1. Skip to navigation
  2. Skip to content
  3. Skip to sidebar

Critical employment issues facing multinational employers

Join Dentons’ global Employment and Labour practice group for a unique, multi-country panel discussion examining critical employment issues that multinational employers face. The event will be held in person in our New York office and broadcast via webinar.

Agenda and speakers
Panels moderated by global practice leader Brian Cousin

Wednesday, June 29, 2016
3:45 p.m. – Registration
4:30 p.m. – Program
7 p.m. – Cocktail reception

Registration (3:45–4:30 p.m.)

Avoiding Violations of Employee Privacy Rights (4:30–5:20 p.m.) Neil Capobianco (US), Dante Trevedan (Mexico), Michael Bronstein (UK), Katell Deniel-Allioux (France), Markus Diepold (Germany), Grace Aoshuang Young (China), Jeff Mitchell (Canada)

Break (5:20–5:30 p.m.)

Implementing an Effective Restrictive Covenants Strategy (5:30–6:30 p.m) Richard Scharlat (US), Dante Trevedan (Mexico), Michael Bronstein (UK), Katell Deniel-Allioux (France), Markus Diepold (Germany), Grace Aoshuang Young (China), Jeff Mitchell (Canada)

Best Practices in Coordinating Global Human Resource Solutions (6:30–7 p.m.) Richard Scharlat (US), Katell Deniel-Allioux (France)

After the discussion, please stay for a networking cocktail reception.

Venue
Dentons
Tribeca conference room
1221 Avenue of the Americas
New York, NY | Map

Questions For more information, please contact Susan DeLeva at +1 212 398 8474.

Click here to RSVP

Critical employment issues facing multinational employers

Early Termination of Fixed Term Contract Results in Employee Windfall (Or the Dangers of Dubious Drafting)

The Ontario Court of Appeal recently awarded an employee, whose fixed-term contract was terminated on a without cause basis twenty-three months into a five-year term, damages reflecting the balance of his remuneration under the Agreement.

The employee, John Howard, was employed in a management position pursuant to a five-year fixed-term Agreement, which provided for early termination in the event of his resignation, by the employer for cause, or by the employer without cause. If his employment was terminated without cause, the Agreement stated that “… any amounts paid to the Employee shall be in accordance with the Employment Standards Act of Ontario”.

Mr. Howard’s employment was terminated and he brought an action for breach of contract, seeking damages reflecting his remuneration for the balance of the contract, which equated to over three years’ of salary and benefits. In defence, his employer argued that any damages should be limited to the two weeks’ he was entitled to under the legislation.

Mr. Howard sought a motion for summary judgment which the motions judge granted, finding that the clause which provided for early without cause termination was unenforceable due to ambiguity. However, the motions judge did not award Mr. Howard the balance owing to him under his agreement, but rather, awarded him reasonable notice of termination at common law, subject to the duty to mitigate, all of which was to be determined at a mini trial. Mr. Howard appealed. Notably, there was no appeal of the motion judge’s determination that the termination clause in question was unenforceable.

Setting aside the decision of the motions judge on the issue of damages, the Court of Appeal confirmed the common law presumption that every employment contract includes an implied term that an employer must provide reasonable notice to an employee prior to termination of employment, but held that by virtue of choosing a fixed-term arrangement, the parties had “unambiguously ousted” this implied term in favour of a contractual obligation of a five year term.

According to the Court of Appeal, after the parties contracted out of the implied obligation for reasonable notice in this case, Mr. Howard was entitled to receive the balance of his remuneration under the agreement in the event of early termination because the contract did not otherwise specify a pre-determined notice period in the event of the same.

In other words, because the without cause termination clause was unenforceable, it could not operate to reduce Mr. Howard’s damages where reasonable notice was otherwise ousted. The Court rejected the employer’s arguments that this created an unfair windfall for Mr. Howard, as the employer was sophisticated, had drafted the agreement, had elected for a fixed term, and had attempted to limit its liability in the case of early without cause termination to legislative minimums. That this latter clause failed to meet the standards imposed by the courts was inconsequential: “If an employer does not use unequivocal, clear language and instead drafts an ambiguous or vague termination clause that is later found to be unenforceable, it cannot complain when it is held to the remaining terms of the contract”.

