I felt forced to resign as a result of an illness or disability – what are my entitlements?

| April 27th, 2017 | No Comments »

Disability and Human Rights Law in the Workplace:

Employees have the right to be free from discrimination on the basis of discriminatory grounds, which includes Illness or disability. If an employee is faced with an illness or disability and needs accommodation to complete their work duties, an employer is obligated to accommodate to the best of their abilities. Unfortunately, there have been instances where rather than accommodating, managers or employers will seek to dismiss an employee or make the employee’s situation difficult to the point where they are forced to resign. This may include harassment, refusal to accommodate, or other actions that target the worker’s disability or illness in order to make work intolerable. In such instances, employee can quit and claim constructive dismissal. This simply means that the employer created an environment that would force any reasonable person to resign – in the eyes of the courts, this is the same as a wrongful dismissal.

Damages:

An employee that is wrongfully terminated is entitled to their severance package in addition to any entitlements for damages under human rights law.  Under human rights law, damages will be assessed by the seriousness of the discrimination and the effect it had on the employee (mental distress). Seriousness is assessed by the duration of the harassment suffered or an employee’s length of employment. This can apply to any harassment by management or supervisors, or coworkers that targets the illness/disability of an individual in the workplace. Under human rights law, these damages are intended to right the wrong of the violation suffered by the victim – not to ‘punish’ the employer. However, for extremely reprehensible acts, the courts seek to punish the action itself in order to send a message of retribution, denunciation and deterrence.  To highlight the difference, consider the case of Strudwick v. Applied Consumer & Clinical Evaluations, 2016 (ONCA).

Strudwick (Vicky) v. Applied Consumer & Clinical Evaluations:

In Strudwick v. Applied Consumers, Strudwick was an employee of 15 years that suddenly developed severe deafness from an unknown cause. Applied Consumers refused to accommodate Vicky, and her supervisor and general manager started a course of “public belittling, harassment and isolation in ways relating to her disability” and took additional action to make Vicky’s deafness more difficult in relation to her work duties. For instance, her supervisor made other workers call Vicky instead of using email for any inquiries, making it near impossible for Vicky to perform her job. At one point, management suggested that Vicky quit and claim disability. It was clear that these actions were done to force Vicky to resign. Management eventually dismissed Vicky on frivolous claims in front of her coworkers in a humiliating manner.

The termination was found to be wrongful dismissal and Vicky was awarded her entitled severance pay. Further, Vicky also was awarded $40 000 in damages for the violations she suffered under human rights law to rectify the wrongs. The judge, however, felt that simply rectifying the wrongs here did not denounce the nature of the actions management took. An additional $55 000 was awarded in punitive damages due to management’s harsh, malicious and reprehensible actions leading to termination.

Concluding Remarks:

The case above resulted in $246 049 in total damages due to further damages awarded for intentional infliction of mental distress and aggravated damages. If you are a worker faced with a situation of discrimination and harassment, it is important to seek legal consultation. Assessing damages for human rights violations may extend beyond human rights legislation for actions that are morally reprehensible. It is always best to seek the advice of an employment lawyer to ensure you receive just compensation in extreme cases.

Medical Marijuana Use in a Safety Sensitive Workplace: Can an Employer Deny an Employee Use?

| March 13th, 2017 | No Comments »

Medical marijuana may be prescribed for several medical reasons. Under human rights law in Ontario, workers have a right not to be discriminated against on the grounds of ‘disability’ which encompasses illness. The use of medicinal marijuana in the workplace must be treated the same as any other prescription drug that a worker uses for a medical condition. In order to use medicinal marijuana in the workplace, the employee must provide medical documentation stating the nature of the disability (reason for use), and whether he/she is able to safely work while using medicinal marijuana while requesting accommodation.

Under human rights law, employers must accommodate an employee with a disability up to the point of ‘undue hardship’. In safety sensitive workplaces, accommodation may present increased challenges for employers. Under occupational health and safety law, workers cannot be a threat to their own safety or the safety of others within the workplace. An employer must, therefore, balance the duty to accommodate and the need to maintain a safe working environment.

There is no blanket standard that can be applied with regards to accommodation of medicinal marijuana use in safety sensitive workplaces. Each case must be examined in relation to the worker’s needs, the work duties and organization of work, and other factors that may have an effect on accommodation. For instance, the interconnectedness of work roles on an assembly line may present greater difficulties in terms of granting a worker the time needed to take prescribed usage of marijuana. If usage requires inhalation, then the worker must be relieved by another available worker that can perform the same role. This is because inhalation must be done in a designated smoking area. Accommodation efforts in this hypothetical may raise question such as: can other workers that can perform the same role be made available at all times? Can the marijuana be taken by ingestion with food while on the assembly line? Does being under the influence raise a health and safety concern? Can this worker be retrained for other similar roles that would alleviate potential health and safety and/or accommodation issues? With regards to the worker’s ability to perform the job duties without any concern for health and safety while under the influence, the worker’s physician must provide documentation showing that there are no issues.

