Temporary Layoffs During COVID-19 – “COVID-19 period” extended until January 2, 2021 On May 29, 2020, Ontario passed Regulation 228/20 under the Employment Standards Act (“ESA”). As a result of this new regulation, non-unionized workers who had their hours reduced or eliminated due to COVID-19 are deemed retroactively to be on Infectious Disease Emergency Leave, which is an unpaid, job-protected leave under the ESA. The regulation applies retroactively from March 1, 2020, and initially was set to expire on September 4, 2020, six (6) weeks after the state of emergency ended. This period of time is referred to in the Regulation as the “COVID-19 period”. Our initial blog, which explains the impact of the Regulation on employer and employee rights, can be found here. On September 3, 2020, the government of Ontario announced that the COVID-19 period would be extended until January 2, 2021. Impact of the Regulation and the Extension of the COVID-19 Period As a result of the Regulation and the government’s latest announcement, non-unionized employees who have been temporarily laid off between March 1, 2020, and January 2, 2021, for reasons related to COVID-19 would be deemed to be on Infectious Disease Emergency Leave. Under the ESA, an employee who has been laid off for more than 13 weeks in any period of 20 consecutive weeks (or for at least 35 weeks in any period of 52 weeks, if certain other conditions are met) will be deemed to have been dismissed from their employment. This constructive dismissal would then entitle the employee to statutory termination pay, as well as severance pay (if certain other criteria are met). The extension of the COVID-19 period to January 2, 2021, means that there will be no deemed terminations arising from temporary layoffs until after January 2, 2021, provided that the reason for the layoff was related to COVID-19. As noted by the government of Ontario, the Regulation can relieve employers from substantial payments to their employees, which can make a difference in times where the business is already struggling to survive the economic effects of the pandemic. Does the Regulation Alter the Common Law related to Temporary Layoffs and Constructive Dismissal? As set out above, an employer has a right to temporarily lay off employees under the ESA. However, it is well-established law that an employer does not have a common law right to temporarily lay off an employee, even if the employer complies with the provisions of the ESA. This would result in a constructive dismissal at common law. The common-law prohibition of temporary layoffs in Ontario can be altered if there is an express term in an employment contract that permits an employer to temporarily layoff employees in accordance with the ESA. In order for the common law to be altered by a statute, there would need to be express language in the statute to that effect, which is not the case here. In fact, the ESA expressly states that “no civil remedy of an employee against his or her employer is affected by this Act” and the Regulation does not contain any language which would modify this section of the ESA. In the event that the common law provides a greater right or benefit to an employee than their ESA entitlements, the common law will prevail. However, an employer can limit an employee’s entitlements by contract, as long as the contract ensures that the employee will not receive less than their minimum ESA entitlements. COVID-19 has resulted in unique and unprecedented circumstances for both employers and employees and how the courts will interpret and apply Regulation 228/20 (and the most recent amendment to the COVID-19 period) remains to be seen. The courts may still find that employees have been constructively dismissed at common law, but may award less generous severance package to employees. The specific facts which resulted in the temporary layoff or reduction in hours or wages will also be relevant. If the common law remains unaltered, many temporary layoffs due to COVID-19 would be unlawful and may result in the employee’s entitlement to a common law notice period and significant severance payouts for employers. Key Takeaway for Employees: Employees who have been temporarily laid off during the COVID-19 period and were waiting until after September 4, 2020, to claim statutory termination pay and severance pay from their employer arising from a deemed termination of their employment will now have to wait until after January 2, 2021. However, assuming that there was no lay-off provision in their employment contract, employees in this situation should consider taking the position that the lay-off was in contravention of the common law, their employment was constructively dismissed, and that they are therefore entitled to a common law notice period. Key Takeaway for Employers: Employers will not be obligated to pay out hefty sums for severance pay and termination pay under the ESA until after January 2, 2021, with respect to employees who have been temporarily laid off due to COVID-19, and may therefore wish to consider extending temporary layoffs until January 2, 2021. However, the Regulation does not bar employees from pursuing an action in common law and it is unclear at this stage how courts will interpret and apply this Regulation. If you have more questions about how this new Regulation will affect you as either an employer or employee, contact employment lawyer Marty Rabinovitch at 416-446-5826 or at marty.rabinovitch@devrylaw.ca to discuss your rights and options. “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 situation and needs.” By Fauzan SiddiquiBlog, COVID-19, Employment LawSeptember 15, 2020September 29, 2020
