The year 2019 brought forth numerous noteworthy decisions in employment law across the country. We have summarized several of these decisions below.
In July 2005, three private companies that owned marine terminals in the Port of Montréal adopted a policy requiring any person who had to move in and around the terminals to wear a protective helmet, as required by Canada Labour Code standards.
Some truck drivers of the Sikh faith, who wore turbans, were required to move in and around the terminals. They contested the policy. The applicants contended that the policy was discriminatory and violated their right to freedom of religion. They applied to the Superior Court for a declaratory judgment exempting them from wearing the “hard hats.” Their application was dismissed, and the applicants appealed the decision.
It was admitted that the policy was prima facie discriminatory and interfered with the appellant truckers’ freedom of religion. Nevertheless, the respondents contended that the policy was an occupational requirement, justified under section 20 of the Charter of Human Rights and Freedoms (Charter), and constituted a justifiable interference with appellants’ right under section 9.1 of the Charter.
Expert evidence demonstrated that truckers risk head and forehead injuries, areas protected by helmets. The interference was minor, since wearing the hard hats was only compulsory for a brief time when the truckers were getting out of their trucks. Furthermore, the policy did not oblige them to remove their turbans.
Since the policy aimed to secure socially essential objectives, by ensuring the safety of workers and allowing employers to comply with their legal obligation to safeguard workers, the overall effect of the policy was proportionate and its interference with religious freedom was held to be justified.
Note: Application for Leave to Appeal now filed
Overtime pay for employees receiving annual salaries Godin v. Aréna des Canadiens inc., 2019 QCCS 1678
The two applicants in this case were, respectively, a senior drafting co-ordinator and an accounting manager working for the employer. They filed an application for authorization to institute a class action on behalf of all the employer’s employees who were remunerated on an annual salary basis, so that they could receive salary increments for working overtime beyond 40 hours a week. The applicants’ work schedule was based on the requirements of their positions, which, in particular, required them to attend hockey games over and above their regular 9 a.m. to 5 p.m. office hours.
The judge dismissed the application to institute a class action. The case law was unanimous in holding that where employees are remunerated on an annual salary basis, the provisions of the Act respecting labour standards do not apply. Those provisions apply only where it is possible to determine an ordinary hourly wage for the employee or employees concerned.
In this case, the employer exercised no control over the applicants’ working schedule that would permit their ordinary hourly wage rates to be calculated. Section 39 of the Act respecting labour standards, under which the CNESST is empowered to “ascertain the wage paid to an employee by his employer,” was held not to apply where it was otherwise impossible to determine an employee’s ordinary hourly wage by means of reliable data.
In rendering this decision, the Superior Court unequivocally affirmed the established rule that the provisions on overtime pay in the Act respecting labour standards do not cover employees receiving annual salaries.
Note: Notice of Appeal file 2019-06-11 (C.A.)
PART 2 — ONTARIO
Reasonable notice period cap Dawe v. The Equitable Life Insurance Company of Canada, 2019 ONCA 512
In this case, the plaintiff, Dawe, was a 62 year-old senior vice president of the company with 37 years of service. He was terminated from his employment on a without cause basis. As a result, Dawe filed a lawsuit against his former employer for 30 months’ common law reasonable notice, which was the period between the termination of his employment and the date of his intended retirement at the age of 65. The common law reasonable notice Dawe sought included payments under two bonus plans in which he was enrolled, and which could have equalled a sum greater than his salary in any given year.
The motion judge awarded the employee a reasonable notice period of 30 months. In his decision, the judge reasoned that the elimination of the mandatory retirement age in Ontario rendered the case law supporting a 24-month cap for common law reasonable notice inapplicable.
However, the Court of Appeal (the Court) overturned the motion judge’s decision. The Court held that while the Bardal factors favoured a lengthy notice period for the terminated employee, the reasonable notice period should not extend beyond the presumptive 24-month cap set by the case law, in the absence of exceptional circumstances. Simply being a long-service employee would not constitute “exceptional circumstances”.