The above was only one of many different scenarios that may arise. Employers are advised to have sufficient workplace policies with regards to prescription medication and workplace safety. This includes having procedures for reporting the use of medicinal marijuana and requesting accommodation, proper procedures for using medicinal marijuana when needed, and defining what is considered impairment with regards to health and safety matters. This is by no means a comprehensive guide. The consultation of an employment law expert should be sought so that unnecessary and costly future litigation is avoided for failing to accommodate up to ‘undue hardship’.

Are you entitled to bonus pay that would have been earned during your notice period in the case of wrongful dismissal?

| March 6th, 2017 | No Comments »

A notice period is required by an employer seeking to terminate an employee. Employers can either provide the employee with notice or pay that would have been earned had the employee worked throughout the notice period. When an employee is terminated without a notice or pay in lieu, this is a wrongful termination and a breach of the employment contract. The remedy is damages paid by the employer in the amount equal to the compensation that would have been earned by the employee during the reasonable notice period that is owed.

What about bonuses that would have been owed to the employee, but require the employee to be “actively employed” at the time the bonus is to be paid? A clause that requires ‘active employment’ during the time of payment does not apply in the case of wrongful dismissal. This was affirmed in the case of Paquette vs. TeraGo Networks Inc. (2016). Employees are generally entitled to bonuses that would have been paid during the notice period, regardless of whether or not the employee was actively working during the time. This is especially the case when bonus pay is essential to overall compensation (i.e. a significant proportion).

To gain a better understanding, it helps to review the Paquette (employee) vs. TeraGo Inc. case. Paquette was under an employment contract that required him to be “actively employed” at the time the bonus was to be paid. The bonus here was set to be paid every February for the previous year’s work. The judgement by the Superior Court of Justice awarded Paquette 17 months of damages for only base-salary and benefits. Paquette appealed this decision, arguing that he is also entitled to bonuses that would have been received had he actually worked for the duration of the notice time (17 months). The Court of Appeals (Ontario) awarded Paquette the bonus pay as well. Simply put, the notice pay is meant to place an employee in a similar position had there been no breach in the employment contract. Here, if Paquette was not wrongful dismissed, he would have collected his bonus at each payment date (February 2015 and 2016). In other words, Paquette had the right to work but was prevented from doing so as a result of the employer’s breach. For the year that Paquette did not work (2016), the bonus was calculated by taking the average of the previous years’ bonus payment.

If you are an employee that receives bonuses as an essential part of compensations (ie. a significant portion), then a clause requiring you to be employed at the time of bonus pay may leave you vulnerable if wrongfully dismissed. Employees in this situation are encouraged to seek legal advice to ensure you are fairly compensated for damages and are fully aware of your workplace rights.

Can a Non-Payment of a Bonus Trigger Constructive Dismissal?

| February 24th, 2017 | No Comments »

In the case of bonus pay, would a disagreement over the entitlement, and subsequently a non-payment, be enough for an employee to claim constructive dismissal? When an employer changes an essential term of an employment contract without the consent of the employee, this is a unilateral change and would warrant a constructive dismissal claim. This means that the employee had no reasonable alternative but to walk away from the job. This requires a fundamental change to the terms of employment such as pay and responsibilities. The remedy sought would be damages in the form of ‘notice pay’.

This, of course, is circumstantial. Important factors include the amount of the bonus in question. If the bonus makes up a large proportion of the employee’s pay and is guaranteed, then a failure of payment would more likely result in a successful constructive dismissal claim. Alternatively, if the bonus was a small amount with no other alteration to the employment contract, a constructive dismissal claim will unlikely be successful. A 2016 Ontario Superior Court case of Chapman vs GPM Investment Management (the company) deals with exactly this.

In this case, Chapman was the CEO and President of GPM. Chapman felt he was entitled to a bonus of 10% of profits made off the sale of an asset (property) for which GMP was involved. GPM disagreed over this 10% bonus because they claimed the gains made did not fall under the definition of ‘profit’ as defined in the employment contract. Chapman quit and claimed constructive dismissal in addition to payment for the 10% bonus he felt was owed. The Ontario Superior Court found that Chapman was entitled to this bonus, however, the failure to make this payment was not enough to trigger constructive dismissal.