Andros v. Colliers Macaulay Nicolls Inc., 2019 ONCA 679 In the case of Andros v. Colliers Macaulay Nicolls Inc., 2019 ONCA 679, the interpretation of the employment contract governing the employee-employer relationship, was at issue. The specific contentions arose from the controversial termination clause contained in the contract. The Plaintiff employee was dismissed without cause by the defendant employer. At the time of termination, the employee had worked for the employer for two periods, with the second period lasting eight-years, during which he was promoted from a senior associate to a managing director. The employment contract contained the following termination clause: “4. Term of Employment . . . The company may terminate the employment of the Managing Director by providing the Managing Director the greater of the Managing Director’s entitlement pursuant to the Ontario Employment Standards Act or, at the Company’s sole discretion, either of the following: a. Two (2) months working notice, in which case the Managing Director will continue to perform all of his duties and his compensation and benefits will remain unchanged during the working notice period. b. Payment in lieu of notice in the amount equivalent of two (2) months Base Salary.” The employee argued that the termination provision was unenforceable because it represented an attempt by the employer to contract out of enumerated employment standards provisions provided for under the Employment Standards Act, 2000 (“ESA”), which is not permitted. The trial judge found that the termination provision in the employment contract potentially reduced the employee’s entitlements upon termination to something less than his minimum entitlement pursuant to the ESA. The trial judge found that at best, the termination provision in the employment contract was unclear or ambiguous as to whether the employee would have been entitled to all statutory ESA entitlements if clause 4(a) or 4(b) applied. The trial judge found that the termination provision was unclear and ineffective in rebutting the presumption of reasonable notice of termination at common law and was therefore unenforceable. The employer appealed the trial judge’s decision. On appeal, the employer’s appeal was dismissed. The Ontario Court of Appeal held that the trial judge did not err in finding that the termination clause was unenforceable, and that the trial judge properly interpreted it by considering it in its entirety. The Court of Appeal concluded that because the termination clause contained two distinct and separate parts, the lower court judge was correct to interpret the parts individually and correctly concluded that the clause was ambiguous. Clauses 4(a) and 4(b) purported to contract out of the ESA and did not incorporate the ESA by silence. It further followed that “if a termination clause purports to contract out of an employment standard without clearly substituting a greater benefit in its place, the entire termination clause is void”. The employee was therefore entitled to a common law notice period. Takeaway The decision in Andros reminds us that termination clauses must be drafted carefully to ensure their enforceability and that there is still uncertainty in the law as to whether a termination clause will be enforceable. Employers should consult a lawyer prior to presenting an employee with an employment contract which contains a termination clause to obtain legal advice about its enforceability. “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 situation and needs.” By Fauzan SiddiquiBlog, Employment LawNovember 15, 2019September 30, 2020
Employer Required to Cover Long-Term Disability for Employees Over Age 65 This blog is co-written by our former articling student, Linda Noorafkan. On November 19, 2018, an Ontario arbitrator determined that a hospital employer was required to continue paying 75% of the billed premium towards the Long Term Disability (“LTD”) coverage of employees that continued working beyond the age of 65. CUPE, Local 1999 and Markham Stouffville Hospital, Re involved a Union that filed a grievance against the Markham Stouffville Hospital (the “Hospital”). The Union took the position that the Hospital had violated the collective agreement by discontinuing LTD coverage for Hospital employees who were 65 years of age and older. With respect to LTD coverage, Article 13.01(a) of the collective agreement stated as follows: The Hospital will pay 75% of the billed premium towards coverage of eligible employees under the long-term disability portion of the Plan (HOODIP or an equivalent plan as described in the August, 1992 booklet (Part B)), the employee paying the balance of the billed premium through payroll deduction. While the insurer’s benefits plan indicated that there would be limited eligibility for LTD once employees turned the age of 65, the HOODIP Long Term Disability Benefit booklet