There's an interesting case out of British Columbia, which the Supreme Court of Canada recently agreed to hear.
Put briefly, the case involves a lawyer, Michael McCormick, who was an equity partner of the Fasken Martineau DuMoulin law firm for over thirty years, until he was forced into retirement by operation of the partnership agreement at his 65th birthday.
He brought an application to the B.C. Human Rights Tribunal, alleging age discrimination in employment, and Faskens sought to have the application dismissed because...it wasn't an employment relationship. He was a partner, not an employee. Ordinarily, at law, that's a pretty academic distinction. But Human Rights legislation often gets interpreted more broadly, and discrimination in 'employment' often captures things not strictly within a conventional employment relationship.
The Tribunal concluded that, for the purpose of the Human Rights Code, a partner is an 'employee' of the partnership. On an application for judicial review by the firm, the British Columbia Supreme Court agreed with the Tribunal.
However, the British Columbia Court of Appeal did not agree, concluding that it is a 'legal impossibility' for a partner to be employed by his own partnership. They concluded that the Tribunal does not have jurisdiction to hear the application, and this is the matter being appealed to the Supreme Court of Canada.
It's easy to see McCormick's argument, in broad strokes: He was one of 60 equity partners in the Vancouver office. He was not the managing partner. He had a vote in major decisions of the firm, but a relatively small voice. He was largely beholden to the other partners in terms of the partnership agreement itself, and he had a boss for all intents and purposes. It looks, in many respects, like an employment relationship. And the fact that he was a partial owner of the firm, and had a vote, doesn't necessarily distinguish it from employment relationships: Outside of professions such as law, many partnerships incorporate companies, which in turn hire the members of the partnership. (So if I wanted to start a business with my three closest friends, we would probably incorporate, and the corporation would hire each of us. And I would then be an 'employee' of the corporation, despite my essential role as one of the operating minds of the business, and my one-quarter equity share in the business.)
Ultimately, the argument that his role is akin to an employment relationship is compelling, and primarily so because it looks very much like the firm fired him.
And, from a policy perspective, there are concerns running much deeper: If partnership in a firm is not an employment relationship subject to the Human Rights Code, then the consequences are broader than mandatory retirement issues. Ejecting partners - or refusing to invite them into the partnership in the first place - because they have children, or are married, or are women, or are racial minorities...it would all be fair game. Given the reputation that law firms have regarding employment equity, that isn't exactly a notion that I expect the Supreme Court to embrace.
Incidentally, this would have a relatively limited impact in Ontario. Ontario's Human Rights Code is more broadly drafted, prohibiting, among other things, discrimination in contracts. That particular prohibition isn't exactly the same as the prohibition against discrimination in employment, but the differences are not particularly large.
*****
This blog is not intended to and does not provide legal advice to any person in respect of any particular legal issue, and does not create a solicitor-client relationship with any readers, but rather provides general legal information. If you have a legal issue or possible legal issue, contact a lawyer.
Monday, March 25, 2013
Monday, March 18, 2013
No Just Cause to Dismiss Bank Manager, but Reinstatement was Inappropriate
Under the Canada Labour Code, it is possible for an employee of a Federally-regulated undertaking, such as a bank, to seek reinstatement for dismissal under certain circumstances. This is a rare remedy for non-unionized employees. I made an entry about this in October 2011, noting that, while managers are usually not able to seek reinstatement, bank managers aren't necessarily 'managers' for the purpose of the Code.
The Federal Court of Appeal recently released a decision in a similar type of case, Payne v. Bank of Montreal, where Mr. Payne - a branch manager in Woodstock, Ontario - was dismissed for cause, but the dismissal was overturned by an adjudicator on an unjust dismissal complaint. The Federal Court of Appeal upheld the finding that there was not just cause (though this appears to have been somewhat reluctant), but found that the reinstatement was unreasonable.
The Facts
Mr. Payne became the Woodstock branch manager in April 2007. In October 2008, he received corrective action relating to complaints from five of his ten employees, including "angrily shouting; demeaning them in front of colleagues and customers; questioning an employee about the nature of a medical appointment...; and commenting on the personal appearance of two employees." The discipline he received was at the highest level short of dismissal, and then other issues came to light.
In early November, 2008, BMO investigated a complaint by his assistant branch manager, Ms. Carter, that he was 'stalking' her following the end of an affair. At the first interview, he denied having had a personal relationship; in a subsequent interview, he admitted having had a sexual relationship with her. As well, it appears that he had disclosed to Carter information about the first investigation which was supposed to be confidential.
On November 20, 2008, Mr. Payne was dismissed for cause, for breaching confidentiality of the first investigation, acting inappropriately on bank premises during and outside business hours, failing to meet expectations from October's corrective letter, and breaching the employer's code of ethics.
Procedural History
The adjudicator found misconduct in the breach of confidentiality and the initial lie about his relationship with Ms. Carter. (Shades of the Reichard case?) However, while disciplinable, these were not "overly serious".
