“In Accordance with ESA ” not Good Enough to Oust Common Law Reasonable Notice:

In Holm v AGAT Labs ( 2018 (ABCA 23 ) the Court of Appeal dealt with a clause that said that upon termination the employee would only receive the notice “in accordance with the provincial legislation for the province of employment” . It sets out in great detail that that is all the employee is entitled to.

The Alberta Employment Standards Code, just like the Ontario ESA, says that an employer must give “at least” the number of weeks set out in the Act, in this case 1 week. Therefore , the Court held, it is also permissible under the Act to pay more than the one week. As this creates an ambiguity, the interpretation that favours the employee should prevail. The Court quoted the Ontario case of Wood v Fred Deeley Imports ( 2017 ONCA 158).The plaintiff was therefore entitled to reasonable notice .

As the  Alberta Code and the Ontario Act use the same language, one could reasonably expect the same result in Ontario.

Of interest also is the  concurrent opinion by Justice O’Farrell who examined the issue of why would the parties have a six paragraph termination clause if all they meant to do was apply the doctrine of reasonable notice. In his reasons he sets out two vastly different approaches to determining the legality of ESA clauses.

          I am compelled to concur in the result reached by the majority. The chambers judge properly applied judicially-approved principles governing the interpretation of employment contracts.

[39]           However the contractual terms employed by the parties in this case have given me cause to question those principles. A lay person reading the entire termination provision of the contract (which is reproduced and appended to these reasons) might be forgiven for thinking that the parties did intend to “limit” termination notice or pay in lieu of such notice to the “minimums” set forth in the employment standards legislation, even though the parties failed to employ either of the quoted words of limitation. A reasonable observer might question why the parties needed a termination clause as lengthy and detailed as the one employed in this case to merely indicate their intention to be governed by the common law’s reasonable notice requirement. In other words, if the termination provision of the employment contract was not intended to limit termination notice or pay in lieu, what was it there for?

[40]           Perhaps the best way to explain the result in this case to the appellant employer is to say that in employment law it is sometimes not as much about ascertaining the parties’ intention as it is about applying judicially-mandated principles of interpretation designed to protect employees because of perceived, and sometimes very real, inequality of bargaining power as between employees and employers. At least two of those principles were operative in this case. One was the principle that termination clauses will only rebut the presumption of reasonable notice if they are absolutely clear. The other is that faced with a clause in an employment contract which could reasonably be interpreted in more than one way, courts are required to prefer the interpretation which gives the greatest benefit to the employee.

[41]           The problem, not so much with principles, but with the approach employed by the courts in interpreting employment contracts is that it may be less understandable than an approach which simply requires the court to ascertain the intention of the parties as disclosed by the words they used. Also, the rules employed in interpreting employment contracts involve presumptions against the employer which may or may not be justified in any given case. Inequality of bargaining power is not always a justifiable assumption. Small business employers and employers in the not-for-profit sector, for example, may be on a much more level playing field. Finally, prospective employers and employees who do not have access to employment lawyers may not be aware of the interpretational rules. Whether small business employers and their employees ought to be required to wade through mountains of jurisprudence in order to find the magic formula needed to achieve enforceable contract language is what is being questioned here.

[42]           The courts have repeatedly asserted that there is no magic formula for limiting termination notice or pay in lieu to the minimums in employment standards legislation. However, if the analysis is not simply one of ascertaining the intention of the parties but rather one of determining whether or not a particular clause is sufficiently clear to rebut the presumption of reasonable notice or to satisfy a judicially-mandated requirement that such clause be interpreted in favour of the employee, there will indeed be a formula of sorts. The formula will be what it takes to satisfy a court that presumptions in favour of the employee, mandated by previously-decided jurisprudence, have been rebutted. Perhaps the jurisprudence requires revisiting for situations where it is clear what the parties intended, but where the words chosen do not satisfy judicial canons of construction. This is not to suggest that the considerations articulated by courts in cases such as Wood v Fred Deeley Imports Ltd, 2017 ONCA 158 (CanLII) at para 28, 134 OR (3d) 481 are not useful. It is simply to suggest that perhaps more emphasis ought to be put on ascertaining what the parties intended.

This differing judicial approach is evident in Ontario, where one set of judges seem to follow the Wood v Fred Deeley approach of closely examining the wording of the clause for potential illegality and/or ambiguity and the “parties intention ” approach as set out in the recent Ontario Court of Appeal  case of Nemeth v Hatch.

Only time will tell which approach will prevail, unless one day the Supreme Court of Canada agrees to address this issue and tell us all once and for all how these contracts should be interpreted.