for August 1992 stated that LTD benefits would be provided “[…] until the employee reaches age 65, or life in some cases.” The booklet also added that LTD benefits would end at the earliest of the following events: • Your 65th birthday, if you become disabled after age 64 and you have completed fewer than 10 years of Continuous Service, when you become disabled. • The day 12 months after the Date of Disability, if you become disabled after age 64 but before age 65 (minus the qualifying period) and you have completed fewer than 10 years of Continuous Service when you become disabled. • The date of death if you have completed 10 years of Continuous Service when you become disabled. In this case, at age 65 your benefit will be further reduced by any additional payments from government plans and your employer’s pension plan that begin at that age (see Amount of Long Term Disability Benefit). In contrast, there is a 1980 HOODIP booklet, which indicated that LTD benefits would only be payable until the employee turned age 65. Also in contrast, The 1984 HOODIP booklet indicated that: … LTD coverage terminated at age 65 but that benefits would continue past age 65 in certain circumstances reduced by pension and other benefits. Employees on LTD benefits are no longer required to take their pensions, Canada Pension Plan or Employment Insurance benefits at age 65. The Union argued that, despite the provisions in the 1980 and 1984 HOODIP booklets, since the collective agreement referred to the 1992 HOODIP booklet, then the Hospital must provide LTD coverage in accordance with the 1992 HOODIP booklet. This would mean that the LTD benefits of employees over age 65 would be reduced by pensions and other benefits, not terminated. In contrast, the Hospital made several arguments regarding the interpretation of the collective agreement. Overall, the Hospital claimed that, based on a review of the collective agreement, the 1992 HOODIP booklet, the plan from the year of 1992, and the history of the HOODIP from the year 1980 to 1992, the Arbitrator should conclude that LTD coverage ought to end once Hospital employees turned 65. Ultimately, the Arbitrator followed the 1992 HOODIP booklet, instead of the plan, by finding that the collective agreement did not expressly terminate LTD coverage once employees turned the age of 65. In support of the Union, the Arbitrator concluded as follows: The Employer also argues that the Union is seeking a new benefit and that clear and unambiguous language is required for such an interpretation. However, in a number of prior awards, arbitrators have found that benefits, including extended health, dental, life insurance, and accidental death and dismemberment, continue beyond age 65 even though the parties did not change the language of their collective agreement after the change to the legislation with respect to mandatory retirement. Arbitrators have rejected the argument that the parties must have intended that the age 65 limit would continue unless they negotiated otherwise, in favour of the assumption that the parties must be presumed not to have intended discriminatory provisions even if they were legal. Clear and unambiguous language has, therefore, been required to support a determination that benefits end at age 65. There is nothing about that analysis that would not apply to LTD benefits…. The Arbitrator concluded that if the employer had different intentions, those intentions ought to have been included in the collective agreement. Thus, the Hospital was required to pay LTD premiums for employees that were above age 65 and met the other LTD eligibility criteria. There appears to be a trend in the jurisprudence towards requiring employers to maintain benefits for employees over age 65. The Human Rights Tribunal of Ontario’s decision in Talos v. Grand Erie District School Board is another example. If you would like more information or legal advice on this subject, 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 situation and needs.” By Fauzan SiddiquiBlog, Employment LawNovember 5, 2019September 30, 2020
Denial of Employee Benefits to Working Seniors: A Charter Violation This blog is co-written by our former articling student, Linda Noorafkan. On May 18, 2018, the Human Rights Tribunal of Ontario (the “Tribunal”) rendered its decision with respect to the issue of whether s. 25(2.1) of the Human Rights Code (the “Code”), when read alongside s. 44 of the Employment Standards Act, 2000 (“ESA”), permitted employers to terminate benefits for employees when they turned 65. In Talos v. Grand Erie District School Board, the Tribunal found that such a termination violated s. 15 of the Canadian Charter of Rights and Freedoms, because it was a form of age discrimination. The section could not be saved under s. 1 of the Charter, and thus, was found to be unconstitutional since it violated the right to equality in a manner that was not demonstrably justified in a free and democratic society. Wayne (Steve) Talos continued to work as a secondary school teacher beyond the age of 65. However, when he turned 65, his extended health, dental, and life insurance benefits were terminated, even though he was still employed on a full-time basis. Mr. Talos heavily relied on the benefits, since they assisted with both his and his