The Court disagreed with the motion judge that employers had an obligation to employ their workers until their intended retirement. He therefore made an error in law by considering the retirement as a factor in determining the reasonable notice period. Ultimately, the Court reduced the lower court award of 30 months to 24 months’ reasonable notice but sided with the motion judge in his ruling that the employee was entitled to his full bonus and benefits for the entirety of the notice period.
The employee’s right to sue under the Workplace Safety and Insurance Act WSIB Decision No. 1227/19
In this case, the employee resigned from her position with the employer as a result of alleged bullying and harassment. Shortly thereafter, she filed a claim in the Ontario Superior Court of Justice claiming damages for constructive dismissal, violations of the Occupational Health and Safety Act (OHSA), the tort of harassment as well as punitive, aggravated and/or moral damages.
In response, the employer made an application to the Workplace Safety and Insurance Appeals Tribunal (the WSIAT), pursuant to the Workplace Safety and Insurance Act, 1997 (WSIA) for a determination on whether the former employee was statute-barred from filing the civil action. The employer argued that the civil action was effectively a WSIB claim for chronic mental stress and, therefore, the employee had no right of action in relation to her constructive dismissal claim.
The WSIAT held in favour of the employer and found that the circumstances of the constructive dismissal were inextricably linked to the alleged workplace injury. The other remedies sought by the worker, including violations of the OHSA and punitive, aggravated and/or moral damages, were also claimed on the same facts of harassment and bullying in the workplace. Ultimately, the WSIAT determined that without the alleged harassment and bullying, the worker in question would not have suffered mental distress to such a degree that she would have suffered any of the damages that she claimed in her civil lawsuit against the company.
Therefore, the WSIAT determined that the worker’s right of action in the constructive dismissal action was statute-barred, pursuant to section 26 of the WSIA.
PART 3 — ALBERTA
The power of labour boards and arbitrators Alberta Union of Provincial Employees v. Alberta, 2019 ABCA 411
In this decision, the court examined the broad powers of labour arbitrators in deciding appropriate remedies. The employee’s employment in this decision was terminated for cause due to dishonesty. Although the arbitrator found the employee was dishonest and worthy of discipline, termination for cause was inappropriate due to mitigating factors, including a thirty-year employment record, and his union leadership. In such a situation, reinstatement is the normal remedy, but the arbitrator concluded that reinstatement was inappropriate, because the employee’s continued pattern of untruthfulness created an insurmountable barrier to a viable and continuing employment relationship as a correctional officer.
Both the union and the employer sought judicial review of the decision, and the chambers judge found that given the arbitrator’s decision concluded that the employment relationship was no longer viable, the only legally permissible conclusion was that termination was appropriate.
The decision was then appealed to the Court of Appeal. The Court emphasized that reasons in labour arbitrations do not have to be perfect or comprehensive. If the tribunal's reasons are brief, or defective in some other way, the reviewing Court should first attempt to supplement the reasons before setting the reasons and the decision aside. The Court agreed with the arbitrator that although the normal remedy is reinstatement, in certain exceptional circumstances, an arbitrator may choose not to reinstate an employee, and award damages instead, such as cases where the employer lacks just cause to terminate an employee but also that the employment relationship is no longer viable.
Justice Wakeling dissented and agreed with the chambers judge that an arbitrator should not order an employer that had just cause to terminate the employee’s employment on account of intentional acts of misconduct, to pay the employee a sum of money unless there is a compelling reason to do so. Compelling reasons may include where the employer has dealt with others who have committed similar forms of misconduct dramatically differently or the employer failed to adopt a fair and reasonable investigative process that adversely affected the employee’s interests, but this was not the case here.
This decision shows that the courts will show deference to the remedial jurisdiction and remedial choices made by arbitration boards.
Duty of care under the Workers' Compensation Act Hall v. Stewart, 2019 ABCA 98
In this decision, the the issue was whether the respondent could be personally liable for tortious conduct committed in his capacity as a director or employee of a corporation. The respondent installed a staircase, which collapsed and injured employees of a sub-contractor. The respondent argued that any negligent act that he committed was part of his duties as an employee of his corporation, and not as an officer of his corporation. The chambers judge agreed. Since the corporation was immune under the Workers’ Compensation Act (the WCA), the respondent was also immune from personal liability.
