11 décembre 2012
Gerald D. Chipeur

Has right to work legislation been introduced in Parliament? Not yet. However, the seed has been planted.

In the fall of 2012, Mr. Pierre Poilievre, M.P. and Parliamentary Secretary to the Minister of Transport, issued a public letter (http://www.pierremp.ca/freedom-to-choose/) expressing the view that an employee governed by the Canada Labour Code should not be forced to associate with the Public Service Alliance of Canada (“PSAC”) and should not be forced to pay dues to PSAC.

Mr. Poilievre also created a “Petition to the Government of Canada for Workers’ Freedom” and has asked Canadians to contact his office to sign the Petition.

Three reasons are given by Mr. Poilievre for his initiative:

1. The Charter guarantee of Freedom of Association (he asserts that since no Canadian is forced to speak or to join a church, no Canadian should be forced to associate against their will);

2. The decision by PSAC to expend $1,694,900 on political action in 2011, regardless of whether each member supported the PSAC funded causes;

3. The decision by PSAC to support the Montreal student protestors with a $5,000 donation, even though the actions of the protestors were illegal and unrelated to any federal workplace.

Notwithstanding these initiatives by Mr. Poilievre, there has been no private members bill introduced in Parliament on this subject matter and there will not be in the short term. This is likely because a Parliamentary Secretary may not introduce a private members bill. Furthermore, the approach advocated by Mr. Poilievre is currently not the express policy of the Minister of Labour, the Honourable Lisa Raitt.

The initiative of Mr. Polievre is significant for a number of reasons.

First, the number of "right to work" States south of the border has grown to 24, with the addition of Michigan just this month. The trend may now be extending further north, as there is now, for the first time, a real debate in Canada about the issue.

Second, when public sector employees in the States of Washington, Idaho, Utah, Indiana, Colorado and Wisconsin were given freedom to not have union dues or political donations from union dues deducted from their pay cheques, tens of thousands of employees chose not to do so. It is likely that Canadian public sector employees would respond in the same way.

Third, at least one Member of Parliament, Mr. Russ Hiebert, has introduced legislation impacting union finances. His Bill C-377 would require unions to disclose financial information about the use of union dues that have been collected in Canada. If Bill C-377 passes, other, similar labour relations legislation may follow by way of private members' bills. The likelihood of passage has been improved by the December 7, 2012 amendments to Bill C-377 relating to privacy and business concerns. It is anticipated that the House of Commons will vote on third reading of the amended Bill C-377 on Wednesday, December 12, 2012. If the bill passes in the House of Commons, it will go to the Senate for consideration.

6 décembre 2012
Valerie Dixon

As Toronto Mayor Rob Ford discovered the hard way, sometimes a conflict of interest is the end of the road (well, maybe). While Mayor Ford’s troubles didn’t relate to employment - he was found to have breached the Ontario Municipal Conflict-of-Interest Act - conflicts of interest can result in an employer being in a position to terminate an employee for cause.

In the area of employment law, the term “conflict of interest” really connotes breach of a duty to the employer. For key, management or executive level employees, it may be properly referred to as a breach of fiduciary duty. For regular, non-fiduciary employees, it can be called a breach of the duty of loyalty. Regardless of the label used to describe the activity, the essence is an employee’s failure to place his or her employer’s interests before his or her own interests.

The legislation that required the dismissal of Mayor Ford for what some might perceive as a minor infraction has been described by the media as a “sledgehammer law”. The common law principles applicable to conflicts of interest in the employment setting are much more nuanced. For example, the conflict of interest must be objectively clear, and not just a perceived conflict in the eyes of the employer. However, even where the employer does not actually suffer any demonstrable harm, the fact that the potential for an objectively clear conflict of interest exists may be enough to dismiss the employee with cause.

Most claims for wrongful dismissal where a conflict of interest is alleged relate to competition by an employee with his or her employer. This might include the use of the employer’s premises and resources for the purposes of competition, taking steps to set up a competitive business to be operated post-employment, or having a controlling interest in a competitor of the employer. Other types of conflict of interest include receiving benefits (either directly or indirectly) from suppliers or other third parties to whom the employee has discretion to provide work.