family’s medical and other expenses, especially since his wife had become severely ill and was ineligible for other benefits to cover her expenses. The section of the Code on which the employer relied to differentiate the entitlement to employee benefits and pension plans on the basis of age was s. 25(2.1) of the Code, as seen in the following related provisions: Employee benefit and pension plans 25 (1) The right under section 5 to equal treatment with respect to employment is not infringed where employment is denied or made conditional because a term or condition of employment requires enrolment in an employee benefit, pension or superannuation plan or fund or a contract of group insurance between an insurer and an employer, that makes a distinction, preference or exclusion on a prohibited ground of discrimination. Same (2) The right under section 5 to equal treatment with respect to employment without discrimination because of sex, marital status or family status is not infringed by an employee superannuation or pension plan or fund or a contract of group insurance between an insurer and an employer that complies with the Employment Standards Act, 2000 and the regulations thereunder. Same (2.1) The right under section 5 to equal treatment with respect to employment without discrimination because of age is not infringed by an employee benefit, pension, superannuation or group insurance plan or fund that complies with the Employment Standards Act, 2000 and the regulations thereunder. Mr. Talos took the position that the distinction in age when it came to benefits discriminated against employees who were 65 years and older, in particular since mandatory retirement was prohibited in Ontario through Bill 211 in 2005. As such, Mr. Talos claimed monetary compensation of $100,000 for lost benefits, as well as injury to dignity, feelings and self-respect. The Tribunal found that Mr. Talos experienced disadvantage because of his age. The Tribunal concluded that employees who worked beyond age 65 “provide[d] the same labour as they did when they were 64 years of age,” but the former was subjected to the termination of benefits despite the similarities in labour. Despite the employer’s arguments that Mr. Talos was not disadvantaged because his pensions were “generous” enough to ensure that Mr. Talos could “lead an economically viable life during his senior years,” especially since he was a member of a union, the Tribunal found these factors to be irrelevant to whether Mr. Talos’ s. 15 Charter right to equal compensation in the workplace was infringed. Nor did the ESA support the employer’s claims that a long career, being part of a profession, and being a member of a union, were “relevant to the statutory protections afforded to all employees” under the ESA and Code. Rather, the Tribunal determined that the ESA establishes “minimum standards for conduct and conditions of employment without regard to an employee’s access to a collective bargaining process.” Thus, the denial of benefits created by the Code was not due to the standards set out in the ESA, but were solely because of Mr. Talos’ age. Although the employer argued that providing benefits to employees aged 65 and older would challenge the financial viability of workplace benefits, the Tribunal ruled that, when considering all the evidence before it, “the financial viability of workplace benefit plans can be achieved without making the age 65 and older group vulnerable to the loss of employment benefits….” Thus, the Tribunal concluded that s. 1 of the Charter did not save the infringement of Mr. Talos’ equality rights since: … the impugned provisions do not minimally impair the rights of these older workers, as an employer is not required to demonstrate that their exclusion from employment benefits is reasonable or bona fide, or justified on an actuarial basis, or because their inclusion would cause undue hardship. Rather, if the legislature was concerned about financial viability, they could have used “less intrusive means” to address those concerns. Ultimately, the Talos decision has numerous impacts on both employers and employees. As a result of Talos, if an employee claims that they were discriminated on the basis of age, s. 25(2.1) of the Code can no longer be used as a defence by employers to justify the termination of benefits for those aged 65 and older. Could this mean that employees have a greater ability to maintain their employee benefits beyond the age of 65? We will have to see what future jurisprudence and possible legislative change hold for the future. If you would like more information or legal advice on this subject, 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 situation and needs.” By Fauzan SiddiquiBlog, Employment LawOctober 29, 2019September 30, 2020
