When a company purchases another business, it is important to consider the legal implications respecting the status of employees. The Ontario Superior Court recently decided a case regarding the validity of an employment contract where an employee had signed an agreement with his former employer but never executed a new agreement when the company was purchased by another business. The plaintiff argued that the employment contract only governed the previous employment relationship. The Court disagreed, finding that the terms of the employment contract still applied.

The Plaintiff was employed by Centricity which was purchased by Open Text. The Plaintiff had signed an employment contract with Centricity which provided him with notice of termination under the Employment Standards Act (the “ESA”), plus an additional four weeks. He also received a one month sabbatical every five years. When Centricity was purchased by Open Text, the Plaintiff was not asked to execute a new employment contract but he did sign a new non-competition and non-solicitation agreement. All of his other terms and conditions of employment remained the same except Open Text did not offer the one month sabbatical.  Although the Plaintiff was displeased that Open Text would not be offering the sabbatical, he never raised this concern with the company.

When the Plaintiff’s employment was terminated by Open Text he was provided with ESA notice plus an additional four weeks as provided in the terms of the employment contract. The question for the Court was whether he received sufficient notice of termination. The court looked at three issues: (1) Whether the contract was binding, (2) Whether it continued in effect after the takeover of Centricity, (3) Whether the Defendant could rely on its terms. The Court found that the employment contract was binding. The employment contract had a clause which provided that the agreement could be assigned by the Company to any affiliate of the Company, and that it would be binding on the parties and their respective successors and assigns. The Court found that the employment contract was binding on Open Text as a successor to Centricity. Although the Plaintiff had signed a new non-competition and non-solicitation agreement provided to him by Open Text, this did not constitute a new employment agreement.

The next consideration was the effect of the takeover of Centricity by Open Text on the employment relationship. The Court determined that the employment relationship remained unchanged. The transaction was an amalgamation, which, unlike an acquisition, does not change the corporate identity of the employer. The Court cited well established case law regarding the distinction between share and asset purchases with respect to employment status, which provides that since a sale of shares does not change the corporate identity of the employer, it does not automatically lead to the termination of the employment relationship.

Finally, although Open Text changed one term in the employment contract, the offer of a sabbatical, this was never challenged by the Plaintiff and it was not argued at trial that this represented a fundamental breach of the employment contract. As such, Open Text was able to rely on its terms when it terminated the employment relationship.

Written employment contracts are a valuable asset to an employer and can significantly reduce the potential liability upon the termination of employment. An employment contract can be used to clearly spell out the terms and conditions of employment, including an employee’s entitlement to notice when employment is terminated. A well drafted employment contract can protect an employer from costly litigation. Additional considerations may apply when a company is considering the purchase of another business. The nature of the transaction will affect the employment status of employees in the business being purchased. For instance, had there been as asset purchase in this case, the employer would have needed, at a minimum, to have the employees’ consent to the assignment of their employment  on the same terms and conditions. Companies should always seek legal advice on the potential liabilities associated with employees prior to entering a transaction.

At the 2013 Ontario employment law conference, employment lawyer Allison Taylor will discuss and provide you with strategic guidance so you can prepare effective employment contracts. The session includes tips on:

• How to prepare and implement enforceable employment contracts,
• How to incorporate language restricting notice on termination of employment without offending quality recruits, and
• How to craft enforceable non-competition and non-solicitation agreements.

Register for the 2013 Ontario employment law conference—and Learn the latest! (Registrations now closed)

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The 15th Annual Ontario Employment Law Conference, is taking place June 10, 2014, at the Mississauga Convention Centre. This event is hosted by First Reference, with presentations by the lawyers at Stringer LLP experts in the areas of employment and labour law.

The Agenda was created based on what you thought were the most pressing issues concerning employer rights and obligations. This year we’ll address the following:

• Unprecedented OH&S Penalties and Lawsuits
• Family Status Accommodation
• Getting Ready for the AODA Employment Standard
• Using Contracts to Protect Your Business
• Workplace Alcohol and Drug Testing
• The Perils of Employee Benefits

In addition, there will be Question and Answer sessions, a round-table, and a lunchtime presentation on New Developments in the Occupational Health and Safety Legislation by Sandra Excellent HB.Sc., B.A.Sc., M.Sc., from the Public Services Health & Safety Association.

We invite business owners, managers, human resources and payroll professionals who are grappling with workplace and employment law issues in the province of Ontario to attend the conference and take advantage of the necessary guidance for navigating through the most pressing issues concerning employer rights and obligations. Learn the Latest^™! to stay current and protect your employees and your bottom line!

Take the time to attend this valuable conference. Register to Learn the Latest^™!

Courts across Canada have been imposing record high fines and sending business owners, managers and supervisors to jail for Occupational Health and Safety (OH&S) contraventions. The Courts have also made it clear that it will be appropriate in some cases to impose a fine which has the effect of bankrupting an employer. A Court has also held that the Ministry of Labour itself could be liable to accident victims for damages resulting from negligent inspections.