The Court then held, consistent with previous decisions regarding liquidated damages, that without a contractual requirement to mitigate his loss, Mr. Howard was under no obligation to do so. Where a contract stipulates the penalty for early termination there is no implied duty to mitigate–it matters not whether the penalty is stated expressly, or is by default the balance of the wages and benefits under the agreement. As a result, Mr. Howard was entitled to 3 years of compensation, with no obligation to mitigate.

This case is yet another example of the dangers of using fixed term contracts, and the importance of drafting clear, unambiguous termination provisions.

The Court’s decision can be found at Howard v. Benson Group Inc. (The Benson Group Inc.), 2016 ONCA 256 http://www.ontariocourts.ca/decisions/2016/2016ONCA0256.htm

Early Termination of Fixed Term Contract Results in Employee Windfall (Or the Dangers of Dubious Drafting)

Patently Unreasonable: BC Supreme Court Rejects Human Rights Tribunal’s Landmark Injury to Dignity Award Which Emphasized Professional Status

In 2013 the British Columbia Human Rights Tribunal found that the University of British Columbia had discriminated against Dr. Carl Kelly when it dismissed him from its Family Medicine Residency Program. Dr. Kelly was awarded damages, including, significantly, $75,000 for injury to dignity, feelings and self-respect. At the time, the high water-mark for this head of damages was $35,000; this had been the result of relatively incremental increases to damages for injury to dignity over time. The award to Dr. Kelly exceeded this threshold by $40,000.

In the case of Dr. Kelly, the Tribunal held that the circumstances were such that a substantial award was appropriate, relying in part on Dr. Kelly’s life-long dream to be a physician and the humiliation and isolation from his family and friends he experienced as a result of his dismissal.

The University sought Judicial Review of the Tribunal’s decision on both the finding of discrimination and the damages awarded. In particular, the University argued that the Tribunal had put undue emphasis on the fact that Dr. Kelly was a medical resident, and that the award of $75,000 created a bifurcated approach to injury to dignity: one for professionals and one for other employees.

On September 24, 2015, the Court did not interfere with the Tribunal’s findings on the merits, but overturned the award of $75,000 on the basis that it was patently unreasonable.

Mr. Justice Silverman found that the award of $75,000 for injury to dignity put undue emphasis on the fact that Dr. Kelly was engaged in medical training and was denied access to his chosen profession. The Court held that in doing so, the Tribunal was elevating damage awards for complainants in professional occupations relative to other categories of employment. Disagreeing with the Tribunal’s finding that Dr. Kelly’s context was inherently unique, the Court held that the Tribunal’s award was patently unreasonable because there was no principled reason why this particular complainant’s circumstances warranted more than doubling the previous highest award.

Importantly, the Court did not comment on what would have been a reasonable award in the circumstances; rather, it remitted the decision back to the Tribunal for reconsideration. It therefore remains open to the Tribunal to grant Dr. Kelly an award for injury to dignity in excess of $35,000, ensuring this case will continue to attract considerable attention.

Patently Unreasonable: BC Supreme Court Rejects Human Rights Tribunal’s Landmark Injury to Dignity Award Which Emphasized Professional Status

The Non-Working Worker: A Practical Guide for Dealing with Employee Absences – Seminar

We hope that you will join us in Vancouver on Wednesday, November 20th as we discuss:

  • When They’re Not at Work: Managing Employees on Leave – Jeff Bastien
  • When They Don’t Return: Managing Employees who are Unwilling or Unable to Return – Andrea Raso
  • They’re Baaaaack…: Managing Reintegration and Performance Expectations – Dana Hooker

BC HRMA members – this workshop may be eligible for CHRP recertification credits.

Event Details
November 20, 2013
8:00 AM – 10:00 AM PDT

Terminal City Club
Walker Room
837 West Hastings St.
Vancouver, British Columbia
Canada

This session is complimentary. Please email vancouver.events@dentons.com to RSVP before November 15th.

, ,

The Non-Working Worker: A Practical Guide for Dealing with Employee Absences – Seminar

Denunciation, Deterrence and Retribution: Jury Awards Dismissed Employee $573,000 in Punitive Damages

The Vancouver Sun has reported that a British Columbia jury recently awarded employee Larry Higginson over half a million dollars in punitive damages, on top of a $236,000 award for wrongful dismissal, taking damages flowing from a wrongful dismissal to new heights in Higginson v. Babine Forest Products Ltd. and Hampton Lumber Mills Inc.