Can Behaviours Associated with a Sex Addiction Merit Employee Dismissal? A recent Nova Scotia labour arbitration decision suggests that employers may not have to accommodate employees who have a medically diagnosed sex addiction where behaviours associated with such an addiction clearly justify discipline or termination. In Ontario human rights law, all employers must accommodate employees with a disability to the point of undue hardship. This may include, for example, allowing employees with medical marijuana prescriptions to use medical marijuana while at work. But sex addiction may not be a “disability,” at least as was suggested in UNIFOR, Local 2215 v I.M.P. Group Limited (Aerospace Division), 2019 CanLII 42096 (NS LA) (“UNIFOR”). In Unifor, an employee was the subject of several complaints from coworkers due to regularly masturbating in a bathroom cubicle of his workplace. After warnings, the employee continued the behaviour, and was fired. The union, on behalf of the employee, commenced a wrongful termination grievance. In support of his case, he provided a report from a doctor who diagnosed him with a sex addiction. The doctor listed a number of symptoms that, in his view, amounted to a sex addiction: “Loss of Control” – increased frequency, duration, or depth of involvement in sexual acting out behaviour indicating a possible loss of control within or between sessions. “Craving” – a strong desire to participate in sexual acting out behaviours, such as pornography, sexual contact, flirtation, sexting, video chat, phone conversation, masturbation, etc. “Threat to Life Roles” – Repeated participation and commitment to sexual acting out despite recurrent social or interpersonal problems or costs – e.g. Conflict at home or at work as a result of sexual acting out or the costs in time and energy of carrying out and keeping up the deception used to hide the behaviour. “Negative Mood” – using sex or sexual acting out behaviour to alleviate negative mood states, stress, tension, or irritation. However, during cross-examination, the doctor admitted that there was no standard list of symptoms attributable to sex addiction. He described how he had taken symptoms of general addiction and then modified them for sex addiction. The arbitrator concluded that the doctor’s assessment of the employee’s sex addiction was problematic primarily because (a) sex addiction is not significantly medically or scientifically recognized; (b) the doctor’s stated symptoms were too general and vague to necessarily be indicative of a sex addiction if such a condition exists; and (c) the symptoms described by the doctor were largely subjective and/or represented his own opinions rather than being some kind of recognized test. The arbitrator, in the end, was not convinced sex addiction was a recognized condition that amounted to a disability, and thus the employer had no duty to accommodate the employee by being accepting of the behaviours which stemmed from his purported addiction. The termination was therefore found to have been justified. What does this case tell us? Although this is a Nova Scotia arbitration decision, and thus is not binding on Ontario arbitrators, this case nonetheless suggests that adjudicators may not be open to recognizing non-scientifically recognized forms of addiction, such as sex addiction, as legitimate disabilities requiring employer accommodation. If you would like more information on arbitration clauses or would like legal advice on this subject, 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 situation and needs.” By Fauzan SiddiquiBlog, Employment LawAugust 27, 2019September 30, 2020
Could a Gift Card Compensate for a Minor Human Rights Tribunal complaint? A recent British Columbia Human Rights Tribunal decision has struck down a human rights complaint by a supermarket customer on the grounds that she was already compensated by the store for her complaint. But what compensation was considered enough? In Duke v Sobeys, 2018 BCHRT 283, the complainant went grocery shopping at a Sobey’s in British Columbia. While shopping, the complainant stated she was approached by an employee who told her inappropriate sex jokes. The employee admitted to his behaviour. Ms. Duke then requested a $250 gift card and an apology, both of which Sobeys provided. After the fact, Ms. Duke filed a complaint with the British Columbia Human Rights Tribunal. The Human Rights Tribunal concluded that the gift card and the apology were sufficient compensation in the circumstances. The Tribunal found that Sobey’s promptly responded to the complaint, immediately investigated it and addressed it appropriately. Because Sobey’s dealt with the complaint as efficiently as possible to ensure that if any discrimination existed, it would be resolved appropriately, the court felt no other remedial measures were necessary. The Tribunal also stated, “it does not further the purposes of the Code to encourage a complainant to increase what is sought, after they receive what they initially ask for”. Since the customer asked for compensation, and Sobey’s promptly provided it to her, no further remedies were required. The complaint was ultimately dismissed under section 27(1)(d)(ii) of the British Columbia Human Rights Code as it did not further the purposes of the Code. What does this decision tell us? As an employer, it is very important to respond quickly to complaints to avoid negative legal consequences. In this case, Sobey’s was quick to investigate the complaint and dealt with it in a reasonable manner that clearly ameliorated their customer’s concerns, at least at the time. This was sufficient to allow Sobey’s to avoid an unfavourable decision of the British Columbia Human Rights Tribunal. If you would like more information on human rights and employment law, contact Marty Rabinovitch at 416-446-5826 or at 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 situation and needs.” By Fauzan SiddiquiBlog, Employment Law, Human Rights LawAugust 20, 2019September 30, 2020
