HR Month in Review – April 2017


A roundup of new legislation, regulations, government announcements, court cases and arbitration rulings

Case of the Month: Ontario Court Sheds Light on Enforceability of Limits on Termination Notice

Being wrongfully dismissed can actually be an economic windfall for employees given the wide range of damages potentially available. That’s why many employers put a clause in employment contracts purporting to limit termination payouts to the minimum notice required by the province’s ESA laws or other set amount. A new case from Ontario’s top court offers insight into what has become perhaps the hottest issue in all of Canadian HR law: Ensuring that termination notice limits are legally valid and enforceable.


What Happened: After 8+ years of service, a 48-year-old sales planner making $100,000 a year was laid off without cause. Her employment contract included the following clause:

[The Company may terminate you without cause at any time] by providing you 2 weeks’ termination notice or pay in lieu thereof for each completed or partial year of employment. . . . The Company shall not be obliged to make any payments to you other than those provided for in this paragraph, except for amounts which may be due and unpaid at the time of termination. The payments and notice provided for in this paragraph are inclusive of your entitlement to notice, pay in lieu of notice and severance pay under the [Ontario] Employment Standards Act. (emphasis added)

The employee claimed the clause was unenforceable. The employer disagreed, noting that the 2 weeks per year worked in working notice the clause provided was actually more generous than the 1 week per year in working notice required by the ESA.

What the Court Decided: The Ontario Court of Appeal ruled that the clause was unenforceable.

How the Court Justified Its Decision: The general rule: ESA benefits are minimum requirements. Thus, while employment contracts may provide for greater benefits, they can’t provide for less than the ESA requires. The working notice provisions of the clause did go beyond ESA requirements, the Court acknowledged. But the clause also took away an ESA benefit. Specifically, it didn’t expressly say the employer had to make contributions to benefits plans during the working notice period as required by the ESA.

The employer claimed that the obligation was implied under the clause. It also noted that it did, in fact, make all the required contributions. But, the Court wasn’t impressed. The enforceability of a termination clause turns on its wording rather than what the employer actually provides after termination. And the wording of this particular clause was fatally flawed. “Nothing in [previous case law] suggests that an employer’s conduct on termination or during the notice period can remedy an illegal and unenforceable termination clause,” the Court emphasized.

Wood v. Fred Deeley Imports Ltd., 2017 ONCA 158 (CanLII), Feb. 23, 2017


While actions may speak louder than words in some contexts, when it comes to termination clauses the opposite is true. Recognition of this principle is the first thing employers should take from the Wood case.

The second takeaway is an understanding of why the wording of this particular termination clause made it “illegal and unenforceable.” The fatal flaw wasn’t simply omitting the employer’s ESA obligation to make post-termination contributions. In fact, the Court cited a 2005 case called Roden v. Toronto Humane Society in which a termination clause with the exact same omission was upheld.

The difference: Unlike in Roden, the termination clause in Wood (specifically, the bold face language) purported to limit the employee’s termination notice to only the benefits expressly listed in the clause. Coupled with this “all-inclusive” language, the Court interpreted the omission as not just an oversight but an active attempt by the employer to illegally contract out of its ESA post-notice contribution requirements.

The Moral

If your termination clause purports to limit notice, whether to minimal ESA requirements or a more generous pre-determined amount or formula, make sure it accounts and provides for no less than the minimum termination notice and benefits to which employees are entitled under your province’s ESA laws.



Labour Standards
Mar. 21: The newly tabled federal budget extends parental leave from 12 to 18 months but leaves benefit amounts unchanged. Employees will have 2 options:

  • 12 months at 55% of average weekly earnings (current regime)
  • 18 months at 33% of average weekly earnings.

Human Rights—Substance Dependency
Feb. 21: Substance dependency is considered a disability that employers must accommodate to the point of undue hardship. The Canadian Human Rights Commission issued new guidelines setting out a step-by-step process for employers to follow to meet their accommodations duties.

Human Rights—Genetic Testing
Mar. 8: Bill S-201 banning employers from requiring job applicants to undergo or submit the results of previous genetic testing as a means of screening out individuals with health risks passed both houses. But before Royal Consent is granted, the Justice Minister wants the Supreme Court of Canada to review whether the bill is constitutional. The review could delay the law’s effective date for up to 2 years, or even derail it completely.