The Jury decision is not reported, however according to reports, Mr. Higginson had been employed for 34 years with the Defendant, Babine Forest Products Ltd., until he was dismissed on October 14, 2009, apparently for just cause. The employer alleged that Mr. Higginson failed to perform his duties as a manager. In response, Mr. Higginson alleged that cause had not been established and that the employer had set him up for termination of employment, had made his working environment miserable and had alleged cause to avoid the obligation to pay notice of termination of employment to long-term employees.

The Prince George B.C. jury found that the employer did not have cause to terminate his employment, and awarded damages in excess of $800,000 as a result of the wrongful dismissal.

Such a large punitive damages award has not been seen since the 2008 Ontario Superior Court of Justice awarded $500,000 to a wrongfully dismissed employee in Keays v. Honda Canada Inc.  However, in Keays, the Supreme Court of Canada (2008 SCC 39) overturned the punitive damages award on appeal.

A Notice of Appeal was filed in Higginson on July 18, 2012.

,

Denunciation, Deterrence and Retribution: Jury Awards Dismissed Employee $573,000 in Punitive Damages

Get your jab! – British Columbia Government Imposes Flu Vaccination Requirement for Health Workers

This article originally appeared on occupationalhealthandsafetylaw.com.

In hopes of driving up immunization rates among BC health care workers, the Government of British Columbia is imposing strict flu-season requirements on workers who come into contact with patients at publicly-funded health care facilities or in the community. Starting with the upcoming flu season, applicable health care workers (including health-authority staff, physicians and residents, volunteers, students, contractors and vendors) will be required to either obtain a seasonal influenza vaccine or to generally don a mask at all times during the flu season.

B.C. Provincial Health Officer Dr. Perry Kendall, who recommended these measures to the Provincial Government, wrote that less than 50 percent of health care workers are immunized against influenza each year, despite being in contact with high risk populations such as seniors, pregnant women, young children, and the immuno-compromised. Citing evidence from long-term care facilities that health care worker vaccinations results in diminished illness and fewer deaths each flu season, the physician argued that “[g]etting the flu shot should be considered standard patient safety practice for all health-care workers who come into contact with patients – as important as following effective hand hygiene practices, staying home when ill or wearing a mask in the operating room.” British Columbia will be the first jurisdiction in Canada to implement such a policy.

According to media outlets, the unions representing health care workers are generally supportive of vaccinations, although the British Columbia Nurses Union has said it will not yet formally respond to the directive and has rather referred to its October 2011 Press Release on the issue where it stated that vaccinations should be promoted through education, rather than through a punitive approach by the employer.

A Government of British Columbia “Backgrounder”, cites influenza as causing the most deaths among vaccine-preventable diseases.

According to Dr. Kendall, in U.S. jurisdictions where similar requirements have been imposed, health care worker immunizations levels have reached approximately 95 percent.

The Government’s Press Release, Dr. Kendall’s Opinion Editorial and the BCNU Press Release on Influenza vaccinations can be accessed at:

http://www.gov.bc.ca/health/

http://www.newsroom.gov.bc.ca/ministries/health/factsheets/opinion-editorial-flu-shots-save-lives-protect-patients.html

https://www.bcnu.org/News/news.aspx?page=Bulletins_Oct 21, 2011

,

Get your jab! – British Columbia Government Imposes Flu Vaccination Requirement for Health Workers

You Quit: Employee’s Claim of Constructive Dismissal Fails

On August 2, 2012, the British Columbia Supreme Court issued its judgment in the case of Danielisz v. Hercules Forwarding Inc. (2012 BCSC 1155). In Danielisz, the plaintiff was a customs broker with the defendant employer. At the time of her alleged constructive dismissal, the plaintiff was a Director of the employer (as the employer apparently required a licensed customs broker on its Board of Directors) and was manager of the customs department.

The employer’s office staff had a history of dissension and interpersonal difficulties. The Plaintiff claimed that she tried to overcome these difficulties, but that the other staff, including her subordinates, had ganged-up on her. She also claimed that her employer had undermined her authority by favouring lighter discipline for a staff member than the Plaintiff had originally imposed.