Arbitration Clauses in Employment Agreements: New Developments Two recent Ontario court decisions suggest that arbitration clauses requiring employees in employment agreements to submit certain employment actions to arbitration may be unenforceable. In a recent Ontario Court of Appeal decision, Heller v Uber Technologies, 2019 ONCA 1, Uber brought a preliminary motion to stay a class action advanced by one of its drivers. Uber sought to have the action proceed to arbitration in the Netherlands pursuant to its boilerplate arbitration clause, to which all drivers are required to agree before driving for Uber. Since this was a preliminary motion, the court assumed that Uber drivers would be considered “employees” under the Employment Standards Act, 2000 (“ESA”) and thereby could, for the purposes of this motion, be considered to benefit from the provisions under the ESA. The court noted that under s. 7(1) of the Arbitration Act, 1991 if a party to an arbitration agreement commences a proceeding for a matter which, according to the agreement, should be decided in arbitration, the court will stay the proceeding and submit the matter to arbitration. However, under s. 7(2), there are exceptions to the rule delineated under s. 7(1): for example, if the court deems the arbitration agreement to be invalid. The Court of Appeal found the arbitration agreement was invalid on two grounds: (a) it constituted an impermissible contracting out of the ESA and (b) it was unconscionable. Considering (a), the Court of Appeal noted that under the ESA, employees may launch a complaint to the Ministry of Labour or may launch a civil proceeding to launch a complaint against their employer. Since the arbitration clause forced employees to proceed immediately to arbitration, it took away their ability to make complaints to the Ministry of Labour or to launch a civil proceeding (arbitration was not considered a “civil proceeding” by the court). This constituted an unacceptable contracting out of the ESA and therefore the clause was ruled unenforceable on these grounds. Considering (b), the court also found that, even if the clause did not violate the ESA, the clause was still unenforceable because it was unconscionable. The court found it to be unconscionable primarily because it was a unilateral arbitration agreement which eliminated the drivers’ bargaining power and because drivers had agreed to the arbitration clause in the absence of legal advice. In a subsequent decision, Rhinehart v. Legend 3D Canada Inc., 2019 ONSC 3296, the court applied the reasoning from Heller, above. Mr. Rhinehart worked at a U.S. branch of a company, Legend 3D USA. Mr. Rhinehart signed several arbitration agreements with Legend 3D USA. Mr. Rhinehart then began to work for Legend 3D Canada. His employment was later terminated. When Mr. Rhinehart sought damages for wrongful dismissal, Legend Canada sought to stay the action and submit the matter to arbitration pursuant to the arbitration agreements between Mr. Rhinehart and Legend USA. However, the court found the arbitrations agreements were not enforceable because they were (a) not between Mr. Rhinehart and Legend CA; (b) the arbitration agreements between Mr. Rhinehart and Legend USA did not apply to issues arising from his Ontario employment; and (c) applying the same reasoning from Heller, the arbitration clauses constituted an impermissible contracting out of the ESA. These cases indicate that where arbitration clauses in employment agreements force employees to proceed to arbitration, rather than using the complaint process under the ESA or advancing a civil action, such clauses will be found unenforceable. Moreover, if the arbitration clause demonstrates a clear inequality of bargaining power, and leaves parties to the contract with no other reasonable choice but to agree in the absence of legal advice, such clauses will likely be invalid as they will be deemed unconscionable. If you would like more information on arbitration clauses or would like legal advice on this subject, 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 situation and needs.” By Fauzan SiddiquiBlog, Employment LawJuly 25, 2019September 30, 2020
Failing to Abide by Confidentiality Provisions in a Settlement Agreement Can Cost You Your Settlement Payment The recent decision of an arbitrator in the matter between Acadia University and Acadia University Faculty Association (Re Dr. Rick Mehta), 2019 CarswellOnt 8518 (Lab Arb) [“Acadia”] emphasizes the importance of abiding by a confidentiality provision in a settlement agreement. Background In the spring of 2018 Dr. Mehta was terminated by Acadia University for, among other things, allegedly harassing students and other faculty members. The Acadia University Faculty Association (“AUFA”) filed a grievance on behalf of Mehta and in April 2019 the matter came before a voluntary mediation session. At the mediation, a settlement agreement was reached and the Minutes of Settlement (the “Minutes”) were voluntarily executed by Acadia University, the AUFA and Mehta. Confidentiality Provision The Minutes