilful misconduct standard. [29] There is nothing in the Operative Just Cause Provision that limits its scope to just cause terminations for wilful misconduct. In its plain wording, the Operative Just Cause Provision gives CannonDesign the right to terminate Ms. Rahman’s employment without notice or payment, for conduct that constitutes just cause alone. That means the Operative Just Clause Provision contravenes the ESA and s. 5 renders it void. Section 5 provides that no employer shall contract out of an employment standard and any such contracting out is void. The Court of Appeal found that the plain wording of the termination provision ran afoul of the ESA and was therefore void and unenforceable. The Court of Appeal ruled that the motion judge erred at law in considering the former employee’s “sophistication and access to independent legal advice” and used those factors, among others, to “override the plain language” in the termination provisions. Key Takeaways When the Rahman decision was released last year, it was found to be a major win in favour of employers. By reversing the decision, the Court of Appeal has upheld the Waksdale decision. It reinforces that termination provisions should be read together, in their plain wording, when assessing their validity and enforceability. The ever-changing legal landscape of employment law in Ontario should encourage employers to have their employment contracts regularly reviewed by a lawyer to ensure they are compliant with statutory requirements for enforceability purposes and to avoid expensive litigation. To incentivize employees to sign the new agreements with updated termination provisions, employers may provide consideration to employees in the form of a signing bonus, salary increase, or other incentives. If you have any questions regarding termination provisions and updating employment contracts, please contact one of our employment lawyers or email info@devrylaw.ca to book a consultation. “This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please see a lawyer. Each case is unique, and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situations and needs.” This blog was co-authored by Owais Hashmi* Sources [1] Rahman v Cannon Design Architecture Inc, 2022 ONCA 451 [2] Waksdale v Swegon North America Inc, 2020 ONCA 391. By Fauzan SiddiquiBlog, Employment Law, Labour LawJuly 19, 2022October 27, 2023
Can An Employer Still Enforce a Mandatory Masking Policy? Ontario’s public health laws in response to COVID-19 continue to evolve. DSF has previously discussed the enforceability of mandatory vaccination policies in the workplace. This blog addresses the enforceability of mandatory masking policies introduced by employers now that Ontario law no longer requires masking in most settings. Evolution of the Ontario Mask Mandate On June 11, 2022, the Ontario mandatory masking requirement was lifted in public transit[1] and most health care settings. The province’s masking mandate has been gradually adjusted since the onset of the COVID-19 pandemic, becoming more relaxed as the volume of infections in Ontario has decreased. The significant changes to the mandate enacted on June 11 were perceived by many as the end of the mask mandate. However, individuals are still required to wear a mask in certain circumstances, such as in long-term care and retirement homes. Hospitals, while no longer obligated by the province to require masking, may nonetheless elect to require masks to be worn in their facilities. Indeed, many hospitals, such as Toronto’s University Health Network, have continued to require masking. Masking Policies in the Workplace Similar to hospitals, although not mandatory, private businesses may choose to have a masking policy in effect. Under the Occupational Health and Safety Act (“OHSA”), employers are required to take every precaution reasonable in the circumstances for the protection of a worker. This includes protection from “occupational illnesses”, such as COVID-19. To ensure compliance with the OHSA, it continues to be prudent for employers to have a masking policy. One possibility would be to require employees to wear a mask when walking through the common areas of the workplace but be permitted to remove their masks when working alone in their office. Individuals who wish to continue masking are permitted to do so, even if their employer does not require it. Employees who refuse to comply with their employer’s masking policy may be subjected to discipline. Is Refusal to Abide by an Employer’s Masking Policy Just Cause for Termination? Employers may terminate an employee at any time without cause, as long as they provide the terminated employee with all payments and entitlements in accordance with the Employment Standards Act, 2000, their employment contract and the common law. If an employee can show that they cannot wear a mask for medical or religious reasons, they would be entitled to accommodation under the Ontario Human Rights Code or the Accessibility for Ontarians with Disabilities Act. In these instances, employers would have a duty to accommodate the employee up to the point of undue hardship, with regard to cost and health and safety issues. However, to date, qualifying for such as accommodation has proved to be extremely difficult and this is likely to continue to be the case. In Beaudin v Zale Canada Co. o/a Peoples Jewellers, 2021 AHRC 155, the Human Rights Tribunal of Alberta (“HRTA”) determined that a store’s choice to refuse service to a customer who refused to comply with its masking policy, even though at the time there was no public health requirement to wear a mask, did not amount to discrimination. In this instance, it was not disputed that the patron had a disability which prevented him from wearing a mask, but because the store offered alternatives such as shopping online (with free delivery) and curbside pick-up, and since the employer had good faith and legitimate health and safety reasons for introducing the policy, the HRTA dismissed the complaint. There are other cases in which human rights tribunals have decided against individuals who refused to follow the mask policies of private businesses.