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Most Significant Cases In Employment Law - 2022

  • February 21, 2023
  • Daria (Dasha) Peregoudova, Ljubica Durlovska, and Zachary Sippel

This article explores the most significant employment law cases in 2022, and their related implications.

BAD FAITH DAMAGES

Awards of bad faith damages (as a subset of the broader category of “moral” damages) in wrongful termination litigation in Ontario have been rare. Such awards only arise in exceptional cases where the conduct of the employer is particularly egregious and the employee can show they have suffered mental distress as a result of such conduct. However, there has recently been an uptick in the awards of such damages, as illustrated by two cases of note in 2022.

Pohl v Hudson’s Bay Company , 2022 ONSC 5230

Mr. Pohl, a 50-year-old sales manager with 28 years of tenure at Hudson’s Bay was offered a demotion to a “sales associate lead” with less hours, no guarantee of hours, less pay and a contract that would allow the company to terminate his employment by providing him with only minimum statutory entitlements, all on the condition that he “voluntarily resign” from his managerial position. Mr. Pohl refused the offer and was subsequently walked off the premises. He successfully sued Hudson’s Bay for wrongful dismissal, and was awarded $45,000 in moral damages and $10,000 in punitive damages.

The Court’s reasoning for awarding moral damages included:

  • The employer’s highly insensitive decision to walk Mr. Pohl out the door on termination and needlessly embarrass him;
  • The “misleading” way in which the employer attempted to lock Mr. Pohl into a new, less beneficial, contract;
  • Failure to pay Mr. Pohl’s outstanding wages in a lump sum post termination, despite repeated demands that they do so; and
  • Failure to issue a timely and correct Record of Employment, thereby increasing Mr. Pohl’s “sense of exploitation, humiliation, and depression”.

The Court found that the employer’s conduct was effectively an attempt to take advantage of a loyal, long-term employee during a vulnerable moment, which was a breach of the employer’s duty of good faith and fair dealing which warranted an award of moral damages.

Rutledge v Markhaven Inc., 2022 ONSC 3183

Ms. Rutledge, a 43-year-old Executive Director at a long term health facility with 21 years of service, was awarded wrongful dismissal damages of 22 months’ pay in lieu of reasonable notice, as well as $50,000 for bad faith and moral damages resulting from the egregious manner in which Markhaven conducted an investigation into an alleged workplace relationship between Ms. Rutledge and another employee, and litigation conduct of Markhaven’s defence counsel.

Specifically, in awarding bad faith and moral damages, the Court found that:

  • Ms. Rutledge was informed that the investigation would be conducted by an independent third party, but it was actually conducted by a business associated with Markhaven’s defence counsel;
  • The investigation was undertaken surreptitiously before Ms. Rutledge was informed that the investigation would be taking place, and the investigator secured information from her without her prior knowledge;
  • Part of the interviews connected with the investigation took place at a local Tim Hortons where some of the 150 employees of Markhaven frequented, thereby failing to conduct the investigation in a confidential manner; and
  • During ensuing litigation, Ms. Rutledge walked into an examination for discovery where she was confronted with photographs of her home, and comments by Markhaven’s lawyer regarding a pending motion for “security for costs”, which was never brought.

NOTICE PERIODS

The calculation of common law reasonable notice of termination is often referred to as an “art form” and not a “science”. This is particularly true when there are a myriad of factors that must be taken into consideration in making a determination as to the appropriate period of reasonable notice, and weight being given disproportionately to certain factors in accordance with the circumstances in each case, as illustrated in the following cases.

Chin v Beauty Express Canada Inc. , 2022 ONSC 6178

Ms. Chin worked at a beauty counter at The Bay for 14 years while it was owned by Premier Salons Ltd. (“Premier”). Premier went bankrupt and Beauty Express Canada Inc. (“Beauty Express”) took over operations. Ms. Chin continued working for Beauty Express under the same management and at the same location for another six years until her eventual termination at the end of 2019, at the age of 69.

Ms. Chin had signed an employment agreement while with Beauty Express, but the agreement was found to be invalid for want of consideration. As such, Ms. Chin was entitled to common law reasonable notice of termination.

It was agreed by all parties that the bankruptcy constituted a constructive dismissal and that Ms. Chin was technically only employed by Beauty Express for six years. Nonetheless, Ms. Chin was awarded 10 months of pay in lieu of notice on the basis that while the experience with the prior employer was important because it allowed her to bring it to Beauty Express, it was not experience which required extensive and specific training. In other words, if Ms. Chin had brought technical skills and experience into the subsequent role beyond what she was able to demonstrate at trial, she would have been awarded a greater reasonable notice period which would have taken into account her entire 14 years of service. 

Currie v. Nylene Canada Inc. , 2022 ONCA 209

Ms. Currie was terminated from Nylene after 40 years of service, and at 58 years old, and subsequently sued for wrongful dismissal. The Court of Appeal upheld an earlier decision which awarded an unusually high reasonable notice period of 26 months (whereas 24 months tends to be the commonly accepted ceiling on such awards). The Court noted the following factors as significant to its decision:

  • Ms. Currie’s advanced age;
  • Ms. Currie worked at Nylene for almost her entire working career, starting from high school;
  • Ms. Currie started at Nylene at age 18 as a “twisting operator”, and ultimately rose to become the “Chief Operator”;
  • Ms. Currie had a very specialized skill set in the manufacturing environment, making it very difficult for her to find alternative suitable employment with skills which were not easily transferrable; and
  • Ms. Currie had very limited computer skills which she tried to upgrade in an effort to mitigate her damages, but the trial judge was not convinced that she would succeed.

Ultimately, Ms. Currie’s termination of employment from Nylene was regarded as the equivalent of “a forced retirement”, thereby warranting a higher-than-normal award of reasonable notice with which the Court of Appeal agreed.

UNENFORCEABLE TERMINATION PROVISIONS

By now, the general principles in Waksdale v. Seagon North America Inc. , 2020 ONCA 391 are well known. Specifically, if any portion of a termination provision in an employment contract denies (or is ambiguous regarding) the employee benefits that they would be entitled to under the Ontario Employment Standards Act, 2000 (the “ESA”), then the entire termination provision is rendered void and the employee’s rights on termination default to those afforded by the common law.

In 2022, two cases expanded the Waksdale principles to non-termination provisions which also had the potential effect of unlawfully contracting out of the ESA, rendering the termination portions of the contract invalid.

In the Rahman decision below, the Waksdale principles were also tested against the argument that when employees are sophisticated, or receive legal advice prior to signing an employment agreement, then termination provisions that may technically contract out of the ESA should not be struck down, given the employee’s knowledge and understanding of the provisions.

Gracias v. Dr. David Walt Dentistry , 2022 ONSC 2967

For six months, Ms. Gracias worked as a dental hygienist for Dr. Walt under a written employment agreement. Upon termination, Dr. Walt provided Ms. Gracias with one week of pay in lieu of notice pursuant to the ESA. Ms. Gracias sued Dr. Walt for wrongful termination, seeking seven months’ pay in lieu of notice. Dr. Walt disagreed based on Ms. Gracias’ short tenure and the fact that she received approximately $16,000 worth of Canada Emergency Response Benefit (“CERB”) funding following her termination. Dr. Walt also argued that Ms. Gracias falsified mitigation documentation during litigation.

The Court held that Ms. Gracias’ employment agreement contained provisions which, when read in context and together with the termination provisions, contravened or attempted to contract out of the ESA. The specific sections which were at issue were the “conflict of interest” and “confidential information” clauses, both of which contained language effectively stating that any breach of those provisions would result in termination “with cause” and no corresponding payments. In his decision, Justice Perell found that these provisions were not compliant with the ESA as they attempted to deny the employee her ESA entitlements for reasons that may not, at law, amount to “wilful misconduct”, which is the higher standard required to be met under the ESA to justify termination without any amounts owing.  

Ms. Gracias was ultimately awarded three months of reasonable notice, without deduction for CERB. Even though Dr. Walt led considerable evidence that Ms. Gracias falsified mitigation documentation, these claims of fraud were found not to have been substantiated.

Henderson v. Slavkin et al. , 2022 ONSC 2964

Ms. Henderson worked as a dental receptionist for Drs. Slavkin and Kellner for 20 years pursuant to a written employment agreement. Her employment was terminated in March 2020. Following termination, Ms. Henderson did not start looking for other employment for 12 months, finally securing alternate employment approximately 18 months after her termination. Ms. Henderson received considerable CERB benefits following termination.

Ms. Henderson’s contract of employment included a “termination without cause” section, as well as “conflict of interest” and “confidential information” clauses, both of which stated that a breach of said clauses would result in Ms. Henderson’s termination for just cause. Justice Brown found that while the termination without cause section was valid, the “conflict of interest” and “confidential information” clauses were so “broad, unspecific and ambiguous” that Ms. Henderson would not be able to conclude that the conduct prohibited by the clauses indeed rose to the standard of “wilful misconduct” or “wilful neglect of duty” as required under the ESA. Therefore, the termination provision too became invalid, and Ms. Henderson was entitled to common law reasonable notice stemming from her termination.

Justice Brown awarded Ms. Henderson 15 months’ pay in lieu of reasonable notice, with three months deducted for Ms. Henderson’s failure to seek re-employment for 12 months after termination. Following the decision in Gracias , Justice Brown refused to deduct CERB payments from Ms. Henderson’s damages.

Rahman v. Cannon Design Architecture Inc ., 2022 ONCA 451

Ms. Rahman was employed as a senior architect at Cannon for over four years. When terminated without cause, she was provided with four weeks of base salary. Ms. Rahman sued Cannon for wrongful dismissal on the basis that the termination provisions in her contact of employment were contrary to the ESA.

In a rare “win” for employers, the motion judge found that the termination provisions in Ms. Rahman’s contract were valid and enforceable because she was a sophisticated employee who had had access to independent legal advice at the time of signing the contract. Furthermore, the motion judge took into consideration the parties’ subjective intentions to be bound by the ESA, despite the plain wording of the provisions being contrary to the ESA.

Disagreeing with the motion judge, the Court of Appeal overturned the decision, finding that, “By allowing subjective considerations to distort and override the wording of those provisions, the motion judge committed an extricable error of law…”. As such, Ms. Rahman’s agreement was held to be unenforceable, and the matter was remitted back to the Superior Court for quantification of Ms. Rahman’s damages.  

INFECTIOUS DISEASE EMERGENCY LEAVE

During the COVID-19 pandemic, temporary measures were introduced by O. Reg. 228/20: Infectious Disease Emergency Leave (“IDEL”) under the ESA which stated that a non-unionized employee whose employer has temporarily reduced or eliminated their hours of work for reasons related to COVID-19, were deemed to be on a job-protected infectious emergency leave and not laid off or “constructively dismissed” under the ESA.

Several subsequent cases wrestled with whether the IDEL regulation precluded an employee who was temporarily laid off in the absence of a contractual term allowing such lay off to allege constructive dismissal under the common law.

In 2021, several cases, such as Coutinho v. Ocular Health Centre Ltd. , 2021 ONSC 3076 , held that an employer could not take advantage of the IDEL provisions to temporarily lay off an employee if the employee has not agreed to a contractual term permitting the layoff, as the ESA and its regulations could not override the common law principle of constructive dismissal. However, in Taylor v. Hanley Hospitality Inc. , 2021 ONSC 3135 , Justice Ferguson refused to follow Coutinho , finding the COVID-19 circumstances unusual enough to permit the IDEL regulation in precluding a common law claim of constructive dismissal.

Ms. Taylor appealed, and, being the last outstanding decision on point, the employment bar waited with bated breath for the outcome. Ultimately, the Court of Appeal ( 2022 ONCA 376 ) held that Justice Ferguson had made an error of law. However, the error was not the finding itself, but Her Honour’s treatment of the decision which had been made under rule 21.01(1)(a) for a determination of a question of law. Consequently, the Court dismissed the motion and remitted the action for determination before another judge of the Superior Court.

As the IDEL provisions in questions ceased to be in effect in mid-2022, and given the remaining case law was aligned in its treatment of IDEL and its relationship to common law constructive dismissal, it is unlikely that the Taylor decision will be re-decided. This is also true given that during the pandemic, most employees were better off accepting available government support and waiting for their job to become available rather than alleging constructive dismissal, quitting, and searching for work in an extremely challenging market. As such, despite the importance of the legal issue raised in the decisions, the quantum of such decisions was far less than initially expected. 

BANKRUPTCY AND NOTICE PERIODS

Under the ESA, employees are usually owed outstanding compensation and termination pay (as well as possible severance pay) in the event of termination by their employer. However, when an employer is in financial distress and is seeking protection under either the Bankruptcy Act or the Companies’ Creditors Arrangement Act (“CCAA”), the employee becomes an unsecured creditor, making it difficult to obtain their full ESA entitlements. Further, companies on the verge of bankruptcy are often purchased at a discount, and the control of the company is transitioned to a new owner along with the company’s assets, including its employees. This bankruptcy-related change of control often triggers considerations into whether the employee’s prior service flows through to the new owner. The case below from the Ontario Court of Appeal provides some clarity on how the Court will consider an employee’s length of service and their termination entitlements in the event a company undergoes bankruptcy under the CCAA.

Antchipalovskaia v. Guestlogix Inc. , 2022 ONCA 454

Ms. Antchipalovskaia commenced her employment with Guestlogix in 2011 under the terms of a written employment agreement. In 2016, Guestlogix sought and obtained protection under the Companies’ Creditors Arrangement Act . Guestlogix was subsequently purchased by a third party, and, as a result, Ms. Antchipalovskaia was terminated and immediately rehired under the same conditions of employment. Ms. Antchipalovskaia submitted a “Proof of Claim” to the Superior Court in order to receive her termination and severance pay from the proceeds of the sale as an unsecured creditor, and was successful, receiving roughly 72% of her total claim amount. She continued to work for Guestlogix until she was terminated without cause in 2019. Ms. Antchipalovskaia sued Guestlogix for wrongful dismissal and sought damages for reasonable notice at common law based on her entire service with Guestlogix from 2011 to 2019.

Ms. Antchipalovskaia brought a motion for summary judgement, and the motion judge agreed that her full service with Guestlogix ought to be considered continuous despite the sale. Accordingly, she was awarded 12 months’ pay in lieu of notice, less the amounts paid in 2016.

Guestlogix appealed the decision of the motion judge. The Court of Appeal clearly distinguished between the ESA and common law approaches to continuous service following the sale of business. The Court held that at common law, following the sale of a business, a contract for personal service cannot be assigned to a new employer without the consent of the parties. As such, employees under the common law are deemed to have been constructively dismissed as soon as the business is sold, thus creating a break in the employee’s service with the employer.

However, the Court determined that while service may not be seen as continuous under the common law, years of service with the same employer could still be a relevant Bardal factor in determining common law reasonable notice for the employee since the employer benefited from the service of an employee who could perform their job at a high level for a number of years. Ultimately, based on the employee’s years of service, age and position, the Court found a seven month notice period to be appropriate.

CANADA LABOUR CODE AND UNJUST DISMISSAL DAMAGES

For a federally regulated employee to be terminated with just cause under the Canada Labour Code , the employer must demonstrate a good faith attempt to progressively discipline the employee, similar to the level of protection typically bargained for by unionized employees. Where an arbitrator finds the employee to have been unjustly dismissed, they may consider whether reinstatement of an employee is an appropriate option, scrutinizing whether the employee has learned from their mistakes and will be able to return to the workplace successfully. Where reinstatement is not appropriate, entitlement to compensation is the only remaining remedy. In the case below, the Federal Court of Appeal weighed in on the proper approach to calculating an employee’s entitlements to compensation where reinstatement is not deemed appropriate.

Hussey v. Bell Mobility Inc., 2022 FCA 95

Ms. Hussey was terminated from her employment and subsequently made an unjust dismissal complaint against her former employer under the Canada Labour Code . The matter was heard before an arbitrator, who agreed that Ms. Hussey had been unjustly dismissed, but refused to reinstate her as he did not believe that she was remorseful or would change the behaviour that led to her dismissal if reinstated. Instead, the arbitrator awarded eight months’ pay in lieu of reinstatement based on calculations derived from the principles of common law reasonable notice, with an additional amount in recognition of Ms. Hussey’s loss of just cause protection under the Canada Labour Code .