contained a provision that all of the parties to the Minutes agreed “to keep the terms of [the] Minutes strictly confidential” and that if asked about particulars a party was to “indicate that the matters in dispute proceeded to mediation and were resolved, and [the parties] will confine their remarks to this statement” (Acadia at para 3). Alleged Breach of the Confidentiality Provision Despite this provision, Mehta was quick to take to social media and make comments such as “I got the vindication I was seeking,” “I have left the university on my term[s] as opposed to the administration’s or union’s terms” and, in response to one of Dr. Mehta’s Twitter followers’ comments “Hope you got a nice sum monz,” Mehta’s reply that “All I will say is that I left with a big grin on my face.” Arbitration As a result of Mehta’s alleged breach of the confidentiality provision in the Minutes, the matter went to arbitration. The arbitrator, William Kaplan, stated that Mehta’s tweets were a clear breach of the Minutes. As a result, the university was no longer required to honour the payment provision in the Minutes and therefore Mehta essentially lost his settlement payment. The Importance Confidentiality Provisions in Settlement Agreements Settlement privilege refers to the common law principle that, with very few exceptions, discussions and documents surrounding a possible settlement of a matter cannot be disclosed. This encourages settlement by preventing settlement discussions from eventually being used as leverage against one of the parties if the matter proceeds through trial. The privilege also generally extends to settlement agreements themselves (see, for example, Sable Offshore Energy Inc v Ameron International Corp, 2013 SCC 37 at paras 17-18). While Dr. Mehta’s consequences for failing to uphold the confidentiality provision of the Minutes may seem harsh, it is important to understand why settlement agreements should be kept confidential. If a settlement agreement could be freely disclosed it could result in prejudice to one or more parties to the settlement. For example, in the case of a labour dispute, such as that in Acadia, an employer may fear that if it settles a grievance and other employees become aware of the amount of the settlement, some of the other employees may be encouraged to commence grievances of their own with the goal of obtaining a similar settlement payment. This in turn could make an employer less willing to settle, which may result in more lengthy and expensive hearings. While settlement privilege provides protection to parties to a settlement agreement, it may not cover all aspects of a settlement agreement. This is why a party to a settlement agreement should ensure that the agreement also contains confidentiality provisions, which specify the extent to which the agreement is subject to confidentiality requirements. In Mehta’s case the provision was clear that no part of the agreement was to be disclosed. One of the reasons the outcome for Dr. Mehta was so severe is because the arbitrator noted that Mehta was involved in the negotiation of the agreement and its provisions. Importance If you are ever involved in mediation or settlement discussions, despite the principle of settlement privilege, make sure that any agreement you reach contains confidentiality provisions to protect yourself from disclosure of the agreement and possible prejudice. If you are a party to a settlement agreement, Acadia illustrates the importance of abiding by confidentiality provisions in the agreement and demonstrates that failing to do so could result in a complete loss of your settlement payment. If you have any further questions about settlement agreements and confidentiality provisions, 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 situation and needs.” By Fauzan SiddiquiBlog, Employment LawJuly 18, 2019September 30, 2020
An Illness/Injury Has Made It Unable to Return to Work: What Can I Do? If an injury or illness has resulted in there being no reasonable likelihood that you will be able to return to work within the foreseeable future, you may be entitled to compensation. The recent Ontario Superior Court of Justice decision, Hoekstra v. Rehability Occupational Therapy Inc., 2019 ONSC 562, sets out new guidelines on frustration of contract in the workplace. This potentially entitles employees to compensation if they have been injured or are suffering from an illness making it unfeasible to return to work. Frustration of contract What is frustration of contract? Frustration occurs where due to an unanticipated, intervening event beyond the control of the parties, a contractual obligation, if performed, would be radically different in character from what was initially agreed upon (see Amalgamated Investment and Property Co Ltd v John Walker & Sons Ltd [1977] 1 WLR 164 Eng. Ct. A.). Normally, frustration relieves both parties of any obligations they have under the contract. Frustration under the Employment Standards Act (“ESA”) Frustration operates somewhat differently in the context of employment law. Under section 2 of regulation 288/01 of the ESA, where a contract of employment is frustrated due to illness or injury, the employer remains obligated to pay the employee’s minimum termination pay and severance pay as of