The reasons the court did not find this to be constructive dismissal was due to a few reasons: the bonus was not much compared to Chapman’s overall compensation, the terms of the employment contract (the bonus structure) were not altered, and the employer intended to continue  honouring the employment contract in the future. The disagreement was also over a particular type of asset that the employer was never going to deal with again, thus making this a one-time isolated event. Overall, the circumstances here did not fundamentally change the conditions of employment, and therefore did not amount to a constructive dismissal. In addition, the employer here gave Chapman options to peacefully resolve the issue.

If there is a concern over an issue regarding the payment of a bonus, it is important to attain legal advice. The issue may involve a disagreement over the interpretation of an employment clause, which requires a wholesome approach – it is often not enough to only consider the clause in question. For both employers and employees, it is advisable to seek legal assistance in determining the appropriate remedies.

Geographic Relocation and Constructive Dismissal

| February 17th, 2017 | No Comments »

Constructive dismissal is when an employer alters the fundamental conditions of the employment contract, which gives the employee little choice but to resign. Many employees do feel that relocation is constructive dismissal. The general rule for establishing constructive dismissal is whether the employment contract has been fundamentally changed. Relocation may be a fundamental change to the employment contract as displayed in past court cases. The following are a few factors to be aware of when deciding to seek representation by an employment lawyer.

It is important to be aware of whether relocation is an implied term of the employment contract as terms of the employment contract are often not in writing. ‘Implied’ terms are certain provision that should be reasonably assumed even though not formally written. In the case of a relocation request from an employer, the request may be implied in a number of circumstances. This includes whether the employer has relocated other workers in the past, whether the business is international (has many locations internationally), and the size of the organization. When the business is international and the position is not a demotion, it is generally seen as an implied condition of the employment contract and therefore not grounds for constructive dismissal.

Other factors to be aware of are whether the relocation is temporary, whether there are changes to other fundamental terms of the employment contract (such as pay and responsibilities), whether relocation expenses are being covered by the employer and whether undue hardship will result from the relocation. Further, the relocation must be done in good faith (i.e. for a legitimate business purpose). If you feel that a relocation request would be constructive dismissal for the reasons mentioned or any other factors, it is important to seek legal consultation from an employment law expert.

Courts have ruled against employers when relocation was not a term included in writing within an employment contract, even when the business was international with offices in other countries. For employers, it advisable to included relocation clauses in initial written employment contracts if this is a reasonable expectation given the nature of the company’s operation. For any uncertainties, seek the advice of an employment lawyer.

Tips for Legally Sound Termination Letter

| February 13th, 2017 | No Comments »

It is all too easy to write a termination letter that does not comply with the law.  Here are some common pitfalls and tips for ensuring that your termination letter is legally sound:

  • Tip #1 – Consider whether you may be using out-of-date precedent: This one is most common.  Sometimes employers use and reuse the same termination letter for years.  While the letter was drafted by a lawyer at one point in time, it has not been reviewed by a lawyer in years.  Employment laws have changed in the meantime, and the termination letter has become unlawful.  If your company uses a precedent termination letter, have your employment lawyer review it at least once a year.
  •  Tip #2 – Ensure that the letter states that the employee is being provided with at least the minimum requirements under the Employment Standards Act, 2000: If the employee’s employment is terminated without cause, they must be provided with a specific amount of notice of termination, and, if applicable, severance pay.  If the termination letter provides less termination and severance pay than what the Employment Standards Act, 2000 says the employee should get, it may be unlawful.  Be aware that even employees who are paid solely on the basis of commission are entitled to termination pay.  Similarly, if the termination letter does not provide for the employee’s benefits to continue during the time period that they receive termination pay, it may be illegal.
  •  Tip #3 – Provide Valid Consideration: If you are asking the employee to sign a legal release on or after termination, you must offer them something that more than just the termination and severance pay that they are otherwise entitled to under the Employment Standards Act, 2000.   You cannot offer an employee something that they already entitled under the law in exchange for their signature on a release.  You must offer something them something in addition to their existing legal entitlements.
  •  Tip #4 – Do not Attempt to Rely on an Employment Contract that is Invalid: Often, in a termination letter, an employer will reference an employment contract signed years ago, such as a termination provision limiting the employee’s entitlements on termination. For the same reason as Tip #1, above, you should ensure that the contract language that you want to repeat in your termination letter is still legally valid. Some common termination provisions found in older employment contracts have been deemed invalid and inapplicable in recent court decisions.
  •  Tip #5 – Be Careful when Alleging a Reason for the Termination: If the termination is without cause, there is no general requirement for an employer to provide a reason for the termination.  However, if the termination is with cause, you generally must provide a reason.  It is important to get the exact reason for a with-cause termination right.  If you terminate an employee’s employment for cause for a reason that turns out to be false or flimsy, they could sue for additional damages on that basis.