At the 2014 Ontario Employment Law Conference, on June 10, 2014, employment lawyer Ryan Conlin, will be discussing,

• On the Crown’s successful appeal in the Christmas Eve scaffolding case,
• A review of one frightening Ontario case where the Court suggested that jail time may become the “new norm” for supervisors convicted in fatality cases,
• The impact of the recent Elliott Lake decision which allowed a class action to proceed against the Ministry of Labour relating to negligent safety inspections, and
• Strategies for responding to this unprecedented level of enforcement.

For example, on the subject of the Ministry of Labour being potentially liable for negligent safety inspections, conference participants will find out that, from time to time judges comment and decide on matters affecting employment law in the context of cases which at first blush have nothing to do with employment. One recent judicial decision in a claim arising from the tragedy at Elliot Lake should be noted by employers as it may have an impact on how workplace health and safety inspections and investigations are conducted in the future.

Quinte v Eastwood Mall is a class-action proceeding arising out of the collapse of the Algo Centre Mall in in June 2012. The decision covers a variety of preliminary matters and challenges to the case as pleaded by the representative plaintiffs, who were two owners of a business in the mall, one of whom was injured in the collapse.

This judgment was not a final judgment, and did not actually determine whether the plaintiffs’ claim against any of the myriad of defendants was valid. Nonetheless, the judge’s commentary and decision is relevant to all employers with responsibilities under the occupational health and safety and worker’s compensation regimes.

In particular, the Court dismissed a motion by the Ontario Ministry of Labour to have the case against it dropped. Additionally, the Court held that persons with Employment Standards Act and workers’ compensation claims could continue to participate in the lawsuit.

This decision will likely have significant consequences for workers, employers and the Ministry. Under WSIA, workers are barred from suing their own employer (and most other employers) for negligence arising out of a workplace accident. However, since the Ministry (like most public sector employers) is a “Schedule 2” employer under the WSIA, most private sector employees are not impeded by the WSIA from pursuing a claim for negligence.

Assuming that this decision is not overturned by a higher Court, we anticipate that the pre-accident inspection activity by the Ministry will be subject to significant scrutiny from counsel for injured workers and that the Ministry may find itself as the defendant in any number of personal injury cases in the future. You can read the full text of this article here.

Don’t miss this opportunity to Learn the Latest! about this new development and other workplace health and safety inspections and investigations issues. Register Today!

In most jurisdictions in Canada, human rights legislation prohibits discrimination on the basis of “family status.” Until recently, few cases were brought alleging discrimination under this branch. However, recent decisions across several jurisdictions have made it clear that employers must be attentive to this ground of discrimination or risk exposing themselves to significant liability.

At the 2014 Ontario Employment Law Conference, on June 10, employment lawyer Jeremy Schwartz, will be discussing,

• What workers must prove to establish “family status” discrimination in the childcare context,
• What is required to show “undue hardship” in the “family status” context, and
• Practical strategies for managing accommodation requests on this ground.

As stated above, recent cases have largely dealt with employee requests for accommodation due to their family status. These complaints are similar in structure to requests for accommodation by disabled employees. These family status complaints argue that by complicating employees’ abilities to fulfil their obligations to their families, employer policies are discriminating against workers with families.

Such accommodation poses serious challenges to employers attempting to efficiently schedule their workforces. It adds another factor that must be taken into account in organizing the workforce. However, unlike what is often the case in disability-related accommodations, in many workplaces the majority of employees may be subject to these familial pressures.

Until recently, few reported decisions dealt with such demands for accommodation. Beginning approximately ten years ago, the volume of cases dealing with this type of complaint has increased. Unfortunately, courts have not reached a consensus on how to deal with them. Three tests have emerged, with their roots in cases in British Columbia, Ontario and the Federal jurisdiction. Each test has used different and vague definitions for what exactly are employees’ rights and employers’ obligations when it comes to family status.

Don’t miss this opportunity to Learn the Latest! about the principles stemming from these family status cases. Register Today!

Many employers prepare written employment agreements that limit employee entitlements on termination of employment. In the absence of an enforceable termination provision, employees are entitled to notice of termination at common law, or pay in lieu thereof.

The case law in Ontario has changed considerably in the past few years regarding what constitutes a valid termination provision. One decision at the forefront of these developments is Stevens v Sifton Properties Ltd. In this case, the plaintiff argued that the termination provisions in their employment contract violated the Ontario Employment Standards Act, 2000 (“ESA”).

The employment contract provided that the employee would receive notice of termination or pay in lieu of notice and/or severance pay in accordance with the ESA. It also provided this would be in satisfaction of all claims and demands against the employer.

The employee argued that because the contract did not provide for benefits continuation during the notice period, it violated the ESA and rendered the termination provision unenforceable.

The court agreed. The contract limited the employee’s entitlements to notice of termination and severance. It provided that the employee would not receive any further entitlements arising out of statute or common law. Even though the employer had indeed provided the employee with benefits during the ESA period, the court held the contract was void. As such, the language in the agreement at issue is distinguishable from contracts which provide only that ESA minimums will apply but don’t have a catch-all limiting provision.

