Employment and Labour Law Seminar 2013: Top Ten Employment Law Developments

Top Ten Employment Law Developments

By Erin Page & Denyse Boulet

Employment and Labour

Law SEMINARS | 2013

Boucher v. Walmart

• A Walmart employee with an excellent ten year employment record

successfully argued that she was constructively dismissed.

• The employee alleged abuse by the store manager including being

forced to count skids in front of other employees to prove she could

count; being punched in the arm twice by a fellow assistant

manager; and being called a “(expletive) idiot”.

• The employee claimed constructive dismissal because of the

abusive work environment as well as sexual harassment, intentional

infliction of mental suffering and assault.

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Boucher v. Walmart

Decision

• A jury found that the employee was constructively dismissed and awarded

the highest award to date for an employment related suit in Canada – $1.46

million.

• Walmart was directly liable for:

• $1.2 million for punitive damages and intentional infliction of mental

suffering; and

• $10,000 for not adequately addressing two assaults the employee

suffered at the hand of a fellow assistant manager.

• The store manager was directly liable for the remainder of the award:

• $100,000 for intentional infliction of mental suffering; and

• $150,000 for punitive damages.

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Boucher v. Walmart

Importance of Decision

• Walmart has appealed the decision to Ontario Court of Appeal calling it

“shockingly unreasonable”.

• This is a striking example of the potential liability that can arise in situations

of workplace bullying/harassment or where serious abuses are found

against a manager.

• Employers should be quick to investigate any potential complaints so that

workplace conflicts can be quickly addressed and neutralized.

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1392644 Ontario Inc. (Connor Homes) v. Canada

(National Revenue) (Fed. C.A.)

• This case involved three workers engaged as child and youth workers and

area supervisors for two Ontario companies operating foster and group

homes for children with behavioural and developmental disorders.

• All three workers signed contacts confirming the parties’ mutual

understanding that the workers were providing services as independent

contractors.

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Decision

• The Federal Court of Appeal unanimously upheld the Federal Court’s decision

that the workers were properly characterized as “employees” and not

“contractors”.

• The shared intent or understanding of a worker and the organization that

engaged his or her services is not determinative of the worker’s legal status as

an independent contractor or employee – this is only a starting point.

• In making the assessment there are a number of factors that will be relevant,

such as:

• Level of control exercised by the employer over the worker’s activities;

• Whether the worker provides his or her own equipment and hires his or her

own helpers;

• Degree of financial risk assumed by the worker;

• Degree of responsibility for investment and management assumed by the

worker; and

• The worker’s opportunity for profit in the performance of his or her task.

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• This case clarifies the considerations of the court when classifying workers.

• It is insufficient, without more, to state in a contract that a worker is an

independent contractor, or to rely on a mutual understanding between the

parties.

• The factual circumstances of a worker’s engagement must support the

designation of the worker as an independent contractor.

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Fernandes v. Marketforce Communications (Ont. S.C.J.)

• An employee was accidentally cc’d on an e-mail between the company’s

Director of Operations and the company’s lawyer.

• The e-mail referenced terminating the employment of the employee and

requested a conference call with the company’s lawyer to discuss the issue.

• Despite efforts to recall the e-mail and repeated requests for the employee

to delete the e-mail due to privilege and confidentiality, the employee read

the e-mail, copied it and provided a copy to her lawyer.

• The employee advised the employer that after receiving the e-mail she was

left to interpret that the company was effectively terminating her employment

and commenced a wrongful dismissal action.

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Decision

• Although the Court confirmed that the e-mail was privileged solicitor-client

communication and the inadvertent disclosure did not waive privilege, the

Court concluded that the preservation of privilege would be unfair to the

employee.

• Without the ability to rely on the e-mail and its impact on her, the employee

would be at a significant disadvantage in establishing the context for the

action.

• The Court upheld the previous decision and found that the solicitor client

privilege was waived.

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• Including the wrong person on an e-mail is an understandable mistake that

happens to everyone.

• This case is a useful reminder of the potential consequences of such a

mistake.

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R. v. Cole (Supreme Court of Canada)

• A teacher was charged with possession of child pornography and

unauthorized use of a computer after a school computer technician remotely

accessed the hard drive of his laptop and found sexually explicit images of

an underage student.

• The laptop was confiscated and the school board officials searched its

contents and copied the temporary internet files onto another disc.