After a meeting at which the employer had tried to resolve some of the conflicts in the workplace, the Plaintiff commenced a sick leave which she claimed was caused by workplace stress. The Plaintiff ultimately went on Employment Insurance sickness benefits, attempted to make a claim with respect to the workplace stress to WorkSafeBC, and filed a complaint of constructive dismissal under section 66 of the Employment Standards Act. The workers’ compensation claim was denied, and the Plaintiff withdrew her complaint under the Employment Standards Act at the mediation.

Shortly after the mediation, the Plaintiff relocated to Kelowna, British Columbia, enrolled her son in school, obtained new employment and advised a co-worker by email that she was unwilling to return to the Defendant employer. However, in her communications with the defendant employer, the Plaintiff asserted that she would be willing to return to work with the Defendant at some point after her concerns with the workplace were resolved. In response, the Defendant employer asserted that the Plaintiff, by filing her complaint under the Employment Standards Act, had repudiated her employment agreement.  The employer proceeded to replace the Plaintiff. The Plaintiff then filed her action claiming damages for constructive dismissal.

Discussing the elements of the Plaintiff’s claim, the Court noted that whether or not a constructive dismissal has occurred depends on an objective assessment of all the evidence, rather than the employee’s subjective view of events. Further, the court held that where the allegations of constructive dismissal relate to claims of undermined authority or the behaviour of co-workers, the Plaintiff must show that the conduct in the workplace was such that a reasonable person in the circumstances should not be expected to persevere in the employment. Not every criticism by an employer or dispute among co-workers will sufficiently poison the work environment such that the employment relationship is undermined.

Applying these principles to the case at bar, the Court declined to find that the Plaintiff had been constructively dismissed. The Court found that the Plaintiff had been less than forthright about her own contributions to the negative work environment (finding that the “Plaintiff was engaged in ‘poisoning the work environment’ as much as she was ‘the targeted employee’”), and further, that the employer had not undermined her authority by imposing a lesser discipline on one of her subordinates. The evidence showed that although the Plaintiff’s immediate supervisor was an ineffective manager, he still reinforced her authority after this particular event.

The bottom line, to the Court, was that despite the unpleasant atmosphere, the work was getting done, the Plaintiff was not being forced to bear more than could be reasonably expected, and the Plaintiff had done little to try and improve the situation. Dismissing the Plaintiff’s claim, the Court found that the Plaintiff’s claim to WorkSafeBC and the complaint under the Employment Standards Act, combined with her relocation and new employment and conflicts in her statements to her employer and others, suggested that she had no intention of returning to work, and had rather hoped to extract some form of compensation from her employer. All of this, the Court held, amounted to a repudiation of the terms of her employment.  Her constructive dismissal claim was dismissed.

Danielisz v. Hercules Forwarding Inc., 2012 BCSC 1155 (CanLII)

,

You Quit: Employee’s Claim of Constructive Dismissal Fails

Wither ‘Big Brother’? B.C. Privacy Commissioner Reins-in Government of British Columbia Criminal Record Checks

In keeping with her stance on overly-invasive employee background checks, British Columbia’s Information and Privacy Commissioner, Elizabeth Denham, has issued her findings and recommendations with respect to the B.C. Government’s policies, as an employer, for employee criminal record checks.

Finding that the government’s polices resulted in the unnecessary or overbroad collection of personal information, the Commissioner issued a number of recommendations aimed at limiting the amount of data collected by the provincial government, as well as the instances in which collection would be justified. The report also contains 16 recommendations for “Best Practices for Public Sector Record Checks”.

A “Best Practices” for private sector employers will be released at a later date.

The Privacy Commissioner’s July 25, 2012 Report can be accessed at: http://www.oipc.bc.ca/orders/investigation_reports/InvestigationReportF12-03.pdf

The Privacy Commissioner’s guidelines on social media background checks can be accessed at:

http://www.oipc.bc.ca/pdfs/private/guidelines-socialmediabackgroundchecks.pdf

,

Wither ‘Big Brother’? B.C. Privacy Commissioner Reins-in Government of British Columbia Criminal Record Checks

Being Kicked in the Behind is No Laughing Matter: Employee’s Exaggerated Account of Workplace Altercation not Grounds for Summary Dismissal

Teresa Scholer was a fifty-five year old employee working in an entry-level position with the defendant employer. At the time of the termination of her employment, she had been working with the employer for approximately nine or ten months. In early 2010, Ms. Scholer was attending to her duties when she had an exchange with a co-worker. Inexplicably, after the exchange, her co-worker kicked Ms. Scholer in the buttocks. This event was captured by the employer’s video surveillance. The video surveillance also captured Ms. Scholer attempting to return the kick.