Mar. 17: In 2015, PIPEDA was amended to allow organizations to disclose protected personal information to organizations conducting fraud investigations without the individual’s consent. New Privacy Commissioner guidance imposes additional restrictions to prevent “indiscriminate” and overly broad disclosure, e.g., by requiring organizations to exercise “due diligence” before using the exception.

Mar. 21: OSFI has officially pushed back the deadline for Pooled Registered Pension Plan administrators to file their Annual Information Return and accompanying auditor’s report by one month to within 4 rather than 3 months after the end of the year to which the document relates.  The agency also posted a new AIR filing guide (RC368).



Labour & Employment

Mar. 13: A long overdue review of Alberta’s ESA and labour legislation is underway. Issues on the table:

Employment Standards Labour Relations
Expanding maternity, parental and compassionate care leave Mandatory union dues deductions in collective agreements regardless of union membership
New sick, family responsibilities and care of critically ill children leave Revisions to processes used by employees to choose, cancel or change union representatives
Revisions to overtime entitlement and banking rules Making it easier for unions to prove certain kinds of unfair labour practices
Beefing up work break entitlements Giving Alberta Labour Relations Board broader authority to decide disputes
Making it easier to qualify for general holidays Expanded dispute resolution options for first contracts and other intractable disputes
New rules on youth employment Review of current definitions of “employer” and “employee”
More generous notice for group terminations Beefing up employee fair representation rights vis-à-vis their unions
Stricter enforcement and penalties Identifying provisions that depart Canadian mainstream for no good reason

Budget 2017
Mar. 16: Items in the newly tabled provincial budget affecting HR and jobs:

  • $46 million for apprenticeship programs
  • $71 million in tax credits for capital investments in small and medium businesses
  • $85 million for foundational skills training programs
  • $667,000 in OHS Innovation Grants for 33 health and safety projects.

Government Wages
Feb. 28: Budget pressures have forced the government to cut the pay of 270 high-earning executives at 23 agencies, boards and commissions. The pay cuts will be phased in over 2 years.

Mar.: The government issued revised guidance (Interpretive Guideline #05) on how pension benefits should be distributed when a marriage breaks down. The fundamental rules are unchanged but the per calculation maximum fee amounts for certain distributions have increased.


Not Enough Evidence to Convict Employer in Oil Worker’s Death
An oil worker was killed after being hit in the head by machinery while removing drill string from a well. There was no eyewitness testimony and it was unclear exactly how the incident happened. Even so, the trial court found the employer guilty of not doing everything “practicable” to ensure the worker’s safety. It then nixed the employer’s due diligence defence because the company didn’t follow standard industry practice. The appeals court reversed and the Court of Appeal agreed. The mere fact that the incident happened isn’t enough, the Court reasoned. The Crown had to prove the employer did something wrong. And failing to follow industry practice isn’t enough to disprove due diligence [R. v. Precision Diversified Oilfield Services Corp., 2017 ABCA 47 (CanLII), Feb. 8, 2017].



Minimum Wage
Feb. 28: The BC general minimum wage is going up 50¢ to $11.35 on Sept. 15. An identical increase will send the minimum wage for liquor servers to $10.10 per hour.

Sex Discrimination
Mar. 8: A newly proposed private member bill would ban employers from requiring female workers to wear high heels on the job. Although the legislature has officially adjourned, the bill has drawn considerable media attention and public support, including from Premier Christy Clark, and is apt to resurface in the next session.

Workplace Safety
May 1: The following OHS regulatory changes take effect:

OHS Regulation Section(s) What’s Changing
1.1 Definitions of combustible and flammable liquids
4.56 Required conditions of work area guards and handrails
4.81, 4.82,  28.9 Environmental tobacco smoke requirements
5.71(2) Combustible or flammable air contaminants requirements
6.4 Asbestos inventory rules
6.58.1 to 6.69 Requirements for lead
6.110 to 6.112.7 Requirements for respirable crystalline silica and rock dust
12.83.1 New section of Tools, Machinery and Equipment rules for chassis dynamometers
13.11, 14.1, 14.2 Construction material hoists rules
14.5 Rated capacity indication rules for cranes and hoists
14.11 Support structure rules for cranes and hoists
14.81 Limit devices rules for cranes and hoists
20.2 Notice of construction project requirements
22.12(1) and (2) Rules for underground supervisors at underground workings
26.13.4 New section in Forestry Operations rules for saw chain shot

Workers’ Compensation
Mar. 7: Three cancers have been added to the list of cancers presumed to be work-related under workers’ comp when suffered by firefighters after a specified number of years on the job: breast cancer, prostate cancer and multiple myeloma. Other cancers on the list include leukemia, brain, bladder and testicular cancer.