[2] In each of these cases, the tribunals concluded that the complainant was not entitled to an exemption from wearing a mask under the applicable human rights legislation. Employers may consider providing alternatives, such as permitting employees to work remotely to avoid human rights complaints about the enforcement of a masking policy. However, as the British Columbia Human Rights Tribunal concluded in The Customer v The Store, 2021 BCHRT 39, “[t]he Code does not protect people who refuse to wear a mask as a matter of personal preference”.[3] The above cases suggest that an employer will likely have a strong case if they choose to terminate an employee for cause and wilful misconduct for failure to comply with a masking policy. However, if COVID-19 becomes less of a public health and workplace safety concern and case counts decrease, it will become more difficult for an employer to establish just cause and wilful misconduct when terminating an employee for failure to comply with a masking policy. On the other hand, if a new variant and wave of the virus emerge and case counts increase, the employer’s case for cause and wilful misconduct, if an employee does not comply with its masking policy, will become strong again. Ultimately, masking disputes in the workplace will depend on the facts and circumstances of each case and whether the masking policy is reasonable in the circumstances. If you have any questions about mask mandates in the workplace or employment law generally, please contact Marty Rabinovitch at (416)-446-5826 or Marty.Rabinovitch@devrylaw.ca. “This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please see a lawyer. Each case is unique, and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situations and needs.” This blog was co-authored by Chloe Carr* [1] With the exception of the TTC’s “Wheel-Trans” Service. [2] See also: Szeles v Costco Wholesale Canada Ltd., 2021 AHRC 154; Rael v Cartwright Jewelers and another, 2021 BCHRT 106; Coelho v Lululemon Athletica Canada Inc., 2021 BCHRT 156; Ratchford v Creatures Pet Store, 2021 BCHRT 157. [3] The Customer v The Store, 2021 BCHRT 39 at para 14. By Fauzan SiddiquiBlog, COVID-19, Employment LawJuly 1, 2022August 15, 2022
Court of Appeal Declines to Decide whether IDEL Constitutes Common Law Constructive Dismissal Following the introduction of Infectious Disease Emergency Leave (“IDEL”) in Regulation 228/20 (the “Regulation”) passed May 29, 2020, pursuant to the Employment Standards Act, 2000 (“ESA”), the common law of constructive dismissal has been uncertain as a result of conflicting Ontario court decisions. Background The Regulation states that non-unionized employees who had their hours reduced or eliminated due to COVID-19 are deemed retroactively to be on IDEL. As reflected in section 50.1 of the ESA, a temporary reduction or elimination of an employee’s work hours and/or wages due to COVID-19 does not constitute constructive dismissal during the “COVID-19 period”, which began (retroactively) on March 3, 2020, and is currently set to expire on July 30, 2022. The Regulation has resulted in some confusion, since it prevents employees on IDEL from advancing a claim for constructive dismissal under the ESA, contrary to the well-established principle that an employer does not have an inherent common law right to temporarily lay off an employee – even if the employer complied with the layoff provisions of the ESA (the employer would need to include a lay-off provision in the employment contract). Normally, in order for the common law to be altered by statute, there would need to be express language in the statute to that effect. As stated expressly at section 8(1) of the ESA, “no civil remedy of an employee against his or her employer is affected by this Act”. The Regulation does not contain any language which would modify this section of the ESA, leaving many to wonder how the courts would interpret and apply the Regulation. In earlier blog posts, which can be found here and here, we too at DSF contemplated this uncertainty. Coutinho v Ocular Health Centre Ltd., 2021 ONSC 3076 (CanLII) (“Coutinho”) The question of whether the Regulation prevented an employee from advancing a claim for constructive dismissal at common law was first put before the court in Coutinho. The court ruled that while the Regulation prevented the employee from pursuing damages under the ESA, it did not prevent them from pursuing a claim for constructive dismissal at common law. Thus the court determined that the Regulation did not impact an employee’s common law right to assert that a