It was not clear from the video whether this was horseplay or something more aggressive. However, Ms. Scholer’s position was that she had been assaulted, and she complained to the employer that she was considering seeking criminal charges against her co-worker. She also complained about an earlier incident involving the same co-worker and about the fact that the co-worker had been scheduled for more shifts.

The employer viewed the surveillance, and considered that Ms. Scholer had not been honest about the incident, and had exaggerated it. Ms. Scholer was informed of the employer’s view of her description of events, but before Ms. Scholer was given an opportunity to review the surveillance, the employer terminated her employment, allegedly because she was difficult. Ms. Scholer was paid statutory notice of termination of employment, but the employer nevertheless insisted at trial that the termination had been for just cause.

The B.C. Provincial Court found that the employer had not established just cause. In particular, the Court found the employer’s focus on Ms. Scholer’s description of the incident, rather than the fact that she had been kicked in the buttocks, perplexing.  In all, the Court found that Ms. Scholer’s inaccurate description of the incident was neither in and of itself just cause for dismissal, nor was it a culminating incident that would justify the termination of her employment. There was no evidence that prior to her termination Ms. Scholer was aware that her job was in jeopardy. Finding that she was wrongfully dismissed, the Court assessed a notice period of four weeks given her particular circumstances including her short service.

Scholer v. Hart Drug Mart Ltd., 2012 BCPC 220 (CanLII)

,

Being Kicked in the Behind is No Laughing Matter: Employee’s Exaggerated Account of Workplace Altercation not Grounds for Summary Dismissal

Employees who supervise or manage processes (vs. other employees) can be exempt from overtime pay: Ontario Labour Relations Board

Ontario’s Employment Standards Act, 2000 provides that employees are entitled to overtime pay for all hours worked in excess of 44 hours in a week. However, there are certain exemptions to this entitlement – one of which applies to employees whose work is “supervisory or managerial in character and who may perform non-supervisory or non-managerial tasks on an irregular or exceptional basis”.

Unsurprisingly, there have been a number of employment standards decisions over the years in which an employee has advanced a claim for overtime and the employer has defended the claim on the basis that the employee is a supervisor or manager and therefore exempt. A number of decisions involving employees who did not supervise or manage employees have found that those employees were not “supervisory”. Occasionally, however, employees who supervise or manage processes – but not employees – are found to be true “supervisors” and/or “managers” such that they are exempt from overtime pay.

The recent decision in Levert Personnel Resources Inc. v. Steven McNeil and Director of Employment Standards provides one such example. In this case, the Ontario Labour Relations Board was tasked with determining whether Steven McNeil, an Account Manager for Levert Personnel Resources Inc., a personnel resources company, was exempt from overtime pay. Mr. McNeil was the primary contact for Levert’s clients in the mining sector. He had total responsibility for negotiating and signing contracts with these clients on Levert’s behalf, and was specifically tasked with managing the clients’ personnel requirements. Although Mr. McNeil did not recruit, hire or supervise the work of employees he placed at client sites, he was required to ensure that the terms of the contract which he had signed with the clients were met. In order to do this, Mr. McNeil would visit client sites and review the trade certificates of Levert’s employees. If an employee did not have the requisite certification, Mr. McNeil would dismiss the employee from the client work site. Mr. McNeil also worked to prepare annual forecasts and strategized and executed sales plans, all of which had a direct impact on the profit margins and financial operations of Levert. Based on this evidence, and despite the fact that Mr. McNeil did not manage or supervise employees directly, the Ontario Labour Relations Board concluded that Mr. McNeil’s work was supervisory and managerial in character.

As a result of this case and others that have been decided along similar lines, it is important for employers to avoid automatically concluding that employees who perform supervisory or managerial functions in relation to machines or processes, rather than in relation to employees, are entitled to overtime pay.

See decisions here: http://www.canlii.org/en/on/onlrb/doc/2011/2011canlii63520/2011canlii63520.pdf, and here: http://www.canlii.org/en/on/onlrb/doc/2012/2012canlii4267/2012canlii4267.pdf

,

Employees who supervise or manage processes (vs. other employees) can be exempt from overtime pay: Ontario Labour Relations Board