Ms. Hussey sought judicial review of the decision, alleging a breach of procedural fairness and arguing that the compensation decision was incorrect in its importing the principle of common law reasonable notice. She argued that instead, the “fixed term” approach should have been adopted, which considers expected earnings until the employee’s retirement and then discounts the amount based on contingencies. The application for judicial review was denied, and Ms. Hussey appealed to the Federal Court of Appeal.

On appeal, the Court agreed with the findings of the arbitrator that utilizing common law reasonable notice as a foundation for calculating pay in lieu of reinstatement was a reasonable approach, and that there has been no consensus among arbitrators or adjudicators to the contrary or to deem the “fixed term” approach as the standard. As a result, the Court upheld the award of eight months’ notice.  The Court also disagreed that Ms. Hussey had been denied procedural fairness.

JUST CAUSE TERMINATIONS

The concept of “just cause” in employment agreements has faced significant scrutiny following the Waksdale decision, cited above. The Ontario Court of Appeal has recently weighed in on the different thresholds for just cause terminations under the ESA and the common law, and how they relate to an employee’s entitlements upon termination for such reasons. Of note is also a recent arbitration decision relating to just cause termination in the face of a breach of COVID-19 policies.

Render v. ThyssenKrupp Elevator (Canada) Limited, 2022 ONCA 310

Mr. Render was terminated for cause after he slapped the buttocks of a female co-worker in front of a number of colleagues and later made jokes about the situation. Mr. Render sued for wrongful dismissal, but was unsuccessful at trial where it was found that he was not truly apologetic for his actions, nor appreciated the seriousness of his misconduct. Further, the trial judge held that while ThyssenKrupp had a workplace culture that seemingly condoned horseplay and inappropriate comments, Mr. Render’s misconduct was of such an egregious nature that termination for cause was justified.

Mr. Render appealed the trial judge’s decision, arguing that the workplace culture of ThyssenKrupp should have been considered a mitigating factor that reduced the penalty for his misconduct to something less than termination. The Court of Appeal dismissed Mr. Render’s argument that an inappropriate workplace culture was a justifiable mitigating circumstance, and took a hard stance against condoning such toxic “locker-room” type workplace cultures.

However, the Court did agree that Mr. Render’s actions were not pre-meditated, but rather in the heat of the moment, and therefore held that Mr. Render’s conduct did not rise to the ESA standard of “wilful misconduct.” As such, the Court held that Mr. Render was entitled to receive his statutory termination entitlements. In contrast, the Court confirmed that Mr. Render’s conduct did meet the threshold for just cause under the common law, and denied his entitlements to common law reasonable notice accordingly.

RESTRICTIVE COVENANTS

Given the recent amendments to the ESA regarding the prohibition of non-competition clauses under the Working for Workers Act, 2021 (subject to only a few concrete exceptions), employers and employees alike have been curious to see how this development will be interpreted and applied by the courts. The cases below address some of the common questions raised by the passing of the legislation, including as to whether the amendment has retroactive applicability.

M & P Drug Mart Inc. v. Norton, 2022 ONCA 398

Mr. Norton commenced his employment as a pharmacist with M & P Drug Mart Inc. (M&P) in 2014 under the terms of a written employment agreement that was negotiated with the assistance of independent legal counsel. The employment agreement contained a non-competition clause which precluded Mr. Norton from being “engaged in, concerned with, or interested in, directly or indirectly” any business that was the same as M&P within a fifteen (15) kilometer radius for one year following the termination of his employment.

In 2020, Mr. Norton resigned from M&P and immediately began working as a pharmacist for a pharmacy located only three kilometers from M&P. M&P brought an application attempting to enforce the non-competition clause in Mr. Norton’s employment agreement, but the application judge found the clause to be overbroad and ambiguous, which rendered it unenforceable under the applicable common law principles regarding enforceability of non-competition clauses.  

M&P appealed the decision, arguing that the language of the non-compete was clear, and that Mr. Norton had the benefit of legal counsel when he signed his employment agreement and should therefore be bound by its terms. The Court of Appeal agreed with the application judge that the non-competition clause was ambiguous, as it did not expressly prohibit Mr. Norton from working as a pharmacist in another pharmacy.

Importantly, the Court of Appeal also clarified that the recent amendments to the enforceability of non-competition clauses through the Working for Workers Act, 2021 were not applicable as the employment agreement in question was entered into before the enactment of the legislation.

Parekh et al v. Schecter et al , 2022 ONSC 302

The plaintiffs entered into an agreement for the purchase of a dental practice. The purchase agreement included an express condition that one of the existing dental associates, Dr. Schecter, would sign a non-competition and non-solicitation agreement. The non-compete prohibited Dr. Schecter from practicing dentistry within five kilometers of the plaintiffs’ dental practice for two years after he left or was terminated from the practice. Shortly after the purchase of the dental practice was finalized, Dr. Schecter resigned and began practicing dentistry at another dental office within five kilometers from the plaintiffs’ practice.

The plaintiffs attempted to enforce the terms of the non-compete through an interlocutory injunction. Dr. Schecter argued that he was not bound by the terms of the non-compete given the amendments made under the Working for Workers Act, 2021 . The Superior Court agreed with the plaintiffs, and held that it was the intention of parliament for the amendments to the enforceability of non-competition clauses to apply to all agreements entered into after October 25, 2021. According to the Court, the amendment has no retroactive power to affect agreements that were entered into before the implementation date. Applying the three-prong test for injunctions, the Court held that Dr. Schecter was bound by the non-competition clause, and therefore prohibited from practicing dentistry within a five kilometer radius of the plaintiffs’ practice until October 27, 2023.

REASONABLE EXPECTATION OF PRIVACY

In recent years, Ontario courts have recognized new torts of “intrusion upon seclusion” and “public disclosure of private facts”. While these developments signalled a move towards a greater preservation of privacy rights in Ontario, it was yet to be seen how these rights may apply to employees in the workplace. In the case below, the Court of Appeal has provided a helpful analysis of an employee’s reasonable expectations of privacy in the public sector. It is yet to be seen whether the principles of this case will have an impact on private sector employers, but, given the recent trends in privacy law in favour of protecting employee privacy rights, they are likely to be persuasive.  

Elementary Teachers Federation of Ontario v. York Region District School Board, 2022 ONCA 476

Two elementary school teachers were concerned that another teacher was receiving preferential treatment from their principal, and contacted their union for support. The union suggested that the teachers keep a log of each instance of preferential treatment they witnessed in the event of a future grievance. The teachers created and shared a log between one another, and stored it on their personal Google Drive accounts. The log was then accessed throughout the day on their school board (“Board”) provided laptops. The principal of the school learned of the existence of the log, and sought to find it. When one of the teachers was away from her laptop, the principal accessed the computer and discovered the log. He proceeded to take pictures of every entry, and shared it with the Board. The contents of the log were then used to discipline both participating teachers, which resulted in reprimands on file for three years that the teachers had failed to conduct themselves in accordance with the Ontario College of Teachers’ Standards of Practice. The teachers grieved the discipline, and alleged a breach of their privacy rights.

The Arbitrator and the Divisional Court both decided that the Board’s right to manage the workplace outweighed the teachers' individual privacy rights, and upheld the discipline.

The Court of Appeal confirmed that the Canadian Charter of Rights and Freedoms (the “ Charter ”) applied to public institutions such as school boards, and therefore was tasked with deciding whether the Board’s actions amounted to an unreasonable search and seizure in breach of section 8 of the Charter .

The Court began by determining whether and to what degree the teachers may have had a reasonable expectation of privacy in the workplace. It is important to note that from the outset of the Court’s analysis, it held that the fact the teachers were using a Board-issued laptop did not impact the Court’s decision on whether there was an expectation of privacy. Instead, the Court focused on the “totality of the circumstances” which included considering the personal nature of the material seized, the teachers’ personal interest in keeping the information private, whether the teachers had a subjective expectation of privacy, and whether it was objectively reasonable to expect that the log would be kept private.

The Court ultimately held that the teachers had a sincerely held belief that the information stored in the log was deserving of protection, and took steps they deemed appropriate to protect the information such as storing information on a “cloud” which is password protected. The Court also recognized that the teachers were directed to collect the information at the direction of their union representative, and that the use of the information by the Principal clearly lead to their discipline. The appeal was therefore allowed, the order of the Arbitrator was quashed, and the Divisional Court’s decision overturned. Given the timing of the appeal, the reprimands had already been removed from the teachers’ files, but, the outcome confirming a breach of section 8 of the Charter was highly significant. 

About the authors

photo of co-author Daria (Dasha) Peregoudova

Any article or other information or content expressed or made available in this Section is that of the respective author(s) and not of the OBA.

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Monkhouse Law

Most Important Employment Law Cases Ontario 2021

employment law cases ontario

Out of hundreds of employment law cases published by Ontario Courts each year, only a handful will set precedents that will be cited for years into the future. In 2021, we saw the Courts continuing to apply legal concepts and policies which only surfaced because of the COVID-19 pandemic. Conversely, more “precedented” issues in employment law such as wrongful dismissal, overtime pay, and the interpretation of employment contracts were still being litigated and decided by the courts.

The following top employment cases of 2021 have either interpreted a new legal issue or added important clarity to existing legal principles within employment law. All the cases listed below have the potential to significantly impact the rights of employees and the duties of employers in Ontario.

COVID-19 Layoffs

In 2021, Covid-related layoffs remained one of the hottest topics in employment law. On March 19, 2020, the Ontario Employment Standards Act, 2000 (ESA) was amended to include infectious disease emergency leave (the IDEL), retroactive to January 25, 2020. Among other things, IDEL prevents employees from complaining that they have been “ constructively dismissed ” to the Ministry of Labour. The IDEL regulation declares that workers who were laid off shall not be deemed to have been laid off, but instead are on emergency leave.

The courts remain divided on whether legislations such as IDEL bar employee’s common law constructive dismissal claims following layoff. The following cases demonstrate the unsettled state of COVID-related employment law.

Ristanovic v. Corma Inc., 2021 

In Ristanovic, Justice Dunphy of the Ontario Superior Court found that two employees, aged over 60 with nearly three decades seniority, were entitled to 22 months’ notice following their temporary layoff in February 2020, at the beginning of the pandemic.

Coutinho v. Ocular Health Centre Ltd., 2021 ONSC 3076

In Coutinho, Justice Broad found that the IDEL regulation does not take away a laid-off employee’s common-law right to sue for constructive dismissal.

Taylor v. Hanley Hospitality Inc., 2021 ONSC 3135

Shortly after the decision in Coutinho, Justice Ferguson rejected the same argument in Taylor and held that the IDEL disarms employees of the common-law right to sue for constructive dismissal.

Overall, in IDEL case, the Courts’ decisions find in the employee’s favour. While Taylor stands out, it is not binding but merely persuasive on other judges of the Superior Court, and may be eclipsed by many other cases which reached the opposite conclusion. In fact, two days after the Taylor decision, the Court refused the employer’s motion for leave to appeal the judgment in Coutinho.

Unauthorized Overtime Is Not Unpaid Overtime

RBC Insurance Agency Ltd. Agence D’Assurances RBC Ltee v Shahzad Ali, 2021ON LRB

In Ali, Monkhouse Law’s Andrew Monkhouse successfully established that an employer may be liable to pay overtime even if it was not aware the work was occurring, so long as the employer reasonably ought to have known the employee was working overtime, and fails to take reasonable steps to prevent the employee from working those hours. Based on phone records, the employer’s compensation policies, and employee testimony, the Court held the evidence was sufficient to demonstrate that the employer ought to have known the employee was working overtime.

Requirements for Establishing Job Abandonment

Nagpal v. IBM Canada Ltd., 2021 ONCA 274

In Nagpal, the Ontario Court of Appeal affirmed the lower court’s finding that job abandonment requires clear, objective evidence of an employee’s intention to no longer be bound by the employment contract. In this case, the employee failed to return to work after his short-term disability benefits were denied but indicated that he intended to return to work. The Court held in favour of the employee and agreed that the employee’s failure to return to work did not amount to voluntary resignation.

Sophistication, Legal Advice, and Negotiation Does Not Affect the Enforceability of Termination Clause

Livshin v. The Clinic Network Canada Inc., 2021 ONSC 6796

Livshin established that legal advice, sophistication, and negotiation are irrelevant to the enforceability of a termination clause. If a termination clause is ambiguous in its compliance with employment laws, it is simply unenforceable.

In Livshin, the Court dealt with an employment contract dispute between two businesses, both owned by sophisticated businesspeople. Both parties were represented by lawyers and received legal advice prior to signing the contract. The employer argued that it should be allowed to rely on the otherwise invalid termination provisions in the contract because the employee was sophisticated and received legal advice. The Court rejected the employer’s argument, concluding that even in the case of a particularly sophisticated employee, who might be seen as balancing the scales of a typically power-imbalanced relationship, this is no reason to permit an employer to draft and rely on clauses that contravene the ESA.

Campbell-Givons v. Humber River Hospital, 2021 ONSC 6317

A little over a week after the decision in Livshin, Justice Black in Campbell-Givons issued a similar decision. Justice Black reiterated the Court’s position that analyzing the employee’s “sophistication” when determining the enforceability of a termination clause is problematic because “a termination clause cannot comply with the ESA for some employees but violate the ESA for others. It either violates the ESA or does not, and it either enforceable or not” (para 46).

Workers’ Compensation Legislation Does Not Bar Harassment-Related Dismissal Claims in Ontario

Morningstar v. WSIAT, 2021 ONSC 5576

In Morningstar, the Ontario Divisional Court overturned the Workplace Safety and Insurance Appeals Tribunal (“WSIAT”)’s previous decision regarding whether an employee would be statute-barred from pursuing a constructive dismissal claim in the Superior Court if the facts of the case stemmed from an injury linked to workplace harassment . The Court determined that, in the aforementioned circumstances, employees can pursue constructive dismissal and other related damages in the Superior Court.

Employer Actions in Conducting a Wrongful Dismissal May Invalidate a Termination Clause

Humphrey v. Mene, 2021 ONSC 2539

Humphrey established that the employer’s bad faith may invalidate the termination clause in the contract.

In Humphrey, the employee’s request for a salary review led to the CEO of the company suspending her two weeks. At the end of the suspension period, the company would decide whether to terminate or demote the employee to a non-executive position. The employee responded to the Suspension Letter through her lawyer, indicating that she would not be accepting a demotion. The employer then terminated the relationship on a with-cause basis citing alleged serious performance failures, despite never having previously engaged in formal performance management with the employee. The employee sued for wrongful dismissal. The employer abandoned its cause allegations almost one year after asserting them, claiming that the evidence of the employee’s alleged misconduct had been destroyed in accordance with the company’s document retention policy and sought to rely on the without cause termination provision in the Employment Agreement instead.

The Court found that employer’s conduct during dismissal was so significant and egregious that it demonstrated an intention to no longer be bound by the employment agreement. As such, the Court held the employer to be disentitled from relying on the “without cause” termination provision.

Perretta v. Rand A Technology Corporation, 2021 ONSC 2111

A contract is repudiated when a party to the contract breaches a fundamental term or condition of the agreement. In Perretta, the Court found that the employer’s actions post-termination demonstrated an intention to no longer be bound by the terms of the employment contract, and therefore the employer could not later rely on the contract to limit the employee’s entitlements at termination.

In this case, the employer insisted that a dismissed employee execute a release in favour of the employer prior to receiving contractual termination entitlements. Although the employer later claimed the requirement of a release to be a mistake, the Court held that the employer’s conduct amounted to a repudiation of the employment contract, which rendered a termination clause unenforceable.

The Distinction Between Damages Under Employment Agreements and Under Shareholder Agreements in Ontario

Mikelsteins v. Morrison Hershfield Limited, 2019 ONCA 515

In Mikelsteins, the Court of Appeal confirmed its earlier 2019 ruling, which distinguished between shareholder agreements and employment agreements.

In this case, the employee’s compensation package included a shareholder agreement that entitled him to purchase company shares and receive an annual share bonus. Under the agreement, upon dismissal the employee would be deemed to have sold his shares to the company. After his dismissal, the employee received compensation for the shares. However, the employee argued that he was entitled to the value that the shares increased and the annual share bonus, which occurred over the 26 months after his termination.

