Canadian Employment Law Today

May 24, 2017

Focuses on human resources law from a business perspective, featuring news and cases from the courts, in-depth articles on legal trends and insights from top employment lawyers across Canada.

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with Tim Mitchell Ask an Expert NORTON ROSE FULBRIGHT CALGARY Have a question for our experts? Email Canadian HR Reporter, a Thomson Reuters business 2017 2 | May 24, 2017 Have a question for our experts? Email Notice of dismissal for short-term employees Question: How much notice for a without-cause dismissal must an employer give a very short-term employee – such as one or two months of service – who isn't on probation? Are there any other legal issues that could come up in such circumstances? Have a question for our experts? Email Canadian HR Reporter, a Thomson Reuters business 2017 Answer: Guidance on how much notice an employer must give to a short-term employ- ee may be derived from two sources: pro- vincial or federal employment legislation; or common law. e statutory entitlements under provin- cial or federal employment legislation are minimum notice entitlements only. For ex- ample, in Alberta the employment standards legislation provides that an employer must give notice of at least one week, if the em- ployee has been employed by the employer for more than three months but less than two years. However, unless the employee's employment contract includes an express notice period, or makes specifi c reference to the notice periods contained in the applica- ble employment standards legislation, a ter- minated employee is entitled to reasonable notice (or pay in lieu thereof ) as determined at common law, which generally provides a signifi cantly greater notice period. An employee's right to notice or pay in lieu of notice under common law, involves a bal- ancing of a number of factors, including but not limited to those referred to as the "Bar- dal" factors. ese factors are: • e character of the employment • e length of service • e age of the employee • Availability of employment, having regard to experience, training and qualifi cation. e range for common law reasonable notice is typically anywhere from zero to 24 months' pay. ere is no general rule that very short-term employees will only re- ceive minimal notice or pay in lieu thereof. In fact, there are a number of examples of short-term employees receiving dispropor- tionately lengthy notice periods. In Rejdak v. Fight Network Inc., as an example, a for- mer employee who had only worked for one month prior to termination was awarded four months' pay in lieu of notice. Some of the factors — in addition to the Bardal factors — that may be considered, and may give rise to additional legal is- sues, include: break in service, economic downturn, inducement, improper cause al- legations, improper interference with miti- gation, successor employer, near cause, cus- tom and industry practice, promises of job security, and relocation. For example, in cases where an employee has been induced to leave secure employ- ment elsewhere, and then is dismissed af- ter a relatively brief term of employment, it is likely to increase damages for reasonable notice. In McIntosh v. C.T.F. Supply Ltd., the employee was awarded 7.5 months' pay in lieu of notice after only three weeks of em- ployment. In this case, the employee had been induced to leave a stable job that he held for over a year. e court found that the employer had intended to terminate the em- ployee once he provided the employer with his business contacts. e court went on to say that the employer was liable for at least the same notice period that the employee could have expected at his prior job. Practically, lengthy common law notice periods can be avoided by including a termi- nation clause in the employment contract. A termination clause must, at least, meet the statutory minimum entitlements of the ap- plicable employment standards legislation. For more information see: • Bardal v. Globe and Mail Ltd., 1960 Car- swellOnt 144 (Ont.H.C.). • Rejdak v. Fight Network Inc., 2008 Carswel- lOnt 4521 (Ont. S.C.J.). • McIntosh v. C.T.F. Supply Ltd., 2001 Car- swellOnt 4643 (Ont. S.C.J.). Introducing probationary period for employee who has already started Question: If an employee is given full employment status on hiring, can the employer later implement a probationary period a few weeks later? Answer: A probationary employee is hired conditionally on the basis that the employer must be satisfi ed at the end of the probation- ary period that the employee is suitable for the position in which she was hired, while an employee given full employment status on hiring is not subject to such a condition. Often, probationary employment contract language will specify that an employer may terminate a probationary employee for any reason without notice. Full status employ- ees, on the other hand, are entitled to a statu- tory notice period pursuant to applicable employment standards legislation, or a com- mon law notice period, prior to termination. Implementing a probationary period a few weeks after employment has com- menced, then, is tantamount to amend- ing an existing employment contract, and increases the risk that an employer will be found to have constructively dismissed the aff ected employee. Constructive dismissal results when unilateral changes are made to funda- mental terms of an employee's employ- ment which are deemed suffi cient, at law, to terminate the employment relationship. When an employer makes a change that is considered fundamental and imposes it unilaterally upon an employee, the em- ployee does not have to accept the change and may take the position that she has been constructively dismissed and sue for wrongful dismissal. To validly vary an employment contract after employment has already commenced, the parties must mutually agree to vary the term of the contract, it must be the inten- tion of both parties to do so, and the em- ployee must accept the employer's attempt to vary the contract of employment. Fur- ther, the Ontario Court of Appeal has re- peatedly recognized that new or additional consideration to support the variation must be exchanged by the parties. Practically, to validly vary an employ- ment contract, or to retain the right to vary an employment contract, an employer should: • Seek employee consent — written and informed employee consent to proposed amendments will minimize the risk of suc- cessful constructive dismissal suits. • Provide "fresh consideration" — if the proposed amendments impact substantive employee rights, employers should provide the aff ected employees with an additional benefi t (such as a one-time payment). • Provide reasonable notice of change – an employee should be given advance notice of all proposed amendments. Where the employee rejects the change, notice of ter- mination with an off er of re-employment on the new terms and conditions is pos- sible. Employers, however, might also con- sider providing notice of the contemplated amendments (along with notice that the CHANGING on page 8 »

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