reduction in hours of work and/or wages constitutes a constructive dismissal, which would entitle the employee to wrongful dismissal damages. For a more thorough discussion of this decision, please see our previous blog post here. Taylor v Hanley Hospitality Inc., 2021 ONSC 3135 (“Taylor”) The “certainty” provided by the court in Coutinho did not last long, however, following the conflicting decision of the Ontario Superior Court in Taylor. In contrast to the decision in Coutinho, the Court determined that an employee on IDEL under the Regulation had no right to claim constructive dismissal claim at common law. Please see our previous blog post here for more details on this decision, and our blog post here to see our first analysis of the conflicting judgments. Taylor v Hanley Hospitality Inc., 2022 ONCA 376 As anticipated, the Superior Court’s decision was appealed due to the inconsistencies between the rulings in Coutinho and Taylor. The Court of Appeal decision was expected to clarify the law in this regard, however, the decision released on May 12, 2022, ultimately did not do so. The Court of Appeal overturned the trial judge’s decision on other, unrelated grounds related to an erroneous granting of a Rule 21 motion under the Rules of Civil Procedure. Thus no determination was made on whether section 50.1 of the ESA overrides an employee’s common law right to assert constructive dismissal. The case and this question of law were sent back to the Superior Court to be re-adjudicated. Current State of the Law: Employers Beware For the time being, Coutinho and Fogelman v IFG, 2021 ONSC 4042 are the governing authorities. In both decisions, the Superior Court has found that section 50.1 and the Regulation do not displace an employee’s common law right to assert constructive dismissal. Although the law is by no means certain, employers should be aware that according to these decisions, many temporary layoffs due to COVID-19 could be considered unlawful and may entitle employees to wrongful dismissal damages. Our employment law team at Devry Smith Frank LLP will continue to monitor the state of the law closely. If you have any questions regarding the IDEL, or any other labour or employment law issues, we would be happy to assist you. “This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please see a lawyer. Each case is unique, and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situations and needs.” This blog was co-authored by Chloe Carr* By Fauzan SiddiquiBlog, COVID-19, Employment LawJune 14, 2022August 15, 2022
Can Employers Monitor Their Employees’ Electronic Activity? Bill 88, the Working for Workers Act, represents one of many attempts by the Ontario legislature to respond to the unique challenges arising during the COVID-19 work-from-home era. One element of this bill will amend the Employment Standards Act, 2000 (“ESA“) to account for the use of electronic monitoring software by employers. As of October 11, 2022, employers with 25 or more employees are required to have a written policy which addresses the electronic monitoring of employees. Background Bill 88, a supplement to the 2021 version of the same name (which you can read more about here) received Royal Assent on April 11, 2022. Electronic monitoring software, though not exclusively used by employers of remote workers, is typically used to surveil the attendance and productivity of those working from home. It is this remote relationship that the new ESA provisions intend to regulate, although in-person employees will still be entitled to notice if such software is being used to monitor them. What are the implications for employers? Employers are not prohibited from utilizing monitoring software. They must, however, have a policy which addresses the following: Whether the employer electronically monitors employees and if so, a description of how and in what circumstances the employer may electronically monitor employees, and the purposes for which information obtained through electronic monitoring may be used by the employer. The date the policy was prepared and the date any changes were made to the policy. Such other information as may be prescribed. A copy of the policy must be provided to employees before October 11, 2022, and when changes are made to the policy, updated copies which reflect those revisions must be provided within 30 days of the date on which the changes were made. When a new employee is hired, they must be provided with a copy of the policy within 30 days of their start date. If using the services of a temporary help agency, those employees must be provided a copy within 24 hours of the start of their assignment, or within 30 days from the day, the employer is required to have the policy in place, whichever is later. What are the implications for employees? While there is a presumption that employees have a reasonable expectation of privacy, this presumption can be displaced through the employer’s electronic monitoring or other policy. There is no recourse under the Working for Workers Act if an employee finds the content of the policy or scope of monitoring to be unreasonable, although certain common law remedies may be available depending on the facts and circumstances. Employees may complain, however, if they are not provided with a copy of the employer’s electronic monitoring policy in accordance with the applicable time frames. What should be included in a monitoring policy? The legislative requirements center around transparency when using electronic monitoring rather than limiting the use of this technology. Thus, employers are simply required to state whether or not they will be using such technology and if so, they must explain in what circumstances they intend to do so. The policy must also include the date it was prepared and the date of any changes made to the policy. While the current requirements are minimal, the legislation requires that the policy include “such other information as may be prescribed,” hinting at the potential expansion of the legal requirements for electronic monitoring policies.