Many employers and providers of services operate under the assumption that the providers of services are independent contractors. The service providers do not have deductions made for them by their employers. They invoice their employers. They should charge GST. Parties in these relationships commonly believe that their contracts can be terminated without any notice or severance pay. If the relationship is truly one of an independent contractor – the foregoing arrangements are safe and contracts can be terminated without notice. However, if they are not independent contractors the parties can expose themselves to substantial risk.
In a recent Ontario case, Keenan v. Canac Kitchens, the employer found himself liable for 26 months of severance pay to contract cabinet installers. The court found that the installers were “dependent contractors” and therefore entitled to notice of termination or termination pay in lieu. There are many factors that are considered by the courts in distinguishing between independent contractors and dependent contractors including degree of control, ownership of tools and risk of profit or loss.
Article written by Alfred C. Kempf
This has been a bad week for Shawn Simoes, the embattled former Hydro One employee. As a result of a barrage of sexist taunts made to CityNews reporter Shauna Hunt, within the span of a few days he has gone from being a highly paid analyst for the utility enjoying a night of soccer with friends, to having the internet brand him the world over as a sexist and a misogynist.
The recent "FHRITP" trend of shouting offensive and sexist obscenities on live television is deeply disturbing. In a world where organizations of all stripes seem more sensitive to discrimination, it’s unbelievable that this is occurring and that some will minimize exchanges of this nature as simply a bad joke or even as a poor judgement call. It's not a gag, and if it was, Hydro One is not laughing. Shawn was fired directly as a result of his sexist tirade.
But can a company fire an employee for an occurrence completely removed from the workplace? The simple reality is that yes it can.
Job security can be very tenuous for non-unionized employees in Canada, as employers have the right to terminate employment at any time and for any reason, provided that the motivation for terminating is unrelated to a ground protected under our human rights legislation.
The bigger question in Shawn’s case is whether he’s entitled to compensation for his termination. That will come down to whether Hydro One had “just cause” and whether Shawn’s conduct amounted to a fundamental breach of the employment contract.
Normally, just cause is raised for conduct occurring at work such as stealing, dishonesty and insubordination. However, it shouldn't really come as a surprise that off-duty conduct can also be examined. Depending on factors such as the employee’s role in the organization, the nature of the employer’s business and whether the company’s public reputation is impacted, off-duty behaviour can justify termination for just cause. In those instances, the employee is not entitled to any compensation or severance pay.
Time may tell whether Shawn was terminated for cause or whether he was wrongfully dismissed. However, from Hydro One’s perspective, it doesn’t seem to matter. They didn’t want him on board, and they had every right to terminate him. As Hydro One CEO Carmine Marcello stated yesterday in an interview with the National Post:
“We looked at it through a filter of our core values that we’ve developed over time and the answer was obvious and we decided to sever our arrangement with the employee. […] We don’t want it in the workplace, end of story.”
Hard to argue with that. I wouldn't want it in my workplace either.
Generally, an employee who is terminated from his/her employment without cause must take reasonable steps to minimize the amount of loss suffered as a result of his dismissal.
This is known as the duty to mitigate.
This duty usually requires that an employee take reasonable steps to find another job after he’s been terminated by his employer.
Recently, in Maxwell v. British Columbia, 2014 BCCA 339, our Court of Appeal confirmed an exception to this duty to mitigate exists where the contract between the employer and employee sets out the employer’s severance obligations where the employer is dismissed without cause.
In Maxwell, the employee was employed for many years pursuant to a written employment contract which provided that she was entitled to pay in lieu of notice depending on the duration of her employment to a maximum of 24 months.
In 2012, her employer was dissolved and replaced by a new entity. The employee was offered employment with the new entity, but instead elected to treat her employment as terminated without cause and claim 24 months’ severance pursuant to her contract.
At trial, the court employee was awarded severance on that basis. The employer appealed and argued that the employee was obligated to mitigate her damages by accepting the position offered with the replacement employer. The employer’s appeal was dismissed.