It appears that there was evidence that one male employee in the office was aware of the relationship, but no evidence that other employees, or members of the community, were aware, and no reason to believe that there was any inappropriate pressure exerted by Mr. Payne which would breach the bank's anti-harassment policy. The relationship was "reckless in the extreme", but the bank suffered no harm as a result.
Altogether, this did not constitute just cause: It was a relationship between two consenting adults, with no inappropriate pressure or abuse, and which had not caused any adverse effects on the workplace. Progressive discipline, in the adjudicator's view, would have been sufficient to cause Mr. Payne to reflect on his conduct and act more appropriately in the future.
On judicial review, the Federal Court found that the adjudicator had: failed to consider the cumulative effect of the conduct for which he was dismissed with the other misconduct for which he was disciplined earlier; failed to appropriately weigh the risk of harm even in the absence of actual harm (and also failed to consider the actual harm associated with loss of productivity when the relationship was carried on during the business day); and failed to explain how conduct he characterized as reckless, foolish, and dangerous was consistent with maintaining the employment relationship.
In the alternative, the judge concluded that the decision to reinstate was unreasonable, because his misconduct had destroyed the trust and confidence required of a manager.
The Federal Court of Appeal's Decision
Let me draw a quick excerpt from near the end of the decision:
However, the reinstatement remedy was another matter. Reinstatement is discretionary upon the adjudicator, but it is favoured by adjudicators barring exceptional circumstances. The adjudicator in this case awarded reinstatement on the basis that the employer had not established that reinstatement was "unrealistic". The Court of Appeal concluded that this was the wrong question. The adjudicator should have asked: "could the employer ever have confidence in the employee's judgment again, such that it should be prepared to run the risk of further misconduct?"
His position had been filled (by a person with many more years of service than him), his performance was not "particularly good", he had poor relations with his superiors, and he had attempted to revive his relationship with Ms. Carter even after receiving the prior discipline. Accordingly, the Court of Appeal concluded that the employer could no longer have trust and confidence in him as a manager.
My Thoughts
I find it quite interesting that, while unwilling to intervene in the adjudicator's finding on just cause, and acknowledging a broad discretion on the adjudicator to determine the remedy (including reinstatement), the Court draws the line at that point.
What I find even more interesting is that the analysis as to why reinstatement was inappropriate looks very similar to the analysis typically used by the Courts to determine just cause.
I think this is a difficult decision to reconcile, for that reason. His misconduct was such that the employer could no longer have the necessary faith in him to continue the employment relationship, but not such that it amounted to just cause. I could easily understand a decision either way on just cause (and, accordingly, the Court's decision to defer is probably the right one), but it seems difficult to me that the Court, having acknowledged that the arbitrator was entitled to find that the misconduct didn't rise to the level of just cause as set out in McKinley, concluded that it was unreasonable to expect the employer to continue employing him.
It may force adjudicators to apply a more detailed analysis to their awards of reinstatement, but I don't think it will have a significant impact: As this is a rather odd outcome, I don't expect adjudicators to often reach the same decision, that misconduct does not rise to just cause, but nonetheless warrants a loss of confidence incompatible with continuing the employment relationship.
(As well, I think there's a conceptual challenge in looking at the trust and faith necessary for a manager, in context of an unjust dismissal complaint seeking a remedy not open to 'managers'.)
With the growing issues of 'personal harassment' in the workplace, however, I think it's important to highlight the analysis of the sexual relationship. Most harassment policies do not expressly prohibit sexual relationships between co-workers. What they prohibit is typically more along the lines of 'sexual advances that are known or ought reasonably to be known to be unwelcome'. As well as unwelcome advances by a person in a position to confer a work-related benefit. So the fact of a sexual relationship between co-workers, or even in a supervisor/subordinate relationship, is not in and of itself misconduct. However, the supervisor/subordinate relationship is 'risky' and must be carried out with the utmost discretion, without favouritism, and with caution on the part of the supervisor to avoid exploiting his/her power. (In general, the better advice to people considering a relationship with a subordinate is this: Don't do it.)
*****
This blog is not intended to and does not provide legal advice to any person in respect of any particular legal issue, and does not create a solicitor-client relationship with any readers, but rather provides general legal information. If you have a legal issue or possible legal issue, contact a lawyer.
The Federal Court of Appeal recently released a decision in a similar type of case, Payne v. Bank of Montreal, where Mr. Payne - a branch manager in Woodstock, Ontario - was dismissed for cause, but the dismissal was overturned by an adjudicator on an unjust dismissal complaint. The Federal Court of Appeal upheld the finding that there was not just cause (though this appears to have been somewhat reluctant), but found that the reinstatement was unreasonable.
The Facts
Mr. Payne became the Woodstock branch manager in April 2007. In October 2008, he received corrective action relating to complaints from five of his ten employees, including "angrily shouting; demeaning them in front of colleagues and customers; questioning an employee about the nature of a medical appointment...; and commenting on the personal appearance of two employees." The discipline he received was at the highest level short of dismissal, and then other issues came to light.