The Court of Appeal disagreed with the employee. It found that the shareholders’ agreement was a contract, but not one governed by the common law developed specifically around employment contracts. The employee had agreed to a contract where the deemed sale of his shares was triggered by notice of termination, a specific point in time, and not at the end of the notice period. Mikelsteins confirmed that unlike an employment agreement or equity compensation plan, a shareholder agreement need only state that equity-related rights end upon termination to avoid wrongful dismissal damages.

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A year in review: Key 2023 employment law decisions

As 2023 comes to a close, it is time to look back on important cases that shaped the employment law landscape over the past year. The cases highlighted below serve as helpful reminders of the potential costs associated with faulty employment agreements, and poor behaviour by employers.

Termination Provisions

In 2023, the Ontario courts continued to closely scrutinize termination provisions in employment agreements. These cases act as a reminder that employers should take care to ensure that employment agreements are drafted in accordance with Ontario’s Employment Standards Act, 2000 (“ESA”) (or applicable employment standards legislation) and to ensure that agreements are current.

  • Tan v Stostac Inc. , 2023 ONSC 2121 : In Tan , the Ontario Superior Court found the entire termination provision of an employment agreement to be void because the just cause portion of the provision violated the ESA. This was the finding despite the fact that the “without cause” provisions contained an “ESA saving” clause, which provided that the provisions of the ESA would be “incorporated” and “prevail if greater.”

In this case, the plaintiff was terminated for reasons of economic hardship caused by COVID-19. The employment agreement contained a termination provision that gave the employer the right to terminate the agreement without notice or pay for “any just cause.” The Court held that this violated Ontario’s employment standards legislation, which provides a threshold for termination without advance notice of “willful misconduct, disobedience or willful neglectful duty that is not trivial and has not been condoned by the employer.”  The Court further held that the “ESA saving” provision did not save the clause. Following the Ontario Court of Appeal decision in Waksdale v. Swegon, the Court held that the invalidity of the just cause provision rendered the without cause provision unenforceable as well. The plaintiff was awarded 7-months’ pay in lieu of reasonable notice.

  • Celestini v. Shoplogix Inc. , 2023 ONCA 131 : In Celestini, the plaintiff argued that the termination provisions in his employment agreement were unenforceable because the substratum of the 2005 contract had disappeared due to material changes in his employment duties. As a result, he argued he was entitled to reasonable notice at common law.

The Ontario Court of Appeal agreed, finding that an employment agreement may not be enforceable if the other terms and conditions of employment have substantially changed in the interim. In this case, there had been significant changes to the employee’s duties since the employment agreement was signed in 2005. The Court held that, even though the employee’s job title remained the same, his new role had changes that were “substantial and fundamental,” and that the substratum doctrine ( that the employment relationship evolves over time ) applied. As a result, the plaintiff was awarded damages for failure to provide 18 months’ reasonable notice of termination.

Notably, the employment agreement in this case did not include a clause that the agreement applied regardless of any changes in duties. If it had, the substratum doctrine should not apply. In this regard, the Court specifically noted that a written employment contract “may oust the application of the changed substratum doctrine, if it expressly provides that its provisions, including its termination provisions, continue to apply even if the employee’s position, responsibilities, salary or benefits change.” (para. 35)

Fixed-Term Contracts

Employers should be especially careful when creating fixed-term contracts, and consider whether it is worth the potential risk. Employers must be aware of the obligations such contracts could impose, including the requirement to pay out the remainder of the fixed term if the contract is terminated early.

  • Kopyl v. Losani Homes (1998) Ltd. , (21 June 2023), Hamilton CV-23-81238 (Ont. S.C.J.): In Kopyl , the Court affirmed that fixed term contracts do not violate the ESA or the common law. In this case, an employment agreement was terminated before the end of the one-year fixed term.

The Ontario Superior Court held that, just because a contract establishes a fixed term of the contract, it is not by nature a termination clause.  Further, if a fixed term contract has an earlier termination clause that is invalid for some reason, the concept of reasonable notice of termination did not apply, and damages were ordered for the balance of the term.

  • Monterosso v. Metro Freightliner Hamilton Inc. , 2023 ONCA 413 : In this case, the Ontario Court of Appeal ruled that fixed-term independent contractors have a duty to mitigate their damages in the event that the contract gets terminated before the end date.

In this case, an independent contractor was hired on a 72 month fixed-term contract. He was terminated without cause after only 7 months. There was no termination provision in the agreement, so the trial judge awarded the independent contractor damages for the remaining 65 months of the term. The defendant appealed on the basis that the trial judge erred in holding that the respondent did not have a duty to mitigate. The Court of Appeal held that the trial judge erred, and there was a duty to mitigate, however, the appellants could not prove that the respondent failed to meet his duty to mitigate.

Increased Notice Periods

In 2023, the Ontario Court of Appeal upheld some awards assessing the reasonable notice period exceeding 24-months, which is generally viewed as the maximum. These cases serve as a reminder to review older, potentially forgotten, employment agreements as the costs may be greater than once anticipated.

  • Milwid v. IBM Canada Ltd. , 2023 ONCA 702 : In Milwid , an employee with 38 years of service in a managerial role was dismissed without notice. The motion judge considered the level of his compensation, the fact that it was an uncertain economy, and the technical nature of his skills, which were particular to the employer’s business, to support a 26 month reasonable notice period. One additional month was awarded due to the fact that the employee was dismissed during the COVID-19 pandemic, which was an exceptional circumstance. The Court of Appeal upheld the award.
  • Lynch v. Avaya Canada Corporation , 2023 ONCA 696 : In Lynch , an employee with 38 years of service was dismissed without notice. Reasonable notice was assessed at 30 months. The Court of Appeal upheld the award noting that “exceptional circumstances” can allow for an award of damages exceeding 24 months. In this case, these circumstances included the employee’s specialization and skills that were tailored to his job with the employer, being identified as a “key performer” by the employer, and the scarcity of similar jobs in his place of residence.

It is only in the most exceptional cases that a notice period of more than 24 months should be assessed. These outlier cases should not impact employers’ assessments of what is reasonable in the circumstances.

Award for Moral Damages  

As always, employers should act in good faith and with due courtesy when terminating employees, and ensure that they fulfill their obligations to employees. In a final case of interest, the employer was ordered to pay moral damages to a terminated employee arising from the manner of his termination.

  • Teljeur v. Aurora Hotel Group , 2023 ONSC 1324 : In Teljeur , the plaintiff was awarded $15,000 in moral damages on the grounds that the employer acted in bad faith in the course of termination. The employee had recorded the termination meeting surreptitiously and this recording was considered by the Court as evidence. The Court found that the employer had behaved in an “untruthful, misleading or unduly insensitive” manner. Contrary to the ESA, the employer did not provide written notice of termination, even though the employee had requested it multiple times. The employer also delayed paying his ESA entitlements and reimbursing him for his business expenses. Additionally, the employer paid the employee a different amount of severance than what he was told he would be paid in the meeting.

As always, please reach out to one of our Labour & Employment lawyers for assistance with drafting employment contracts, and advice on hiring and termination to avoid such pitfalls.

This publication is provided as an information service and may include items reported from other sources. We do not warrant its accuracy. This information is not meant as legal opinion or advice.

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Top Ontario employment law decisions of 2023, part one

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employment law cases ontario

As 2023 winds down and the new year approaches, below are some of the key employment law changes recently made in Ontario, as well as some potential developments that may be enacted in 2024.

Recent Changes in Ontario:

Employment Standards Act

Bill  79 , Working for Workers Act, 2023, made a number of changes to the E mployment Standards Act ,  2000  (“ESA”) that came into force on October 26, 2023, including the following:

  • Group Terminations.  Employees who work fully remotely now count towards the threshold for determining whether a reduction in force amounts to a “group termination” under the ESA. Accordingly, employers must consider remote workers whose employment they intend to terminate when determining whether the employer will terminate 50 or more employees at an employer’s “establishment” in the same 4-week period. Where that is the case, the employer must comply with the ESA’s group termination provisions, which require, among other things, the provision of additional notice to employees and submission of a report to the Ministry of Labour. 
  • Reservist Leave.  Statutory-protected reservist leave has been expanded to include time off an employee requires to recover from a physical or mental health illness, injury or medical emergency related to participation in a military operation or training. Further, the waiting period for new hires to be eligible to take reservist leave has been reduced from three to two months of consecutive employment. Employers who describe reservist leave entitlements in their employee handbooks or workplace policies should update those materials to reflect these changes.

Workplace Safety

On December 1, 2023, the Workplace Safety Insurance Board of Ontario (“WSIB”) added a new “Communicable Diseases”  policy  to its Operational Policy  Manual  that provides guidelines for claims for communicable illnesses. The new policy defines a “communicable illness” as “an illness resulting from infectious agents such as viruses, bacteria, and fungi” and establishes that an employee has initial entitlement to workers’ compensation benefits if an employee’s communicable illness “arose out of and in the course of employment, in that the employment made a significant contribution to contracting the communicable illness.” The policy sets out guidelines, factors, and evidence to be considered in making such a determination and applies to employee claims made to WSIB with an accident date on or after December 1, 2023.

Looking Ahead to 2024:

Bill  149 , Working for Workers Four Act, 2023, was tabled on November 14, 2023 and has been referred to the Ontario Legislature’s Standing Committee on Social Policy. If passed as currently drafted, Bill 149 would make a number of changes to the ESA, including the following:

  • Canadian Experience.  Employers would be prohibited from including any requirements related to “Canadian experience” in publicly advertised job postings or any associated application forms. This change is intended to remove barriers to employment imposed on internationally trained immigrants and is consistent with the Ontario Human Rights Commission’s  position  that strict “Canadian experience” requirements are often discriminatory in contravention of the Ontario  Human Rights Code.
  • Pay Transparency.  Employers would be required to disclose the expected compensation for a position or the range of expected compensation for a position in public job postings. Similar requirements already exist in British Columbia and Prince Edward Island. As employers can expect greater public scrutiny of their pay practices resulting from this potential requirement, they should ensure their pay equity plans and practices are up to date and comply with Ontario’s  Pay Equity Act  and consider that competitors will have insight into their employee compensation. Accompanying regulations, if enacted, may further inform how employers approach this pay transparency requirement.
  • Artificial Intelligence.  Employers would be required to disclose in public job postings whether they will use artificial intelligence to screen, assess or select applicants for the position. In addition to complying with this expected disclosure requirement, employers who use artificial intelligence in their hiring processes should be cognizant of the potential for biases built into such tools to produce prohibited discriminatory effects, as well as employer privacy and consent obligations when collecting and storing personal information provided by candidates.

We will continue to monitor the progress of this proposed legislation and will provide future updates.

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Top 7 employment law issues that will affect Ontario employers in 2023

employment law cases ontario

As we leave behind 2022, the long shadow of COVID-19 continues to linger and may have changed our workplaces forever.

Perhaps the most significant workplace trend with long term effects on employers is remote work.  Given how it proved to be a viable option for many workplaces over the pandemic, as workplaces started opening in late 2022, employees are demanding the ability to work from home at least some of the time.  As employers navigate this option, legal risk factors include how to record and determine working hours and overtime, how remote work will affect employees’ right to disconnect, and how privacy issues intersect with an employer’s electronic monitoring.

Against that backdrop, below are important employment law developments we saw in 2022 for Ontario employers, and what that could mean in 2023.

Employment Development #1: IDEL and Constructive Dismissal Claims

As of July 30, 2022 , employers can no longer rely on the Infectious Disease Emergency Leave  regulation (“ IDEL ”) to put employees on indefinite leave.  After that date, employers could rely on the ESA temporary layoff provisions to further delay their employees’ return to work.

However, it remains unclear whether employers who had put employees on IDEL are at risk of a successful constructive dismissal claim.  Given conflicting lower court decisions in Coutinho v Ocular Health Centre Ltd ., 2021 ONSC 3076, Fogelman v. IFG, 2021 ONSC 4042, and Taylor v. Hanley Hospitality Inc . ( Taylor ), 2021 ONSC 3135, the latter’s appeal to the Ontario Court of Appeal was expected to give us clear guidance in 2022.  Instead, the Court of Appeal in Taylor v. Hanley Hospitality Inc., 2022 ONCA 376 ultimately decided the appeal without deciding this issue.

We can look forward to more definitive direction from a Superior Court or an appellate court decision in 2023.

Employment Development #2: Termination or layoff due to non-compliance with vaccination policies

Throughout 2022, mandatory vaccination policies in the workplace were a notable topic of discussion.  As the vaccination rate among Canadians is high and COVID-19-related restrictions have lifted, it may become increasingly difficult in many workplaces to justify a mandatory full vaccination policy in 2023.

Past cases, generally decided in labour relations cases by arbitrators, tended to uphold an employer’s right to have a mandatory full vaccination policy.  These cases were decided during the peak of the pandemic when the vaccination rate was not high enough, and old variants were more deadly than new ones.

Those trends started to change by mid-2022.  For instance, in July 2022, the arbitrator in FCA Canada Inc. v Unifor, Locals 195, 444, 1285 , 2022 CanLII 52913 (ON LA), held that a two-dose requirement was reasonable when it was initially introduced, but was no longer reasonable as of the date when the decision issued. In Toronto Professional Fire Fighters’ Association, I.A.A.F. Local 3888 v Toronto (City ) , 2022 CanLII 78809 (ON LA), the arbitrator upheld the mandatory vaccination policy requiring two doses as reasonable, but found that the enforcement mechanisms of disciplinary suspensions and discharge for non-compliance were unreasonable.

While different considerations will be at play in the non-unionized context, we can expect more labour relations decisions in 2023 that will temper the reasonableness of a mandatory full vaccination policy.  Employers will continue to face uncertainty and risk if they decide to terminate employees due to non-compliance with mandatory vaccination policies, as the cases will likely be decided on a case-by-case basis.

Employment Development #3: Electronic monitoring policies put transparency first

Privacy rights are a growing concern especially as employers incorporate permanent remote work and hybrid work models. Government is responding to employee concerns with legislation forcing transparency on employers. For instance, an amendment to the Employment Standards Act, 2000 (“ ESA ”) on April 11, 2022 requires employers with 25 or more employees on January 1 of any year  to have a written policy in place by March 1 of that year on the electronic monitoring of employees .

The policy must include:

  • A description of how and in what circumstances the employer may electronically monitor employees.
  • The purposes for which the information obtained through electronic monitoring may be used by the employer.
  • The date the policy was prepared.
  • The date any changes are made to the policy.

Failure to do so may result in complaints to, and investigations by, the labour division of Ontario’s Ministry of Labour, Immigration, Training and Skills Development. As noted in our article Ontario Electronic Monitoring Policy Due by October 11, 2022 this should be reviewed annually.

Employment Development #4: Digital Platform Workers’ Rights Act

The Digital Platform Workers’ Rights Act was passed in April 2022, and we expect that the contemplated amendments to the ESA will be declared in force sometime in 2023.

This Act will apply to digital platforms and their workers, such as DoorDash and Uber and their drivers – the vast majority of whom are currently unprotected as independent contractors.  The changes contemplated will provide all digital platform workers with comprehensive minimum rights to:

  • Information (section 7).
  • A recurring pay period and pay day (section 8).
  • Minimum wage (section 9).
  • Amounts earned by the worker and to tips and other gratuities (section 10).
  • Notice of removal from an operator’s digital platform (section 11).
  • Resolve digital platform work-related disputes in Ontario (section 12).
  • Be free from reprisal (section 13).

Digital platforms will need to invest significant time and resources to bring themselves into compliance. They should consider starting as early as possible to avoid risk of financial liability, even before the Act comes into force.

Employment Development #5: Reckless Termination and Discrimination Claim

Employees who have been recklessly terminated may claim significant damages against their employer. In Luckman v. Bell Canada , 2022 CHRT 18 , a recent decision of the Canadian Human Rights Tribunal (“CHRT”), the employer, Bell Canada (“ Bell “), terminated their employee, Mr. Luckman, citing corporate restructuring.  Bell denied that performance was a reason for his termination.

However, prior to his termination, Mr. Luckman had taken a few medical leaves of absence as he suffered from health issues known to Bell.  On his return from a second medical leave, Bell failed to offer any accommodations, such as a flexible schedule, remote work, or additional resources, to deal with known stresses of his return to work, ultimately affecting his performance.

