Minimum Wage Increase and Constructive Dismissal

Legislation meant to help the precarious situation of minimum wage earners is having the opposite effect on some of these workers.

2018 brought with it an increase in the minimum wage for Ontario workers. For the hundreds of thousands of Ontario workers who earn minimum wage, the increase of minimum wage to $14 per hour from Bill 148 was a blessing.

Many employers, however, did not feel the same way. Business owners small and large alike have pushed back against Ontario’s minimum wage increase. Many have argued that increasing their employees’ wages will drastically cut into their bottom line. Some have even found creative ways to rebalance their budget.

Tim Hortons

Shortly before the minimum wage was increased, one Tim Horton’s franchise in Cobourg, Ontario sent a letter to its employees informing them that there would be some changes to their benefits and incentives. There were three main changes to their employment terms:

  1. Paid breaks were eliminated
  2. Benefits coverage was drastically reduced
  3. Incentives (like paid days off) were cancelled

Were these changes at the discretion of the employer? Or do they constitute a substantial enough rollback to qualify as a constructive dismissal?

Constructive Dismissal

According to the Supreme Court of Canada, a constructive dismissal occurs when “an employer decides unilaterally to make substantial changes to the essential terms of an employee’s contract of employment and the employee does not agree to the changes and leaves his or her job, the employee has not resigned, but has been dismissed.”

That is, when an employer makes significant and sudden alterations to an employee’s terms of employment, the employee may be in the position to treat their contract as having been terminated. In the case of a constructive dismissal, an employee’s resignation from the company may be considered a dismissal, entitling the employee to a severance package the same as if they had been terminated without cause.

The Tim Hortons situation raises a few questions with regards to constructive dismissal. Did the employees agree to the changes? Were the employees given reasonable notice? Are these changes considered substantial or fundamental?

Determining if changes made to the terms of employment like those in Cobourg constitute a constructive dismissal can be complicated. Claiming constructive dismissal carries a degree of risk, especially since there is no guarantee of compensation once an employee has left their position.

Takeaway for Employers

While the actions of the Cobourg Tim Hortons franchise owners have sparked much debate, they have not yet been litigated. Nonetheless, the situation is a good reminder to employers to make sure that any changes you wish to make to your employees’ contracts need to be done properly. An experienced employment lawyer can help you ensure that your changes are handled appropriately and legally.

If the increase in minimum wage has led to significant changes in the nature and compensation of your work, you should seek legal advice from an experienced employment law team before taking action. KCY at LAW can help you understand your rights and recommend the best course of action for your unique situation. Call 905-639-0999 to book your consultation today!

Marijuana Legalization and the Workplace

Impending legalization of recreational marijuana use has many employers wondering about impairment, poor productivity and attendance, and unsafe conditions in their work environment.

Drug Testing in the Workplace

The Ontario Human Rights Commission recognizes that workplace safety is a legitimate goal for employers. However, workplace drug testing should only be adopted if there is a bona fide occupational requirement for doing so. This means that the testing practice is:

  • adopted for reasons logically connected to the job’s performance
  • adopted in good faith to achieve a legitimate work-related purpose
  • reasonably necessary to achieve this purpose

Employers must therefore be able to demonstrate that it is not possible to accommodate an employee’s recreational or medicinal marijuana use without incurring undue hardship on their business.

Marijuana Impairment

When it comes to drug and alcohol testing, tests should be done to measure current impairment, not act as a deterrent.

One of the difficulties facing businesses who may have legitimate requirements for their employees to undergo drug testing is that there is currently no clear consensus on what constitutes marijuana impairment. Unlike with breathalyzers for alcohol, there are no precise tests for measuring current levels of impairment from marijuana use.

Urine tests can pick up use that happened weeks earlier and blood tests only reveal use in the past few hours. Neither of these tests can quickly measure current levels of impairment.

Discrimination, Human Rights and the Duty to Accommodate

With the legalization of recreational marijuana, employers will have to balance competing obligations to accommodate medical marijuana use and cannabis addiction, and to ensure the health and safety of all in their workplaces.

As with any other prescribed medication or addiction (which is considered a disability under human rights law) employers have a duty to accommodate the needs of their employees to the point of undue hardship.

Accommodation policies can largely mirror existing policies for prescription medications that can have an impairment effect. Similarly, rules regarding the recreational use of marijuana in the workplace, during working hours and outside the workplace can mirror your policies on alcohol consumption.

Some options for accommodating an employee’s medical marijuana requirements include:

  • moving employee out of safety-sensitive positions
  • providing more frequent breaks
  • offering alternative scheduling or duties

A prescription for medical marijuana does not entitle an employee to be impaired at work or compromise the health and safety of themselves or others. Nor does is override smoke-free laws or allow for unexplained absences or late arrivals.