Workers’ Comp Doesn’t Ban Negligence Lawsuit by Injured CEOs
A plane carrying CEOs to an annual executive retreat made a crash landing. The injured CEOs wanted to sue for negligence but the airline claimed that workers’ comp barred their case. The Workers’ Comp Appeals Tribunal disagreed. The CEOs were “workers” but the injuries didn’t happen in the course of their employment. The trip’s primary purpose, WCAT explained, was education and training. And since the training was for their personal rather than the company’s benefit, the injuries they suffered along the way weren’t work-related. The BC Court of Appeal said the WCAT’s ruling wasn’t “patently unreasonable” and refused to overturn it [Northern Thunderbird Air Inc. v. British Columbia (Workers’ Compensation Appeal Tribunal), 2017 BCCA 60 (CanLII), Feb. 1, 2017].



Government Wages
Mar. 13: The government’s new financial austerity bill includes a 2-year wage freeze on public-sector workers when their current collective agreements expire. Affected workers, including teachers, doctors and nurses, would then receive a modest 0.75% pay raise in the third year and a 1.0% increase in the fourth. The bill, which also imposes automatic pay cuts to ministerial salaries in budget deficit years, has sparked public protests and threats to sue from labour unions.

Red Tape
Mar. 14: Taking a page from the US President’s book, Manitoba introduced a bill that would require government agencies to cut 2 existing regulations for each new regulation implemented. Other measures designed to reduce red tape include requiring agencies to furnish public reports detailing each of their regulations and review their regulatory requirements every 3 years.



Minimum Wage
Apr. 1: For the third time since December 2014, New Brunswick is raising its minimum wage, this time from $10.65 to $11 per hour.

Human Rights
Mar. 15: Proposed changes to the Human Rights Act include:

  • Adding “family status” and “gender identity or expression” as protected grounds
  • Banning discrimination by any person in the workplace as opposed to just employers and persons acting on their behalf
  • Revising the definition of “mental disability”
  • Expanding the Human Rights Commission’s authority to investigate, settle and dismiss complaints.



Minimum Wage
Apr. 1: The Newfoundland minimum wage goes up 25¢ to $10.75 per hour. Another 25¢ increase takes effect on Oct. 1, 2017 when the minimum wage will reach $11.00. Meanwhile, the province is holding public consultations on switching to automatic minimum wage adjustments tied to the CPI.

Mar. 24: The government unveiled an ambitious new plan to increase immigration by 50% over the next 5 years—1,700 new immigrants per year by 2022. Key aspects of the plan include partnering with employers and community organizations to improve and expand the Provincial Nominee Program.

Government Jobs
Feb. 24: Newfoundland plans to cut 287 civil service management jobs, 90 of which will be achieved by not hiring for jobs currently open.


Did Manager Resign or Was He Wrongfully Dismissed?
After getting chewed out by his bosses, a veteran manager handed in his keys. “I’m done,” he uttered as he left the office. After several days of not returning calls, he met with management. But the damage was done and he never returned. The manager claimed constructive dismissal; the employer claimed he resigned. The trial judge sided with the manager and said that the employer had breached its implied contractual duty of good faith by not giving him enough time to reconsider whether he wanted to return. The Court of Appeals rejected the notion of an implied contractual duty of good faith. But it agreed that the manager was constructively dismissed and hadn’t resigned. The damage award was a split decision: The manager was entitled to $80,000 in lost pay and benefits; but the employer didn’t have to pay him moral and punitive damages for causing mental distress [Avalon Ford Sales (1996) Limited v Evans, 2017 NLCA 9 (CanLII), Feb. 2, 2017].



Apr. 1: The GNWT officially extended the Work Credit Program, which offsets the costs of mineral explorers during downturns in commodity prices, for 2 years. Under NWT Mining Regs., holders of recorded mineral claims must complete work or submit cash to keep their claims active. The WCP, which had been due to expire in March 2017, increases the value of credits for work completed by a multiplier of 1.5. Result: Holders have to submit less cash to keep their claims active.



Minimum Wage
Apr. 1: The annual CPI adjustment takes effect sending the general minimum wage up 15¢ to $10.85 per hour and the minimum wage for inexperienced workers, i.e., less than 3 months’ experience with the company and kind of work for which they’re hired, to $10.35.