So how does an employer ensure that it can terminate, for cause, an employee who may be in breach of his or her duties? As usual, best practice is to ensure that expectations are clearly communicated through express provisions in either a written employment agreement or policy. Such a provision or policy should describe:

1. What conflicts of interest actually are (both actual and perceived);

2. Whether the employee may hold outside employment or operate a business outside of his or her employment;

3. Whether the employee must disclose to the employer any ownership interest that he or she (or any “related party”, such as a family member) has in a competitor and/or whether the employee is allowed to have any ownership interest in a competitor;

4. Whether the employee must disclose any interest in any transaction of the employer, including whether the employee will receive any direct or indirect benefit;

5. The procedure for reporting, investigating and managing conflicts; and

6. The consequences of breaching the policy.

4 décembre 2012
Carol S. VandenHoek

Recent amendments to the Human Rights Code (Ontario) added to the protected grounds of discrimination both gender expression and gender identity. The recent decision of Vanderputten v. Seydaco Packaging Corp.,[1] while filed prior to the amendments, is instructive on the handling of gender identity and expression issues in the workplace.

The applicant, Maria Vanderputten was transitioning from male to female. Ms. Vanderputten alleged that she was subjected to a poisoned work environment resulting from ongoing harassment including comments about her gender identity and the requirement to use the men’s change room. The employer insisted that she continue to be treated as a man until she had completed surgery. Ongoing harassment from co-workers included name calling and comments, being pushed, having things thrown at her, and postings on the bulletin board. The harassment was alleged to have played an important role in the culminating incident which led to her dismissal from employment.

Ms. Vanderputten had a discipline history including suspension for aggressive behaviour and altercations with co-workers. An issue in the proceeding was whether some or many of these events resulted from harassment from the co-workers to which the applicant responded, or as alleged by the employer, whether the applicant was the instigator of these incidents.

The Human Rights Tribunal (Ontario) decided that the employer failed to properly investigate the allegations and concerns of the employee and did not respond in a reasonable manner. Insisting that the employee be treated as a man until her transition was complete was determined to be an act of discrimination. The actions of the employer failed to take into account the employee’s needs and identity. The Adjudicator, however, acknowledged the complexity of the issues and the need to balance and reconcile various rights and interests.

The Adjudicator was critical of the employer’s position that Ms. Vanderputten was the instigator. In reaching this conclusion, the employer repeatedly failed to consider her version of events or consider the context in which the events took place. As a result, the employer would consistently conclude that Ms. Vanderputten was at fault without due consideration. The Human Rights Code (Ontario) mandates that an employer reasonably investigate and address complaints of discrimination and harassment. The Adjudicator rejected the arguments that the gender identity of Ms. Vanderputten played no part in the decisions by the employer.

Ms. Vanderputten received and award of $22,000.00 for injury to her dignity, feelings and self respect, and an award for lost wages. The employer was ordered to develop a formal human rights policy and undertake training to ensure future compliance. A request for reconsideration of the decision was dismissed by the Tribunal.

This case addresses the obligations of an employer in a case where the gender identity of an employee is not in conformity with social norms.

27 novembre 2012
Béatrice Arronis

We have all been told at least once, “Sorry, you’re too late”. What if it was your turn to say it? It is well known that in the context of grievance arbitration, both unions and employers must conduct their files with diligence in order to avoid causing prejudice to the other party. Failure to do so has consequences, such as the loss of their right of action. The defense of laches can be used against the other party where there was unjustified delay in exercising its rights, though no definite prescription period is applicable.

In order to successfully use the defense of laches, two elements must be present. First, the grievor must have caused an unjustified and unreasonably long delay. Second, this delay must have caused prejudice to the other party. In other words, a plaintiff who waits too long to exercise its rights is presumed to be negligent and to have abandoned its grievance. Hence, the plaintiff will have to demonstrate that there was an acceptable reason for the elapsed time. Even if a reasonable explanation is provided, the right of action may still be lost, based on the fact that the other party has suffered irreparable prejudice.

For example, in a recent Quebec case, the union submitted six grievances to arbitration more than two and a half years after submitting them to the employer¹. In his ruling, the arbitrator clearly stated that the delay must be calculated from the time when the grievance was submitted to the employer. In this case, the employer received six grievances in October and November 2007, but the union decided to submit them to arbitration only on May 27, 2010. Since no acceptable justification was given by the union, the delay was considered unreasonable and rendered the grievance non-arbitrable because it caused a great prejudice to the employer.

The doctrine of laches is applicable on a case-by-case basis and all relevant circumstances should be taken into account. Therefore, there is no clearly defined delay after which this doctrine automatically applies. Note that a 13 month delay was ruled unreasonably long². As to acceptable justifications, it is clear that delays resulting from circumstances which the griever had no control over may put the defendant’s objection to rest, or when both parties are responsible for the delay. Where no justification is provided by grievor, the defense of laches has been applied to dismiss a grievance where indemnities or compensation payable by the employer would greatly increase because of an unreasonable delay caused by the union³, as well as in cases where a party’s right to a fair hearing was impaired. This could occur, for example, where records have been destroyed or where key witness are absent or have only a vague memory of important facts.⁴  

21 novembre 2012
Robert Bell

Usually, applicants under the Ontario Human Rights Code have one year to file an application after a discriminatory incident. However, when there is not one, but a series of incidents, the Tribunal may find that there has been a “continuing contravention” of the Code and the one year time limit runs from the last incident in the series rather than from the first.