 

Wilson v ACEL Continues :

Mr. Wilson worked for AECL from May 2005 until his termination on November 16, 2009. He then filed a CLC unjust dismissal complaint, presumably in early 2010.

It took two years to get to arbitration at which time Arbitrator Shiff made a preliminary ruling  that said simply paying statutory notice and severance pay did not avoid the remedies section of the CLC. This was judicially reviewed first by the Federal Court, Trial Division, then the Federal Court of Appeal and finally to the Supreme Court of Canada, which ruled in Mr Wilson’s favour.

I thought that at that point, having won, Mr Wilson would either get his back pay and reinstatement or just a whole lot of money.

Nope. The matter was referred to a new arbitrator, Michael Bendal. Seven years after the fact, AECL raised for the very first time, a new jurisdictional defence involving the application of Public Servants Disclosure Protection Act, a whistle blowing statute intended to protect whistleblowers from retaliation.

AECL lost again before Bendel. ( 2017 CarswellNat 6877) Another set of dates will be set to finally hear the merits. That is unless AECL again seeks judicial review of the rejection of their jurisdictional argument.

I thought that there was a principle of administrative law which said that a Court should wait until the administrative procedure is completed before judicially reviewing the case, in order to avoid this start and stop process. One can only hope that if AECL tries to judicially review this newest ruling that the Court will tell them to wait until the case is over and then file their comprehensive application,

Justice delayed in justice denied.

Court Awards 10K for Dismissal + 20k for Aggravated Damages + 10k for Punitive Damages:

In Horner v 897469 Ont Ltd ( 2018 ONSC 121) Newton J. awarded non-notice damages for an employee who was bullied at work. In this undefended action, the Court found that Ms Horner had been bullied by a co-worker, which caused her great upset. She complained to the owner, who told her to take a few days off  and that he ” would figure it out in a few days”. A few days later he fired her, alleging cause in relation to her dealings with the bully co-worker. Having previously been diagnosed with depression, the termination caused her to fall into deeper depression. She lost 30 pounds, was under doctor’s care and has been unable to look for work. She did not get EI as the employer alleged cause.

The Court awarded $20,000 for aggravated damages and another $10,000 for punitive damages. A previous judge had awarded her 3 months notice.

Contrast this with Galea v Walmart ( 2017 ONCA 245) where the Court awarded $750,000 for conduct of a somewhat different sort where there was no medical evidence of mental distress of the Plaintiff.

UBER Class Action Fails Due to Arbitration Clause:

In Heller v UBER (2018 ONSC 718) Perell J. was faced with a motion by UBER to stay  a class action seeking to declare UBER drivers as employees for the purposes of the Ontario Employment Standards Act. He ruled that the arbitration clause, which required that all disputes arising from the agreement must be resolved through a mediation / arbitration procedure in Amsterdam, according to Dutch law in accordance with the ICC Arbitration rules, which require a minimum fee of approximately $7,500 to be paid by the driver, required a stay of the class action.

The Court held the following :

1) This relationship might be a commercial relationship, even though it may also be an employment one, and as such the International Commercial Arbitration Act , not the Arbitration Act, 1991 applies.

2) The issue of whether the arbitrator has jurisdiction in this matter is to be first decided by the arbitrator. This is called the Competence – Competence Principle,

3) As the ESA does not preclude resorting to arbitration, the Court should not refuse to stay the action on that basis.

4) It is not unconscionable to prevent an employee from pursuing his ESA rights through the Courts where there is an arbitration clause.

An appeal is likely, according to Plaintiff’s counsel.

Quere: What is the UBER drivers all filed separate ESA complaints with the  Ministry of Labour instead of a class action?

Would the OLRB rule that they did not have jurisdiction to hear the case because the parties has decided that the matter must be decided in a foreign country? Does not the “no contracting out” section of the ESA  ( section 5) relate to this issue? Sections 97,  98  and 99 (2) of the ESA deal with when a complaint under the ESA cannot be filed with the Ministry. Is this an exhaustive list or can there be non statutory exceptions?

Revoking Employee’s Ability to Work at Home = Constructive Dismissal:

In Hagholm v Coreiro ( 2017 ONSC 7713) Sloan  J. had a situation where  a 59 year old Manager of Consulting Services who for 22 years had been able to work at home 3 days a week and only came to to the office the other two days . Then out of the blue, the Employer said now you must come to the office 5 days a week . She said no and quit and sued for constructive dismissal . Her commute was 110 km one way.

The Court found that it was essential term of her agreement that she be able to work at home 60% of the time and that the employer’s unilateral change was a constructive dismissal , warranting a 22 month notice period.