Canada: Legal Trends 2016: Employment & Labour


In the past year, the media and governments across Canada have paid greater attention to workplace discrimination and harassment. In Ontario, for example, the government introduced Bill 132, Sexual Violence and Harassment Action Plan Act, which, among other things, ensures that employers are legally obligated under the Occupational Health and Safety Act to prevent sexual harassment in the workplace and to respond to sexual harassment complaints. Also, effective January 1, 2016, employers with more than 50 employees in Ontario must comply with the employment accessibility standards set forth in the Accessibility for Ontarians with Disabilities Act, 2005.

Under this legislation, employers will have to consider their recruitment, performance management, career development and other human resources policies and practices to ensure consideration of the accessibility and accommodation needs of job applicants and employees with disabilities. Employers will also be required to create and maintain a written process for addressing employee accommodation requests and using individual accommodation plans for employees with disabilities and those returning to work after a disability-related leave.


Recent case law indicates a willingness of the courts to examine the hiring process. As a result, employers should audit their recruitment and hiring practices to minimize the risk of legal disputes and ensure they hire the best candidates.

Job descriptions should influence the content of ads used to attract applicants and guide the candidate evaluation process, including what an employer may ask during a job interview. Information gathering must be approached with consideration given to legal limitations under human rights and other statutes. Working from a carefully developed, detailed job description focuses the interview on testing the candidate against the employer's requirements and helps prevent mishaps.

Background screening and social media searches may also be fraught with pitfalls. Employers are likely to collect information about characteristics that may be protected by human rights legislation. Over-collecting information may also breach the applicant's privacy interests if it goes beyond what is necessary for the hiring process.

Finally, with the upward trend toward negligent misrepresentation cases and the Supreme Court of Canada's decision in Bhasin v. Hrynew, requiring good faith in the performance of contracts, prudent employers will want to take care not to mislead the candidate about the nature of the position, the potential compensation or the prospect of future advancement. Of course, a well-written and enforceable employment agreement is a key good hiring practice and can save employers time and money if things go wrong following hire.


According to recent case law, the economy can impact an employee's reasonable notice entitlements. However, the case law is mixed regarding what impact it should have on notice.

Some Canadian courts have indicated that the state of the economy should not be considered in the notice analysis, while others have found that a waning economy justifies a longer notice period. However, in Gristey v. Emke Schaab Climatecare Inc., the Ontario Superior Court of Justice held that where an employee was terminated following a steady decline in the company's business, economic factors were such that the employer was entitled to provide less pay in lieu of notice to the employee.

The conflicting case law makes it difficult to predict how economic conditions will impact an employee's reasonable notice period. One way to reduce uncertainty regarding employee entitlements on termination is to use a well-drafted employment contract containing an enforceable termination provision.


The recently elected federal government has pledged to legalize recreational marijuana use, and some recent court decisions have taken a permissive approach regarding medical use of marijuana. These developments will affect employer efforts to ensure a safe workplace.

The new government's promise to "legalize, regulate, and restrict access to marijuana" means marijuana consumption and incidental possession will no longer be crimes under Canada's Criminal Code. A regulatory scheme of taxation and supply will be established, with harsh penalties for those selling marijuana outside the law's bounds. Assuming the government follows through with its promise, recreational marijuana use will soon be legal but regulated across Canada.

In 2013, the Supreme Court of Canada confirmed the importance of employee privacy interests in relation to drug- and alcohol-testing policies in Communications, Energy and Paperworkers Union of Canada, Local 30 v. Irving Pulp & Paper, Ltd. In 2015, the court in R. v. Smith confirmed that whether Canadians smoke, eat or imbibe medicinal marijuana, they have a constitutional right to its use. Employers must balance their interest in mandatory drug and alcohol testing to produce a safe workplace with employee privacy interests. Only when necessity outweighs privacy interests can an employer impose drug and alcohol rules with disciplinary consequences. As a result, mandatory workplace drug testing is impermissible absent an established substance abuse problem, even if the workplace is one with heightened safety concerns. The legalization and regulation of marijuana could further tilt the scales against restrictive drug and alcohol policies in the workplace.

Similar legal issues have arisen at the state level in American jurisdictions where marijuana is already legal — namely, Washington, Oregon, Colorado and Alaska. For example, in Coats v. Dish Network, the Colorado Supreme Court affirmed the employer's right to discipline or terminate employees for marijuana use, even though marijuana is now permitted under state law. The court held marijuana is not a "lawful off-duty activity" pursuant to Coloradoan employment law; therefore, termination for its use is permissible. This is because marijuana remains illegal under American federal law.

The trend toward protecting employee privacy rights and new developments regarding marijuana legalization are expected to raise myriad employment issues in the near future. We anticipate that balancing lawful marijuana use with the need for a safe workplace will be subject to further legal challenges. Given the importance the Supreme Court of Canada currently places on employee privacy, predicting the outcome of litigation is difficult. Challenges regarding an employer's duty to accommodate employees with disabilities involving medical marijuana use are also anticipated.​​​

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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