Everything was turned over to police who reviewed it all without a warrant.

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Decision

• The Supreme Court applied the “totality of the circumstances” test, which

considers:

• The subject matter of the alleged search;

• Whether the claimant had a direct interest in the subject matter;

• Whether the claimant had a subjective expectation of privacy; and

• Whether the subjective expectation of privacy was objectively reasonable.

• Employees have a reasonable expectation of privacy in the information

contained on a work-issued computer where personal use of the computer is

permitted or reasonably expected.

• In the Court’s view, the more personal and confidential the information in

question, the more likely that it is a constitutionally protected privacy interest.

• Ownership of the property is a relevant consideration, but is not determinative.

Similarly, the policies, practices and customs of the workplace are relevant but

not determinative.

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• Where an employer permits personal use of a work computer or where personal use

of a work computer can be reasonably expected, employees will have a reasonable

expectation of privacy in the personal information stored on the computer.

• Employers need to implement clear and unambiguous written policies which address

both permitted employee usage of computers as well as access to monitoring of the

computer by the employer.

• The employee should be put on notice as to the circumstance in which the employer

will access its computer or its network more broadly.

• The policy should confirm that data sent over the network remains the property of the

employer.

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Star Choice Television Network Inc. v. Tatulea

• The employee commenced employment as a customer service agent in 2008. At

the end of 2009, he took time off work and requested leave with pay due to neck

pain and cervical strain. His doctor recommended a three week leave of absence.

• The employee subsequently applied for short term disability and was denied. The

employer, however, recommended and offered to provide accommodation in his

position on two occasions.

• The employee’s physician recommended another leave of absence and the

employee applied for long term disability benefits. At the employer’s request, the

employee saw a psychiatrist, as well as other specialists, who diagnosed him with

fibromyalgia.

• The employer offered the employee a six-week program of accommodation to

facilitate his successful return to work, as well as reduced and modified work hours.

The employee attended on the first day and then refused to participate.

• Despite several attempts by the employer to discuss the duty to accommodate with

the employee, the employee did not participate in the discussion and the employer

terminated his employment.

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Decision

• The arbitrator upheld the termination of the employee.

• The arbitrator found that the employer made numerous requests and reasonable

attempts to “originate a solution” and facilitate the employee’s return to work

through offers of accommodation. The employee did not live up to his end of the

bargain.

• The employee was informed very clearly on more than one occasion that unless

he met with the employer, his employment could be terminated.

• The arbitrator considered the actions of the employer and found that it had met

its duty to investigate and offer accommodation measures.

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• This case highlights the fact that employees also have an obligation in the

accommodation process.

• They employee must be reasonable when considering whether the

accommodation measures respond to his or her needs. The employee plays

an integral role in the overall process and must meet and communicate with

the employer to discuss proposed accommodation measures.

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Bowes v. Goss Power Products Ltd., 2012 ONCA 425

The Case

• Employee’s position at Goss Power Products was terminated without cause

and he found alternate employment at the same salary after two weeks.

• Employee had entered into written contract of employment which provided

that he would receive six months’ notice or pay in lieu upon termination.

• The employment contract was drafted by the Employer and was silent with

respect to the Employee’s duty to mitigate his damages.

• The Employer paid the three weeks statutory requirement and refused to

pay the balance of the amount stipulated in the contract and argued that it

was unfair for the Employee to receive a salary from his new employer as

well as the termination specified in the employment agreement.

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The Decision

• The Ontario Court of Appeal found that an employment agreement which

stipulates a fixed term of notice or payment in lieu should be treated as fixed

liquidated damages and was not equivalent to common law damages for

reasonable notice.

• The damages are liquidated and therefore are not subject to mitigation.

• Justice Winkler stated that “there is nothing unfair about requiring employers

to be explicit if they intent to require an employee to mitigate what would

otherwise be fixed or liquidated damages”.

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Why it matters?

• Employers and Human Resources professionals should remember that a

duty to mitigate is not implied in an employment contract.

• The duty to mitigate must be explicitly and clearly set out in the employment

agreement.

• The parties are expected to clearly set out their intentions in the language of

the contract in order to provide certainty and closure on termination.

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British Columbia (Workers’ Compensation Board) v.