In early November, 2008, BMO investigated a complaint by his assistant branch manager, Ms. Carter, that he was 'stalking' her following the end of an affair. At the first interview, he denied having had a personal relationship; in a subsequent interview, he admitted having had a sexual relationship with her. As well, it appears that he had disclosed to Carter information about the first investigation which was supposed to be confidential.
On November 20, 2008, Mr. Payne was dismissed for cause, for breaching confidentiality of the first investigation, acting inappropriately on bank premises during and outside business hours, failing to meet expectations from October's corrective letter, and breaching the employer's code of ethics.
Procedural History
The adjudicator found misconduct in the breach of confidentiality and the initial lie about his relationship with Ms. Carter. (Shades of the Reichard case?) However, while disciplinable, these were not "overly serious".
It appears that there was evidence that one male employee in the office was aware of the relationship, but no evidence that other employees, or members of the community, were aware, and no reason to believe that there was any inappropriate pressure exerted by Mr. Payne which would breach the bank's anti-harassment policy. The relationship was "reckless in the extreme", but the bank suffered no harm as a result.
Altogether, this did not constitute just cause: It was a relationship between two consenting adults, with no inappropriate pressure or abuse, and which had not caused any adverse effects on the workplace. Progressive discipline, in the adjudicator's view, would have been sufficient to cause Mr. Payne to reflect on his conduct and act more appropriately in the future.
On judicial review, the Federal Court found that the adjudicator had: failed to consider the cumulative effect of the conduct for which he was dismissed with the other misconduct for which he was disciplined earlier; failed to appropriately weigh the risk of harm even in the absence of actual harm (and also failed to consider the actual harm associated with loss of productivity when the relationship was carried on during the business day); and failed to explain how conduct he characterized as reckless, foolish, and dangerous was consistent with maintaining the employment relationship.
In the alternative, the judge concluded that the decision to reinstate was unreasonable, because his misconduct had destroyed the trust and confidence required of a manager.
The Federal Court of Appeal's Decision
Let me draw a quick excerpt from near the end of the decision:
It may seem surprising that the facts of the present case would not have been found to warrant dismissal for cause. However, this is a question that Parliament has committed to the Adjudicator. It is not the function of a reviewing court to substitute its view of the merits of a dispute for that of an Adjudicator. The court is limited to the residual role of ensuring that the reasons given by the Adjudicator justify the outcome, and demonstrate that it falls within the range of acceptable outcomes. That range may well include a decision that appears “counter-intuitive” (Newfoundland Nurses, at para. 13) to the non-specialist.So the adjudicator's decision that there was not just cause is "surprising" and "counter-intuitive", but not unreasonable to the point of warranting judicial intervention. A sexual relationship, in and of itself, doesn't warrant dismissal for cause without other contextual elements. While the context - the other disciplinary matters - are serious, the adjudicator did consider the overall effect of the various disciplinary issues, and was entitled to deference in his finding that, even combined, they did not amount to just cause for dismissal.
However, the reinstatement remedy was another matter. Reinstatement is discretionary upon the adjudicator, but it is favoured by adjudicators barring exceptional circumstances. The adjudicator in this case awarded reinstatement on the basis that the employer had not established that reinstatement was "unrealistic". The Court of Appeal concluded that this was the wrong question. The adjudicator should have asked: "could the employer ever have confidence in the employee's judgment again, such that it should be prepared to run the risk of further misconduct?"
His position had been filled (by a person with many more years of service than him), his performance was not "particularly good", he had poor relations with his superiors, and he had attempted to revive his relationship with Ms. Carter even after receiving the prior discipline. Accordingly, the Court of Appeal concluded that the employer could no longer have trust and confidence in him as a manager.
My Thoughts
I find it quite interesting that, while unwilling to intervene in the adjudicator's finding on just cause, and acknowledging a broad discretion on the adjudicator to determine the remedy (including reinstatement), the Court draws the line at that point.
What I find even more interesting is that the analysis as to why reinstatement was inappropriate looks very similar to the analysis typically used by the Courts to determine just cause.
I think this is a difficult decision to reconcile, for that reason. His misconduct was such that the employer could no longer have the necessary faith in him to continue the employment relationship, but not such that it amounted to just cause. I could easily understand a decision either way on just cause (and, accordingly, the Court's decision to defer is probably the right one), but it seems difficult to me that the Court, having acknowledged that the arbitrator was entitled to find that the misconduct didn't rise to the level of just cause as set out in McKinley, concluded that it was unreasonable to expect the employer to continue employing him.
It may force adjudicators to apply a more detailed analysis to their awards of reinstatement, but I don't think it will have a significant impact: As this is a rather odd outcome, I don't expect adjudicators to often reach the same decision, that misconduct does not rise to just cause, but nonetheless warrants a loss of confidence incompatible with continuing the employment relationship.
(As well, I think there's a conceptual challenge in looking at the trust and faith necessary for a manager, in context of an unjust dismissal complaint seeking a remedy not open to 'managers'.)
