On August 21, 2015, an Adjudicator of the Public Service Labour Relations and Employment Board reinstated two long service Parks Canada employees who were terminated for entering a restricted area at a National Park site and swimming in an underground cave pool that contained an endangered species of snail. While Adjudicator Gobeil was satisfied that the grievors had entered the premises knowing that they should not have and swam in the protected habit of the endangered snails, she rescinded the terminations. In determining that termination was not an appropriate sanction, Adjudicator Gobeil considered the 30 years of service of one of the grievors and the 14 years of service of the other grievor. In addition, both grievors had clean disciplinary records and the termination resulted from a single, unplanned incident.

The grievors were reinstated effective the date of the decision.

The grievors were represented by Wassim Garzouzi of RavenLaw.

In a recent arbitral award, Arbitrator Goodfellow confirmed that the cancellation of two full-time employee’s shifts during temporary slowdowns constituted a layoff within the meaning of the collective agreement. The Arbitrator agreed with the Union, CUPE, Local 139, that the cancellation of shifts was a layoff because it involved a reduction in a full-time employee’s hours of work below the permissible level in the collective agreement. Under this award, the parties agreed to a protocol to use in such circumstances in the future.

CUPE, Local 139 was represented by Wassim Garzouzi and Amanda Montague-Reinholdt of Raven, Cameron, Ballantyne & Yazbeck LLP.

It is an established principle in labour law that an employer cannot impose more than one penalty for the same offence – but what constitutes a penalty? That was the issue at the heart of Collège Boréal, an arbitral award released on July 23, 2015, where an employee appeared to receive two sanctions for the same event.

The grievor was tasked with accompanying college students at a hockey tournament in Toronto, where several incidents involving alcohol consumption and on-ice altercations took place. Upon returning to the College, the grievor failed to disclose these events. After meeting with his supervisor, he was advised, by email, that a note would be placed on his employee file due to his lack of judgment. Roughly two weeks later, the grievor was placed on administrative suspension, and terminated shortly thereafter.

During the hearing, the employer argued that the supervisor’s email did not constitute discipline, and therefore, the College was not barred from imposing a subsequent penalty – in this case termination. In assessing whether the email constituted discipline, Arbitrator Kathleen O’Neil applied “an objective interpretation”, without “placing emphasis on the intention” of the supervisor. The email was deemed disciplinary and therefore, the employer was barred from imposing a second disciplinary sanction for the same events. The Arbitrator nonetheless added supplemental discipline for events that were not properly covered by the email.

The grievor was ultimately reinstated.

OPSEU, Local 672, was represented by Wassim Garzouzi of Raven, Cameron, Ballantyne & Yazbeck LLP.

In Garreton v Complete Innovations Inc., 2016 ONSC 1178, a decision released earlier this year, the Ontario Divisional Court found that a termination provision in an employment contract was void because it would have violated the Employment Standards Act (“ESA”) if the employee had worked for the employer for more than five years. The Court held that the employer could not rely on the provision, even though in fact the employee had been terminated after less than five years of service. This decision provides important confirmation that potential future violations of the ESA can nullify a notice provision in an employment contract.

Background

The Plaintiff, Marcela Garreton, was terminated for cause by her employer, Complete Innovations Inc (“CI”), after a little over two years of employment. She brought a claim for wrongful dismissal in Small Claims Court, and obtained an award of $25,000, amounting to five months’ notice.

Ms. Garreton had a written employment contract which set out the notice period, in the event that her employment was terminated without cause:

Otherwise Complete Innovations Inc. may at any time terminate this agreement by providing the Employee with (1) one week notice if their duration of continuous employment with the Company is more than 3 months but less than 1 year. (2) weeks prior written notice of intention to terminate if the Employee duration of continuous employment with the Company is more than 1 year but less than (3) years. If the duration of continuous employment with the Company is more than 3 years each additional year will entitle the Employee to (1) one additional week of notice to a maximum of 8 weeks. … Complete Innovations Inc. shall maintain on your behalf your employee benefits for a period of not less than the period required by applicable statute.