If you have questions about writing a legally sound termination letter, or if you think that your termination letter is unlawful, contact one of the lawyers at Whitten & Lublin for assistance.

 

Author: Simone Ostrowski, Whitten & Lublin

Inducement of an Employee: Risks and Damages

| January 9th, 2017 | No Comments »

Inducement: When pursuing an employee that works for another company, it is important to be mindful that this employee would be sacrificing a number of employment benefits by leaving their employer. This generally includes seniority, potential career advancements with their former employer, job security, benefits and so on. If recruiters are very persistent and aggressive towards an employee of another organization, or use promises such as career advancement, security, or higher pay, then this will be seen as inducement. The law seeks to protect individuals being induced by holding employers liable if the employee is terminated unjustly or too quickly. Thus, when recruiters focus on attracting talent from another organization, employers should be aware of the potential risks.

Risk 1: Increased damages through notice pay

This is problematic an unjust dismissal or constructive dismissal claim. In these circumstances, the employer will owe the employee pay for damages through increased notice pay as a result of the inducement. (Notice pay are damages owed to place the employee in a similar position had he/she not been terminated).

Risk 2: Damages for Misrepresentation (moving costs)

Another concern for employers should be whether the inducement was accompanied by a misrepresentation of the employment offer. The key is to be completely honest about the available position. If certain promises are made, such as advancement, but it is known that such promises are only possible with a budgetary approval, this information must be given before the candidate is hired. If a misrepresentation is made, the employer will be liable for any moving costs the employee incurred in addition to the amount owed through increased notice pay. Of course, this is only an issue if the employee is terminated undeservingly (i.e. termination without just cause) or too quickly. Nonetheless, employers should take the necessary steps to ensure their recruiters are fairly representing employment opportunities to potential candidates.

Factors used to Determine if Inducement Occurred

If the employer is able to show that the employee was not induced or if the employment lasted several years, then it is less likely that damages will be awarded. In summary, some of the factors to determine whether inducement occurred are:

  1. Whether the former job was secure
  2. Whether the employee accepted the offer while there were other better offers available
  3. Whether the employee had to move as a result of accepting the position
  4. Whether the employee was an owner of a business prior to inducement

If you are an employee and feel you have been induced and now find yourself unemployed after a short period, please contact an employment law expert to ensure you are compensated fairly. Employers are also encouraged to seek legal advice for any concerns regarding the risks mentioned above.

Is an Employee Obligated to Provide an Employer ‘Reasonable Notice’ of Resignation?

| November 23rd, 2016 | No Comments »

notice of resignationIt is well known that employers must give an employee ‘reasonable notice’ or pay in lieu upon termination when there is no just cause (i.e. the employee has not done anything wrong to be fired). Conversely, although rarely pursued, an employer has the right to receive ‘reasonable notice’ from an employee planning to resign. Below, the factors for determining ‘reasonable notice’ time for employees will be reviewed with reference to a relatively recent case by the Ontario Supreme Court case [Gagnon v. Jesso ONSC] (referred to as “Jesso”).

Reasonable Notice

For employees, ‘reasonable notice’ is the period of time an employee is required to give their employer before the date they wish to resign. The amount of ‘reasonable notice’ time required from an employee will vary with respect to the importance of the employee’s position and duties. The purpose of ‘reasonable notice’ is to grant the employer enough time to either replace the employee or to adjust in a way that would avoid substantial financial losses. In general, employees with managerial responsibilities are required to provide longer notice periods; however, employees in key non-managerial roles may also be require to provide comparable notice time. Jesso highlighted the relevant factors to consider, which include: the employee’s length of service and the difficulty the employer will face with replacing the employee’s skillset (i.e. the labour market conditions). If applicable, any unique circumstances that would result in the employer needing added time to adjust must also be factored into the notice time.

Jesso Example: 

To illustrate the factors considered in determining “reasonable notice”, consider the example of Jesso v. Gagnon. Gagnon is a heating and cooling company (owned by Pierre Gagnon), and Jesso was a salesperson for nearly 10 years with a mechanical engineering degree. Jesso and his sales partner were responsible for over 60% of the company’s sales, and ultimately, a significant source of Gagnon’s revenue. Jesso eventually resigned after strained relations with his employer. Further, Jesso knew that his sales partner was also planning to resign around the same time, since both were pursuing employment with the same competitor.