With the growing issues of 'personal harassment' in the workplace, however, I think it's important to highlight the analysis of the sexual relationship. Most harassment policies do not expressly prohibit sexual relationships between co-workers. What they prohibit is typically more along the lines of 'sexual advances that are known or ought reasonably to be known to be unwelcome'. As well as unwelcome advances by a person in a position to confer a work-related benefit. So the fact of a sexual relationship between co-workers, or even in a supervisor/subordinate relationship, is not in and of itself misconduct. However, the supervisor/subordinate relationship is 'risky' and must be carried out with the utmost discretion, without favouritism, and with caution on the part of the supervisor to avoid exploiting his/her power. (In general, the better advice to people considering a relationship with a subordinate is this: Don't do it.)
*****
This blog is not intended to and does not provide legal advice to any person in respect of any particular legal issue, and does not create a solicitor-client relationship with any readers, but rather provides general legal information. If you have a legal issue or possible legal issue, contact a lawyer.
Thursday, March 14, 2013
Court declines to hear Police Officer's DFR Complaint
By way of background, let me explain that all unions have a duty of fair representation to their members. For most unionized employees in Ontario, their recourse for breaches of the duty of fair representation (DFR) lies in an application to the Ontario Labour Relations Board.
However, there are certain groups excluded from the Labour Relations Act, with organizing provisions built into other statutes, such as police and firefighters. Under the Police Services Act, police can be represented by an association; as a result, most police services in the Province are represented by Police Associations, which are in most ways indistinguishable from unions.
But, whereas the Labour Relations Act builds specific recourse to the OLRB for DFR complaints, the Police Services Act has no parallel. Accordingly, it is now trite law that the OLRB has no jurisdiction to hear DFR complaints from police or firefighters.
Nonetheless, it is also trite law that Police and Fire Associations, at common law, owe a duty of fair representation to their members.
The question becomes: How do you enforce that duty? This question was addressed recently by the Superior Court in Cumming v. Peterborough Police Association.
Mr. Cumming commenced a Court action based on the Association's alleged failure to properly represent him in disciplinary proceedings. The Association took the position that the essential nature of the dispute arose from the interpretation, application, administration, or violation of the collective agreement, and therefore is the sole jurisdiction of an arbitrator - and accordingly that the Court doesn't have jurisdiction. Justice Gunsolus accepted this argument, dismissing the action.
The decision is not entirely unprecedented. In 2006, the Court of Appeal came to a similar decision in Renaud v. Town of Lasalle Police Association. The Police Services Act creates a comprehensive scheme for dispute resolution, and therefore arbitrators have exclusive jurisdiction. That decision was probably binding on Justice Gunsolus, and probably made this a foregone conclusion.
But I'm still not sure it's right.
Is an individual member of a bargaining unit a "party" to a collective agreement?
There are a couple of issues: Firstly, the decision is premised on the notion that the individual officer is a party to the Collective Agreement (and therefore bound to the recourse contained within the Collective Agreement). While the legal relationships between employer, union, and bargaining unit member are complicated, I'm not at all sure that this is a correct statement of law. In many contexts, the Courts have concluded that individual bargaining unit members are not parties to collective agreements. (See, for example, Speckling v. Local 76 of the Communications, Energy, and Paperworkers' Union of Canada, 2009 BCCA 258, or CUPE Local 79 v. Toronto, 2012 ONSC 1158.)
However, even if you supposed that the individual bargaining unit member is a party to the collective agreement, it would be a party as a result of the union's representative role - in other words, the union's participation in the collective agreement is on behalf of the individual employees, entering into a contract with the employer. It is incoherent to suggest that the collective agreement in any way constitutes a contract between the union and the bargaining unit members.
Is the duty of fair representation a term of the collective agreement?
Secondly, the duty of fair representation, at common law, is one which exists prior to the collective agreement. Mandatory grievance arbitration clauses, such as in the Labour Relations Act or s.123/124 of the Police Services Act, regard disputes in terms of breaches of the collective agreement.
The Labour Relations Act creates a different mechanism for dealing with DFR complaints, and is therefore 'comprehensive'. However, the Police Services Act does not create a DFR mechanism. To read the mandatory arbitration clause as creating a DFR mechanism raises a number of issues, not the least of which is that it would essentially mean that the DFR is derived implicitly from the collective agreement, which is clearly not the case, as the association is actually bound by the DFR when *negotiating* the collective agreement.
Was Renaud correctly decided?
To really get in at the meat of this, we need to trace back into the precedents underlying the Renaud decision. Abbott v. Collins is an important Court of Appeal decision from 2003, involving OPP officers suing other officers for allegedly disciplining them.
In Renaud, the Court said of Abbott:
In Abbott, what the Court actually said is this:
What has the Supreme Court said about the DFR?
Justice Gunsolus also refers to the Supreme Court's decision in Gendron as affirming that the "exclusive principle applies in respect of the duty of fair representation".