In Terri Lynn Garrie v. Janus Joan Inc. and Stacey Szuch (2012) HRTO 1955 (CanLII), in an Application for Reconsideration, a full panel of the Tribunal found for the first time that an ongoing wage differential constituted a continuing contravention of the Code.

The Applicant in this case originally filed an application in 2009 claiming discrimination because of disability. She and other adults with developmental disabilities performed the same duties as general labourers who did not have developmental disabilities.  The Applicant and other labourers with developmental disabilities were paid a “training honorarium” of $1.00 per hour, which eventually was increased to $1.25 per hour.  Conversely, the general labourers who did not have developmental disabilities were paid minimum wage or higher. At first instance, the Tribunal dismissed her allegation that she had been discriminated against by being paid less than employees without developmental difficulties. The Tribunal held that the employer’s payment practices were not a continuing contravention and the complaint was outside the one year time limit.

Upon Review, the Tribunal held that the previous decision was wrong and that the time limit ran from the last incident and not the first. As a result, the application was not time-barred and could proceed. The decision provides helpful clarification regarding continuing contraventions under the Code.

It is now clear that an ongoing wage differential constitutes an ongoing contravention – the practical effect of which is that employees will have much longer to file applications in these circumstances; potentially, at a much greater cost to the employer.  

19 novembre 2012
Alex Heaslip

Buck stops with Director
Director jailed 90 days for repeatedly failing to pay wages

A recent court ruling sends a clear message to directors: violate the Employment Standards Act, 2000 obligations and you may be sent to prison.

Between March, 2007 and October, 2009, 61 employees from six companies operated by the same director filed claims under the Act for unpaid wages. Following an investigation, the Ministry issued 113 orders to pay amounts totaling over $125,000. None of the orders were paid. In October, 2011, the director and the companies pled guilty to failing to comply with the orders.

On November 1, 2012, the Ontario Court of Justice sentenced a director to 90 days in jail for repeatedly failing to pay employee wages pursuant to the Employment Standards Act, 2000. The director and his six companies were also fined $280,000.00 plus a 25% victim surcharge required pursuant to the Provincial Offences Act. The director and the companies were also ordered to pay the outstanding wages.

Pursuant to the Employment Standards Act, 2000, directors and officers of Ontario corporations can be personally liable for up to 6 months of unpaid wages.

This case serves as a stark reminder to directors to ensure that all wages are paid to employees.

7 novembre 2012
Clifford J. Hart

Likely every unionized employer reading this has faced the situation where an employee, in some way or another, "quits" and then some time after claims s/he didn't mean it. It is fair to say that many employers have initially rubbed their hands in glee (without being too cynical) only to be told that, in the circumstances, they would be wise to allow the employee to return to work.  I recently fielded questions by three different clients on this topic, so as a follow-up to my colleague Monique Petrin Nicholson's post in March of this year, I thought it would be a good time to send out this summary of the law.

Employee resignations have two components. First, there is the subjective intent to quit. Second, the intention must be confirmed by some objective conduct. Think of it as a golf or tennis swing. Hitting the ball is one thing.  The power and control of the shot come from the follow through.

On the first point, it must be demonstrated that the employee had the subjective intent to quit. This is generally the easier part. The employee utters the words "I quit", or "I resign". In some cases, the evidence will show that the employee told colleagues in the days or weeks before that s/he was going to do so. In other cases, the statement is made in the heat of the moment. It could follow an argument with a supervisor, or after being issued discipline. In either case, there is an express statement from the employee. Going back to the sports analogy, contact with the ball has been made.

Now for the harder part - the follow through or, in legal terms, objective conduct that confirms the intention to quit; For example, the employee writes and submits a letter of resignation on his/her own (vs. signing one that was prepared by the employer). Or, the employee cleans out his/her locker and goes for a good-bye beer with other employees.  Better yet, the employee meets with his/her union representative prior to leaving the plant.  The employee can be said to have followed through with the statement of "I quit".

But wait, there's more. Some time after leaving the plant, the employee attempts to rescind the resignation. This may be hours, days or even weeks after after doing so. The employee might have realized on his/her own that the decision was a foolish one. Or, the employee's partner might have pointed that out. In a case I had years ago, shortly after tendering his written resignation, the employee learned that quitting did not get him out of his family support obligations (true story).  After a three day arbitration, his grievance was dismissed.

