Canada: Employment Law: Key Decisions From 2017

The year 2017 brought forth numerous significant decisions in employment law across the country. We have summarized several of these impactful decisions below.

Part 1 — Québec

Sylvestre v. Distribution Zone Électronique inc., 2017 QCTAT 3655

After an employee announced his intention to resign his job 11 months later, his employer decided to terminate his employment before the announced termination date, deciding that the notice of resignation period was too long. Applying the ruling of the Supreme Court of Canada in the case of Asphalte Desjardins inc., the Tribunal administratif du travail recalled that an employer that shortens the period of work announced in the notice of termination given by an employee is in fact breaking the contract of employment unilaterally. In Québec, a just and sufficient cause is required to terminate the employment of any employee having more than two years of service. Since the employer here had no serious grounds for shortening the notice of resignation given by the employee, the Tribunal administratif du travail of Québec concluded that the employer was obligated to keep the employee on its staff until the announced date of his resignation. It should be noted that this decision is now the subject of a pending judicial review application in the Superior Court of Québec. We reported and summarized this decision in our December newsletter.

Delgadillo v. Blinds To Go Inc., 2017 QCCA 818

In Québec, the Act respecting Labour Standards prohibits any member of "senior managerial personnel" from filing a complaint to contest their dismissal believed to be without just and sufficient cause. The concept of "senior managerial personnel" is interpreted restrictively by Québec courts, and in the context of the particular facts of each case. With that in mind, in this decision, the Court of Appeal of Québec revisited the concept of "senior managerial personnel" within the meaning of the Act, finding that although a plant manager had authority over only one department (in this case, over one of the company's two manufacturing plants), that individual could nevertheless be considered part of the "senior managerial personnel" and thus excluded from exercising the statutory remedy. This judgment also highlights the importance of taking into account the particular context of the business concerned. We reported and summarized this decision in our September newsletter.

Bayouk v. ADT Canada inc., 2017 QCTAT 1301

This decision is an excellent application of the principles governing constructive dismissal, especially in the context of a change of company ownership. This case confirmed that an employer is entitled to alter an employee's duties and responsibilities at any time, but only insofar as their working conditions are not substantially changed. Here, the employer had made some changes to the employee's duties after the company was integrated into the newly purchased company, and had assigned him to work in a somewhat different position. However, the Tribunal administratif du travail concluded that this change was not tantamount to a constructive dismissal, because the employee had not been downgraded to a lower status nor had there been any major alteration of his responsibilities. The Tribunal administratif du travail held that [Translation] "employment contracts have a dynamic nature", and that that was especially true in the context of the sale of a business, it being understood that the responsibilities of managers may always be subjected to certain modifications without their constituting any form of constructive dismissal.

Part 2 — Ontario

Wood v. Fred Deeley, 2017 ONCA 158

The Ontario Court of Appeal held that an employer's conduct upon termination or during the notice period cannot remedy an otherwise illegal and unenforceable termination clause.

In this case, the employee signed an employment agreement the day after she commenced work for Fred Deeley. While the Court concluded that signing a written employment agreement the day after the employee commenced work did not render the agreement unenforceable, it found that the termination clause contained in the employment agreement improperly excluded the employee's minimum statutory entitlement to benefits continuation during the notice period. The Court also stated that the termination clause improperly combined statutory notice of termination with statutory severance pay, resulting in an ambiguous provision. Namely, the termination provision improperly created several possible scenarios, some of which were not compliant with the Employment Standards Act, 2000 ("ESA"). Accordingly, the termination clause was void and unenforceable.

Finally, the Court concluded that even by providing the employee with more than her minimum entitlements under the ESA upon termination, including benefits continuation and severance pay, an unenforceable termination clause cannot be remedied after the fact upon termination. An employee will be entitled to reasonable notice of termination at common law in these circumstances equivalent to nine months. For more information about this case, please see our article in our May newsletter.

Adam Papp v Stokes Economic Consulting Inc. and Ernest Stokes, 2017 ONSC 2357

In Adam Papp v. Stokes Economic Consultation Inc. and Ernest Stokes, the Ontario Superior Court of Justice addressed when a former employer may be held liable, including personally liable, for an unfavorable reference. The Court concluded that the employer made an honest reference in good faith and, accordingly, was not liable for defamation.