Bell might have legitimately cited performance issues but provided no evidence that it had tried to manage performance or that the selection process to terminate him as opposed to another employee was based on non-discriminatory grounds.  Rather, the Tribunal found that Bell’s termination was reckless as, even though Mr. Luckman’s medical limitations were known to Bell, Bell offered no accommodation on his return to work, and no one seemed to have “considered whether firing an employee recovering from cancer surgery might be discriminatory.”  For this “reckless termination”, the Tribunal awarded $15,000 in damages for pain and suffering, a further $15,000 for Bell’s wilful and reckless conduct, as well as $91,052.40 for lost wages.

Employers should proceed cautiously when they know, or should know, that there are potential human rights issues in terminating an employee or be at risk of potentially significant financial liability.

Employment Development #6: Removal of Canadian Experience Requirement

Requiring Canadian experience as part of licensing criteria in any of the regulated professions will be deemed void on and after December 1, 2023. This opens up employment and business opportunities to internationally trained professionals. This important development, the result of over a decade of advocacy, arose from Bill 27: Working for Workers Act , 2021 , which received royal assent on December 2, 2021.  Strictly speaking, this is not a 2022 development; however, since the Bill grants a 2-year grace period for compliance, over the course of 2022 and into 2023, Ontario regulators of professions will bear the onus of removing the Canadian experience requirements from their licensing criteria, except for public health and safety exemptions.

A list of regulated professions can be found in Schedule 1 of the Fair Access to Regulated Professions and Compulsory Trades Act, 2006, SO 2006, c 31 .

Employment Development #7: CERB Not Deductible From Wrongful Dismissal Damages

In Yates v. Langley Motor Sport Centre Ltd., 2022 BCCA 398 , the British Columbia Court of Appeal overturned a lower court’s decision and ruled that the Canada Emergency Response Benefit program (“ CERB ”) benefits received during the termination notice period is not deductible from the wrongful dismissal damages. The Court of Appeal noted that broader policy considerations and the purpose of the CERB program, designed to support employees but not to give employers a windfall, support a conclusion that CERB payments should not be deducted from damages awarded.  Whether employees should pay back CERB is an issue between the government and these employees, and not between employees and their employers.

Although not binding other than in British Columbia, this appellate decision is helpful as lower courts across Canada have been divided on this issue.  We may see more appellate decisions that will settle this issue definitively.

Finally, as employment law keeps evolving, and as we emerge from the Covid-19 shadow into transformed workplaces, employers are well-advised to consult regularly with experienced counsel to ensure continuous compliance.

These developments may be difficult to navigate. If you need guidance from an experienced employment lawyer, call Hum Law today at (416)214-2329 or Complete our Free Assessment Form Here .

employment law cases ontario

Most Important Employment Law Cases of the 2010s (2010-2019)

In order of appearance, from newest to oldest, here are the employment law cases that shaped Ontario and to some extent every jurisdiction in Canada in the 2010s:

Amberber v. IBM Canada Ltd., 2018 ONCA 571 : Here, the Ontario Court of Appeal provided some clarity on the enforceability of termination clauses especially in regard to relatively ambiguous or poorly written termination clauses. The court concluded that judges should adopt a common-sense approach and not “strain to create an ambiguity where none exists.”

A.B. v. Joe Singer Shoes Limited , 2018 HRTO 107 : In a high-water mark, the Human Rights Tribunal of Ontario awarded $200,000 to an employee for injury to dignity, feelings and self-respect resulting from repeated sexual assault and harassment.

Wood v. Fred Deeley Imports Ltd., 2017 ONCA 158: The Ontario Court of Appeal held that a termination clause in an employment contract is unenforceable if it explicitly or even ambiguously (a) excludes the continuation of benefits during the notice period or (b) excludes the payment or potential payment of statutory severance (on top of statutory notice).

Galea v. Wal-Mart Canada Corp., 2017 ONSC 245 : The Ontario Superior Court awarded a high-water mark $750,000 in extraordinary damages (i.e. moral damages, including aggravated damages and damages for mental distress and punitive damages) as against Wal-Mart for its pre-termination and post-termination conduct of the termination of one of its senior employees who was “set up to fail” by Wal-Mart and left in limbo for many months. Interestingly this case was not appealed.

Paquette v. TeraGo Networks Inc., 2016 ONCA 618 (CanLII) : The Ontario Court of Appeal held that an explicit contractual requirement for “active employment” when incentive compensation (i.e. bonus, equity, etc.) is paid, without more, is not sufficient to deprive an employee of a claim for incentive compensation that she would have received during the notice period, as part of her wrongful dismissal damages.

Potter v. New Brunswick Legal Aid Services Commission , 2015 SCC 10 : Here the Supreme Court of Canada crafted the test for constructive dismissal .

Hryniak v. Mauldin, 2014 SCC 7 (CanLII) : This Supreme Court of Canada case broadened the application of summary judgment motions, and since then many if not most employment law matters have proceeded via this more efficient, proportionate and less expensive mode of determining employment law issues.

The Trilogy of Overtime Class Action Certifications: Fulawka v. Bank of Nova Scotia,   2012 ONCA 443 ; Fresco v. CIBC ,  2012 ONCA 444 ; and McCracken v. CN Railway ,  2012 ONCA 445  paved a path forward for employment law class actions.

Russo v. Kerr, 2010 ONSC 6053 (CanLII) : Here, an employee, when faced with a significant reduction in his compensation, sued for constructive dismissal but, unusually, continued to work for the company under the new terms to mitigate his losses. The court found that the employee was constructively dismissed. The court ordered damages for the difference between what the employee would have earned during the reasonable notice period and what he would earn under the altered terms.

Piresferreira v. Ayotte, 2010 ONCA 384 (CanLII): The Court of Appeal rejected a duty of care on employers to shield employees from the acts of other employees that might cause mental suffering, saving employers from tort claims in cases to come later that decade.

Employment Law in 2020

I look forward to reading the Supreme Court of Canada decision in David Matthews v. Ocean Nutrition Canada Limited , which will be the first time the highest court in Canada reviews executive compensation and bonus law. In addition, the court should clarify a second issue: What is the impact of so-called ‘bad faith’ in the employment relationship? My old old boss Andrew Monkhouse argued on behalf of an intervener to shape the interpretation of the law in this case, and another one of my old bosses, Howard Levitt , argued for the Applicant.

I also look forward to reading about the interpretation of gig workers’ employment contracts in 2020 and beyond. Are gig workers like app-based delivery drivers employees or independent contractors under Ontario employment standards law? What about foreign arbitration clauses in their contract – are they enforceable? We will find out… My old colleague at Monkhouse Law, Alexandra Monkhouse, argued on behalf of an intervener at another hotly anticipated Supreme Court of Canada case, Uber Technologies Inc., et al. v. David Heller .

Top 10 Employment Law Cases of 2017

Top 10 Employment Law Cases of 2016

Employment Lawyer in Toronto Ontario

Jeff is a lawyer in Toronto who works for a technology startup. Jeff is a frequent lecturer on employment law and is the author of an employment law textbook and various trade journal articles. Jeff is interested in Canadian business, technology and law, and this blog is his platform to share his views and tips in those areas.

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Canada: Employment & Labour – Top Ten Cases Of 2021

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It is no secret that over the past year the COVID-19 pandemic has been the subject of much discussion in the realm of employment and labour law. In 2021, we saw courts and administrative tribunals alike grapple with the question of how the pandemic has impacted, or not impacted, our established employment and labour standards. Few employment contracts and collective bargaining agreements had previously contemplated a global pandemic, leaving issues such as sick leave, employee health and safety, and work stoppage in uncertain territory. However, 2021 was not all about the pandemic (believe it or not). We continued to see growth in the areas of human rights, occupational health and safety, and termination of employment relationships.

Below we have summarized what we believe are the top 10 Canadian employment and labour cases of 2021 that employers should be aware of:

Northern Regional Health Authority v. Horrocks, 2021 SCC 42

Labour arbitrators have exclusive jurisdiction over human rights disputes arising from collective agreements.

In 2021, the Supreme Court of Canada made a final decision on the exclusive jurisdiction of labour arbitrators over human rights disputes that arise under a collective agreement. We previously wrote about that decision here.

The respondent employee was suspended for attending work while under the influence of alcohol, and disclosed to the employer that she had an alcohol dependency. As a result, the employer required that the employee sign a "last chance agreement" to abstain from alcohol and undergo treatment. The employee refused to enter the agreement and was terminated.

The Union grieved the termination, and the employee was reinstated. However, the employee was terminated again shortly thereafter for alleged breach of the reinstatement terms. The employee filed a discrimination complaint with the Manitoba Human Rights Commission. The employer contested the jurisdiction of the human rights adjudicator and argued that disputes under the collective agreement were the exclusive jurisdiction of a labour arbitrator. The adjudicator found that she had jurisdiction and went on to find that the employer had discriminated against the employee. This decision was judicially reviewed and ultimately appealed by the employer to the Supreme Court of Canada.

The Court reiterated the well-established principle that labour arbitrators can decide on human rights claims which fall within collective agreement disputes. Justice Brown, writing for the majority, determined that exclusive jurisdiction is guided by an analysis of the relevant legislation. To this end, various provincial labour relations legislation expressly requires that each collective agreement contain a clause which provides arbitration as the exclusive and final step for dealing with interpretation, application, or violation of the agreement.

The Court decided that a labour arbitrator will not have exclusive jurisdiction if there is another piece of legislation which includes clear language providing another tribunal with jurisdiction over the subject matter. In Horrocks, there was no counter-prevailing legislation that provided the Manitoba Human Rights Commission with jurisdiction. In other words, the Commission did not have jurisdiction to adjudicate her claim and the exclusive venue for determination was through the arbitration process.

The Court was careful to note that this decision does not necessarily preclude all workplace-related actions in the court. An arbitrator's exclusive jurisdiction extends to human rights disputes arising from the interpretation, application, or alleged violation of a collective agreement, meaning an employee is precluded from filing a human rights complaint in relation to such matters unless the legislation specifically provides for concurrent jurisdiction.

Slater v. Halifax Herald Limited, 2021 NSSC 210

Cerb benefits are not deducted from wrongful dismissal damages - or are they.

After nearly four decades working for the Halifax Herald, a 61-year-old employee was temporarily laid off without pay in March 2020 due to the onset of the COVID-19 pandemic. The employee was originally told that the lay-off would last about three months, but rather than being reinstated, the employee was terminated three months later. The employer offered to pay the employee for an additional ten weeks, although they maintained that they were not obligated to do so. The employee claimed wrongful dismissal and sought damages.

Initially, the employer argued that through frustration of contact they had no legal obligations to the employee. Eventually, the employer acknowledged that it owed the employee some damages. However, in the meantime, the employee had begun to collect income replacement in the form of Canada Emergency Response Benefit ("CERB") payments from the Government of Canada. The employer argued that CERB payments should be deducted from any required damages.

The federal government administered CERB to people who had to stop work as a result of the pandemic. At the time of this litigation, the government had yet to clearly set out the rules and repayment terms regarding CERB as they were focused on providing pandemic assistance to Canadians without delay. Applicants were simply told that they may have to repay the benefit if a later evaluation revealed they did not meet the necessary criteria. The court considered the existing rules regarding Employment Insurance ("EI") and damages. EI is not deducted from damages, because if the employee is successful against the employer, the onus is on the employee to remit any benefits back to the government. The court determined that in light of the uncertainty in repayment of CERB, it should air on the side of caution and not deduct CERB from any wrongful dismissal damages.

Slater is only one of a handful of cases to determine the status of CERB within wrongful dismissal damages. Similar cases in other provinces have yielded mixed results, and some courts, particularly those in British Columbia, have concluded that CERB payments should be deducted. In Slater, the court definitively held that damages should not be adjusted to consider CERB payments. It would be unfair to deduct CERB payments from damages, especially given the fact that many of those who received CERB payments will likely have to repay them. The employee was awarded pay in lieu of 24 months' notice, which he would be owed based on his long service, age, and the nature of his employment. As this issue has yet to come before an appellate court, the final determination is yet to come.

The Worker v The District Managers, 2021 BCHRT 41

Human rights tribunal dismisses religious discrimination complaint from worker refusing to wear a mask.

One of the most contentious issues arising from the COVID-19 pandemic are the federal and provincial mandates around mask-wearing in public places and private businesses. We previously wrote about two such decisions here and here . The Worker is the second screening decision we wrote about, published by the British Columbia Human Rights Tribunal (the "Tribunal") regarding the mandatory requirement to wear masks in public places (the first decision we wrote about pertained to a dispute between a customer and a store). Screening decisions are rarely publicized, as they are typically sent privately to the complainant informing them if their human rights claim will or will not proceed to a hearing. When screening decisions are published, it is usually for the purposes of educating the public.

In the Worker , the Tribunal considered whether an employer discriminated against an employee on the grounds of religious belief for refusal to wear a mask. The employee was contracted to do work at a district facility. When he arrived, he refused to wear a mask and alleged it was his religious creed. The employee was subsequently terminated for refusal to wear a mask.

In a screening decision, the Tribunal dismissed the employee's complaint and gave reasons surrounding the validity of mask mandates. The employee could not demonstrate any facts which support that wearing a mask is subjectively or objectively prohibited by any religion. They found that much of the employee's arguments were personal and not rooted in any legitimate religious grounds.

The end result: the employee's beliefs were not protected on the basis of religion, as they were born out of personal disagreement with mask mandates. This decision suggests an employee will face a relatively high bar in convincing a decision maker that opposition to masks or other COVID measures, such as vaccines, are actually based in a religious belief rather than some other non-protected opposition.

Wong v Polynova Industries Inc., 2021 BCSC 603

Employers must communicate repudiation of the employment contract in writing.

The plaintiff employee was 70 years old and had worked for the employer continuously for 15 years at the relevant time. Through a text message service, WeChat, the employee indicated to his supervisor that he would be absent from work due to illness. The employee indicated this would be approximately a two-week period due to COVID isolation. However, this absence extended for a two-month period. The employee did not communicate at all with the employer during his absence. Twice throughout the two-month absence, the employer attempted to call the employee's landline, which had been disconnected. The employer made no further efforts to contact the employee.

During the employee's absence, the employer trained new personnel to effectively replace the employee. To the employer's surprise after the two-month absence, the employee arrived for a regularly scheduled shift. The employer told the employee he had abandoned his job, and therefore he was no longer employed, and he was owed no compensation in lieu of notice. The employee disagreed, and alleged he was terminated without notice.

At the outset of the court's decision, they emphasized that employment is a contractual relationship. While an employee can repudiate their employment contract through abandonment, an employer must accept this repudiation. In this case, the employer did not communicate acceptance of this repudiation. Since communication of repudiation never occurred, the employment contract remained intact. As a result, the employee was entitled to damages in lieu of notice.

The court held that an employer can accept repudiation through several methods, but importantly, it should always be done in writing. One simple way of accepting repudiation of the employment contract is by issuing a Record of Employment.

EN v Gallagher's Bar and Lounge, 2021 HRTO 240

Misgendering employees is a serious ground for human rights complaints against employers.

The employer operated a bar and restaurant. Four persons were employed in the kitchen of the restaurant. One employee identified as gender queer and two employees identified as non-binary. All three employees use they/them pronouns. The employees each brought a human rights complaint against their employer on the grounds of gender discrimination. The employees recounted their employer misgendering them throughout their employment. Specifically, the employees alleged there was an incident where the employer made transphobic statements to customers about his kitchen staff. Shortly after this incident, the employees ceased working at the restaurant due to the employer's conduct and the lack of a safe and discrimination free workplace.

The employer denied these allegations and did not respond to the human rights complaint. The human rights tribunal found that the complaints of the employees were substantiated, and both the misgendering and transphobic statements constituted discrimination. Each of the employees were awarded $10,000.00 for lost wages and compensation for injury to dignity, feelings, and self-respect.

This case serves to remind employers that allegations of misgendering and transphobic environments are serious. Employers must take appropriate action to create a discrimination free workplace for gender queer, non-binary, and trans employees.

Hucsko v A.O. Smith Enterprises Limited, 2021 ONCA 728

Refusal to participate in remedial action following a workplace sexual harassment investigation constitutes just cause for dismissal.

The employee was a senior product designer who had been working for the employer for 20 years. The employee was accused of making sexual innuendos towards a female project manager on four occasions. An investigation was conducted and found that the comments made by the employee constituted sexual harassment. The employee was provided with a copy of the investigation report and a letter requiring him to take part in sensitivity training and give the complainant an apology. The employee accepted training but refused to apologize to the complainant, and was dismissed as a result.

The trial judge was asked to examine if the comments made by the employee constituted sexual harassment. The trial judge declined to determine if the comments constituted sexual harassment because the actual reason for dismissal was listed as "serious and wilful insubordination", which the judge took as a reference to the employee's refusal to issue an apology. The trial judge was also of the opinion that the investigation had never concluded that the employee's conduct was in fact sexual harassment. The trial judge determined that the employee's refusal to apologize did not create an irreparable breakdown in the employment relationship.

The case made its way to the Ontario Court of Appeal, where the trial decision was overturned. The Court of Appeal found, based on the workplace investigation, that the employee's conduct definitively constituted sexual harassment. The court emphasized the seriousness of the misconduct and that the refusal to apologize created a sufficiently serious breakdown in the employment relationship to warrant termination. The court decided that though the employee was not initially terminated, a refusal to agree to the remedial efforts of the investigation constituted just cause for dismissal.

This case serves as a reminder to employees and employers alike, that sexual harassment in the workplace is a serious matter which, on its own, can justify termination. Further, a failure by the employee to accept the remedial action(s) required by the employer following a fair investigation may constitute just cause for termination, even where the original conduct was not deemed sufficiently serious.

Kraft v Firepower Financial Corp, 2021 ONSC 4962

Employee hardship during the pandemic can result in employers owing employees longer notice periods at common law.

Employers should be aware that the ongoing pandemic can result in employers owing employees longer notice periods at common law. In Kraft, the employee's position as a salesperson in the field of investment banking was terminated without cause in March 2020. The employee had worked for the company for six years and sued for pay in lieu of notice.

The employee argued that they were entitled to more notice due to the difficulties that the pandemic creates in finding employment. The court reviewed the evidence from the employee about his failed job search with over 70 job applications which were unsuccessful. The court agreed in this case, that the economic hardship of the job market should be reflected in the damages awarded to the employee. At paragraph 22, the court found that "there is evidence that the pandemic impacted on the Plaintiff's ability to secure new employment. In light of that evidence, he deserves to receive at least somewhat above the average notice period". The court modestly increased the notice period by one month greater than what the employee would normally be entitled, for a total of 10 months' notice.

Though notice is examined on a case-by-case basis, employers should be aware that the pandemic can be a factor which could increase the common law notice period. We previously wrote about pandemic-related notice periods and their mixed jurisprudence across courts and jurisdictions here .

Rahman v Cannon Design Architecture Inc. , 2021 ONSC 5961

Despite the onca's decision in waksdale , the enforceability of termination provisions continues to be an evolving area of law.

Last year, we listed Waksdale v. Swegon North America Inc. , 2020 ONCA 391 as one of our Top Ten of 2020 (find it here ). The Ontario Court of Appeal held that employment contracts, and especially termination clauses, are to be read as a whole, so that if one clause is found to be statutorily invalid (such as the just cause termination provision), all are invalid (including the without cause termination provision). This year, we saw parties to an alleged wrongful dismissal claim attempt to apply the Waksdale principles. In Rahman , the defendant sought summary judgement for a wrongful dismissal claim. The defendant is a subsidiary of the US-based Cannon Corporation and has one Canadian office located in Toronto. The plaintiff was employed at the Toronto office.

In response to COVID-19, the parent company instituted lay-offs and salary reductions, which resulted in a reduction of the plaintiff's salary and eventually her employment was terminated without cause. The plaintiff argued that the termination provisions in her written employment agreement were void because they allegedly violated the minimum standards of Ontario's Employment Standards Act , 2000, SO 2000, c 41 (" ESA ").

Upon her hiring in February 2016, the plaintiff had been provided with an offer letter which was specific to her position, and a general "Officer's Agreement" which formed part of her terms of hiring. She reviewed both with a lawyer prior to accepting the position. The court quickly dismissed four of the plaintiff's five claims on the basis that the offer letter clearly stated that it would prevail in the event of a conflict between the two documents. It was therefore unnecessary to consider arguments centering on the wording of the Officer's Agreement where the offer letter complied with the ESA . The court was left to consider whether the "just cause" termination provision in the offer letter permitted termination without notice in circumstances beyond those permitted by the ESA . If that were the case, the plaintiff argued, then following Waksdale, the without cause termination provision would be void.

The judge found that not only was Ms. Rahman sophisticated when it came to negotiating contracts, but also that she and her lawyer had not raised any concerns with the termination provision during negotiations.

Further, Ms. Rahman had negotiated a more beneficial termination clause, which entitled her to the greater of her statutory entitlement, or two months' pay in lieu of notice if terminated without cause in the first five years, provided she agree to sign a release. Her statutory entitlement under the ESA was only one month. The defendants argued, and the court agreed, that if it were to side with the plaintiff, the unintended effect would be to potentially allow employers to deprive employees of fairly-negotiated benefits that exceed the common law standard.

When drafting employment contracts, the best practice for employers is to include a "saving provision", which stipulates that employment legislation standards constitute the minimum entitlement. Additionally, employers should strongly encourage potential employees to seek independent legal advice and carefully review all terms prior to signing employment contracts.

United Nurses of Alberta v Alberta Health Services, 2021 ABCA 194

Family status protection under human rights legislation continues to be subjected to conflicting standards across canada.

This appeal stems from a judicial review of an Arbitration Board decision concerning a nurse who was denied a change in rotation based upon family status accommodation. The reviewing judge at the Alberta Court of Queen's Bench found the Arbitration Board's majority decision to be unreasonable, and Alberta Health Services (the employer) appealed. The Alberta Court of Appeal sought to determine the applicable test for prima facie discrimination in family status human rights cases.

The central issue involves two competing lines of jurisprudence: the general test as set out by the Supreme Court of Canada in Moore v British Columbia (Education) , 2012 SCC 61, and the Federal Court of Appeal's slightly more recent decision in Canada (Attorney General) v Johnstone , 2014 FCA 110, which builds off Moore . The general test for discrimination from Moore indicates that a complainant must show:

  • They have a characteristic protected from discrimination;
  • They experienced an adverse impact on account of the challenged norm; and
  • The protected characteristic was a factor in the adverse treatment.

However, that test has not necessarily been strictly followed in "family status" discrimination cases, which looks at discrimination based on a parent-child relationship.

In Johnstone , the Federal Court considered a case where an employee alleged discrimination on the basis that the employer failed to accommodate as necessary to meet childcare needs. The Federal Court decided that discrimination would only be established ".if the employee has sought out reasonable alternative childcare arrangements unsuccessfully and remains unable to fulfil his or her parental obligations". Many have pointed out that this imposes a self-accommodation standard on the employee not contemplated by the Moore test.

Since Johnstone , many arbitrators across Canada have begun to apply the new, more onerous standard in family status cases while others have adopted modified approaches. The Alberta Court of Appeal clarified the issue for tribunals in Alberta and decided that Moore is the proper test, and Johnstone has no legal justification or imposition. The court found that the Moore test provides certainty and uniformity, whereas the Johnstone test is "fundamentally flawed". In dismissing the appeal, the court found that "imposing a more onerous self-accommodation burden in this manner perpetuates rather than ameliorates human rights inequality."

It will be interesting to see if other jurisdictions follow Alberta on this matter, as jurisdictions across the country continue to rely upon Johnstone as well as other modified tests . Until there is clarification from the Supreme Court of Canada, both employers and claimants may continue to be subject to uncertainty and potentially differing standards in litigating family status cases.

United Food and Commercial Workers Union, Canada Local 333v Paragon Protection Ltd (unreported, 9 November 2021, Von Veh) (ON Arb) and Electrical Safety Authority v Power Workers' Union (unreported, 11 November 2021, Stout) (ON Arb)

Case law developing on workplace vaccine mandates produces mixed results.

Increasingly workplaces in Canada have begun to implement mandatory COVID-19 vaccination policies. In November 2021 we canvassed two early arbitrations where unions challenged mandatory workplace vaccine policies (found here ). We have chosen these two cases to demonstrate the mixed arbitration results of mandatory workplace vaccination policies.

In United Food and Commercial Workers Union, Canada Local 333 v Paragon Protection Ltd the employer implemented a policy where all workers had to be fully vaccinated, subject to any valid human rights exemptions. The employer was a security company, employing 4,400 security guards across 450 sites in Ontario. The union grieved the policy, alleging that it breached the collective agreement, labour relations legislation, and the human rights code. The arbitrator found that the policy was reasonable and enforceable. The arbitrator made a number of significant findings that supported the policy including that it was created in recognition that most of the sites where the employer provided services already had their own mandatory vaccination policies. Further, the collective agreement already contemplated that the employer could require employees to be vaccinated for certain job sites and that employees may generally be required to be inoculated. Overall, the arbitrator found that the policy struck a balance in providing a safe workplace because it still allowed for valid vaccine exemptions.

In Electrical Safety Authority v Power Workers' Union, the mandatory workplace vaccination policy was not upheld by the arbitrator. The arbitrator warned that this decision is not about the merits of being vaccinated or the effectiveness of vaccination against COVID-19. They emphasized that the science is clear that COVID-19 vaccines are safe and effective at reducing the likelihood of serious illness or death, particularly with respect to the Delta variant. However, the arbitrator found that the policy represented a significant over-reaching of management rights, as unvaccinated employees were subject to discipline up to and including termination. The arbitrator found that the employer's regular testing and masking policies were already effective at reducing the risk of workplace transmission, and the majority of employees had continued to work remotely. If there was a client that required a vaccinated employee, the employer was able to schedule to meet this requirement. Overall, the arbitrator found there was no evidence that the unvaccinated employees created real problems for the company's business. The arbitrator warned that this analysis was subject to the present conditions of the pandemic, and at another point in time it could be considered reasonable.

While both cases are early decisions, they demonstrate that mandatory vaccination policies are assessed on a case-by-case basis and are largely fact-specific. However, in consideration of the recent exponential increase in COVID-19 cases, stronger government mandates, and more evidence that vaccines reduce hospitalization, these cases should not necessarily be taken as how decisions will be resolved today. Mandatory workplace vaccination policies continue to be a live issue in employment and labour law. With the increasing spread and prevalence of the Omicron variant, we are interested to see how the case law further develops. We encourage employers to consider their approach to vaccine mandates and reach out for advice.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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employment law cases ontario

Ontario’s New Employment Laws Target Mass Termination, Increased Fines, and More

Boardroom table representing Ontario's new employment laws around mass terminations

On October 26, 2023, the Working for Workers Act, 2023 received Royal Assent in the Legislative Assembly of Ontario. This bill introduces several revisions to the Employment Standards Act, 2000 , and other legislation relating to Ontario employees’ rights, expanding on previous changes from the Working for Workers Act, 2021 , and the Working for Workers Act, 2022 .

Additionally, the Legislative Assembly of Ontario recently announced it is considering Bill 149, the Working for Workers Four Act, 2023 , which, if assented to, will bring further changes to Ontario’s employment law landscape.

This blog will provide a high-level overview of the recent employment law changes arising out of the Working for Workers Act, 2023 , and the Working for Workers Four Act, 2023 . It will also highlight key components that employers and employees need to know.

What Will the New Employment Laws Do for Ontarians?

Like previous interactions of the Working for Workers Acts , the Working for Workers Act, 2023 covers several critical areas for Ontario employees and raises other vital initiatives relating to the well-being of Ontario’s workforce. Some of the important points for employers and employees to be aware of are detailed below.

Information for New Employees

The Working for Workers Act, 2023 proposes regulatory changes that will require employers to provide specific information to new employees about their job. Specifically, these changes will require employers to provide new employees with written information regarding their position, including pay, location of work, and hours of work along with the date by which that information must be provided to the new employee (for example, before their first day of work).

New Mass Termination Requirements

Fully remote employees will now be included in mass termination provisions. In other words, remote employees will receive the same minimum notice of termination, or pay-in-lieu for termination, as employees who work in office.

Special rules apply for notice of termination when 50 or more employees are terminated by an employer within a four-week period. An employer is required to provide:

  • 8 weeks’ notice (or pay in lieu) if 50 to 199 employees are terminated,
  • 12 weeks’ notice (or pay in lieu) if 200 to 499 employees are terminated, or
  • 16 weeks’ notice (or pay in lieu) if 500 or more employees are terminated.

These changes ensure that fully remote employees are included in the calculation of terminated employees for mass terminations and receive the same notice as office-based employees.

Increased Fines for Occupational Health and Safety Act Offences

Corporations convicted of offences under the Occupational Health and Safety Act relating to workplace safety may be required to pay a fine. The new employment laws raise the maximum fine that can be imposed in these situations from $1.5 million to $2 million, making Ontario’s corporate occupational health and safety fines the highest in the country. These fines are intended to reinforce the importance of worker safety and impose harsher penalties on employers who disregard it.

Increased Fines for Retaining Passports or Work Permits of Foreign Nationals

The new employment laws also strengthen protection for temporary foreign workers, establishing Canada’s highest maximum fines against employers or other individuals convicted of withholding a foreign national’s passport or work permit.

Changes to Military Reservist Leave

Military reservists have traditionally been granted entitlement to reservist leave (leave for deployment or military skills training) after three consecutive months of employment. Changes enacted by the Working for Workers Act, 2023 will shorten the length of employment required to two months, or any time if they are deployed for emergency operations inside Canada.

The new employment laws also allow military reservists to take reservist leave to recover from physical or mental injuries.

Other Proposed Changes for Ontario Workers

In addition to the changes outlined above, the Ontario government is proposing additional changes for the Ontario workforce, as follows:

Removing Barriers to Women in the Construction Sector

The Ontario government intends to introduce new regulatory amendments that ensure construction job sites include access to at least one women’s-only washroom and properly fitting safety equipment. These amendments are designed to make skilled trade positions more accessible for women.

Expanding Compensation for Firefighters and Fire Investigators

The Ontario government plans to expand cancer coverage for firefighters. These changes will make Workplace Safety and Insurance Board (WSIB) compensation claims extend to thyroid and pancreatic cancers and will be retroactive to January 1, 1960.

Preparing Students to Enter the Skilled Trades Faster

The Ontario government will allow students in Grade 11 to begin full-time skilled trades apprenticeship programs, after which they will be eligible to apply for an Ontario Secondary School Diploma as “mature students.” These changes will also potentially lower the entry requirements for skilled trades requiring applicants to have a Grade 12 education.

New Employment Laws: Working for Workers Four Act, 2023

On November 14, 2023, more new employment laws were introduced in the Legislative Assembly of Ontario through Bill 149, the Working for Workers Four Act, 2023 . While the Ontario government is still considering these proposed changes, they will, if assented to, do the following:

  • Require employers to disclose salary ranges in job postings and confirm whether employers are using artificial intelligence during the hiring process;
  • Ban unpaid “trial shifts” for new restaurant and hospitality workers, and reduce employee wages for dining and dashing or other stolen property;
  • Ban employers from requiring Canadian work experience in job postings; and
  • Enable “super indexing” increases to Workplace Safety and Insurance Board benefits above annual inflation rates.

More information on the proposed changes can be viewed on the Ontario government’s Working For Workers Four Act, 2023 page .

Final Thoughts on Ontario’s New Employment Laws

With the Working for Workers Act, 2023 receiving Royal Assent and the Working for Workers Four Act, 2023 being considered in the Ontario Legislature, the Ontario government is introducing several changes to protect prospective and current employees better. With these changes, employees will receive heightened protections in several key areas, and certain employees will benefit from increased access to leave and benefits.

Both employees and employers must familiarize themselves with these changes and consider how the proposed changes under the Working for Workers Four Act, 2023 may impact their rights and obligations. If you have questions or concerns about how these changes affect you as an employee, or your obligations as an employer, speak with an experienced employment lawyer .

Contact the Labour and Employment Lawyers at Grosman Gale Fletcher Hopkins LLP for Advice on Compliance With Employment Legislation

The knowledgeable Toronto employment lawyers at Grosman Gale Fletcher Hopkins LLP remain on top of legislative amendments within Ontario in order to provide clients with knowledge and comprehensive advice. We help employers remain on top of their obligations under the ever changing employment laws , while aiding employees in understanding and asserting their rights in the workplace. To schedule a confidential consultation with our employment law team, contact us online or at 416.364.9599 .

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Ontario to repeal wage-cap law after Appeal Court rules Ford government's Bill 124 unconstitutional

Province will not appeal decision and instead repeal bill 'in its entirety in coming weeks'.

employment law cases ontario

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Ontario will repeal a wage-cap law on public sector workers that the Court of Appeal found unconstitutional Monday.

