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Posts tagged: Doug MacLeod

Can a successor employer offer a person lessor termination pay than the original employer?

By , November 17, 2017 5:13 pm

Can a successor employer offer a person lessor termination pay than the original employer?

This issue was addressed by Ontario’s Court of Appeal in Krishnamoorthy v. Olympus Canada Inc., 2017 ONCA 873

Facts:  Carsen Group Inc. was the exclusive Canadian distributor for Olympus America Inc. Olympus America decided to terminate its distribution agreement with Carsen, and started a related company, Olympus Canada Inc. to distribute its Canadian products. In July 2006, Olympus America terminated its distribution agreement with Carsen and offered employment to one of Carsen’s employees, Nadesan Krishnamoorthy .  

Olympus Canada provided an offer of employment to Mr. Krishnamoorthy. The terms of the employment agreement limited the notice of employment he was entitled to receive to Employment Standards Act (“ESA”) minimums.  When Mr. Krishnamoorthy accepted Olympus Canada’s offer, he did not receive a signing bonus or any other additional compensation for entering into an employment agreement with Olympus Canada.  

Ten years later, Olympus Canada terminated Mr. Krishnamoorthy’s employment  without cause. Olympus Canada offered him the termination pay he was owed under his employment agreement.  Mr. Krishnamoorthy refused the offer claiming  the termination clause was unenforceable because Olympus Canada had not provided him with any legal consideration.

Issue on appeal: Did the motion judge err in concluding that the termination clause in the parties’ employment agreement was unenforceable due to a lack of consideration?

Decision: The Court of Appeal reversed the motion judge’s decision and ruled that Olympus Canada’s offer of employment amounted to consideration for the termination clause.

Mr. Krishnamoorthy relied on a provision of the Employment Standards Act which deems there to be continuity of employment where an employer sells his business to a purchaser who employs an employee of the employer. However, the Court ruled that this statutory provision  can not be used to claim rights or entitlements on which the ESA is silent. For example,  it does not require the purchaser of a business’ assets to offer employment to employees of that business on the same terms as their original contracts as claimed by Mr. Krishnamoorthy.  Olympus Canada became a new employer upon its purchase of some of Carsen’s assets, and the fact that Mr. Krishnamoorthy’s day-to-day job did not materially change after the sale was not relevant. As such, the Court of Appeal found that Olympus Canada’s offer of employment amounted to consideration for the termination clause.

Lessons to be learned:

  1. If your organization purchases the assets of another business you can offer employees of that business lessor terms of employment such as a lower pay rate and less termination pay.
  2. The employee is generally not required to accept substantially lesser terms of employment.
  3. If the employee accepts lesser terms of employment then a court will generally enforce the lesser terms of employment provided the contract is drafted properly and the terms comply with the Employment Standards Act.

All We Do Is Work

By , October 31, 2017 9:23 am

This blog introduces you to all members of the firm and describes the kinds of cases we handle.

 

MacLeod Law Firm

 

OUR PEOPLE

Nicole Simes has been working with me for more than four years. She represents and advises employers and employees. She spends a lot of her time in court and at administrative tribunals: she is a real litigator! Nicole has a particularly strong background and interest in human rights issues.

Nadia Halum articled with the firm and has been working as an associate for about 1 ½ years. Nadia also represents and advises employers and employees. Nadia is an exceptional legal researcher. She also has considerable experience assisting employers with compliance issues under the Employment Standards Act, the Occupational Health and Safety Act and the Accessibility for Ontarians with Disabilities Act.

Fiona Martyn is currently articling with the firm. She supports Nicole, Nadia and me. This includes legal research, drafting pleadings & facta, and putting together court documents.

Judy Lam is our Office Manager and oversees the non-legal aspects of the firm. She is often the first point of contact with the firm.

OUR CLIENTS

Employers

We mostly advise and represent small and medium sized employers. Many of our clients are owner operators. Most of our clients employ 100 or less employees although we do advise several large employers. Many of our employers do not have a person with a formal human resources designation (i.e. CHRP, CHRL, or CHRE) and for these clients, in addition to providing legal advice we often take on the role of trusted advisor.

When we are first introduced to a new client we make sure the employer has a well drafted employment contract. Then we make sure the client has complied with its obligations under Ontario’s employment laws.  Our blog keeps our clients up to date on most employment law developments. We are a phone call away and often answer questions in real time; that is, when you call with a question we can often answer it immediately on the phone.

Employees

We advise employees in all positions and all industries.

We review 100s of severance packages each year; this usually involves a one-hour meeting where we: review the background to the termination; discuss the client’s legal rights; discuss the client’s options; and, tell the client whether we think the package is fair.

If we cannot negotiate a fair settlement for our client then we commence legal proceedings. These proceedings may be commenced in small claims court, at the Ministry of Labour, at the Ontario Human Rights Tribunal, or in the courts. It is sometimes in our client’s interest to commence two or more legal proceedings.