The Court of Appeal held that where a contract specifically provides the consequence of termination without cause, the employee is entitled to severance under the contract and would have no obligation to mitigate his damages, unless the contract provides otherwise.
This case is important from an employer’s perspective because it demonstrates that employers must clearly state whether an employee is required to mitigate his losses where the contract defines the employer’s severance obligations.
This case is important from an employee’s perspective because it highlights that employees may wish to negotiate out of mitigation clauses, particularly toward the end of their career.
Article written by Mark Danielson
As an employment lawyer, I have met with dozens of people who have suffered a workplace accident and are now fighting for their compensation benefits. Fortunately, there is an avenue for workers to contest unfair decisions from WorkSafeBC. The process is long and difficult, but in many circumstances workers are able to overturn the decision that denied them their benefits and obtain proper compensation. If you are a worker that has been denied WorkSafeBC benefits, here are five steps to have your appeal heard.
1. Note your deadline for a response
The WorkSafeBC appeal process is always going to begin with a decision letter from a claims manager. This letter will normally cite WorkSafeBC policy and will state why the decision is being made. Normally, workers will have 90 days to request a review of a decision they disagree with.
If you have been denied WorkSafeBC benefits, note this date, circle it on your calendar and do whatever else you need to do to be reminded of it. Don’t let this date pass without taking action! In deciding whether or not to accept your request for review, the first thing that a reviewing officer will look at is whether or not this limitation period has been respected.
2. Start gathering medical information
WorkSafeBC commonly denies claims for a “lack of objective medical evidence”. What this means is that it’s often not enough for a worker to simply tell the claims manager that they are in pain or that they can’t perform the functions of their job. There has to be medical documentation to support this.
With this in mind, start gathering medical information early. Ask your health care providers for support by having them prepare an opinion on your diagnosis, your progress and your prognosis. Ask your family physician to review the opinion of WorkSafeBC’s staff doctor and have them provide comments. If you need to consult a specialist, ask your doctor for a referral and let WorkSafeBC know.
Also don’t be afraid to ask for a copy of your medical charts from your care providers. You are entitled to these documents and they can contain crucial information which may not have been disclosed to WorkSafeBC.
3. Get the help you need
Before you file your request for review, get help. The Workers’ Compensation Act and its supporting policies are very complex, and your appeal may deal with complicated questions of law. Fortunately, support can come from a number of sources, including your union, a workers’ adviser, a friend or family member, or a lawyer knowledgeable in workers’ compensation law. Whatever you decide, familiarize yourself with the process and make sure you are able to identify what legal test needs to be met.
4. Request a Review
The first step in the formal appeal process is to request a review. When a request for a review is received, WorkSafeBC will assign the file to an in-house reviewing officer for reconsideration. This reviewing will provide a second look at the file to make sure that the original decision was appropriate. In conducting the review, the officer can consider written arguments and new evidence. I strongly encourage workers to provide thorough, well thought out arguments supported by evidence when requesting a review.
5. File an Appeal with WCAT
If the worker is unsatisfied with the result of the review, they can then request an appeal to the Workers’ Compensation Appeals Tribunal (WCAT). WCAT hearings can be heard in person, and the worker may have an advocate to present evidence and arguments that support their claim. The employer may also be present at the hearing, although in reality they rarely participate.
The WCAT hearing is a relatively informal process, and often there will only be the worker, their representative and the WCAT chairperson together in a small boardroom. These hearings should be taken seriously, as they are often the best opportunity for the worker to tell their story in full and ask for the compensation they are looking for.
Article written by David M. Brown
More On the Job articles
- Severance may depend on contract Dec 18
- Think twice before you sue Dec 4
- Are interns employees? Nov 6
- Workplace drug and alcohol concerns Oct 23
- Principals must register with WorksafeBC Sep 25
- When workplace investigations go wrong Sep 11
- I quit! Or did I? Aug 28
- What is Constructive Dismissal? Jul 17
- Recording employee phone calls Jul 3
- New harassment regulations Jun 19
- Texting may come back to haunt you May 23
- Privacy law and the workplace Apr 24