Figliola, 2011 SCC 52

The Case

• Employee at School Board developed generalized anxiety disorder because

of stress associated with her position and went on long term disability leave.

• Employee requested accommodations for her return to work (available

alternative work)

• Employer did not provide the employee with a suitable alternative position

and terminated her employment on July 9, 2004.

• Employee filed a complaint with the Ontario Human Rights Commission on

November 24, 2004 for discrimination and failure to accommodate

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The Decision

• The Tribunal found that the Board discriminated against the employee and

failed to accommodate her disability related needs.

• The Tribunal ordered:

• Reinstatement to suitable alternative employment including adjusting her

length of seniority (and provide up to 6 months of job training)

• Pay loss of wages from June 26, 2003 until date of reinstatement

• Pay employer pension contributions and additional costs for buy-back

• Retroactive payment to CPP

• Out of pocket expenses for dental and medical expenses

• Pay tax consequences

• Pay applicant $30,000 as compensation for the injury to her dignity,

feelings and self-respect;

• Interests (pre and post judgment)

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Why it matters?

• Costs of not providing reasonable accommodations can be huge

(reinstatement, financial award).

• What is “reasonable” will depend on your organisation. The Tribunal found

that the School Board could have accommodated this employee’s disability

related needs (large organization, management structure, availability of

suitable positions).

• The Tribunal found that alternative work constituted reasonable

accommodation for an employee who suffered from anxiety as a result of

the stress caused by that employee’s particular position (in this case, she

was the supervisor for regulated substances).

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Mediations before the Human Rights Tribunal of Ontario

RULE 15 of the Rules of Procedure of the HRTO

15.1 At any time after an Application is filed, mediation assistance may be

offered by the Tribunal or requested by a party.

15.2 Parties and their representatives who participate in mediation under Rule

15.1 must sign a confidentiality agreement before the mediation

commences.

15.3 The Tribunal may direct that a party or a person with authority to settle on

the party’s behalf be present at the mediation.

15.4 All matters disclosed during mediation are confidential and may not be

raised before the Tribunal or in other proceedings, except with the

permission of the person who gave the information.

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Why is it a good idea to agree to mediation?

• Chance of settling the matter

• Certainty for the parties

• Confidentiality

• Mediators are vice-chairs of the Tribunal (knowledge of the Tribunal’s case

law and procedures) but will not be the adjudicator should the matter

proceed to a hearing

• Settling may be best alternative to proceeding to hearing

• Legal fees

• Time spend preparing and attending

• No guarantee of success

• Decisions are public

• HRTO has no jurisdiction to award costs to successful party

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Do I need legal representation at mediation?

• Preferable if possible

• Mediators will provide parties with their opinion as to how an adjudicator at

the hearing may decide

• Will also tell the parties of the weaknesses of their position and the strength

of the other parties’ position

• With or without representation, must be prepared:

• Amounts awarded by the Tribunal in similar cases

• Facts of the case, witnesses, documents, other evidence

• Realistic expectations

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Brito v. Canac Kitchens, 2012 ONCA 61

The Case

• 55 year old employee with 24 years of service is dismissed without cause

and given statutory minimum payment of 31.79 weeks plus benefits for the

statutorily mandated minimum period of eight weeks.

• Employee secured alternate employment at a much lower rate of

remuneration and without disability coverage.

• Employee became disabled 15 months after termination.

• Employee disputes the period of notice to which he is entitled and other

entitlements.

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The Decision

• The trial judge awarded 22 months notice period (confirmed on appeal).

• Found that the plaintiff was entitled to benefit coverage for the 22 month

notice period at law (confirmed on appeal):

• the plaintiff is entitled to be put in the same position that he would have

been into if the employer had provided him with working notice – he

would have received his regular compensation plus all benefit coverage

for the entirety of his 22 month notice period.

• $15,000 in damages relating to the defendant’s “hardball approach”

(overturned on appeal).

• $90,000 in costs.

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Why it matters?

• The decision confirmed that employers are exposed to significant liability

when they neither extend long-term disability (LTD) benefits during the

common law notice period nor obtain a release.

• Sets out the idea of the employee should be put in the same position he or

should would have been in had the employer provided working notice.

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Thank You

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Employment and Labour Law Seminar 2013: Top Ten Employment Law Developments

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Transcript of Employment and Labour Law Seminar 2013: Top Ten Employment Law Developments