Policies and Procedures

Employers may have to review and update their workplace policies and procedures to address the legalization of recreational marijuana use.

The good news is, the legalization of recreational marijuana isn’t likely to require you to make radical changes to your existing workplace policies and procedures. Fulfilling your human rights obligations while keeping your workplace safe and productive should not pose a significant challenge to most employers.

You will no longer be able to include cannabis use as an illegal off-duty activity and you likely will no longer be able to restrict employees’ possession of it in the workplace. However, employers will be able to take progressive disciplinary actions for an employee’s failure to follow workplace policies.

Impairment at Work

Employees do not have the right to be impaired at work. You can still expect workers to show up sober and ready to work.

Employers will be able to set rules regarding marijuana use similar to those they may already have regarding alcohol consumption. Furthermore, employers can prohibit the use of marijuana at work and during working hours.

KCY at LAW can Help

With all these changes and so much uncertainty, employers may be unsure of their rights when it comes to maintaining a safe and drug-free work environment. Due to the conflicting nature of existing case law, employers should consider having their policies reviewed by an experienced employment lawyer. To book your consultation with KCY at LAW, call 905-639-0999

Expanded Liability for Workplace Harassment

Whereas traditionally, harassment and discrimination complaints have been directed at employers or colleagues, a recent decision from the Supreme Court of Canada has many employers worried about increased liability for workplace harassment between parties without a direct employment relationship.

British Columbia Human Rights Tribunal v. Schrenk, 2017

Mohammadreza Sheikzadeh-Mashgoul was a civil engineer and was assigned by his engineering firm to consult on a road improvement construction project. Part of Mr. Sheikzadeh-Mashgoul’s job was to supervise workers on the site. As is often the case on construction sites, these workers had a different employer than Mr. Sheikzadeh-Mashgoul.

One of these workers, Edward Schrenk, repeatedly made discriminatory and harassing insults about Mr. Sheikzadeh-Mashgoul’s religion, birthplace and sexual orientation. Having enough of Mr. Schrenk’s racist and homophobic slurs, Mr. Sheikzadeh-Mashgoul brought a human rights complaint against Mr. Schrenk and Mr. Schrenk’s employer.

Mr. Schrenk and his employer argued that Mr. Sheikzadeh-Mashgoul couldn’t bring a complaint against them since they were neither Mr. Sheikzadeh-Mashgoul’s colleague nor employer. They argued that the British Columbia Human Rights Tribunal (BCHRT) did not have jurisdiction over the complaint since Mr. Sheikzadeh-Mashgoul and Mr. Schrenk had different employers.

The Tribunal ruled that it did have jurisdiction, a decision that was overturned at the BC Court of Appeal. However, the Supreme Court of Canada has agreed with the BCHRT that this matter between Mr. Sheikzadeh-Mashgoul and Mr. Schrenk was within the Tribunal’s jurisdiction. The matter now sits again with the BCHRT.

The Supreme Court’s Decision

To support its decision, the Supreme Court of Canada cited the BC Human Rights Commissions prohibition on discrimination in the employment context. The court argued that the BC Human Rights Code protects workers from discrimination and harassment in employment regardless of the identity of the perpetrator.

Despite the lack of direct employment relationship, the Supreme Court ruled that Mr. Sheikzadeh-Mashgoul’s complaint was valid.
According to Justice Abella, this responds “to the realities of modern workplaces, many of which consist of diverse organizational structures which may have different employers and complex work relationships… [and] recognizes that preventing employment discrimination is a shared responsibility among those who share a workplace.”

Similarly, Justice Rowe agreed that the Human Rights Code “supports an approach that views employment as a context requiring remedy against the exploitation of vulnerability rather than as a relationship needing unilateral protection.”

What this Means for Employers

The Supreme Court’s decision has expanded scope of Human Rights protection to non-traditional workplace relationships, including parties who have no direct employment relationship. This allows individuals to proceed with employment discrimination complaints against individuals and organizations with whom they have no formal employment relationship. Employers may now be liable for human rights claims from people who are not even their employees.

Accordingly, an individual may bring a human rights complaint if the:

  • perpetrator was important to the complainant’s workplace
  • discrimination happened in the complainant’s workplace
  • complainant’s work environment or performance was negatively affected by the perpetrator’s action.

Outside of BC, the impact of the Supreme Court’s decision depends on the wording in your province’s human rights legislation. Ontario’s Human Rights Code is similar to that of BC which suggests Ontario employers will also face this new liability for harassment and discrimination in the workplace.

You should always consult with an employment lawyer if you are facing a discrimination or harassment claim.

If you have questions regarding the impact of this Supreme Court decision on your business, call KCY at LAW and book your consultation today! 905-639-0999