However, the Court of Appeal found that both the respondent and the corporation owed a duty of care with respect to the installation of the staircase to others who might be on the construction site. Although the corporation benefits from the immunity provided by the WCA, the respondent does not.
Under section 16(1)(c) of the WCA, where the individual is a director of a corporation and is performing the work as part of the business of the corporation, whether by way of manual labour or otherwise, the individual is not deemed to be a worker. The exclusion under section 16(1)(c) is broad, and it is not necessary to identify whether the work was being done “as a director” or in some other capacity. Under section 15(1) of the WCA, a director of a corporation can apply to the Workers’ Compensation Board for the WCA to apply to them as workers if the Board approves the application. However, the respondent did not make such an application.
From a public policy standpoint, the Court stated that in assessing whether a corporate representative should be exposed to personal liability for corporate torts, it must be acknowledged that the underlying risk can readily be managed and diverted through the purchase of appropriate insurance.
Directors of corporations who are actively performing work that is a part of the business of the corporation should consider whether their personal liability risks are managed appropriately.
PART 4 — BRITISH COLUMBIA
Breach of anti-harassment policy Lewis v. WestJet Airlines Ltd., 2019 BCCA 63
This decision demonstrates the potential risks associated with incorporating terms of an anti-harassment policy into an employment agreement, including the risk of a class action for breach of contract.
In this case, Mandalena Lewis, a former employee of WestJet, proposed bringing a class action for breach of contract on behalf of female flight attendants who were entitled to the benefits of an anti-harassment policy that was incorporated into their employment agreements. The policy outlined WestJet’s obligations regarding harassment and discrimination, including the commitment to provide a workplace free of harassment, to investigate complaints, and to take necessary disciplinary action.
WestJet filed an application to strike the claim on the grounds that the court lacked jurisdiction to hear the dispute. WestJet contended that the employment contract simply implemented its statutory obligations to prohibit and prevent workplace harassment under the Canadian Human Rights Act or the Canada Labour Code. Thus, the essential character of the dispute concerned WestJet’s failure as an employer to protect against breaches of its employee’s statutory rights, which fell exclusively within the jurisdiction of the Canadian Human Rights Tribunal and the various provincial Workers’ Compensation Boards.
Ms. Lewis submitted that she did not seek to enforce any statutorily-conferred rights. Rather, she relied only on the contract of employment.
The lower court found that Ms. Lewis’ proposed claim rested on allegations of breach of the WestJet employment contract, not on a statutory right or on a claim of discrimination per se. As such, such a claim was not restricted to the jurisdiction of the relevant statutory bodies.
The British Columbia Court of Appeal (BCCA) dismissed WestJet’s appeal, concluding that although the alleged facts involved discrimination and harassment which could ground a complaint before the relevant statutory bodies, Ms. Lewis pled breach of contract, which was an independent cause of action.
Discrimination on the basis of family status Envirocon Environmental Services, ULC v. Suen, 2019 BCCA 46
In this decision, the BCCA confirmed that the stringent test outlined in Health Sciences Assoc. of B.C. v. Campbell River and North Island Transition Society, 2004 BCCA 260 continues to apply with respect to adverse effect discrimination on the basis of family status. This test requires that a complainant prove:
- an employer imposed a change in a term or condition of employment; and
- this change resulted in a serious interference with a substantial parental or other family duty or obligation.
In this case, Brian Suen brought a complaint against his employer, Envirocon, to the British Columbia Human Rights Tribunal alleging discrimination after he was terminated for refusing to accept a position that would require him to be away from home for an extended period of time shorty after the birth of his child. Envirocon sought to have the complaint dismissed, arguing that Mr. Suen did not allege facts that could constitute adverse effect discrimination on the basis of family status. The Tribunal and the British Columbia Supreme Court refused to dismiss the complaint.
On appeal, the BCCA affirmed that Campell River remains good law, and quashed the Tribunal’s decision not to dismiss the complaint on the basis that Mr. Suen could not satisfy the second part of this test. Rather, the facts were only capable of establishing the undisputed fact that Mr. Suen was a parent. The BCCA noted that Mr. Suen was no different than the vast majority of parents, and nothing in his complaint suggested his child would not be well cared for in his absence.