The law from Premier Doug Ford's government — known as Bill 124 — capped salary increases for public sector workers at one per cent a year for three years.

A lower court struck it down as unconstitutional and the Appeal Court, in a 2-1 decision, largely upheld that decision, writing that the infringement couldn't be justified.

"Because of the Act, organized public sector workers, many of whom are women, racialized and/or low-income earners, have lost the ability to negotiate for better compensation or even better work conditions that do not have a monetary value," the court wrote in its majority opinion.

The Progressive Conservatives enacted the law in 2019 as a way to help the government eliminate a deficit. The province argued the law did not infringe constitutional rights, saying the charter only protects the process of bargaining, not the outcome.

In a news release Monday, the Ontario government said it will not appeal the court decision and will instead "take steps to repeal Bill 124 in its entirety in the coming weeks.

"To solve for the inequality of workers created by today's court decision, the province will urgently introduce regulations to exempt non-unionized and non-associated workers from Bill 124 until it is repealed," the release said.

The Ontario Appeal Court wrote that governments are entitled to try to hold compensation increases to a certain level, but the issue is how they do that.

"Ontario has not been able to explain why wage restraint could not have been achieved through good faith bargaining," the court wrote.

"In the absence of any evidence for the need for expediency or that the same goal cannot be achieved through collective bargaining, it is hard to understand on what basis the Act's salutary effects outweigh its beneficial effects."

Decision seen as 'big victory' for unionized workers

The Appeal Court found, however, that the lower court judge erred by striking the entire statute. The law applied both to unionized workers and those not represented by a bargaining organization, and the Appeal Court said the act is only unconstitutional for workers represented by unions, who have different rights because they bargain collectively.

In a dissenting opinion, Justice C. William Hourigan wrote that the evidence showed very real economic reasons for imposing wage restraint, and that the government did so instead of cutting services or jobs.

"According to the application judge's analysis, it would be permissible for the government to temporarily reduce wage costs when the economy was on the brink of collapse, but it would be unconstitutional for the government to act proactively to prevent the inevitable," Hourigan wrote.

"If a government sees an economic cliff on the horizon, courts should not require it to wait till the last moment to act."

  • Ontario teachers awarded additional pay to compensate for Bill 124
  • Ontario public servants awarded 6.5% pay hike in wake of Bill 124 ruling

The law had sparked widespread outrage among labour groups and opposition parties, with its effects on the health sector a particular focus, as critics argued it was partly responsible for driving nurses out of the profession or into private nursing agencies, where the pay is substantially higher for the same work.

"This sham of a bill has severely impacted access to and quality of care for Ontarians since 2019," said Ontario Nurses' Association provincial president Erin Ariss.

"The trauma inflicted on nurses and health care professionals because of Bill 124 has driven tens of thousands of us out of the health care system and away from the work that we love."

WATCH | 'I wish public services were being funded appropriately,' union head says

employment law cases ontario

Head of teachers’ union ‘pleased’ after Ontario Appeal Court rules Bill 124 unconstitutional

Monday's decision was seen as a big victory for unionized workers.

"I'm feeling like most broader public sector workers are feeling across Ontario: vindicated," said Steven Barrett, a lawyer representing Ontario Federation of Labour in the case.

"The Court of Appeal is clear that freedom of association and the protection of collective bargaining and the right to strike actually are meaningful."

Paul Cavalluzzo, who represents the Ontario English Catholic Teachers Association, said the government's financial records were its own undoing.

"Certainly the government's books now show that this legislation was not necessary, we were in a surplus situation," he said.

"They were not even spending all of the budget money on health and education — the bill was unnecessary."

Pam Parks

Two unions representing health-care workers said in a joint statement that Monday's ruling was a win for families and all unions who fought to protect workers' rights to freely bargain a collective agreement.

"We urge Doug Ford to end his attacks on the very people we need to fix Ontario's worsening health-care system," the presidents of CUPE's Ontario Council of Hospital Unions and SEIU Healthcare wrote.

The union representing the province's public elementary teachers said the government never should have appealed the decision in the first place, as it "wasted" taxpayer dollars and undermined their recent contract negotiations.

"Let the court's ruling be a lesson for the Ford government to never circumvent bargaining or trample on workers' democratic rights again," the Elementary Teachers' Federation of Ontario wrote.

Government gained little from the law, says union

The government gained little from the law, said J.P. Hornick, president of the Ontario Public Service Employees Union.

"They've lost not just the respect of workers, but they've also cost us as workers an exponential lifetime of having to catch up," Hornick said.

"What they have gained is a reinvigorated labour movement."

Since the law was struck down, even while pending appeal, arbitrators have awarded additional retroactive pay to several groups of workers that had "reopener" clauses in their contracts, including teachers, nurses, other hospital workers, public servants, ORNGE air ambulance paramedics, and college faculty.

Several hospitals have told a legislative committee conducting pre-budget hearings that the Bill 124 reopener arbitration rulings are straining their budgets, though the government has committed to reimbursing them.

"Bill 124 settlements are driving hospitals into extraordinary cash flow difficulties, threatening our financial viability and forcing delay of critical capital purchases," Sherri McCullough, board chair of Kingston Health Sciences Centre, told the committee last month.

  • Ontario gives some teachers, education workers retroactive salary bumps as remedy to Bill 124
  • Ford government appeals Ontario court decision striking down Bill 124

Ontario's financial accountability officer said in 2022 that Bill 124 was set to save the province $9.7 billion on public-sector salaries and wages, though a successful court challenge would all but wipe that out.

That could cost the province $8.4 billion over five years, he said.

Though the 2019 law was time limited for a three-year period, it has still been affecting collective bargaining because of when some previous contracts expired and the length of some negotiations.

With files from CBC News

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Sunday 12 December 2021

Top five cases of importance to ontario employment law - 2021 edition.

employment law cases ontario

What it Takes to Make it to the Top Five

Those that didn’t make the cut, number five - hawkes v. max aicher (north america) limited, 2021 onsc 4290, number four - hucsko v. a.o. smith enterprises limited, 2021 onca 728, number three - morningstar v. wsiat, 2021 onsc 5576, number two - rahman / steve livshin, number one - the idel cases, looking back to last year’s list.

2020 has changed so much that much of 2021 is likely to be focused squarely, if not exclusively on pandemic issues: Can employers require employees to be vaccinated? Are those temporary layoffs constructive dismissals at common law? Will the effect of the pandemic be a bump to reasonable notice periods? All of those issues will have to be front and center in 2021. With respect to building the law in general, it would be fantastic if the SCC granted leave in Waksdale and squarely addressed the contrary decision of the BCCA in Miller, to which it previously denied leave. I would also love to see what happens with Moringstar and the development of subsection 13(4) of the WSIA versus what the SCC suggested in Matthews. While I think those academic issues will have to wait a bit, until things stabilize on more pressing fronts, to me, those are the interesting issues for years to come.

Looking Ahead to 2022

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Employment & labour – top ten cases of 2020.

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In a year like no other, there have been steady developments in the landscape of employment & labour and human rights law. Some of these developments were long anticipated, including the effect of termination on bonus compensation and the legality of mandatory arbitration clauses in the gig economy. Perhaps the most interesting cases, however, are those that relate directly to the major issues of this past year including the COVID-19 pandemic and widespread movement for racial justice and equality.

Below, we provide a summary of the top 10 Canadian decisions we believe Atlantic Canadian employers should be aware of going into 2021.

IBEW Local 1620 v Lower Churchill Transmission Construction Employers’ Assoc. Inc., 2020 NLCA 20 [IBEW]

Accommodating cannabis use in a safety-sensitive environment: Duty to accommodate requires employer to consider all possible options. Insufficient for an employer to show that only some of the possible accommodations are unreasonable.

We previously wrote about the arbitrator’s decision in IBEW here and here .

The grievor, a construction labourer, suffered from Crohn’s disease and osteoarthritis. To manage the associated pain, he used medically prescribed cannabis. This pain management regimen was in place when, in 2016, he applied for a labourer position on a construction project. He was hired pending satisfactory drug and alcohol screening. The grievor tested positive for drug use. Upon learning of the underlying medical reasons, the employer made numerous requests for additional medical evidence regarding his capacity to perform work safely. In the end, the employer refused the grievor employment on the ground that his medicinal cannabis use created an unacceptable safety risk. The Union grieved the decision, alleging a failure to accommodate.

The arbitrator denied the grievance on the basis that that the grievor’s position was deemed to be “safety-sensitive”, meaning that any performance limitations due to substance use could result in significant injury. The Union brought an application for judicial review to the Supreme Court of Newfoundland and Labrador. The applications judge found that the arbitrator’s decision was within the range of reasonable outcomes. The Union then appealed to the Court of Appeal and the sole question on this appeal was whether the applications judge reasonably concluded that the employer could not accommodate the grievor without undue hardship. Central to the issue is the fact that current science is not capable of assessing a person’s individual level of impairment due to cannabis use, nor can it accurately determine how recently cannabis was taken given the fact that cannabis can be detected in a person’s body long after it has been consumed.

The Newfoundland and Labrador Court of Appeal held that it was insufficient for the employer to rely on the dearth of scientific tests for impairment to discharge their onus of accommodating the grievor. The employer did not, for example, consider alternatives to scientific or medical tests such as functional assessments of the employee. The court did not purport to say that such tests would be adequate, only that all reasonable options need be considered. The Court of Appeal found that the applications judge erred in concluding that the arbitrator’s decision was reasonable as the arbitrator did not complete the necessary analysis. The matter was remitted back to arbitration for a complete and holistic analysis of the employer’s duty to accommodate. It will be interesting to see whether the arbitrator determines that accommodation without undue hardship is possible in a safety-sensitive work environment on this broadened analysis.

Uber Technologies Inc. v. Heller, 2020 SCC 16 [Heller]

When there is a pronounced power imbalance between parties to a standard form contract, forced arbitration clauses which prevent the weaker party from meaningfully pursuing disputes will be considered unconscionable.

We previously wrote about the Ontario Court of Appeal’s decision in Uber here .

The Supreme Court of Canada’s decision in Uber expands the role of the doctrine of unconscionability in standard form contracts, particularly with respect to arbitration agreements.

By way of background, to become a driver for Uber, drivers had to accept the terms of the service agreement, which specified that all disputes with Uber were required to go to mediation and then arbitration in the Netherlands. This process involved an upfront administrative cost- to be paid by the driver- of US$14,500, amounting to nearly a year’s salary and not inclusive of other costs and legal fees.

The Respondent, Heller, was the named plaintiff in a class action against Uber Technologies seeking a declaration that drivers are employees of Uber and, accordingly, entitled to the benefits of the Ontario’s Employment Standards Act, 2000 (“ ESA ”). He further sought a declaration that Uber violated the ESA . While the Ontario Superior Court of Justice stayed this action in favour of arbitration, the Ontario Court of Appeal found that the arbitration clause was unconscionable. As this was a preliminary motion, Justice Nordheimer (writing for the ONCA) assumed the drivers to be Uber employees as pleaded. On this view of the arrangement, the arbitration clause was invalid as it ousted provisions of the  ESA  (namely its complaints procedure) out of which employers cannot lawfully contract. Justice Nordheimer allowed the appeal on this basis, noting that he also would have set the arbitration clause aside for unconscionability in forcing drivers to pursue their claims in a foreign country. Uber appealed this decision to the Supreme Court of Canada.

Notably, the Supreme Court of Canada declined to deal with the ESA argument, clarifying that the question before them was limited to who has the authority to decide whether an Uber driver is an employee- the courts of Ontario or an arbitrator in the Netherlands. On this point, the Supreme Court of Canada agreed with the Ontario Court of Appeal calling it a “classic case of unconscionability.” The Supreme Court of Canada found that both traditional elements of unconscionability were met: inequality of bargaining power and an improvident bargain. Arbitration is meant to be a cost-effective and efficient option for parties seeking to resolve their disputes, but when it is not realistically attainable by one of the parties, it “amounts to no dispute resolution mechanism at all”. This decision enables Mr. Heller to proceed with his class action against Uber.

Lyft Canada Inc. v United Food and Commercial Workers International Union, Local 1518 , 2020 BCLRB 35 [ Lyft ]

British Columbia Labour Review Board finds nothing prevents ride-sharing services Uber and Lyft from hiring their drivers as independent contractors; no violation of Labour Relations Code .

In a big year for ride-sharing service cases, both Uber Canada Inc. and Lyft Canada Inc. (together, the “App”) were named in an application to the British Columbia Labour Review Board (“BCLRB”) on behalf of their respective ride-share drivers, seeking a declaration that said drivers be characterized as employees of the services. This declaration is contrary to the relationship clause contained in the Lyft Terms of Service, which categorizes the drivers as independent contractors. A similar clause is contained in the Uber Terms of Service. The drivers, represented by the United Food and Commercial Workers International Union, Local 1518 (“Union”), claimed that they should be considered employees under the British Columbia Labour Relations Code (the “ Code ”) and that Uber and Lyft had breached their employee rights under the Code . In this respect, this case mirrors the Ontario class action pursued by Uber drivers in the Heller case discussed above.

In this matter, the BCLRB dismissed both arguments, finding that the Respondents had not disingenuously represented their business or their relationships with their drivers, at least not as far as the Union had shown. The drivers were required to agree that they were independent contractors before being able to accept riders through the service, and contractually cannot assert they are employees of the Respondents. In contrast to Heller , the BCLRB did not find that the Respondents had structured their businesses in a “disingenuous manner in order to frustrate any rights Drivers may have under the Code ”. It is noteworthy that the BCLRB released their decision on Lyft three months before the Supreme Court of Canada released their decision in Heller. Had the BCLRB been informed by the Supreme Court’s finding that the power imbalance between the parties created an unconscionability issue in the contracts, their decision may have been different. It is likely that Canadian courts will see this issue arise again in light of the decision in Heller .

Unifor Local 823 v K+S Windsor Salt Ltd., 2020 CarswellNS 546 [ Windsor Salt ]

Employer’s duty to accommodate for alcohol use disorder is engaged despite employee’s failure to expressly acknowledge their alcohol use disorder.

The grievor was a full-time mine shaftsman at the time of his termination in September 2019. The employer, K+S Windsor Salt, terminated the grievor’s employment after he breached his Last Chance Agreement (“LCA”) put in place following a history of absenteeism. The grievor suffered from alcohol use disorder which contributed to his repeated failure to show up for scheduled shifts at the mine. He sought treatment on multiple occasions and his family physician was apprised of the situation and communicated with the employer, albeit never referring specifically to alcohol use disorder. Many of the grievor’s absences were addressed by his physician, but others went unexplained.

The employer’s substance use policy required that employees suffering from substance use disorders self-disclose in order to ensure that they benefit from the policy. The employer argued that the grievor failed to disclose his diagnosis as required by the policy. The employer further asserted that they followed proper disciplinary steps by implementing the LCA, and that the grievor’s failure to abide by the agreement justified his termination. The Union argued on behalf of the grievor that his failure to explicitly address his alcohol use disorder with the employer was a result of the stigma attached to such a diagnosis. They further submitted that the LCA failed to address the root cause of the problem. To support their argument, the employer referred to the Supreme Court of Canada’s approach to substance use in Stewart v. Elk Valley Coal Corp ., 2017 SCC 30 (“ Elk Valley “). In Elk Valley, the employer was held to have acted reasonably in terminating an employee with a substance use disorder due to their failure to abide by company policy.

The arbitrator distinguished the finding in Elk Valley on the basis that in that case, the employer was not aware of the substance use disorder prior to the LCA, and in this instance the employer either knew or strongly suspected that the grievor suffered from an alcohol use disorder. The grievor communicated with the employer, either directly or through his family physician, that he was attending “programs” and on at least one occasion referred to the Springhill detox program. The facts also indicate that the Union president was aware of the nature of the problem and informed the employer of that before the LCA was signed.

The arbitrator therefore found that even if an employer only suspects there could be a substance or alcohol use disorder at play, they have a duty to address that suspicion with the employee before taking any action. Despite finding there is a strong presumption in favour of enforcing LCAs, the arbitrator agreed with the Union that the LCA in question was designed to deal with the grievor’s absenteeism, but did not address the cause of the absenteeism and therefore was insufficient in the circumstances. The arbitrator found that the grievor “was doomed to breach the LCA because it made no attempt to accommodate the disability that was causing the absenteeism that so rightly concerned the employer”. As such, the employer could not reasonably expect that the grievor would be able to meet the terms of the LCA. The employer’s duty to accommodate was engaged before it entered into the LCA despite the lack of disclosure on the grievor’s behalf.