the date of frustration. In Hoekstra, cited above, the plaintiff had not performed any employment duties for four years due to a severe illness that forced him to go on medical leave. As a result, an employment dispute ensued, stemming from the employer’s refusal to pay further medical benefits. The medical condition eventually shifted from being merely temporary to being a permanent disability, and thereby rendered him incapable of engaging in required work at his employment. The court held that frustration of an employment contract occurs where “there is no reasonable likelihood of the employee being able to return to work within a reasonable time” (at para 28, citing Fraser v. UBS, 2011 ONSC 5448 at para 32). The employee was entitled to termination pay based on the period from the first day of his employment, to the date the frustrating event occurred (i.e., the date the illness was indicated as being more-or-less permanent by a doctor). The court also ordered the employer to pay the employee statutory severance pay. Importantly, the court held that both employees and employers can claim frustration of contract. This principle is also highlighted in the decision of Estate of Cristian Drimba v Dick Engineering Inc., 2015 ONSC 2843, where an employee took the position that his employment contract had been frustrated and the court agreed and awarded termination pay and severance pay pursuant to the ESA. Either way, the employee may be entitled to compensation under s. 2 of regulation 288/01 of the ESA if the test for frustration is met, and the frustration is the result of injury or illness. If you would like more information about these new developments, or would like legal advice as to frustration of contract, please contact experienced employment lawyer Marty Rabinovitch of Devry Smith Frank LLP 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 situation and needs.” By Fauzan SiddiquiBlog, Employment LawJuly 4, 2019September 30, 2020
Medical Marijuana: Limits to Consumption in Unionized Workplaces A recent labour arbitration decision from Saskatchewan has framed what might be the boundaries around workplace consumption of medical marijuana. In Kindersley (Town) v Canadian Union of Public Employees, Local 2740, 2018 CanLII 35597 (SK LA), an employee was dismissed for vaping medical marijuana while operating the employer’s vehicle. The employee had previously disclosed to his employer that he had had a prescription for medical marijuana and was allowed to vape marijuana in the workplace. The employee was not allowed to operate his employer’s vehicle for approximately 30 minutes following the vaporization of marijuana. He was also not permitted to operate heavy machinery for 1 hour after vaping. The employee was later discovered to have been vaping while driving and immediately before driving. As a result, the employer summarily dismissed the employee. The employee’s union filed a grievance challenging the summarily dismissal. The arbitration board held that, despite the lack of proof of the employee’s impairment on a balance of probabilities, the vaping of marijuana immediately prior to and while operating the vehicle entitled his employer to summarily dismiss him. The board also emphasized the fact that the employee appeared to lack respect for the limits of his employer’s medical accommodation of him, and cared little for the safety of his coworkers by vaping while other employees were in the vehicle with him. The arbitration board found the decision to summarily dismiss was not excessive discipline. The board noted that while the employee should not be deprived of using marijuana for the medical purpose intended, ultimately “there is no reason he could not have done this more discreetly rather than in the presence of his co-workers and while driving.” What does this case tell us? While it is a Saskatchewan decision, the same principles apply in Ontario: having a prescription for medical marijuana is not a free licence to consume it whenever and wherever you like, particularly while working for an employer. Moreover, even if your employer has expressly accommodated you by allowing you to consume marijuana in the workplace, not adhering to the terms of that accommodation could result in dismissal without notice. It is also important to note this case applies to unionized employees, who have greater protections from dismissal than non-unionized employees. This suggests that, in a non-unionized workplace, the threshold for misconduct meriting dismissal based on the consumption of medical marijuana could be lower. According to Ontario’s human rights laws, all employers must accommodate employees with a disability to the point of undue hardship. This accommodation could include allowing employees to use medical marijuana while at work. However, employees must comply with the limits of their employer’s accommodation, so as to avoid undesirable disciplinary measures. If you would like more information about these amendments, or would like legal advice to ensure your place of work is compliant, please contact experienced employment lawyer Marty Rabinovitch of Devry Smith Frank LLP 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 situation and needs.” By Fauzan SiddiquiBlog, Cannabis Law, Employment LawJune 5, 2019June 16, 2020
