Canadian HR Reporter

February 9, 2015

Canadian HR Reporter is the national journal of human resource management. It features the latest workplace news, HR best practices, employment law commentary and tools and tips for employers to get the most out of their workforce.

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Canadian HR RepoRteR February 9, 2015 2 News Recent stories posted on Check the website daily for quick news hits from across Canada and around the world. web O n t h e Across cANAdA Women denied equal pay and promotions at Castlegar mill: Human rights complaint Female employee fired, allegedly after complaining she earned less than male predecessor Puppy cruelty charges laid against former CEO after alleged elevator incident desmond Hague resigned in September Federal messaging on unpaid interns changed after NDP's private member's bill Bill would limit use of non-educational internships LinkedIn reveals most overused buzzwords of 2014 'passionate,' 'motivated' among worst offenders ArouNd the world 2 dead in apparent murder- suicide at NYC Home Depot: NYPD Both were Home depot employees, reports say McDonald's faces worker lawsuit for franchise operator's alleged racial, sexual discrimination owner told many of those fired they 'didn't fit the profile' Intel's diversity drive should focus on internal changes, advocates say one-quarter of employees in 2013 were women; 12 per cent were Hispanic or african american Obama trumpets rising U.S. wages; data has more sombre tone Surveys suggest income growth remains much slower than before recession New talent acquisition trends Simon parkin, HR solutions practice leader at the talent Company, shares some new recruitment trends with Canadian HR Reporter Featured Video Successful Companies Begin With Successful Leaders . Give Your Leaders the Skills They Need to Succeed 1-800-663-7305 • Public Programs • Client Solutions • Executive Coaching • Applied Research • Advisory Services Contact us to get your copy of the Public Program schedule! FREE DOWNLOAD ! Leverage the strengths and skills of your workforce— learn the dynamics of knowledge transfer. Bridging the Gaps: How to Transfer Knowledge in Today's Multigenerational Workplace outlines 15 methods for facilitating the flow of information and insight from those who have it to those who need it. Download your FREE copy today (value of $695) at coincides with their statutory en- titlements, said Philpott. "And the vast majority at the store level have signed agree- ments agreeing to the minimum standards as their termination and severance entitlements, so it's a pretty neat package." Entitlement to termination pay varies depending on the mini- mum statutory requirements in the province of employment, said Clio Godkewitsch, an associate at Koskie Minsky in Toronto. Given the number of terminations at play with Target, the group termi- nation provisions are triggered in most provinces and in some cases the entitlements of employees are in fact 16 weeks (such as Ontario), but in some places significantly less (such as Alberta). But all Tar- get employees will receive at least 16 weeks' pay, she said. Severance pay and termination pay are commonly used to mean the same thing but in fact have different meanings under statute in Ontario, said Godkewitsch, and almost one-half of Target's employees are in Ontario (8,011) where entitlement to severance pay requires at least five years of employment. Without the employee trust, Target workers would be con- sidered unsecured creditors and have no priority status, said Godkewitsch. "Nothing's guaranteed in an in- solvency... it's true that 16 weeks isn't necessarily generous for all employees because some are in fact entitled to 16 weeks anyway but the point is they're actually go- ing to get it." ere is, however, a cap on the funding to the trust, which is flex- ible, said Philpott. "What we have been advised is that it's almost certain to be enough but there's no guarantee on that, so there could be an out- side possibility of it not meeting the needs. But we're told that on all of the information they have and what they anticipate to hap- pen, based on their projections, that the $70 million will be more than enough." For now, it's a salary continu- ance for all employees. e notic- es of termination went out on Jan. 15 and 16 and the effective date of the notice was Jan. 24. It's only after that point that there will be decisions made on an individual basis about who's going to stay and for how long, she said. "e expectation is that most employees will continue working for a period of time through their notice period, so they'll be paid for that, and then when they're no longer needed at the store or head office or wherever they're work- ing, they'll be advised and then they will get a continued payment from the trust," said Philpott. "e anticipation is it will be like a weekly payment — it'll be like a paycheque, rather than a lump sum." Target workers will be paid in the usual manner for the hours they work, but if someone works fewer than their normal hours, their earnings will be topped up by the trust as pay in lieu of notice. "Top-ups are individually determined and are based on the employee's regular work week and regular wages," said Godkewitsch. And if an employee refuses to work when required to by Target, he will be treated as having re- signed employment with no fur- ther entitlements, she said, adding this reflects the law, both under statute and common law. In addition, the retailer plans to have a key employee retention plan funded up to $6.5 million "to facilitate and encourage the continued participation of senior management and other key em- ployees... to guide the business through the contemplated orderly wind-down process and preserve value for shareholders," according to an application to Ontario Supe- rior Court. 'Mixed bag' approach It's a mixed bag approach, accord- ing to Anil Verma, a professor at the University of Toronto's Rot- man School of Management and Centre for Industrial Relations. "ere's some things that look like they're a step forward in the direction of employee interest, but there are some things that I would have said they should have stayed away from." e whole idea of severance is to help workers find employment, and having to work for 16 weeks makes that a challenge, he said. "You have some notice period but job hunting can be time- consuming, you have to go for interviews and if you're working, perhaps you can't get time off to go and look for a job," he said. "My motivation to do a good job for Target would be pretty low during these 16 weeks, so there would be low morale, low productivity and, in the worst case scenario, maybe even sabotage of some kind." Instead, Target should offer re- tention bonuses to all employees, not just managers, he said. "Managers are important for an orderly winddown but I'm sure that some employees are also go- ing to be important," said Verma. "ere is some math in there that you can do to offset the potential loss of productivity and balance that against the increased cost of paying some severance but having higher productivity." On the other hand, the fact that Target set aside money in a trust fund is a good move, he said. "Target's intent here is to run full speed and have sales and real- ly sell out their stock, so that they are trying to minimize the cost of closure. And I think, in looking down the road, they might also be trying to not burn their bridges too much so that, let's say two or five years from now, they decide to come back to Canada, people will remember some of these things." Sixteen weeks' pay makes Target look better than it would other- wise, said Peter Saulnier, Vancou- ver-based partner at Logan HR, a member of Verity Filion. "It's a business issue as opposed to just an HR issue," he said. "ey want to be aware of the brand eq- uity they've built up very success- fully in the U.S., even with Cana- dian customers." The $70-million fund is un- usual, especially in the retail sec- tor, said Sheryl Boswell, director of marketing at Monster Canada. "It does show that they do care about the employees that are go- ing to be affected," she said, and it's "absolutely" good for the brand. But whether it involves 17,000 employees or one individual, the best way to handle layoffs is with care and integrity so they are treated with the respect they deserve, said Bram Lowsky, ex- ecutive vice-president at Right Management in Toronto. "(at involves) communica- tions, which should be transpar- ent, frequent and honest, or it's the severance that you're offering, which certainly has some legalities to follow along employment stan- dards minimums and common law (or) providing them with out- placement support to help them restart their careers as quickly and successfully as possible." Does working notice mean low morale? tArget < pg. 1 "You have some notice period but job hunting can be time-consuming, you have to go for interviews and if you're working, you can't get time off to look for a job."

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