In this case, a former employee used a former employer as a reference for his new job application. The former employer gave a negative review, and the former employee did not get the job. He commenced an action against his former employer for defamation. However, the former employer succeeded at trial on both the defences of justification and of qualified privilege. The Court concluded that the reference was justified because it was based on objective and verifiable facts. The Court further concluded that a defence of qualified privilege exists when a former employer provides a reference. Employers are permitted to provide a negative reference as long as the employer is not motivated by malice. As a result, the Court dismissed the claim. For more information about this case, please see our article in our May newsletter.

Nagribianko v. Select Wine Merchants Ltd., 2017 ONCA 540

In Nagribianko v. Select Wine Merchants Ltd., the Ontario Court of Appeal examined the enforceability of probationary clauses and ultimately concluded that if parties to an employment contract agree to a probationary period, the right to common law reasonable notice can be rebutted where the employee is terminated during the probationary period.

In its decision, the Court concluded that even a very brief probationary clause, "Probation...Six months", was enforceable. It stated that the status of a probationary employee has "acquired a clear meaning at common law", enabling an employer to terminate an employee without common law notice during the probationary period if the employer makes a good faith determination that the employee is unsuitable for the position. Accordingly, the employee was only entitled to his minimum entitlements under the ESA in these circumstances. While employers are encouraged to draft more precise probationary clauses for employment agreements, this case affirms that the term "probation" has a well-established meaning that permits an employer to terminate an employee without reasonable notice after making a good faith assessment about his or her suitability for a position where a probationary clause has been included in the employment contract.

Part 3 — Alberta

Styles v. Alberta Investment Management Corporation, 2017 ABCA 1

An employee was terminated without cause after three years and the key issue in this wrongful dismissal case was whether the employee was entitled to payments from a long-term incentive plan ("LTIP") which would not vest until after the fourth year, given the fact that the plan clearly stated that active employment was a condition of the LTIP entitlements.

This decision from the Alberta Court of Appeal is significant for employers as it confirmed that employers are not bound by any common law duty to reasonably exercise discretionary contractual power. In reversing the lower court's decision and finding that the employee was not entitled to the LTIP entitlement, the Alberta Court of Appeal rejected the idea of the duty to reasonably exercise contractual power, confirming that the decision to terminate an employee without cause need not be justified by the employer. The Court further confirmed that the courts must enforce the terms of freely negotiated employment contracts when the language and meaning is clear.

Part 4 — British Columbia

Buchanan v. Introjunction Ltd., 2017 BCSC 1002

In a significant decision of the British Columbia Supreme Court, an employee who was terminated before his first day of work was awarded wrongful dismissal damages despite a probationary clause in his employment agreement.

In this case, Introjunction Ltd. offered Mr. Buchanan full-time employment pursuant to an employment agreement dated October 16, 2016, with his work scheduled to begin on November 1, 2016. The agreement contained a clause providing for "a probation period of three months beginning on the Effective Date" during which the employment could be terminated without notice. Introjunction then changed its mind about its staffing needs and attempted to retract Mr. Buchanan's offer of employment two days before he was to start work. Instead, it offered him some short-term work. Mr. Buchanan sued for wrongful dismissal. The Court held that the probationary clause did not apply because it did not commence until the "Effective Date" of November 1, 2016, and the offer was retracted prior to that date. Moreover, even absent that language, the Court held that the probationary clause could not have been applied because the purpose of a probationary period is to allow an employer to engage in a good faith assessment of an employee's suitability for the job, and that was not possible here since Mr. Buchanan had not worked for a single day. As a result, the Court concluded that Mr. Buchanan had been wrongfully dismissed and held that he was entitled to six weeks' pay in lieu of notice.

About BLG

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.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
Similar Articles
Relevancy Powered by MondaqAI
Hicks Morley Hamilton Stewart Storie LLP
Norton Rose Fulbright Canada LLP
 
In association with
Related Topics
 
Similar Articles
Relevancy Powered by MondaqAI
Hicks Morley Hamilton Stewart Storie LLP
Norton Rose Fulbright Canada LLP
Related Articles
 
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions