Canadian Employment Law Today

Canadian HR Reporter, 2021 actual dollar value of the claim was there- fore quite limited. Nevertheless, the court ruled Coutinho was entitled to statutory termination pay under the ESA, subject to Ocular's claim it had cause to terminate her employment, which remained the outstanding issue for trial. Significantly, the judge did not explain how Coutinho could possibly be entitled to statutory notice in light of the clear language of the IDEL regulation that extinguished any claim for constructive dismissal under the ESA. This may be an issue explored if the decision is appealed. However, given the relatively low value of the claim, the employer may choose to forgo an appeal. Even if this decision is not appealed, it may have limited impact on employers for two reasons. First, if an employee has been laid off for a prolonged period of time (more than a few months) without making any objection, the employer may successfully argue that the employee acquiesced to the layoff. This is because in order to establish constructive dismissal, an employee must object to a unilateral change to the terms of employment within a reasonable period of time. Second, many layoffs during the pandemic resulted from forced closure of a business due to a government order. The Coutinho deci - sion did not comment on how a constructive dismissal claim arising in that particular scen- ario would be addressed. Lessons for employers COVID-19 may not be accepted as excep- tional. The court was not satisfied that the exceptional nature of the pandemic justi- fied a broad and liberal reading of the IDEL regulation, such that it could extinguish a common law constructive dismissal claim. A similar result was reached in a recent Alberta decision, Kotsteckyj v. Paramount Resources Ltd., where the Alberta Court of Queen's Bench held that a reduction in compensa - tion (16 per cent to 20 per cent) resulting from a COVID-19 cost savings program was a constructive dismissal. In both decisions, the court applied a traditional constructive dismissal analysis and was not prepared to consider the unprecedented impact COVID-19 has had on Canadian employers. An employment agreement can reduce risk. Had Coutinho's employment been governed by a written employment agree - ment that gave Ocular the right to tempor- arily lay her off, or had Coutinho consented to the layoff, this claim could have been avoided. This is because, absent an express or implied provision in the employment contract or consent, there is no right to layoff at common law. Historically, most employment agree - ments have not included a layoff provision. However, moving forward, this may not be the case. We recommend that every employer review their employment contracts and consider including a layoff provision. But do not simply change your employment agree - ments without legal advice, as a unilateral change of this nature may be unenforceable. For more information, see: • Coutinho v. Ocular Health Centre Ltd., 2021 ONSC 3076 (Ont. S.C.J.). • Kotsteckyj v. Paramount Resources Ltd., 2021 ABQB 225 (Alta. Q.B.). June 16, 2021 | Canadian Employment Law Today CREDIT: BLUE PLANET STUDIO iSTOCK ABOUT THE AUTHOR Priya Sarin Priya Sarin is a lawyer with Sherrard Kuzz LLP, an employment and labour law firm representing employers in Toronto. She can be reached at (416) 603-0700 (main), (416) 420- 0738 (24 hours) or by visiting www.sherrardkuzz.com.

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