Initially, Jesso gave Gagnon 2 weeks of notice but the court ruled that reasonable notice in this case would be 2 months. This is not a trivial amount of notice time. Firstly, Jesso’s length of service with Gagnon did contribute to the 2-month required notice time. The most important factor, however, was his substantial skillset, which is indicated by Jesso’s sales performance. Gagnon could not quickly replace the performance gap that Jesso’s resignation would cause. This was due to Jesso’s skillset in itself, as well as the low availability of comparable employees within this industry – these factors contributed to the length of time Gagnon would need to replace or adjust to Jesso’s resignation. Lastly, there was the issue of Jesso knowing that his sales partner was also resigning near the same time. This was a special circumstance that would add to Gagnon’s difficulty in adjusting to this loss as Jesso and his sales partner contributed to over 60% of Gagnon’s sales.

It is important to understand that the above example is a simplified generalization used to apply the relevant factors for determining reasonable notice for employees. Each case will be influenced by the particulars of the employment relationship and surrounding circumstances. Jesso makes this point clear, as any unique circumstances that may create more difficult for the employer to adjust or replace the employee must be considered. Please seek the advice of an employment law professional if faced with a similar situation.

What You Can Do About A Hostile Work Environment

| October 14th, 2016 | No Comments »

Hostile Work EnvironmentA hostile work environment is distressing for employees and costly for employers. Fortunately, the law provides many ways to combat and prevent hostile work environments.

An employee who is subject to a hostile work environment because of his or her race, sex, age, disability, family status, or any other trait listed in Ontario’s Human Rights Code, may be able to file a claim at the Human Rights Tribunal of Ontario. The Tribunal hears claims related to hostile work environments that are rooted in employee’s protected traits.

An employee who is punished because they reported a hostile work environment to their employer can file a complaint to the Ministry of Labour under Ontario’s Occupational Health and Safety Act. Health and safety law also says that employers must protect employees from workplace harassment which can lead to a hostile work environment. Employees must also have a way to report allegations of harassment, and employers must investigate each employee’s allegation of harassment.

If a hostile work environment makes it intolerable for the employee to report to work, the employee may be able to quit their job and claim constructive dismissal. A constructive dismissal occurs where an employee has been treated so poorly that they are forced out of their job as if they had been fired. The employee quits, but then claims the payments that they would have been entitled to from the employer if the employee had been fired. A constructive dismissal can take place where an employer takes part in creating the hostile work environment, or where an employer does not prevent a hostile work environment.

Employees should not be too quick to quit and claim constructive dismissal, though. Constructive dismissal is very difficult to prove. Where an employee claims to have quit because of the employer’s actions, or lack of action, related to a hostile work environment, the employee must prove that it was intolerable for them to continue working, and would have been intolerable for any reasonable person in their position.

If your employer is simply upholding a reasonable workplace rule or policy, this will usually not be considered a hostile work environment. For example, if you are suspended because you were continuously late to work in violation of your employer’s lateness policy, your suspension would probably not be unlawful.

If you feel that you have been subject to a hostile work environment, you should speak with an employment lawyer before taking any action.

 

Author: Simone Ostrowski, Whitten & Lublin

Constructive Dismissal in Ontario: What Qualifies and Do You Have A Case?

| December 16th, 2015 | 1 Comment »

Constructive dismissalVery simply, a constructive dismissal is when an employer makes fundamental changes to an employee’s job that are unfavourable to the employee. The employee may resign and demand a severance package as though the employer terminated the employment relationship.   Examples of constructive dismissal may include:

  • a demotion
  • pay cut
  • change in work location
  • change in schedule
  • change in job duties
  • intolerable conditions in the workplace, such as harassment, discrimination or toxic work environment

A constructive dismissal may not necessarily be a single fundamental change, but a series of incremental changes that on the whole, represent a substantial change to the employment relationship.

Workplaces are not static. Change is inevitable and it is not uncommon for employees to dislike certain changes to their job. However, not all changes will amount to a constructive dismissal. For example, a change in job location that may entail an extra half hour of commuting time, while inconvenient, probably would not amount to a constructive dismissal. Conversely, a change in location that may add several hours of additional commuting time is more likely to amount to a constructive dismissal.

In order to have a valid claim for a severance package from your employer, the change has to be a substantial departure from the existing employment relationship, and it would be unreasonable in the circumstances to continue working. It is important that you obtain legal advice about whether you have a claim for a severance package before you consider leaving your job.

Author: Jonquille Pak, Whitten & Lublin