We also review scores of employment contracts each year. After reviewing the history of contract negotiations, we inform our clients which parts of the contract are a problem and suggest ways to change the contract so it is more employee friendly. If our client is the employer’s clear first choice then we can often help the person secure significant enhancements to the employer’s initial offer.

ALL WE DO IS WORK

The MacLeod Law Firm will continue to restrict its practice to workplace law which includes employment law, labour law (i.e. workplaces that are unionized), and human rights law.

We have three lawyers to assist you with your legal needs. We operate a collaborative law practice which means we often consult with each other to get different perspectives on a case. I also delegate work to Nicole, Nadia and Fiona as appropriate which means our client receive cost effective service.

We understand that every client has a different risk tolerance. We get to know our clients so the advice we provide is consistent with this risk tolerance and makes business sense.

For those readers who have not retained the MacLeod Law Firm in the past and want to know how we can help your organization, please call me at 416 317-9894 at your convenience.

 

Case Study: Why You Need to Periodically Review Your Employment Contract

By , October 11, 2017 9:08 am

A well-drafted employment contract is the best employment law investment an employer can make. It protects an employer from significant liability and will usually save thousands of dollars in termination costs.

An employment contract should be reviewed periodically because judges are refusing to enforce termination clauses if they are not drafted properly.

In a recent case, Covenoho v. Pendylum Ltd.,2017 ONCA 284, Ontario’s highest court concluded a termination clause was not legally enforceable because it might breach the Employment Standards Act (“ESA”) in the future.

The Facts

Joss Covenoho signed a one year fixed-term contract with Pendylum Inc. The employer terminated her agreement without advance notice when she had been employed for less that 3 months. The termination clause stated in part that the contract could be terminated before the end of the fixed-term “if the Pendylum Client to which you have been contracted terminate[s] its contract with Pendylum for your services”.

Decision by Motion Judge

The motion judge concluded that since the employee had been employed for less than three months, she was not entitled to any notice of termination. Under the ESA an employer is not required to provide any notice of employment to an employee during the first three months of employment.

Decision by Court of Appeal

The Court of Appeal reversed the motion judge’s decision and found that the termination provisions were void. It ruled that “the terms must be construed as if (the employee) had continued to be employed beyond three months; if a provision’s application potentially violates the ESA at any date after hiring, it is void”. In this case, if Ms. Covenoho had been terminated after three months of work, then the termination clause would have violated the ESA because she could have been terminated without any notice of termination (or any payment in lieu of notice) contrary to the ESA.  The court also ruled the employee was entitled to receive the salary that she would have earned for the balance of the fixed-term contract.

Lessons for employers:

1)   Employers should periodically review their termination clauses to ensure they are properly drafted and do not provide shorter notice than required by the ESA.

2)  As we have written about before, it is generally a bad idea to enter into a fixed term contract. If a fixed term contract must be used, it must include an enforceable early termination clause.

On October 16 and October 20 MacLeod Law Firm is holding seminars in Toronto and Barrie that will cover three topics. One topic is why employment contracts need to be reviewed periodically. Cases like this one is one reason but there are other reasons. Information on the seminar can be found here.

For over 25 years, Doug MacLeod of the MacLeod Law Firm has been advising employers on all aspects of the employment relationship. If you have any questions, you can contact him directly at 416 317-9894 or at [email protected]

The material and information in this blog and this website are for general information only. They should not be relied on as legal advice or opinion. The authors make no claims, promises, or guarantees about the accuracy, completeness, or adequacy of any information referred to in this blog or its links. No person should act or refrain from acting in reliance on any information found on this website or blog. Readers should obtain appropriate professional advice from a lawyer duly licensed in the relevant jurisdiction. These materials do not create a lawyer-client relationship between you and any of the authors or the MacLeod Law Firm.

 

Everything You Need to Know About Ontario’s Employment Laws

By , September 26, 2017 9:35 am

Now that I have your attention, let me outline three things you need to know.

  1. The Ministry of Labour is devoting considerably more resources to enforcing the Employment Standards Act (the “ESA”) and your organization is more likely to be inspected.

Earlier this year, the government announced it was hiring an additional 175 enforcement officers. In addition, I expect amendments to the ESA will be passed this fall by way of Bill 148 which will impose several new obligations on employers.

If your organization is inspected you will be asked, among other things, if you have: posted certain required written policies; provided employees with required training & documentation; posted certain required information in a conspicuous place; and, complied with the new obligations imposed by Bill 148. If not, then the inspector will issue orders and you must comply with these orders. If not, your organization will be subject to significant fines.

Are you ready for an inspection?

  1. About 50% of the complaints that are filed with the Ontario Human Rights Tribunal deal with disability related discrimination. In many cases, an employee claims the employer has failed to accommodate a disability. So chances are you will receive a request for accommodation at some point in time.