[1] Employers should consider the following when drafting their policy: Is the use of monitoring software reasonable and necessary? (Is there a specific need for it? Will it fulfill this purpose and if so, how?) What is the scope of the software? (Does it monitor all activity, or simply record when people sign on to their computer, and sign out when they are finished working?) How will the information collected be used? (For example, will it be used to determine employee productivity? To confirm attendance? To keep records of how long an employee is away form their computer during the day?) How can the employer ensure all employees are made aware of the existence of the policy and its content? (The policy could be made available online and employees notified of the date on which becomes effective. The employer could require the employee to acknowledge in writing that they have read and understood the content of the policy). If you have any questions regarding the use of electronic monitoring software in the workplace, how to draft such monitoring policies or any other obligations and rights enshrined by these legislative changes please contact Marty Rabinovitch at (416) 446-5826 or Marty.Rabinovitch@devrylaw.ca. “This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please see a lawyer. Each case is unique, and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situations and needs.” This blog was co-authored by Chloe Carr* [1] [1] Bill 88, An Act to enact the Digital Platform Workers’ Rights Act, 2nd Sess, 43nd Leg, Ontario, 2022 (assented to 11 April 2022), ON 2022, c 41.1.1(2)3. By Fauzan SiddiquiBlog, COVID-19, Employment LawJune 14, 2022September 2, 2022
Employees Injured While Working from Home Could be Entitled to Workers’ Compensation Seven months into the COVID-19 pandemic, Alexandria Gentile-Patti was working from home as a telephone customer service agent for Air Canada. At the time, many Canadians brought their workplaces home to weather the pandemic. On September 25, 2020, Mme Gentile-Patti took her lunch break and ventured downstairs. After a few steps, she lost her footing and fell—sustaining an injury. For this harm, she claimed workers’ compensation. Air Canada contended that the fall had no connection to her employment; i.e., she was at home and she was not working when she fell. Ultimately, the Québec Administrative Labour Tribunal (“Tribunal Administratif Du Travail”) ruled that Mme Gentile-Patti was indeed entitled to compensation under the provincial framework for employment injuries. To be clear, the injury at home was a workplace accident for compensation purposes. It occurred only moments after she disconnected from work to take a break and eat. The COVID-19 pandemic has changed where and how thousands of Canadians work. According to Statistics Canada, nearly a third of employees aged fifteen to sixty-four performed most of their work out of their homes from 2020 to 2021.[1] This figure is more than seven times higher than it was in 2016.[2] This tribunal decision out of Québec signals that the law concerning working in virtual workplaces is still developing. The decision also shows that employees need to be protected from harm wherever and however they work. Even as measures to combat the spread of COVID-19 are rolled back, many changes to the employment landscape may be here to stay. The law will need to continue to evolve in response to these developments. Background A workplace insurance system provides benefits to employees who have been injured at work or who have workplace illnesses. A workplace insurance system is also called workers’ compensation. In Québec, the Act respecting industrial accidents and occupational diseases provides the framework under which compensation is provided for employment injuries.[3] The compensation aims to provide “physical, social and vocational rehabilitation” for an injured worker.[4] Other provinces have similar schemes. In Ontario, the Workplace Safety and Insurance Act, 1997 outlines the statutory requirements for employees to qualify for workplace insurance benefits.[5] In Ontario, an accident at work includes, “a chance event occasioned by a physical or natural cause … arising out of and in the course of his or her employment.”[6] In Québec, an accident at work consists of an “unforeseen and sudden event” which arises “out of or in the course of work.”[7] The Québec Case of Air Canada et Gentile-Patti Mme Gentile-Patti fell down her stairs in her private residence in the middle of her workday. She disconnected from her workstation to take a lunch break—ensuring that there would be no further incoming customer calls.