Canadian Employment Law Today

Canadian Employment Law Today | 3 Cases and Trends Canadian HR Reporter, a Thomson Reuters business 2018 Employer wins fight over termination pay entitlement Investigator, adjudicator deemed worker wasn't in construction industry, but court found construction exemption was applicable based on nature of work BY JEFFREY R. SMITH A NORTHWEST TERRITORIES em- ployer has won its appeal to dismiss an order to pay a laid-off worker termination pay be- cause the worker was subject to legislative exemptions for the construction industry. Lester Bonnell worked at the Diavik Diamond Mine located 300 kilometres northeast of Yellowknife in the Northwest Territories. Bonnell was an employee of Ce- mentation Canada, an underground mine engineering company that provides mine development and production services to mining companies. e Diavik mine own- ers contracted Cementation to develop and construct the underground part of the mine. Bonnell's job at the mine was a scoop op- erator, "mucking out" or removing amounts of material after it had been loosened or fragmented during blasting and other mine development activities. Much of the mate- rial he cleared out was kimberlite — a type of igneous rock that may contain diamonds. After five-and-one-half years employed with Cementation, Bonnell was laid off with- out notice. He didn't receive any termination or severance pay, so he filed a complaint un- der the Northwest Territories Employment Standards Act. Cementation argued that Bonnell wasn't entitled to termination pay because a regulation under the act exempt- ed employees in the construction industry from entitlement to termination pay. e regulation states that entitlement to termination pay doesn't apply to workers employed "in the construction industry," those who work less than 180 days in a year, those who work for a fixed term of 365 days or less, or those in a job for less than 25 hours. An employment standards officer inves- tigated Bonnell's complaint and spoke to someone with the territory's Workers' Safety and Compensation Commission (WSCC). e source informed the officer that Diavik was an operating mine when Bonnell was employed there and there was no construc- tion project that he could have worked on. e WSCC source also said Cementation's employees at the mine worked as miners and were not part of a construction crew. e officer also confirmed with sources at the Northwest Territories and Nunavut Chambers of Mines and the Mine Training Society, that Cementation's employees at Diavik were miners. As a result, the employ- ment standards officer ruled that Bonnell wasn't employed in the construction indus- try and ordered Cementation to pay Bonnell $16,153.85 in termination pay. Cementation appealed to an adjudicator, but the adjudicator confirmed the order to pay. e adjudicator found that "the con- struction industry is characterized by short- term projects" and construction workers were exempted because of the irregular and intermittent nature of employment and projects in the industry — an aspect of the industry of which employees were aware. Bonnell had worked with Cementation for five-and-one-half years, which was a period of time uncharacteristic of a construction employee, said the adjudicator. e adjudicator also found that the mate- rials Bonnell mucked out as part of his job included kimberlite, which contained dia- monds, erefore, Bonnell was involved in the harvesting of diamonds, which was the work of a miner, said the adjudicator. Adjudicator tied construction industry to short-term work Cementation appealed to the Northwest Territories Supreme Court, arguing that the interpretation and application of the construction employee exemption from termination pay by the adjudicator was un- reasonable, particularly in tying it to short- term work specifically — a link that wasn't made in employment standards legislation. e court found that the adjudicator's reli- ance of the length of employment as a factor in determining whether someone was a con- struction employee could lead to "great un- certainty," as there was no formal standard in place that specified what could be consid- ered short- versus long-term employment. e court also found that the arbitrator overlooked the distinction between devel- opment mine work like that which Bon- nell did — constructing and developing the mine, including removing material and "mucking out" so the actual ore mining can take place — and production mine work — harvesting and processing ore to retrieve diamonds. ough the physical, day-to-day aspects of the two roles were similar, their objectives were different. In addition, they had different employers — Bonnell and the development miners were employed by Cementation, while the production miners worked for the mine owner, said the court. e court noted that while the territory's employment standards legislation didn't define the construction industry, the act de- fined "work of construction" as "a building, mine…" which contemplated that "a mine can be constructed" and a company that is tasked with that job is in construction — such as Cementation was contracted to do for the Diavik mine and, once the job was done, its workers would move somewhere else, said the court. "e employees of an employer engaged to construct or develop a mine or parts of a mine prior to mining taking place are, logi- cally, working in the construction industry," said the court. "eir role is not to mine the ore, but to construct an infrastructure so that others can mine the ore." e court determined that the arbitra- tor's finding that Bonnell wasn't in the con- struction industry and not exempt from the termination pay provision in employment standards legislation was erroneous and un- reasonable. It allowed Cementation's appeal and overturned the order for it to pay Bon- nell termination pay. For more information see: • Cementation Canada Inc. v. Bonnell, 2018 CarswellNWT 37 (N.W.T. S.C.). Employment law blog Canadian Employment Law Today invites you to check out its employment law blog, where editor Jeffrey R. Smith discusses recent cases and developments in employment law. The blog includes a tool for readers to offer their comments, so discussion is welcome and encouraged. The blog features topics such as preparing for marijuana legalization, Ontario's minimum wage change, and random drug and alcohol testing. You can view the blog at www.employmentlawtoday.com.

• Cover