In Gendron, however, the issue was whether or not a bargaining unit could pursue his DFR rights under common law, despite the fact that the Canada Labour Code gave him a statutory DFR right. The Supreme Court applied what is now a well-established analysis, as above, regarding comprehensive legislative schemes. The common law rights and recourse are, in effect, displaced by the statutory language of the Canada Labour Code.
By contrast, there's no question that the Police Association's DFR arises by virtue of common law. (I would argue that this, in and of itself, is a good reason to question whether or not the Police Services Act is 'comprehensive' in this regard.)
Conclusion
While the Courts in Renaud and Cumming suggest that an officer might seek recourse through conciliation and arbitration against the Association, it is less than obvious to me that this is actually a plausible method in general (and it seems to me that there would be some instances where an arbitrator certainly wouldn't have jurisdiction). Does anyone know of any circumstances in which this has been attempted?
In sum, I question Renaud's reliance on Abbott, and believe that the question needs to be revisited. The issues in Abbott bore little-to-no resemblance to the issues in Renaud. Even if Abbott called the Police Services Act 'comprehensive' in the way that Renaud suggests, that would be obiter outside of the disciplinary context. There are enough differences, generally speaking, between DFRs and disciplinary grievances that such a cursory comparison is inappropriate; a case such as Cumming calls for a careful examination of what, precisely, the Police Services Act says of DFRs.
*****
This blog is not intended to and does not provide legal advice to any person in respect of any particular legal issue, and does not create a solicitor-client relationship with any readers, but rather provides general legal information. If you have a legal issue or possible legal issue, contact a lawyer.
However, there are certain groups excluded from the Labour Relations Act, with organizing provisions built into other statutes, such as police and firefighters. Under the Police Services Act, police can be represented by an association; as a result, most police services in the Province are represented by Police Associations, which are in most ways indistinguishable from unions.
But, whereas the Labour Relations Act builds specific recourse to the OLRB for DFR complaints, the Police Services Act has no parallel. Accordingly, it is now trite law that the OLRB has no jurisdiction to hear DFR complaints from police or firefighters.
Nonetheless, it is also trite law that Police and Fire Associations, at common law, owe a duty of fair representation to their members.
The question becomes: How do you enforce that duty? This question was addressed recently by the Superior Court in Cumming v. Peterborough Police Association.
Mr. Cumming commenced a Court action based on the Association's alleged failure to properly represent him in disciplinary proceedings. The Association took the position that the essential nature of the dispute arose from the interpretation, application, administration, or violation of the collective agreement, and therefore is the sole jurisdiction of an arbitrator - and accordingly that the Court doesn't have jurisdiction. Justice Gunsolus accepted this argument, dismissing the action.
The decision is not entirely unprecedented. In 2006, the Court of Appeal came to a similar decision in Renaud v. Town of Lasalle Police Association. The Police Services Act creates a comprehensive scheme for dispute resolution, and therefore arbitrators have exclusive jurisdiction. That decision was probably binding on Justice Gunsolus, and probably made this a foregone conclusion.
But I'm still not sure it's right.
Is an individual member of a bargaining unit a "party" to a collective agreement?
There are a couple of issues: Firstly, the decision is premised on the notion that the individual officer is a party to the Collective Agreement (and therefore bound to the recourse contained within the Collective Agreement). While the legal relationships between employer, union, and bargaining unit member are complicated, I'm not at all sure that this is a correct statement of law. In many contexts, the Courts have concluded that individual bargaining unit members are not parties to collective agreements. (See, for example, Speckling v. Local 76 of the Communications, Energy, and Paperworkers' Union of Canada, 2009 BCCA 258, or CUPE Local 79 v. Toronto, 2012 ONSC 1158.)
However, even if you supposed that the individual bargaining unit member is a party to the collective agreement, it would be a party as a result of the union's representative role - in other words, the union's participation in the collective agreement is on behalf of the individual employees, entering into a contract with the employer. It is incoherent to suggest that the collective agreement in any way constitutes a contract between the union and the bargaining unit members.
Is the duty of fair representation a term of the collective agreement?
Secondly, the duty of fair representation, at common law, is one which exists prior to the collective agreement. Mandatory grievance arbitration clauses, such as in the Labour Relations Act or s.123/124 of the Police Services Act, regard disputes in terms of breaches of the collective agreement.
The Labour Relations Act creates a different mechanism for dealing with DFR complaints, and is therefore 'comprehensive'. However, the Police Services Act does not create a DFR mechanism. To read the mandatory arbitration clause as creating a DFR mechanism raises a number of issues, not the least of which is that it would essentially mean that the DFR is derived implicitly from the collective agreement, which is clearly not the case, as the association is actually bound by the DFR when *negotiating* the collective agreement.
Was Renaud correctly decided?
To really get in at the meat of this, we need to trace back into the precedents underlying the Renaud decision. Abbott v. Collins is an important Court of Appeal decision from 2003, involving OPP officers suing other officers for allegedly disciplining them.
In Renaud, the Court said of Abbott:
In Abbott v. Collins, [2003] O.J. No. 1881 (C.A.), this court confirmed that the scheme created by the Act and Regulations and the Collective Agreement is intended by the legislature to provide a comprehensive scheme to govern all aspects of the employment relationship between the appellant and the respondents. [Emphasis added]And here's the rub. That's not what the Court said in Abbott. Nor would Renaud have been on all fours with Abbott, were that true.
In Abbott, what the Court actually said is this:
...the legislative scheme in Ontario, like the one in Saskatchewan, is intended to create a complete substantive and procedural code for discipline of police officers within the provisions of the Police Services Act and its regulations. [Emphasis added]Or, put another way, referring to a Supreme Court interpretation of similar Saskatchewan legislation, this:
Extrapolating from that approach, Bastarache J. concluded that the legislature had provided a comprehensive scheme regarding discipline within the Police Act and Regulations, which included the investigation and adjudication of discipline matters, and that formalistic interpretations of the Act must be avoided if they would deny the Commission jurisdiction in such cases. [Emphasis added]Put another way, the Court in Abbott did not deal with the question of whether or not the Police Services Act provided a "comprehensive scheme to govern all aspects of the employment relationship". In none of the decisions relied upon in the Renaud decision was the DFR even an issue.
What has the Supreme Court said about the DFR?
Justice Gunsolus also refers to the Supreme Court's decision in Gendron as affirming that the "exclusive principle applies in respect of the duty of fair representation".
In Gendron, however, the issue was whether or not a bargaining unit could pursue his DFR rights under common law, despite the fact that the Canada Labour Code gave him a statutory DFR right. The Supreme Court applied what is now a well-established analysis, as above, regarding comprehensive legislative schemes. The common law rights and recourse are, in effect, displaced by the statutory language of the Canada Labour Code.
By contrast, there's no question that the Police Association's DFR arises by virtue of common law. (I would argue that this, in and of itself, is a good reason to question whether or not the Police Services Act is 'comprehensive' in this regard.)
Conclusion
While the Courts in Renaud and Cumming suggest that an officer might seek recourse through conciliation and arbitration against the Association, it is less than obvious to me that this is actually a plausible method in general (and it seems to me that there would be some instances where an arbitrator certainly wouldn't have jurisdiction). Does anyone know of any circumstances in which this has been attempted?
In sum, I question Renaud's reliance on Abbott, and believe that the question needs to be revisited. The issues in Abbott bore little-to-no resemblance to the issues in Renaud. Even if Abbott called the Police Services Act 'comprehensive' in the way that Renaud suggests, that would be obiter outside of the disciplinary context. There are enough differences, generally speaking, between DFRs and disciplinary grievances that such a cursory comparison is inappropriate; a case such as Cumming calls for a careful examination of what, precisely, the Police Services Act says of DFRs.
*****
This blog is not intended to and does not provide legal advice to any person in respect of any particular legal issue, and does not create a solicitor-client relationship with any readers, but rather provides general legal information. If you have a legal issue or possible legal issue, contact a lawyer.
Wednesday, March 13, 2013
Mitigation did NOT require employee to 'bump'
NB: While certain aspects of this case involve policies that resemble a unionized environment, the employee in question was not a bargaining unit member, and the framework would be totally out of place for a bargaining unit member.
In recent years, I've frequently commented on the growing body of law requiring employees to accept different conditions with their existing employer, as mitigation for constructive or actual dismissal - the logic being that they were constructively or actually dismissed, but a reasonable person would nonetheless have kept the job and accepted the modified conditions, while seeking replacement employment.
There's a recent case from the Ontario Superior Court of Justice, Bannon v. Schaeffler, distinguishing those cases.
The Case
Mr. Bannon worked for Schaeffler Canada Inc./FAG Aerospace Inc., starting in September 1972 at age 19. He started as a machine operator and later became a 'setter'. In 1991, he participated in a pilot project to reduce set-up times; in 1996 he became part of a team to improve efficiency. From 2001 forward, he was a "Set-Up Time Reduction Coordinator", developing procedures, giving workshops, instructing setters, etc.
As we all know, the economy tanked in 2008. This affected the employer's business significantly, and on April 29, 2009, he was advised that his job was being eliminated, but under the employer's Lay Off and Recall Policy that he was entitled to exercise seniority rights and take a position as a setter again. (In union contexts, this is known as 'bumping'.)
This would have entailed a pay cut (by a little over 10% of his hourly rate), a return to shiftwork, and a return to highly physical labour.
Mr. Bannon wasn't sure that he would be able to perform the duties of a setter. Aside from the fact that much had changed technologically from when he had last performed those duties, he was now 56 years old, with significant back problems, and didn't believe that he would have the strength or agility required for the job.
Accordingly, he declined the new position, and on April 30, 2009, the employer terminated his employment, providing him with 34 weeks' pay (being the statutory minimum in his case).
