Canadian Employment Law Today

September 27, 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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©2017 Thomson Reuters Canada Ltd. All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, without the prior written permission of the publisher. The publisher is not engaged in rendering legal, accounting or other professional advice. If legal advice or other expert assistance is required, the services of a competent professional should be sought. The analysis contained herein represents the opinion of the authors and should in no way be construed as being either official or unofficial policy of any governmental body. We acknowledge the financial support of the Government of Canada, through the Publications Assistance Program (PAP), toward our mailing costs. GST #897176350 Published biweekly 22 times a year Subscription rate: $299 per year CUSTOMER SERVICE Tel: (416) 609-3800 (Toronto) (800) 387-5164 (outside Toronto) Fax: (416) 298-5082 (Toronto) (877) 750-9041 (outside Toronto) E-mail: customersupport. Website: Thomson Reuters Canada Ltd. One Corporate Plaza 2075 Kennedy Road, Toronto, Ontario, Canada M1T 3V4 Director, Media Solutions, Canada: Karen Lorimer Publisher/Editor in Chief: Todd Humber Editor: Jeffrey R. Smith E-mail: Sales Manager: Paul Burton Email: Phone: (416) 649-9928 Emplo y ment Law Today Canad ad a ian How would you handle this case? Read the facts and see if the judge agrees YOU MAKE THE CALL 12 YOU MAKE THE CALL Was Mahood free to establish his own window and gutter cleaning business in Kamloops? OR Was the non-competition agreement still in effect? IF YOU SAID Mahood was free to estab- lish his own business and the non-competi- tion agreement had expired, you're correct. e court noted that while layoff s occurred each season, they were always on See ru's terms and Mahood didn't willingly agree to them. Since it wasn't a term in the employ- ment contract that was explicitly agreed to by both parties, any layoff s each year that were longer than 13 weeks could be considered a termination under the B.C. Employment Standards Act and an end to Mahood's employment under the non- compete agreement, said the court. Mahood was only laid off for December 2010 and January 2011, so that year's layoff wasn't 13 weeks long. However, he was laid off from Nov. 11, 2011, to April 30, 2012, a period longer than 13 weeks that therefore qualifi ed as a termination. As a result, the non-compete agreement started to run on Nov. 10, 2011 and would have expired in November 2014, the court said. e court also found that Mahood was only skilled in the window washing and gutter cleaning business and his seasonal position with See ru didn't make him privy to valuable and confi dential informa- tion. ere was no evidence that Mahood's business would signifi cantly harm See - ru's business, particularly since there were other competitors in Kamloops as well. As a result, the court determined that the non-compete agreement was too broad to be enforceable anyway, as it wasn't reason- able to the interests of both parties and the interests of the public. For more information see: • See ru Window Cleaners Inc. v. Mahood, 2016 CarswellBC 3230 (B.C. S.C.). Company fi ghts competition by former employee THIS INSTALMENT of You Make the Call features a dispute over when a non- compete agreement started after a worker left to start his own business. See ru Window Cleaners is a com- pany providing window, gutter, and pres- sure cleaning for houses and buildings in Kamloops, B.C. Due to the nature of its business, much of its work was seasonal and as a result it temporarily laid off many workers for a part of each year. e layoff s were around the same time each year and all were considered temporary — See ru didn't intend to sever the employment re- lationship of any laid-off workers, as their employment would resume when the sea- sonal workload increased. In 2001 or 2002, the company hired Adam Mahood as an entry-level window cleaner. He worked intermittently for sev- eral years and became a seasonal worker and crew foreman in August 2008. In Oct. 2008, Mahood signed a non-competition agreement that was a condition of him be- coming a seasonal worker. Mahood left the company in Febru- ary 2009 and was rehired one year later. See ru required him to sign a new non- competition agreement in February 2010 in which Mahood agreed not to establish or attempt to establish his own business relat- ing to window, gutter, or pressure cleaning within the City of Kamloops for a period of three years following the end of his employ- ment with See ru. e agreement de- fi ned the physical boundaries of the area in Kamloops for which it applied. Mahood continued to work seasonally for See ru, working from February to November in 2010 and 2011, April to Au- gust in 2012, April to December in 2013, and from March to November in both 2014 and 2015. In November 2015, Mahood went on paternity leave. A couple of months later, on Jan. 14, 2016, he resigned from his em- ployment with See ru and started a busi- ness providing window and gutter cleaning services. See ru fi led for an injunction against Mahood preventing him from op- erating his new business in the Kamloops area, pursuant to the non-competition agreement. e company argued that the non-competition agreement was in eff ect for three years after Mahood's resignation in January 2016. Mahood countered that when he was laid off each year, he didn't willingly agree to them and never had a defi nite return date. He said he was never sure he would be re- hired each year, so eff ectively his employ- ment was terminated with each layoff . As a result, the last non-competition agreement he signed in February 2010 was in eff ect for three years after his layoff that November, and he didn't sign any subsequent agree- ments when he was rehired in other years. As a result, the non-competition agree- ment expired in November 2013 and there were no limitations on establishing his own window and gutter cleaning business in January 2016, Mahood argued.

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