Summer Jobs
Mar. 23: The government has begun the process of hiring students for summer jobs. Fifty of the more than 80 positions offered have been posted on the government’s website so far.

Post-Grad Jobs
Mar. 21: The government is sweetening the pot for employers that hire women, the disabled and other “diverse” graduates under the Graduate to Opportunity program by increasing the first-year subsidy from 25% to 35% of wages.



Mar. 24: The Dept. of Family Services is now accepting employer applications for Canada Nunavut Job Grants for the 2017-2018 fiscal year. Employers are eligible for CNJG training grants if they:

  • Are registered in and local to Nunavut
  • Have a position that the trainee can advance into after training
  • Can contribute at least one-third of total eligible training expenses.



Minimum Wage
Mar. 24: The MOL announced that the following minimum wage hikes will take
effect on Oct. 1:

Minimum Wage Current Hourly Rate Rate as of Oct. 1, 2017
General $11.40 $11.60
Student $10.70 $10.90
Liquor Servers $9.90 $10.10
Hunting & Fishing Guides $56.95 for less than 5 consecutive hours in a day


$113.95 for 5 or more hours in a day (whether or not hours are consecutive)

$58 for less than 5 consecutive hours in a day


$116 for 5 or more hours in a day (whether or not hours are consecutive)

Homeworkers $12.55 $12.80

Human Rights
Mar. 8: The Ontario Human Rights Commission has taken a clear position against sexual and gender-based dress codes in the workplace. A new OHRC report discusses sexualized dress codes for restaurant staff, noting among other things, that dress codes should:

  • Allow for a range of options in terms of style, sizes and comfort
  • Not require sexualized, revealing or gender-stereotypical clothing
  • Not include grooming rules or specific hairstyle requirements
  • Not be more onerous for women than men
  • Be clearly communicated to and freely available to all staff.

Workplace Safety
Apr. 1: That’s the deadline for workers using fall protection on what the OHS defines as a “construction project” to complete a working at heights training program approved by the MOL. Caveat: Your workplace may be deemed a construction project if construction work is conducted on it, even if it’s a factory, warehouse or other facility not typically thought of as a construction site.

Workers’ Compensation
Apr. 23: That’s the deadline for employers of first responders covered under the new rule that post-traumatic stress disorder (PTSD) is work-related under workers’ comp to submit a PTSD prevention plan to the MOL

Mar. 16: FSCO revised its S500-307 Joint and Survivor Pension or Annuity policy to incorporate the new Pension Benefits Act definition of “spouse.” That definition includes either of 2 persons who:

  • Are married to each other or
  • Not married but living together in a conjugal relationship: i. continuously for at least 3 years; or ii. in a relationship “of some permanence,” if they’re the parents of a child.


RCMP Officers Slammed with $141K Harassment Damage Award
An RCMP sergeant contended that he was continually and mercilessly harassed by senior officers for supposedly lying about his involvement in Conservative party politics. The court found the sergeant and his story credible, ruling that the officers had behaved outrageously and that the sergeant suffered career damage and emotional distress as a result. But instead of the $500,000 the sergeant sought, the court awarded him $141,000–$100,000 in general damages and $41,000 for financial losses from being denied promotions [Merrifield v The Attorney General, 2017 ONSC 1333 (CanLII), Feb. 28, 2017].

Transferred Employees Bring Class Action Suit against BlackBerry for Severance
A new case worth watching is the class action lawsuit brought by a group of more than 300 employees against BlackBerry Ltd. for unpaid severance they claim they’re due after being transferred to one of the company’s business partners. The transfer amounts to termination triggering BlackBerry’s obligations to provide notice, the employees contend.

Agency Fined $70,000 for Not Implementing Workplace Violence Program
MOL inspectors issued 10 orders requiring a security services firm to implement a workplace violence and harassment program after a worker was injured in a city hall building. After a post-deadline follow-up inspection found compliance with only 3 of the orders, the firm was fined $70,000–$10,000 for each order not complied with [Federal Force Protection Agency, MOL News Release, Feb. 9, 2017].



Minimum Wage
Apr. 1: The minimum wage is going up ¢25 to $11.25 per hour. Since 2008, the provincial minimum wage has increased 38%, more than 3 times the 11% pace of inflation over that period.