The employer argued that the employee failed to mitigate his losses by not accepting the setter position. After all, with no acrimony and no bad faith, it fell squarely within the framework for cases such as Evans v. Teamsters and Mifsud v. MacMillan Bathurst Inc. However, Justice Haines distinguished those cases concluded that, given Bannon's physical limitations, the employer had not satisfied its onus of establishing that it was unreasonable for Bannon to reject the setter position.
Bannon was awarded an overall notice period of 20 months.
Obiter Dicta: Is the Mitigation Issue Engaged?
There's a bit of obiter in the decision which is somewhat awkward.
There are similar elements here to the case of Silva v. Leippi from British Columbia in 2011: In that case, the business was being sold, and the purchasers offered new terms of employment for Mr. Silva; Mr. Silva turned around and tried to negotiate the terms, which had the effect of implicitly rejecting the initial offer. They couldn't come to terms, and he was dismissed. The Court found that he had failed to mitigate, by rejecting the offer of modified employment.
The Silva case is very odd, for a number of reasons, most importantly that it imposed an obligation to mitigate prior to any breach of contract. This is inconsistent with the first principles of contract law, and I was very concerned about that decision when I first saw it.
Bannon's counsel picked up on a similar argument in this case: When Bannon rejected the setter position, his existing employment contract had not yet been terminated, and therefore no obligation to mitigate arose. He went on to propose an alternate framework for such cases, pointing out the traditional analysis of constructive dismissal cases as set out by the Ontario Court of Appeal in Wronko:
When an employer attempts to make a unilateral change to a fundamental term of the employment relationship, an employee has three options:
In recent years, I've frequently commented on the growing body of law requiring employees to accept different conditions with their existing employer, as mitigation for constructive or actual dismissal - the logic being that they were constructively or actually dismissed, but a reasonable person would nonetheless have kept the job and accepted the modified conditions, while seeking replacement employment.
There's a recent case from the Ontario Superior Court of Justice, Bannon v. Schaeffler, distinguishing those cases.
The Case
Mr. Bannon worked for Schaeffler Canada Inc./FAG Aerospace Inc., starting in September 1972 at age 19. He started as a machine operator and later became a 'setter'. In 1991, he participated in a pilot project to reduce set-up times; in 1996 he became part of a team to improve efficiency. From 2001 forward, he was a "Set-Up Time Reduction Coordinator", developing procedures, giving workshops, instructing setters, etc.
As we all know, the economy tanked in 2008. This affected the employer's business significantly, and on April 29, 2009, he was advised that his job was being eliminated, but under the employer's Lay Off and Recall Policy that he was entitled to exercise seniority rights and take a position as a setter again. (In union contexts, this is known as 'bumping'.)
This would have entailed a pay cut (by a little over 10% of his hourly rate), a return to shiftwork, and a return to highly physical labour.
Mr. Bannon wasn't sure that he would be able to perform the duties of a setter. Aside from the fact that much had changed technologically from when he had last performed those duties, he was now 56 years old, with significant back problems, and didn't believe that he would have the strength or agility required for the job.
Accordingly, he declined the new position, and on April 30, 2009, the employer terminated his employment, providing him with 34 weeks' pay (being the statutory minimum in his case).
The employer argued that the employee failed to mitigate his losses by not accepting the setter position. After all, with no acrimony and no bad faith, it fell squarely within the framework for cases such as Evans v. Teamsters and Mifsud v. MacMillan Bathurst Inc. However, Justice Haines distinguished those cases concluded that, given Bannon's physical limitations, the employer had not satisfied its onus of establishing that it was unreasonable for Bannon to reject the setter position.
Bannon was awarded an overall notice period of 20 months.
Obiter Dicta: Is the Mitigation Issue Engaged?
There's a bit of obiter in the decision which is somewhat awkward.
There are similar elements here to the case of Silva v. Leippi from British Columbia in 2011: In that case, the business was being sold, and the purchasers offered new terms of employment for Mr. Silva; Mr. Silva turned around and tried to negotiate the terms, which had the effect of implicitly rejecting the initial offer. They couldn't come to terms, and he was dismissed. The Court found that he had failed to mitigate, by rejecting the offer of modified employment.
The Silva case is very odd, for a number of reasons, most importantly that it imposed an obligation to mitigate prior to any breach of contract. This is inconsistent with the first principles of contract law, and I was very concerned about that decision when I first saw it.
Bannon's counsel picked up on a similar argument in this case: When Bannon rejected the setter position, his existing employment contract had not yet been terminated, and therefore no obligation to mitigate arose. He went on to propose an alternate framework for such cases, pointing out the traditional analysis of constructive dismissal cases as set out by the Ontario Court of Appeal in Wronko:
When an employer attempts to make a unilateral change to a fundamental term of the employment relationship, an employee has three options:
- The employee can accept the change, either expressly or implicitly through apparent acquiescence, in which case the employment will continue under the altered terms.
- The employee may reject the change and sue for damages if the employer persists in treating the relationship as subject to the varied term.
- The employee may make it clear to the employer that he or she is rejecting the new term. The employer may respond to this rejection by terminating the employee on notice, or may acquiesce by permitting the employee to continue to fulfil his or her duties.