Abrams v. RTO Asset Management, 2020 NBCA 57

Employers must be clear in their communication with terminated employees as to the cause of termination, or lack thereof.

We previously wrote about Abrams here .

Mr. Abrams was dismissed from his position as Regional Manager of a furniture and appliance leasing business in May 2017. He had commenced work with the employer nearly 30 years prior, although there was some disagreement as to continuity as Mr. Abrams had taken multiple leaves and changed positions several times during his employ. The most recent employment contract between the parties set the notice period for termination without cause to four weeks, which is the minimum under the New Brunswick Employment Standards Act (“ ESA ”). Mr. Abrams brought a wrongful dismissal action seeking reasonable notice under common law.

The employer argued that there was just cause for dismissal as Abrams had entered into a romantic relationship with one of his subordinates, provided her with confidential information, and had promoted her without disclosing their relationship to the employer. However, Mr. Abrams’ termination letter and Record of Employment both indicated that he was terminated “on a without cause basis”. Furthermore, he was provided four weeks’ pay in lieu of notice (in accordance with the terms of his Employment Contract and the ESA) and at his final meeting with the employer he was informed that he was being terminated without cause. Mr. Abrams argued that the employer had clearly communicated that his termination was without cause.

At trial, the motion judge found that his relationship with a subordinate would have constituted just cause for termination and therefore the employee was not entitled to reasonable notice of termination. Mr. Abrams appealed, and the New Brunswick Court of Appeal determined that the motion judge erred in finding that he was dismissed with cause when the employer had been very clear in their communications with Mr. Abrams that they were dismissing him without cause.

The court went on to consider the enforceability of the without cause termination of Mr. Abrams’s contract, and held that it was void for attempting to contract out of the benefits provided under the ESA . Since the most recent contract also did not contain a clause precluding consideration of previous years of service, the Court of Appeal found it reasonable to consider all of Mr. Abrams’ nearly thirty years of service across his various positions and awarded damages for 24 months’ notice.

This case should serve as a cautionary example for employers to take care when drafting termination letters and contractual provisions. In the meantime, leave for appeal has been filed with the Supreme Court of Canada. Stay tuned for further updates.

Matthews v. Ocean Nutrition Canada Ltd., 2020 SCC 26 [Matthews]

Employers should revisit their incentive clauses and plans, including employee stock ownership plans (ESOP), following the Supreme Court of Canadas (SCC) determination that common language is not sufficient to preclude employee entitlements under these plans over a common law notice period.

We previously wrote about Matthews here .

In short, Matthews was a senior employee at Ocean Nutrition Canada who eventually left the company, due to mistreatment by the COO. The company was sold thirteen months later, which, had he still been employed, would have triggered a payout under the employee Long-term Incentive Plan (“LTIP”). The Nova Scotia Supreme Court determined that Matthews was constructively dismissed from his senior management position and was entitled to damages equal to fifteen months’ notice, but the question was whether he was also entitled to the LTIP payout given that the sale occurred during what would have been Matthew’s notice period. The wording of the LTIP specifically excluded employees who were not employed full-time on the date that the LTIP came into effect, including those that had resigned or had been terminated. While the Nova Scotia Court of Appeal found that this language was sufficient to oust Matthews’ entitlement to the LTIP payout during the notice period, the Supreme Court of Canada disagreed.

The Supreme Court found that whether damages for breach of employment contract should include compensation for loss of the LTIP entitlement is a two-step process:

  • Would the employee have been entitled to the bonus or benefit as part of their compensation during the reasonable notice period?
  • If so, do the terms of the employment contract or bonus plan unambiguously take away or limit that common law right?

The SCC concluded that the language in the LTIP was insufficient to rebut the common law presumption, and held that Matthews was entitled to the LTIP payment. In order to rebut the common law presumption, contractual language must be “absolutely clear and unambiguous.” Unfortunately, the Supreme Court did not provide examples of such clear and unambiguous language but it does put employers on notice that they will be held to a high standard in clarity of language should they wish to exclude incentive entitlements over a reasonable notice period.

United Steel Workers Local 2251 v Algoma Steel Inc ., 2020 CanLII 48250 (ON LA) [ United Steel ]

A global pandemic does not discharge employers from their duty to accommodate.

COVID-19 has left no area of law untouched, and employment law is no exception. United Steel involved an employee of a steel manufacturing plant in Sault Ste. Marie impacted by the mandatory quarantine order. The grievor is a dual citizen of Canada and the United States, and a single father to two children, both living in the United States. Although the grievor was exempt from the federally mandated self-isolation period as an essential worker, the employer implemented its own 14 day self-isolation policy independent of the one implemented under the Quarantine Act . The employer’s policy was implemented under the authority of the Ontario Health and Safety Act , which stipulates that employers must take every reasonable precaution to protect their employees.

The grievor therefore had to choose between either continuing to attend work or maintaining access to his children during a global pandemic. The Ontario arbitrator weighed the grievor’s argument that the policy was unreasonable and violated his right to equal treatment on the basis of family status against the employer’s argument that the policy was reasonable in the circumstances, given the high infection rates in the United States.

The arbitrator determined that, on the evidence, the employer’s COVID-19 policy was arbitrarily applied. The evidence revealed that some employees had spouses who worked in the United States but otherwise lived in the same home, and these employees were not subject to the self-isolation requirement despite having the same exposure risk. The arbitrator found that the employer had failed to reasonably accommodate the grievor, and could have found alternative work arrangements to limit contact with other co-workers. The arbitrator also determined that as part of the agreement to allow the grievor to continue to work without isolating, it would be reasonable to limit the grievor from travelling within the United States to any COVID-19 “hot spots”. Facing an unprecedented modern health crisis, the arbitrator in this decision was able to find a balance between individual employee family-status rights and the health and safety of the workplace.

NK v Botuik , 2020 HRTO 345

Consent to sexual activity is vitiated when one party uses their position of power, such as a supervisory position, over the other party in order to convince them to give consent.

The Applicant, known as NK, was a Direct Care Worker at two group homes for people with disabilities owned by Alan Stewart Homes Limited (“Alan Stewart Homes”). Over the course of her employment, the Applicant alleged that she was sexually harassed, propositioned, and assaulted by the Respondent who was also her supervisor at her first group home, violating her right to equal treatment without discrimination based on sex, right to freedom from harassment in the workplace based on sex, and right to be free from sexual solicitation. The Applicant reached an agreement with Alan Stewart Homes with respect to the matter and withdrew her claim against them. The Respondent, Botuik, never responded to the application and therefore forfeited his right to notice and participation.

The Applicant was a single mother who had a history of abuse by older men and substance use disorder, the latter of which she had worked hard to overcome. She was pleased to have secured employment with Alan Stewart Homes but immediately found herself subject to unwanted attention from her supervisor, the Respondent Botuik. He made it clear to her that important decisions related to her position, such as scheduling, fell to him alone. The Applicant testified that the Respondent initiated sexual contact with her, with increasing intensity, over the course of her employment, always ignoring her objections and reminding her that he was a very important part of the company and had a lot of power. Once her three-month probationary period ended, the Applicant immediately applied for a position at a different group home and was transferred. When she finally attempted to tell the Respondent that she was ending their relationship, he became violent and sexually assaulted her in her home, then left her and filed a police report against her for assault.

Shockingly, NK was subsequently terminated from her employment following an investigation done by an external lawyer. The lawyer found that NK and Boutik each engaged in inappropriate conduct in the workplace and that the employer behaved appropriately at all points. The report did not find any violation of a harassment or workplace safety policy as it concluded the relationship between NK and the Respondent was consensual. Despite being directly referenced in a letter NK wrote to Alan Stewart Homes, there was no mention of the sexual assault in the investigative report. The matter with Alan Stewart Homes was settled ahead of the hearing so, unfortunately, we will not know the extent of liability that may have been found, if any.

However, the Human Rights Tribunal of Ontario found several clear violations of the Ontario Human Rights Code by the Respondent Botuik. The Respondent’s wielding of his position with the company in order to force the Applicant into a sexual relationship with him vitiated any consent that the Applicant may have appeared to give. Despite the fact that the (final) assault did not occur at the workplace, it was still a consequence of the forced relationship that resulted from the Respondent leveraging his position over the Applicant.

Notably, NK sought compensation of $100,000 but was awarded $170,000 due in large part to the uniquely egregious nature of the harassment and culminating assault.

Sole Cleaning Inc . v Chu , 2020 ONSC 7226 [ Sole Cleaning ]

In assessing defenses to an injunction based on defamatory statements against an employer alleging racism, the experiences of racialized peoples should be given appropriate consideration.

Sole Cleaning pertains to the ability of employees to publicly criticize their former employers.  The employer brought a motion for an injunction against a terminated employee who had accused them of racist acts by posting on her social media accounts. Ms. Chu was one of eight employees at the shoe and handbag cleaning business owned by the employer, and her employment was terminated in June 2020. The employer claims Ms. Chu was terminated for her hostile attitude and damage done to a customer’s shoes, but Ms. Chu claims her termination stemmed from her support of the Black Lives Matter (“BLM”) movement.

Following the start of the global BLM protests in May, Ms. Chu alleged that she encouraged her employer to make a statement in support of the movement. Although the employer agreed to do so, Ms. Chu argued that they were largely dismissive of the issues and that their actions were performative at best. Ms. Chu argued that not only were all of the employees of the business “BIPOC” (Black, Indigenous, and/or People of Colour) as opposed to the two owners who were both white, but that the majority of Sole Cleaning’s customers were BIPOC with the employer relying heavily on the business of their BIPOC customers.

Following her termination, Ms. Chu posted a number of statements on her Instagram and Twitter accounts. The statements alleged that she had been unjustly terminated from her employment for supporting the BLM movement, that the employers were racists and had used racist epithets, that the employers did not care about Black people and only wanted to profit off of Black culture, and that they treated their BIPOC employees poorly. In response to these social media posts, most of the other employees quit, and the business was subject to negative attention in the media. Sole Cleaning sought injunctive relief to stop Ms. Chu’s statements that alleged racist behaviour.

The Ontario Superior Court Justice noted that only five cases across Canada were cited as granting injunctive relief in similar situations, making it a rarely acceptable remedy. In contemplation of Ms. Chu’s defence of justification and fair comment, the judge elected to consider all of the evidence as a whole, including a number of hearsay statements included in Ms. Chu’s affidavit, as part of a contextual approach. The judge highlighted the duty of the court to consider “the experiences of racialized persons and how their experiences can be seen through a lens that differs from those of us who are not members of racialized communities”. On the defence of fair comment, the legal test is whether any person could honestly express the same opinion on those facts, and the court found that the lived experience of BIPOC cannot be ignored when assessing the objectivity component of the fair comment test, especially when dealing with allegations of racism. While the employer’s argument could succeed at trial, the judge could not find that the defences raised by Ms. Chu would inevitably fail and therefore the injunction was not granted and the motion was dismissed.

This case will be one to follow as the defamation case proceeds to trial. In the meantime, it serves as a cautionary example to employers considering similar action.

Waksdale v. Swegon North America Inc. , 2020 ONCA 391 [ Waksdale ]

Ontario Court of Appeal holds that employment contracts, and especially termination clauses, are to be read as a whole, therefore if one clause is statutorily invalid, all are invalid, regardless of which clause was actually applied.

In Waksdale , a short term employee was terminated on a without cause basis. Pursuant to his employment contract – which contained the standard with and without cause termination provisions, he was provided two weeks’ pay in lieu of notice.

Following the termination, the employee commenced a wrongful dismissal action against the employer. In response, the employer argued that the employee was terminated pursuant to the without cause provision. The employee argued that while the “without cause” provision was valid, the “for cause” provision was not, as it attempted to contract out of the ESA . The employee submitted that the two provisions must be read as a whole, rendering both provisions unenforceable. The Ontario Superior Court of Justice agreed with the employer that the without cause provision was valid and could stand on its own.

On appeal, the Ontario Court of Appeal found that the motion judge had erred in interpreting the employment contract, and that individual termination provisions should be read together rather than on a piecemeal basis. If one termination provision is in violation of the ESA , then the whole employment contract is void regardless of whether the termination was effected under the enforceable provision. The fact that the employee was terminated under the enforceable provision was of no consequence to the court – the only relevant question was the enforceability of provisions at the time the agreement was executed. In their decision, the Ontario Court of Appeal also considered the power imbalance inherent in the employee/employer relationship, declining to avail themselves of the severability clause for a provision that attempted to contract out of the ESA.

The employer sought leave to appeal to the Supreme Court of Canada. While employers should stay tuned for further developments, those who intend to limit employee rights on termination without cause should be careful in ensuring all of the termination provisions of the employment contract are compliant with applicable legislation.

This article was written with assistance from Erin Mitchell, an Articled Clerk in Cox & Palmer’s Halifax office. 902.491.1282 [email protected]

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Top Five Cases of Importance to Ontario Employment Law - 2018 Edition

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Punitive Damages in Ontario Wrongful Dismissal Cases

November 28, 2023 By Articles

In recent court decisions, courts in Ontario have awarded punitive damages to employees for an employer’s bad behaviour during wrongful dismissal claims.

What are Punitive Damages in Employment Law Cases?

In employment disputes, such as wrongful dismissal or constructive dismissal cases, punitive damages refers to a court’s decision to award an employee additional financial compensation simply to punish an employer’s bad behaviour. Generally, a court would award punitive damages as an appropriate remedy where an employee can prove:

  • the employer’s conduct was “malicious, oppressive, and high handed” and was a “marked departure from the ordinary standards of decent behaviour”;
  • the employer committed an actionable wrong independent of the wrongful dismissal claim; and
  • demonstrate that the punitive damages award meets the objectives of “retribution, deterrence, and denunciation”.

Basically, punitive damages are intended to punish employers for engaging in extremely harsh or improper conduct that deserve condemnation and deterrence. In wrongful dismissal disputes, some of the cases that courts have found justify punitive damages include:

  • terminating an employee as retaliation for complaining about workplace harassment or discrimination
  • conducting unfair and biased workplace investigations to justify termination
  • alleging just cause for dismissal under false pretenses as a way to avoid providing an employee with a severance package
  • making a counterclaim against an employee to strategically intimidate them during a lawsuit or discourage them from pursuing their legal rights and entitlements

Boyer v. Callidus Capital Corporation

In Boyer v. Callidus Capital Corporation , 2023 ONCA 233 , an  employee sued his employer for wrongful dismissal after providing the employer with  18 months’ notice of his intention to retire at the end of 2016, primarily due to his health condition and concerns over the direction the company was taking. However, over the next year, he claimed to have experienced verbal abuse and criticism, including threats. In fact, all of his files had been transferred from him. Eventually, he left the company four months earlier than planned.

As part of his claim for wrongful dismissal, he sought a fair severance package, vacation pay, stock options and the value of his lost employee health benefits plan. In response, the employer issued a counterclaim for $150 million alleging that the wrongfully dismissed employee had breached his fiduciary obligations by failing to provide honest and transparent reporting to the company concerning three borrowers.

In the Court of Appeal’s view, when the overall context was scrutinized, what was “really going on” with the counterclaim was an attempt to silence a former employee seeking recovery in his wrongful dismissal claim and to create a chilling effect for other employees who want to bring claims or raising issues relating to toxic work environments. What this decision makes clear is that while a counterclaim against an employee suing for wrongful dismissal may be made in appropriate circumstances, the courts will not allow employers to use them as tools in a tactical attempt to silence the employee from pursuing their legal rights (in this case, to silence this employee and other employees regarding the allegedly “toxic work environment” at the company).

Giacomodonato v. PearTree Securities Inc.

In Giacomodonato v. PearTree Securities Inc. , 2023 ONSC 5628, the court ordered an employer to pay the costs of the proceeding in the amount of $830,761 on a partial indemnity basis to discourage “frivolous and strategic claims.” Specifically, it focused on the employer’s counterclaim, including its claim for punitive damages, which the court viewed as “obviously meritless” and warned employers that owe money (severance packages) to employees they “should be discouraged from engaging in tactical litigation designed to discourage employees from pursuing their rights and entitlements.”