[8] She left her dedicated work area on the second floor to go to a separate space to eat. Her employer, Air Canada, asserted that Mme Gentile-Patti was not working when she fell. Quite literally, she disconnected from work immediately prior to the accident. Further, Air Canada had no control whatsoever over Mme Gentile-Patti’s home environment. The accident occurred during her private life (or in her “personal sphere”) which was not connected to her work.[9] In sum, Air Canada contended that Mme Gentile-Patti’s injury was not the result of a workplace accident and that she should not be entitled to workers’ compensation. Criteria to determine whether a work accident occurs during the performance of work have been developed by Québec jurisprudence. These factors include location, time, remuneration for the activity, degree of authority exercised by the employer over the employee, purpose of the activity, whether the activity was incidental, and connection of activity to the performance of work.[10] The Tribunal noted that these criteria are to be considered together, with a particular focus on the connection of the purpose of the activity to the performance of the work.[11] The Tribunal noted that there was no distinction drawn by the statute when an accident occurs in the employer’s establishment, in the employee’s private residence, or elsewhere.[12] For example, workplace accidents have occurred in a hotel room, convention halls, and parking lots.[13] There was nothing to suggest that a personal residence should be specifically excluded from this analysis. In Mme Gentile-Patti’s case, the very reason why she was at home at that time was because it was required by her employer.[14] Even though Mme Gentile-Patti was on break in her home, it was integral to the way she worked. The schedule—which contemplated taking breaks—was a key feature of how the work was organized. The Tribunal noted that a high degree of precision about the specific activity at the very moment the accident occurred (i.e., going to eat), was not necessarily determinative.[15] The Tribunal concluded that Mme Gentile-Patti’s fall down the stairs—of her private residence while going to perform a personal activity, while on break from working—was nonetheless a workplace accident for compensation purposes. Discussion and Conclusion As employees invite more of their work lives into their homes—out of either necessity or convenience—the distinction between work and personal spheres becomes less clear. In light of the rapid changes to the Canadian employment landscape in the face of COVID-19, the law is evolving to adapt to these new realities. Accidents which may have an initial appearance of being purely of personal character may qualify as workplace accidents. However, it remains to be seen how this Québec tribunal decision will influence or be received in Ontario. Employers in Ontario have a statutory duty to safeguard the health and safety of their employees pursuant to the Occupational Health and Safety Act.[16] By law, an employer must take every reasonable precaution to maintain a safe working environment.[17] But it remains to be seen what steps employers could reasonably take to protect employees in their own homes. This uncertainty is all the more pronounced when the theoretical limits of what constitutes a home workplace are not well-defined. Mme Gentile-Patti was injured near where she was working, while she was not working. The fact that the Tribunal found a sufficient nexus between the accident and her work suggests that the Tribunal contemplates a very large sphere where work-“adjacent” activities could be considered work activities. For more flexible work arrangements, even more of employees’ time—and even more of the places they go—could be considered part of their work sphere. In an era where a third of Canadian employees are performing most of their work at home, and where more and more activities could be considered performed “in the course of employment,” the law will need to respond by clearly articulating certain limits. “This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please see a lawyer. Each case is unique, and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situations and needs.” [1] Statistics Canada, Working from home during the COVID-19 pandemic, April 2020 to June 2021 (Ottawa: Statistics Canada, 4 August 2021). [2] Ibid. [3] Act respecting industrial accidents and occupational diseases, CQLR c A-3.001, s 1. [4] Ibid. [5] Workplace Safety and Insurance Act, 1997, SO 1997, c 16, Schedule A. [6] Ibid, ss 2(1), 13(1). [7] Gentile-Patti, supra note 1 at para 10 (“Un accident du travail est constitué d’un événement imprévu et soudain qui survient par le fait ou à l’occasion du travail”). [8] Ibid at para 7. [9] Ibid at paras 9-10. [10] Plomberie & Chauffage Plombec inc et Deslongchamps, CALP 51232-64-9305, 17 January 1995, B Lemay, cited by Gentile-Patti, supra note 1 at para 11. [11] Tremblay et Société des Alcools du Québec, CLP 287024-62B-0604, 21 February 2007, N Blanchard, at para 27 cited by Gentile-Patti, supra note 1 at para 12. [12] Gentile-Patti, supra note 1 at paras 11, 14. [13] Ibid at para 16. [14] Ibid at para 18. [15] Savard et Centres jeunesse Montérégie, 2021 QCTAT 2659 (CanLII) at para 21, cited by Gentile-Patti, supra note 1 at para 19. [16] RSO 1990, c O.1. [17] Ibid, s 25(2)(h). By Fauzan SiddiquiBlog, Employment LawMay 4, 2022