Bannon's position was that he had opted for #3, which put the employer in a position of either having to acquiesce and let him stay in his old position, or dismiss on reasonable notice.
It would have been open to the employer to dismiss, and then to offer him new employment as a setter, in which case Bannon would have been obligated to consider the new employment in context of his duty to mitigate. But until the dismissal, there was no duty to mitigate, and therefore a rejection of an offer prior to the dismissal can not have breached the duty. And the employer did not make a new offer of employment following the dismissal, which Bannon would have to consider, in light of his obligation to mitigate.
Such is the plaintiff's argument, and it seems sound to me. Justice Haines, however, rejected it, finding that he was effectively terminated from one job and offered another in replacement. It is not entirely clear from the decision, but it appears that Justice Haines considered the employment contract to be effectively repudiated when they told him that his job was eliminated and he could take the position of a setter.
I question this analysis: It is directly inconsistent with some very well-established doctrines of wrongful dismissal regarding the requirements for notice of dismissal. Having a discussion about a position being eliminated is not effective notice of dismissal, much to the chagrin of many an employer. Effective notice must include when the contract will end, and must be clear and unambiguous. It's hard to imagine such a notice being effective when not in writing. The fact that he showed up for work on April 30, 2009, suggests strongly that he didn't take from that meeting that his position, as of that moment, did not exist.
Put another way, there's no reason to think that it wasn't open to the employer, as of April 30, 2009, to provide actual notice. Which is not, in fact, a repudiation of the contract, but which is an affirmation of it. Actual notice does not breach the contract, and therefore does not cause the duty to mitigate to arise.
*****
This blog is not intended to and does not provide legal advice to any person in respect of any particular legal issue, and does not create a solicitor-client relationship with any readers, but rather provides general legal information. If you have a legal issue or possible legal issue, contact a lawyer.
Tuesday, March 5, 2013
Don't Wait: The Dangers of Delay
If you have a legal claim to make against your employer, there are plenty of good practical reasons to seek legal advice promptly. Aside from the obvious, being that - generally - the sooner you make your claim, the sooner you get paid on it (assuming you're successful), there's also the reality that evidence deteriorates with time. Witness memories fade and documents are lost or destroyed, for example. And, if your employer reorganizes or becomes insolvent, it may become difficult or even impossible to collect your full entitlements.
Then there are tactical matters - in some cases, especially with recent changes to the Rules of Civil Procedure, a dismissed employee might be able to get into Court before the notice period has expired, and I have not yet seen an Ontario Court discount the notice period for the prospect of future mitigation. In many cases, benefit continuation is an issue, but few employers discontinue benefits within the statutory notice period, so I like to use that time to negotiate further benefit continuation.
There are tactical considerations running the other way, too, but none of them should cause you to delay seeking legal advice for one simple reason, the most important of all:
Limitations.
We all know the meaning of the phrase 'statute of limitations' from American legal dramas. In Ontario, most civil actions are governed by the Limitations Act, 2002, which generally prevents an action from being commenced after the second anniversary of the date the cause of action arose and was 'discoverable'. There are exceptions, and nuances in when the clock starts, but as a generality, what a potential plaintiff should take from that is: If you think you might have a claim against somebody, get legal advice as soon as possible.
And it's more complicated, because a dismissed employee may have more than one (or different) avenues of recourse, with different timeframes. Going before the HRTO, for example, requires an Application to be filed within one year of the incident (or, the last incident in a pattern, as the case may be).
Not all avenues are suitable or preferable for any given case, and choosing one often means you can't pursue another afterwards, so talk to a lawyer before choosing one. And do it sooner than later, because sometimes the best option is the one that expires first.
Limitations periods are strictly enforced. They aren't relieved against lightly.
And what's more, even with something which should be as black-and-white as wrongful dismissal, it may not be so clear: When did the cause of action arise? The date of dismissal, of course. Or perhaps the date that notice of dismissal was given? Or maybe the date at which pay continuance stopped? Or, in a case of constructive dismissal, could it be the date that the problems in the workplace arose that eventually drove you out?
Showing up on your lawyer's doorstep the day before the limitations period expires is not exactly practical, either. Yes, there are sometimes things that can be done on short notice, but I don't always take on files under such circumstances, and never without a hefty retainer paid by bank draft or certified cheque. The normal process involves negotiations, which take time. Most wrongful dismissal matters are resolved without ever needing to incur the expense associated with commencing litigation.
The bottom line is this: There is almost never a good reason to need to fight about limitations periods. A plaintiff should assume the earliest possible limitations date, and start the process well in advance of it. (The other take-away here, however, is that because these things are nuanced, you shouldn't be stopped from seeking legal advice simply because of delay. Don't assume that you're out of options until your lawyer tells you so.)
*****
This blog is not intended to and does not provide legal advice to any person in respect of any particular legal issue, and does not create a solicitor-client relationship with any readers, but rather provides general legal information. If you have a legal issue or possible legal issue, contact a lawyer.
Subscribe to:
Posts (Atom)