The timing of the attempt to renege the decision is a factor. Returning to the plant within hours after quitting may draw more sympathy from an arbitrator. But a quick reversal is not determinative. Rather, if it can be shown that the employee expressed his/her desire to quit and took confirmatory steps after doing so, an arbitrator might very well find that the employee must live with the consequences of his/her actions.

19 octobre 2012
Stuart E. Rudner

Man in London, Ont. fired after posting derogatory comments on tribute page
for bullied British Columbia teen who committed suicide

We have spent the last few days reading about the horrific tragedy that resulted in Amanda Todd, a 15-year-old teen in British Columbia, taking her own life after years of bullying.

Now, as the community rallies around her and anti-bullying initiatives take on new life, one man posted the following on a Facebook memorial wall for Amanda: "Thank God this b**** is dead."

The poster was readily identifiable as Justin Hutchings of London, Ont. His employer, Mr. Big & Tall Menswear, was also readily identifiable. Hutchings was promptly dismissed, though reports to date are unclear as to whether he was fired for cause or not. Here’s the question: Did the company have just cause to dismiss him over the Facebook posting?

Let’s remember a few basic principles:

• Most employees in Canada do not have job protection. They can be let go at any time, for any reason (other than protected grounds under human rights legislation), as long as they are provided with the required notice of dismissal or pay in lieu.
• Generally speaking, what employees do on their own time is their own business.

So, it would be open to an employer in this type of situation to dismiss the employee on a without cause basis, as long as they provide notice or pay in lieu. However, if the employer wants to take the position it had just cause, we need to continue the analysis:

Off-duty conduct will be considered misconduct which can result in discipline or dismissal if:

• the conduct of the employee harms the company’s reputation
• the employee’s behaviour renders the employee unable to perform his duties satisfactorily
• the employee’s behaviour leads to refusal, reluctance or inability of the other employees to work with him
• the employee’s conduct makes it difficult for the company to properly carry out its function of efficiently managing its works and efficiently directing its workforce.

In other words, the conduct must have an impact on the employer or the employment relationship to constitute misconduct.

If an employee has engaged in misconduct, the next question is what form of discipline is appropriate — summary dismissal, or something less?

In assessing whether summary dismissal is appropriate, the law is clear that the misconduct is not to be considered in isolation. Rather, a contextual approach is to be used which takes into account all relevant circumstances.

This can include length of service, disciplinary record, nature of position (and degree of trust required), any mitigating circumstances and the employee's response when confronted with the allegation. In marginal cases, the employee’s honesty (or lack thereof) in the investigation process can be the difference between a finding the employment relationship has been irreparably harmed and just cause for dismissal therefore existed, and a conclusion that summary dismissal would be too harsh. Throughout the analysis, the principle of proportionality is to be kept in mind.

When explaining the decision to dismiss Hutchings, Kamy Scarlett, senior vice-president store operations and corporate HR at the parent company of Mr. Big & Tall Menswear, stated: “Our company ethics are based on tolerance, respect and fair and honourable treatment of all individuals, internally, with our customers and the population as a whole.” Scarlett also said: “We have zero tolerance for the mistreatment of others no matter what form it takes.”

I often urge employers to use “zero tolerance” policies cautiously. Just because your policy says something will be just cause for dismissal does not mean a court will agree. The contextual approach is always to be applied. Furthermore, zero tolerance policies can lead to unintended results. Most employers will say they have zero tolerance for employee theft. However, when confronted with the assistant that takes a pencil home one night so his daughter can do her homework, the employer will be reluctant to dismiss the employee for what is clearly an act of theft.

Getting back to Hutchings, it is unclear at this time whether he was dismissed with or without cause. We know what he did. However, there is much we don’t know about the relevant background and circumstances. As such, it would be difficult, at this time, to comment on whether or not the employer had just cause to dismiss him. That said, his conduct was morally reprehensible, and it is hard to fault the company for terminating the employment relationship, with or without just cause.

16 octobre 2012
Carol S. VandenHoek

The case of Barton v. Rona Ontario Inc.¹raises the issue of dismissal for cause based upon employee misconduct relating to a serious safety violation. In this case, the plaintiff was an assistant store manager who had worked for the employer for almost 4 years. The employee Mr. Barton was dismissed for cause together with another employee. Following trial, it was determined that the employer did not have cause to terminate his employment. Mr. Barton was unemployed for 12 months following his termination. As a 64 years old employee of 3 years and 8 months seniority, Mr. Barton was awarded 10 months in lieu of notice.