The court emphasized the following factors:

[The employer] invited this litigation. [The employer] conducted this litigation in an unforgiving, scorched earth, and bare-knuckle manner . It missed no opportunity to malign [the employee].   [The employer’s] decision to pursue a counterclaim and punitive damages of so little merit leaves me to infer that those claims were advanced only for tactical reasons and in an attempt to dissuade [the employee] from pursuing the money [the employer] owed to him. [The employer’s] attempt to now claim that this action “was an unexceptional employment action” is entirely inconsistent with its own approach to this litigation. In my view, and in light of the choices it made in the conduct of this litigation, it should have reasonably expected to face a costs order of this magnitude. [Emphasis added]

Ruston v. Keddco MFG. (2011) Ltd.

In Ruston v. Keddco MFG. (2011) Ltd., 2019 ONCA 125 , an employer was responsible for paying an employee $100,000 in punitive damages and a further $25,000 in aggravated damages, in addition to 19 months’ damages for wrongful dismissal.

After his employment was terminated alleging cause by a new company that had acquired his previous employer, Mr. Ruston sought details as to the reasons for his termination. After claiming that he did not know the alleged conduct against him the company alleged just cause for dismissal, and that he would be hiring an employment lawyer, the company told him that, if he did, a counterclaim would be filed against him and that the litigation would be “very expensive.” True to form, when Mr. Ruston filed a wrongful dismissal claim, Keddco filed a counterclaim, seeking damages of $1.7 million for fraud as well as $50,000 in punitive damages.

At trial, the court found that the company failed to prove cause or any of its other allegations against the employee. The court also found that the company’s counterclaim had been a “tactic to intimidate” the employee. As such, the trial judge found that the company breached its obligation of good faith and fair dealing in the manner of his dismissal, awarding him:

  • 19 months’ pay in lieu of notice, including bonuses and benefits, totalling $479,000;
  • punitive damages in the amount of $100,000;
  • aggravated damages in the amount of $25,000; and
  • costs on a substantial indemnity basis in the amount of $546,684.73.

With respect to the aggravated and punitive damages award, the Court of Appeal found that the evidence provided support for the court’s conclusion that the company had breached its duty of good faith and fair dealing in the manner of dismissal, especially when it threatened the employee in an effort to deter him from making a claim and then commencing a counterclaim that was intended to (and did) cause him considerable stress.

Additionally, the Court of Appeal rejected the company’s argument that the same underlying conduct could not give rise to both aggravated and punitive damages, stating:

“ It does not follow from the fact that this is the same conduct which the trial judge referred to in making the aggravated damages award that an award of punitive damages amounted to either double recovery or double punishment. That is because aggravated damages aim to compensate a plaintiff for heightened damages caused by the breach of the employer’s duty of good faith and fair dealing in the manner of dismissal, while punitive damages seek to punish and denunciate inappropriate or unfair conduct.”

Despite recognizing that the award was “unusually high,” the Court of Appeal upheld the lower court’s finding, noting that since the company had threatened the employee with an expensive counterclaim and then delivered on its promise by engaging in costly and unnecessarily complex litigation, it had to bear the costs of its decisions. As such, it ordered the company to pay the employee a further $35,000 for the costs of the appeal.

Pohl v. Hudson’s Bay Company  

Recently, the Ontario Superior Court was asked to award bad faith/moral and punitive damages in the case of  Pohl v. Hudson’s Bay Company,  2022 ONSC 5230, which involved an employee with 28 years of service who was fired by HBC during a nation-wide business restructuring in light of the COVID pandemic.

The employee brought a claim for wrongful dismissal, where he was successful in obtaining a severance package of 24 months of salary in lieu of reasonable, particularly due to his older age and many years of service. However, the employee also sought and obtained additional compensation in the form of  aggravated/moral and punitive damages due to the manner of his termination, due to the following behaviour by the employer:

  • the employee was “escorted” out of the door despite there being no misconduct being alleged against him. Justice Centa considered this action unduly insensitive.
  • it attempted to offer the employee a demotion that would disentitle him from claiming common law notice was viewed by the Justice as misleading.
  • it failed to issue an ROE properly and failed to pay his outstanding wages in a lump sum following his refusal to sign the severance package which the court viewed as an intentional violation of the Employment Standards Act, 2000.
  • it filed two ROEs issued by HBC contained errors or inaccuracies, including incorrect dates.

As such, after taking all of the above conduct together, the court found that HBC did breach its duty of good faith and fair dealing as an employer, w $45,000.00 as payment for moral damages as a result.

Additionally, the court also awarded the wrongfully dismissed employee punitive damages of $10,000, largely due to its failure to comply with the ESA termination pay and severance pay obligation, as well as its failure to issue a correct ROE.

Take-Away Lessons

The courts have increasingly vocalized their position that an employer’s meritless counterclaims are not a tactic to better position the employer in wrongful dismissal litigation. Rather, for employers who proceed with counterclaims with a lack of evidence to support their allegations and thus unnecessarily complicate the litigation may see significant adverse costs awards against them.

Call Employment Lawyer Toronto Today

If you are an employee who believes you were wrongfully dismissed from your employment with or without a fair severance package , call today to discuss your options. As an employment law firm in Toronto , Bune Law has reviewed and negotiated improvements to many severance packages. You will review and get guidance on your severance package before you agree to sign any termination documents, and help ensure that your severance package is fair and reasonable.

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Employer Retaliation and Employees Rights (in Ontario)

Employer Retaliation and Employees Rights (in Ontario)

Laws in many jurisdictions, including Ontario, provide protections against workplace reprisals. In Ontario, for example, the Employment Standards Act, 2000 (ESA), and the Ontario Human Rights Code ( the Code )  have provisions that prohibit employers from retaliating against employees for exercising their rights or reporting workplace violations. If an employee believes they are facing workplace reprisal, they may have legal avenues to address the situation, such as filing a complaint with the appropriate regulatory body or seeking legal advice.

What is a Workplace Reprisal

A workplace reprisal refers to a situation in which an employer or superior takes negative actions against an employee as a response to the employee’s engagement in protected activities, such as reporting misconduct, discrimination, harassment, or violations of laws and regulations within the workplace. These protected activities are often related to ethical, legal, or policy concerns, and employees should be able to raise them without fear of retaliation.

Workplace reprisals can take various forms, including but not limited to:

  • Termination or Firing : An employee might be terminated from their job as a direct response to their reporting of misconduct or other workplace issues.
  • Demotion : An employee might be demoted from their current position to a lower-ranking position with reduced responsibilities and compensation due to their protected activities.
  • Reduction in Pay or Benefits : An employer might cut an employee’s pay or benefits as a way of punishing them for engaging in protected activities.
  • Negative Performance Reviews : An employee’s performance reviews might be unjustly downgraded after they have reported workplace issues.
  • Isolation and Exclusion : An employee might be isolated or excluded from important meetings, projects, or opportunities as a form of retaliation.
  • Increased Scrutiny : An employer might subject an employee to heightened scrutiny, such as excessive monitoring or increased disciplinary actions, as a way of retaliating.
  • Intimidation or Threats : Employees might be subjected to intimidation, threats, or hostile behavior as a response to their protected activities.

Employee Rights and Reprisal under the Employment Standards Act

Reprisal is prohibited under the ESA . Section 74(1) of the ESA contains a non-exhaustive list of activities in which an employer is prohibited from penalizing or threatening to penalize employees,  such as

a)        Ask the employer to comply with the Employment Standards Act, 2000 (ESA) and its regulations;

b)       Asking questions about rights under the ESA ;

c)        Filing a complaint under the ESA ;

d)       Exercising or trying to exercise a right under the ESA ;

e)       Giving information to an employment standards officer;

f)         Asking about the rate of pay paid to another employee to determine if an employer is providing equal pay for equal work;

g)        Disclosing their rate of pay to another employee to determine if an employer is providing equal pay for equal work;

h)       Taking, planning on taking, being eligible or becoming eligible for a pregnancy, sick, bereavement, family responsibility, declared emergency, family caregiver, family medical, critical illness, organ donor, reservist, domestic or sexual violence, crime-related child disappearance or child death leave;

i)         Being subject to a garnishment order (i.e., a court order to have a certain amount deducted from wages to satisfy a debt);

j)         Participating in a proceeding under the ESA ; and/or

k)        Participating in a proceeding under section 4 of the Retail Business Holidays Act (regarding tourism exemptions that allow retail businesses to open on holidays).

Contact us today to schedule a consultation with our Experienced Employment Lawyers

Remedies available to employees in response to retaliation .

In response to workplace reprisal, employees may have access to a range of remedies to address the unjust actions taken against them. The specific remedies available can vary depending on the jurisdiction, the nature of the reprisal, and the laws in place. In Ontario, for instance, employees have certain rights and protections against workplace reprisals. Some potential remedies available to employees in response to reprisal may include:

Reinstatement

If an employee was terminated or demoted as a result of reprisal, one potential remedy could be to reinstate them to their previous position or a position of equivalent status and compensation.

Employees who suffered financial losses due to the reprisal, such as loss of wages during a period of unemployment, may be entitled to back pay for the time they were affected.

Compensation for Damages

Employees might be entitled to compensation for any emotional distress, humiliation, or other psychological harm they experienced as a result of the reprisal.

Injunctions

In some cases, a court might issue an injunction to prevent further reprisal actions from taking place, ensuring the employee’s rights are protected moving forward.

Correction of Records

If the reprisal resulted in negative performance evaluations or records, the employee might have the right to have those records corrected or expunged.

Legal Costs

If an employee takes legal action against their employer and is successful in proving the reprisal, they might be entitled to have their legal costs reimbursed.

Punitive Damages

In certain cases, if the employer’s actions were particularly egregious or willful, the employee might be awarded punitive damages in addition to compensatory damages. These damages are meant to punish the employer for their behavior.

Non-Monetary Remedies

In some situations, remedies might include changes to workplace policies, training for employees and supervisors, or other measures aimed at preventing future reprisals.

It’s important for employees who believe they have experienced workplace reprisal to seek legal advice and understand their rights and options. The process for seeking remedies can involve filing a complaint with relevant regulatory bodies, initiating legal proceedings, or engaging in mediation or arbitration, depending on the circumstances and the applicable laws.

Ontario Case Law

Ontario case law has established four elements which, if proven, demonstrate that an employer has engaged in acts of reprisal against an employee. Mediclean Inc v Mendoza holds that a   breach under section 74(1) of the ESA will arise if:

  • Employee performed one of the protected activities listed above;
  • The employer knew that the employee engaged in the protected activity;
  • Employer penalized or threatened to penalize the employee; and
  • The employer intended to take disciplinary action against the employee for engaging in the protected activity.

When an employee claims that their employer has taken negative actions against them that constitute reprisal, the burden falls on the employer to show that they have not engaged in acts of reprisal.

Reprisals and Employee Rights under the Ontario Human Rights Code

Section 8 of the Ontario Human Rights Code (the Code ) also prohibits reprisals in an employment and labour context.

To make out reprisal under the Code , the employee does not need to show that their rights have been infringed. Rather, in their claim, the employee need only demonstrate that they experience the following:

  • employer is taking or threatening to take reprimand action against the employee;
  • action or threat of action results from the employee asserting their rights under the Code ; and
  • t he employer intends their actions and/or threat of action to be in response to the employee asserting their rights under the Code .

All three factors must be found to prove reprisal has or is occurring under the Code .

What Should You Do If Your Employer Retaliates and Violates Your Employee Rights?

Complaints under the esa.

If you believe you have been reprised for engaging in any of the above activities listed under section 74(1) of the ESA , you can file a complaint with the Ontario Labour Relations Board (OLRB). You would be required to complete a form A-53 or C-26 . You can contact the Ontario Ministry of Labour if you need assistance with the forms or information about the filing process. However, the Ministry of Labour cannot represent you or advise you as to whether your claim, in fact, constitutes reprisal. In these cases, you can consult an employment and labour lawyer who can provide legal advice catered to your unique situation.

Alternatively, you can pursue a civil action in court instead of filing a complaint with the OLRB.

Complaints under the Code

As previously discussed, section 8 of the Code prohibits reprisal and may offer remedies. To file a complaint under the Code , a Form 1 Application must be completed and submitted to the Human Rights Tribunal of Ontario (HRTO). A free guide is available online if you wish to commence a Human Rights Application on your own, or you can consult a human rights lawyer who can assist you with preparing your Application to the HRTO.

Advice for Employers Accused of Reprisal

Employers should carefully consider disciplinary actions taken towards employees and whether those actions are in connection with any conduct and/or complaints made by the employee in relation to their employee rights. If the disciplinary actions are retaliatory in nature, they could constitute a reprisal, and the employee could be justified in seeking damages.

If you have been served with a claim of reprisal, you may want to seek legal advice from a lawyer specializing in employment and labour law, depending on the forum in which the claim is brought. When an employer is served with a form A-53 or C-26 from the OLRB, a form A-54 should be submitted to the OLRB in response. In the event that an employer is served with a Form 1 Application from the HRTO, a Form 2 Response should be submitted to the HRTO. An employment and labour lawyer can assist employers in preparing and filing their responding materials with both institutions.

In Ontario, multiple statutory protections are available to protect employee rights regarding reprisals. Both the ESA and the Code prohibit employer retaliation against employees for asserting their rights in the workplace. Remedies available to employees could include reinstatement of their position and damages for lost wages.

An employment and labour lawyer can help you determine if you have been reprised, file claims, negotiate with an employer or employee, or help you defend against a claim of reprisal.

If you are an employee or employer in need of assistance with reprisal. Our team of experienced workplace lawyers at Achkar Law can help.

Contact us by phone toll-free at 1 (800) 771-7882 or email us at [email protected] , and we would be happy to assist.

Further Reading

  • Ontario Employment Standards Act, 2000: Your Handbook
  • The Ontario Human Rights Code: A Primer
  • An Employment Lawyer: 5 Questions To Ask
  • Whistleblower Protection In Ontario

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COMMENTS

  1. OBA.org

    This article explores the most significant employment law cases in 2022, and their related implications. BAD FAITH DAMAGES Awards of bad faith damages (as a subset of the broader category of "moral" damages) in wrongful termination litigation in Ontario have been rare.

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    Coutinho v. Ocular Health Centre Ltd., 2021 ONSC 3076 In Coutinho, Justice Broad found that the IDEL regulation does not take away a laid-off employee's common-law right to sue for constructive dismissal. Taylor v. Hanley Hospitality Inc., 2021 ONSC 3135

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  6. Top Five Cases of Importance to Ontario Employment Law

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  9. PDF Labour & Employment Law in Ontario

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  11. Canada: Employment & Labour

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  12. Employment & Labour

    Below we have summarized what we believe are the top 10 Canadian employment and labour cases of 2021 that employers should be aware of: Northern Regional Health Authority v. Horrocks, 2021 SCC 42. Labour arbitrators have exclusive jurisdiction over human rights disputes arising from collective agreements. In 2021, the Supreme Court of Canada ...

  13. Ontario employer had just cause for dismissal, but didn't investigate

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    Colistro v. Tbaytel, 2019 ONCA 197 The facts in this case are fairly similar to other harassment cases we see nowadays, but what makes this case truly unique is the devastating cost consequences for the plaintiff employee.

  18. Top Five Cases of Importance to Ontario Employment Law

    First, the decision must have a considerable impact on Ontario law. Accordingly, even if the case is from the Supreme Court of Canada, if the decision primarily concerns the interpretation of extra-provincial legislation, then it does not make the list. Second, the decision must have a considerable impact on employment law. I ditched labour ...

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  23. Punitive Damages in Ontario Wrongful Dismissal Cases

    Keddco MFG. (2011) Ltd. In Ruston v. Keddco MFG. (2011) Ltd., 2019 ONCA 125, an employer was responsible for paying an employee $100,000 in punitive damages and a further $25,000 in aggravated damages, in addition to 19 months' damages for wrongful dismissal. After his employment was terminated alleging cause by a new company that had ...

  24. Employer Retaliation and Employees Rights (in Ontario)

    Laws in many jurisdictions, including Ontario, provide protections against workplace reprisals. In Ontario, for example, the Employment Standards Act, 2000 (ESA), and the Ontario Human Rights Code (the Code) have provisions that prohibit employers from retaliating against employees for exercising their rights or reporting workplace violations.If an employee believes they are facing workplace ...