Mar.: Initiatives in the 2017 federal budget supporting industry growth and jobs in PEI:

  • $1.2 million in additional Canada-PEI Labour Market Development Agreement funding
  • $204,827 in additional Canada-PEI Job Fund funding
  • New $325 million federal Atlantic Fisheries Fund (shared among the Atlantic provinces)
  • $125,250 to fund up to 250 student bursaries under Team Seafood program for summer 2017.



Mar. 21: According to a private study, government employees in Québec earn an average 9.1% more than private-sector employees in comparable positions. Their non-wage benefits, including pensions, personal leave and job security, are also more generous. The disparity between public and private-sector wages is nearly as high in Alberta where federal, provincial and municipal government employees take home 7.9% than their private-sector counterparts.

Health Services Fund
May 20: Health Services Fund contributions for employers whose total payroll is $1 million or less will gradually decrease over the next 5 years, starting in 2017 (Employers with payroll between $1 million and $5 million will also get a gradual reduction in their contribution rate):

Employer Sectors Current 2017 2018 2019 2020 2021 and thereafter
Primary & Manufacturing 1.60% 1.55% 1.50% 1.50% 1.50% 1.45%
Service & Construction 2.70% 2.50% 2.30% 2.15% 2.05% 2.00%

Public Pensions
Mar. 22: The Pension Plan of Management Personnel fund realized a 7.1% return on investment in 2016, below the 7.6% average return on funds administered by the Caisse de dépôt et placement du Québec during the year.


Federal Agency in Charge of Work Safety Not Subject to Provincial OHS Law

The CSST (since renamed CNESST) cited the non-profit agency in charge of maintaining federal infrastructure along the St. Lawrence Seaway for 13 OHS violations. The Crown contended that the agency was the “principal contractor” in charge of work performed at a construction site by multiple contractors. The agency contended it was a federal undertaking constitutionally exempt from Québec OHS law. The Commission des lésions professionelles ruled that the agency was a principal contractor and that it was also an exempt federal undertaking. The court agreed. The Québec Court of Appeal and Supreme Court of Canada both declined to review the case. Result: The ruling stands [Commission des normes, de l’équité, de la santé et de la sécurité du travail c. Commission des lésions professionnelles, 2016 QCCS 2424].



Budget 2017
Mar. 22: Measures in the newly tabled budget with potential effects on HR and payroll:

  • Application of PST to restaurant meals, construction services and permanently mounted equipment in resource sector
  • Elimination of Employee Tool Tax Credit
  • Reduction of Labour-Sponsored Venture Capital Tax Credit
  • $250 million cut in funding for public sector compensation.

Mar.: The FCAA issued revised versions of the following pension forms and guides:

Workplace Safety
Mar. 15: Work injuries were sharply down in 2016, according to a new WCB report:

Rate or Total 2016 2015
Total Injury (per 100 workers) 5.55% 6.30%
Time Loss Injury (per 100 workers) 1.86% 2.07%
Time Loss Claims 7,813 8,417
Total Claims 30,377 32,577
Fatalities 31 32
Rate Codes with lower injury rates in 2016 than 2015 85.7%


OHS Fines Scorecard (March 2017)

Defendant Fine Violation
B.N. Steel & Metal. $60,200 Failure to safeguard workers from contact with moving machine parts after arm amputation incident
Mosaic Potash Colonsay ULC $85,400 Failure to ensure safety of mining equipment after worker’s leg crushed in conveyor
Kelsey Pipeline $40,005 Failure to use taglines to control rotation of a load—worker hits head on cement floor after steel beam knocks him over
Larry Ledinski (roofing contractor) $2,800 Failure to ensure proper use of fall and head protection
SaskPower supervisor $28,000 Failure to ensure health and safety of workers under his supervision resulting in worker’s electrocution



Minimum Wage
Apr. 1: Yukon is raising its minimum wage:

Category New Hourly Rate Previous Hourly Rate
General minimum wage $11.32 $11.07
Category A workers $32.87 $32.13
Category B workers $29.47 $28.81
Category C workers $26.14 $25.55
Category D workers $23.72 $23.19

One more change: The minimum wage for domestic employees, farm workers, guides or persons employed by an outfitter who aren’t paid an hourly rate or on a piece work basis will be $90.56 (8 hours x $11.32) for each day or part of a day worked.

Human Rights
Mar. 24: Public consultations on a proposal to add gender identity and expression to the list of grounds protected from discrimination under the Human Rights Act came to an end. Formal adoption, which would bring Yukon into line with most of the rest of the country, is a sure thing.