The contract did not provide for any severance pay in addition to the above notice provision. It therefore failed to provide a minimum standard prescribed by sections 64 and 65 of the ESA, which entitles employees with five years or more of service to severance if they work for employers with a payroll of over $2.5 million.

The trial judge had declined to determine whether the termination provision in the contract was enforceable, because the employer did not rely on it in support of the termination. The Divisional Court found the failure to address this issue to be an error of law, and therefore considered the question of whether the Plaintiff would be limited to the two weeks’ notice prescribed in the contract. The Court held that a termination provision can be invalid if, at some point during the potential life of the contract, it would fall below the ESA minimum standards:

In my view, the employment contract must be considered at the time it is executed. If the termination provision is not onside with notice provisions and severance provisions (if applicable) of the Act at the outset, then it is void and unenforceable. Potential violation in the future is sufficient. As Low J. states, “It is not that difficult to draft a clause that complies completely with the Act, no matter the circumstance.”

The Court ultimately concluded that the trial judge made no error in finding that there was no just cause to terminate Ms. Garreton, and, therefore, the Court upheld the award of $25,000.

Discussion

This decision has significant implications for many employees with written employment contracts. It provides clarity regarding the issue of whether a termination clause in a contract will be void only if it falls below the employee’s entitlements at the time of termination, or whether a potential future violation is sufficient.

Prior to this case, there were differing lines of authority on this issue at the Superior Court level. In Wright v. The Young and Rubicam Group of Companies (Wunderman), 2011 ONSC 4720, the judge had found that a notice provision in an employment contract was void for potentially violating the ESA. In Ford v Keegan, 2014 ONSC 4989, the judge disagreed with the result in Wright, and found that the contract must “conform to provincial employment standards legislation for the particular employee, in the particular circumstances”.

In this case, the Divisional Court rejected the analysis in Ford, and instead favoured the conclusion in Wright. As a result, employees will now have a stronger chance of nullifying a notice provision in an employment contract, even if the provision would have only hypothetically run afoul of the ESA if they had continued working for the employer for a longer period. This decision thus provides greater protections for employees, who typically have little to no control over the terms of their employment contracts, and places a greater obligation on employers to ensure that a contract meets the ESA minimums from the outset.

[This article is for informational purposes only and does not constitute legal advice, which cannot be given without consideration of your individual circumstances.]

On April 26, 2016, the Federal Court of Appeal rendered its judgment in Bahniuk v Attorney General of Canada, 2016 FCA 127, allowing the appeal from the judgment of the Federal Court and setting aside a portion of a remedial award made by an Adjudicator of the Public Service Labour Relations Board. The appeal related to the Adjudicator’s decision to reduce the award for compensatory damages for unjust termination by all monies earned by the employee, Stanely Bahniuk, between the date of the termination and the date of the Adjudicator’s decision. This reduction was made by the Adjudicator despite the fact that Mr. Bahniuk did not earn income during the 14-month period to which the compensatory damages related.

In its decision, the Court confirmed that amounts set-off from contractual damages on account of mitigation must be referable to the loss for which damages were awarded. The Court was satisfied that the Adjudicator unreasonably set-off the amounts earned by Mr. Bahniuk in the time after the 14-month period for which he received compensatory damages for the unjust termination.

Mr. Bahniuk was represented by Andrew Raven and Amanda Montague-Reinholdt of Raven, Cameron, Ballantyne & Yazbeck LLP.

David Yazbeck was recently re-elected as an Institutional Board Member for the Workers’ History Museum. David’s re-election continues RavenLaw’s long-standing support for the Workers’ History Museum. In addition to David’s role as a Board Member, RavenLaw has been an institutional member of the Board of Directors for a number of years.

The Workers’ History Museum was founded in 2011 with the goal of developing and preserving workers’ history, heritage and culture in the National Capital Region and Ottawa Valley.

On April 6, 2016, Morgan Rowe spoke in the University of Ottawa Law School’s class on Disability Rights Law. She addressed issues related to disability accommodation in employment, education and transportation and also discussed how accommodation processes themselves can create barriers for people with disabilities.