What is next?

This decision has prompted many employers to revisit the language in their employment contract termination provisions. Since the Sifton Properties case, employment contracts that limit employee entitlements to notice of termination and severance pay, without taking into account other ESA entitlements may be deemed void by a court.

At the 2014 Ontario Employment Law Conference, on June 10, employment lawyer Landon Young, will be discussing,

• The ground-rules for drafting non-competition and non-solicitation agreements
• How to craft enforceable agreements, and
• Practical strategies for implementing agreements upon termination of employment (for employees who don’t have agreements yet).

Don’t miss the opportunity to learn the latest! At the Ontario Employment Law conference, you will learn more about using contracts to protect your business as well as how you can ensure your employment agreements will be enforceable. Register Today!

Last days to register for the 15th Ontario Employment Law Conference, on June 10, 2014 at the Mississauga Convention Centre. This event is hosted by First Reference, with presentations by the lawyers at Stringer LLP, experts in the areas of employment and labour law.

The Agenda was created based on what you thought were the most pressing issues concerning employer rights and obligations. This year we’ll address the following:

• Unprecedented OH&S Penalties and Lawsuits
• Family Status Accommodation
• Getting Ready for the AODA Employment Standard
• Using Contracts to Protect Your Business
• Workplace Alcohol and Drug Testing
• The Perils of Employee Benefits

We invite business owners, HR professionals, payroll professionals and managers who are grappling with workplace and employment law issues in the province of Ontario to attend the conference. Register to Learn the Latest!

Below you can view a video that introduce the topics they will be addressing at the Conference on June 10, 2014.

Don’t miss this opportunity to Learn the Latest! Register Today!

In Canada, Monday, May 22, 2017 is recognized as a public (statutory) holiday known as Victoria Day, except in the Atlantic provinces (New Brunswick, Newfoundland and Labrador, Nova Scotia and Prince Edward Island). In Quebec, the public holiday is r… Click here to read the rest of the article

In a recent case out of Goderich, Ontario a $20,000 fine, the highest of its kind in Canada, was handed out for a health privacy violation.

Between September 9, 2014 and March 5, 2015, a Masters of Social Work student accessed the personal health… Click here to read the rest of the article

Brooks v. Total Credit Recovery Limited, a decision from the Human Rights Tribunal of Ontario examined words, their etymology, and their impact in the workplace.

Background

On September 7, 2010, the applicant filed an Application with the Human… Click here to read the rest of the article

Since Express Entry began on January 1, 2015, it has been necessary for prospective permanent residents to first receive an Invitation to Apply (“ITA”) before submitting an application for permanent residence under one of the following cat… Click here to read the rest of the article

A recent case from Nova Scotia illustrates that as laws and social attitudes concerning marijuana change, employers may be burdened with previously unexpected costs.

As Canada moves toward decriminalization by July 2018, the stigma associated with… Click here to read the rest of the article

In this week’s blog, we’re taking a look at the first and most critical step in kickstarting your analytics journey to bring value to your business—identifying and prioritizing your business objectives.

We also look at the importance of starting smal… Click here to read the rest of the article

A 2016 decision of the BC Court of Appeal is a good reminder to BC employers of the purpose of an employee’s obligation to provide reasonable notice of resignation and, if breached, what an employer can expect to recover. It also underscores the val… Click here to read the rest of the article

This update includes:

• Cut-off age for dependent children raised
• Traveling visa-free to Canada for eligible Bulgarians, Romanians, Brazilians
• Conditional permanent residence for spouses and partners eliminated

IRCC raises the cut-off age for… Click here to read the rest of the article

The Ontario Court of Appeal, in Brake v. PJ-M2R Restaurant Inc., 2017 ONCA 402 (CanLII), recently clarified the law of mitigation.

The duty to mitigate is an employment law principle that requires employees who are terminated without reasonable n… Click here to read the rest of the article

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Sweeping changes to employment coming: Changing Workplaces Review final report released

On May 23, 2017, the Government of Ontario released the Changing Workplaces Review final report.

Employee… Click here to read the rest of the article

“As a result of this recent decision from Ontario’s Court of Appeal, counsel need to be mindful of the fact that not all mitigation income is equal, and some may not be counted as mitigation income at all.”

When I have a consultation with an … Click here to read the rest of the article

On May 24, 2017, the Government of Alberta tendered and passed first reading of Bill 17: Fair and Family-friendly Workplaces Act (the “Bill”). The Bill proposes a number of significant amendments to Alberta’s Employment Standards Code and Labour Rela… Click here to read the rest of the article

We reported on the Government of Ontario’s release of the Changing Workplaces Review Final Report, which comprehensively reviewed Ontario’s Employment Standards Act, 2000 (the “ESA”) and Labour Relations Act, 1995 (the “LRA”). Today, the Government o… Click here to read the rest of the article