Referencing the contextual approach in assessing whether there was cause to terminate Mr. Barton, the Court focused on his act of misconduct. There was clear misconduct in that Mr. Barton was aware that employees were utilizing a lift truck (“order picker”) to assist a co-worker who used a wheelchair to access a second floor room for the purpose of attending a training program. The room was not otherwise accessible to the employee. The Trial Judge found that Mr. Barton breached his obligations as a manager in that he failed to take appropriate steps to stop this use of the lift truck. The evidence at trial disclosed that while Mr. Barton as manager did not “positively give permission for the lift scheme” he did not order that the employees not carry out the actions in moving their colleague up to the second floor nor did he stop them from repeating the act to facilitate his descent. This was determined by the Court to be a breach of his obligations as a manager.

The incident was investigated internally. The employer had internal safety rules prohibiting use of “power equipment by unauthorized employee, or riding on any moving equipment” which was listed in their policies under “Causes for Immediate Dismissal”.

The Trial Judge agreed that the misconduct of Mr. Barton as manager was serious but found that such misconduct was not severe enough to warrant dismissal. The Trial Judge concluded that a stern warning would have been appropriate discipline relating to Mr. Barton’s role in the serious safety violation. Of important note is that the employee had an excellent work record and no prior infractions were noted. As such the Trial Judge determined that there was nothing in the work history of the employee to suggest that he was not amenable to discipline or that he would repeat such misconduct in the future.

The use of discipline in response to serious safety violations poses a significant challenge for employers. Some employers may cite a “zero tolerance” policy for such violations. Even in a situation of a safety violation it is clear that a contextual approach to the misconduct will be undertaken by the Court in assessing the seriousness of the misconduct and the proportionality of the response by the employer.

¹ 2012 ONSC 3809

10 octobre 2012
Heather MacMillan-Brown

“The Lord said ‘let there be wheat’ and Saskatchewan was born” – Stephen Leacock

Saskatchewan has long been synonymous with farming. The 2011 census suggests that while there are currently fewer farms in this province than in years past, they are more productive than ever. And one reason for this efficiency is the use of hired help: more than one-third of farms were reported to have hired paid labourers.

In Rocking Hills Cattle Co. Ltd. v. Saskatchewan (Director of Labour Standards), 2012 SKCA, the central issue was the interpretation of section 4(3) of The Labour Standards Act, which provides that the Act does not apply to “…an employee employed primarily in farming, ranching or market gardening”.

In Rocking Hills, the employee had worked as the bookkeeper and office manager for Rocking Hills Ranch, a large ranching operation near Kenaston, Saskatchewan. Over her six-year period of full-time, year-round employment with Rocking Hills Ranch, she had not been compensated for overtime, public holiday pay, or annual holiday pay. The employer took the position that her position was exempt under section 4(3) of the Act because she was an employee engaged in farming or ranching.

The Director of Labour Standards issued a wage assessment requiring Rocking Hills to pay the employee $6,280 in overtime and holiday pay. On appeal of this assessment, the adjudicator upheld the assessment. Rocking Hills then appealed to the Court of Queen’s Bench.

Madam Justice Gunn upheld the decision of the adjudicator and held that the exemption set out in section 4(3) of the Act applies only if an employee is engaged in “farm type” or “ranch type work”. In other words, in Justice Gunn’s view, the fact that the employee worked for a ranching operation was immaterial and the fundamental question was instead the nature of the employee’s work for the employer. Thus, because the employee was doing a non-ranching job, she did not fit within the exemption and Rocking Hills should have been paying her overtime and holiday pay over the period of her employment.

Rocking Hills then applied for leave to appeal to the Saskatchewan Court of Appeal. In his decision to grant leave to appeal, Mr. Justice Richards recognized that there are inconsistent Saskatchewan decisions on the interpretation of the exemption provided to farming and ranching operations under section 4(3) of the Act. Some decisions corresponded with Madam Justice Gunn’s conclusion but there were other authorities that Mr. Justice Richards pointed to that suggest that non-farm or ranch related work can fall within the section 4(3) exemption if the employee is employed by a bona fide farmer or rancher. Thus, in light of the inconsistent decisions surrounding the interpretation of the exemption provision, Mr. Justice Richards granted leave to appeal.

In light of the agricultural landscape in Saskatchewan, it will be interesting to monitor the results of this appeal, which has not yet been heard. Will the farming/ranching exemption depend upon whether or not the employee is actually doing farm/ranching work or is the exemption available simply because the employee works for a farming or ranching operation? The answer could have a significant impact upon the farm or ranch employer’s obligations to its employees.

Thank you to Kit McGuiness, articling student in the Saskatoon office, for his significant contribution to this article.