Responding to a request for accommodation can be extremely complicated. Failing to do so can be extremely costly.

Did you know that there is a procedural duty to accommodate and a substantive duty to accommodate?

Did you know that in some cases you have a duty to ask an employee if they have a disability?

Did you know that in some cases you have a duty to offer another position to a disabled employee?

Do you know whether or not you can require an employee seeking accommodation to see a doctor of your choosing?

Did you know that some employers are required to prepare a written individual accommodation plan for a disabled employee?

Do you feel comfortable responding to a request for accommodation?

  1. A well drafted employment contract is, in my opinion, the best employment law investment you will ever make. For various reasons it needs to be reviewed periodically.

In an era when the government is taking away management rights, did you know that an employment contract can add to your management rights?

In an era when courts are refusing to enforce termination clauses (and other clauses)  in employment contracts, did you know that you need to periodically review your contract to make sure it doesn’t need to be amended?

When the government imposes new obligations on employers such as the ones that are contained in Bill 148, did you know that you need to review your employment contract to make sure it complies with the ESA? For example, if your contract states that an employee receives two weeks vacation each year then this clause will need to be changed if one section in Bill 148 becomes law this fall.

The MacLeod Law Firm is not in the seminar business. I believe these topics are so important, however, that I am holding a seminar in Toronto on October 16th and in Barrie On October 20th to discuss them.

For more information about the seminar, click here.

For over 25 years, Doug MacLeod of the MacLeod Law Firm has been advising employers on all aspects of the employment relationship. If you have any questions, you can contact him directly at 416 317-9894 or at [email protected]

The material and information in this blog and this website are for general information only. They should not be relied on as legal advice or opinion. The authors make no claims, promises, or guarantees about the accuracy, completeness, or adequacy of any information referred to in this blog or its links. No person should act or refrain from acting in reliance on any information found on this website or blog. Readers should obtain appropriate professional advice from a lawyer duly licensed in the relevant jurisdiction. These materials do not create a lawyer-client relationship between you and any of the authors or the MacLeod Law Firm.

 

The Confusing and Unsettled Law Relating to Employee Medical Notes

By , September 12, 2017 10:00 am

A proposed change to Ontario’s Employment Standards Act (“the Act”) contained in Bill 148 states that an employer shall not require an employee to provide a medical note from a qualified health practitioner (as defined in the Act) as evidence of a sickness if the employee claims a paid sick day under the Act. However, an employer may require an employee who takes a paid sick leave under the Act to provide evidence, that is reasonable in the circumstances, that the employee is entitled to the leave.

If this proposal is passed into law, the Act would override management’s common law right to require a medical note as proof of an illness for up to two days a year.

For more information on Bill 148, click here.

For more information on our October seminar which will discuss Bill 148, click here.

 

Medical Note

 

Can an employer request a better medical note?

I receive calls from employer clients who express frustration over the contents of a medical note submitted by an employee; often a one-line note.

The note states the employee is unable to work for a specified period of time. The note can be submitted in suspicious circumstances. For example, the employee may claim he is sick during a time he has been denied a leave or on the day after a long weekend.

There are two issues that arise in this scenario. One is whether the person is taking an unauthorized leave. The other is whether the leave is paid (assuming the person is entitled to paid sick leave).

The $64 000 Question: Can an employer demand that an employee attend an independent medical examination

When a suspicious medical note is received the employer often wants to know whether it has the right to force the employee to see a doctor of the employer’s choosing to confirm the illness.

Independent Medical Examinations when a Disabled Employee Requests Accommodation

The $64,000 question can and does arise when a disabled employee requests accommodation.

In this scenario, employers have the duty to accommodate an employee’s disability unless it would cause undue hardship. For this duty to be triggered the employee generally discloses a disability and requests accommodation.

An employer is required to accommodate both physical disabilities and mental disabilities.

For example, an employee may request significant accommodation based on minimal information such as a medical note that states: “John Smith is medically able to return to work on Monday and can work 2 hours a day for the next two weeks and 4 hours a day for the following two weeks.”

Can an employer demand that an employee attend an independent medical examination as part of the procedural aspect of the duty to accommodate? The answer is, of course, “It depends”

A Case Study: Bottiglia v. Ottawa Catholic School Board, 2015 HRTO 1178 (CanLII)

The Facts

In April 2010 Mr. Bottiglia went on sick leave. At that time, he had accumulated approximately 465 paid sick days.

In June 2011 Mr. Bottiglia’s physician, Dr. Richard Levine, told the employer that he needed a medical leave until further notice and that when a return to work was foreseeable, the employer would be informed in a timely fashion.

In February 2012, Mr. Bottiglia told the employer “while it always has been my hope that my health situation would improve with time and allow my return to work, much to my chagrin and disappointment, my latest medical assessment indicates that a full recovery will take a prolonged period of time.”

In a March 2012 letter Dr. Levine stated that Mr. Bottiglia had been struggling with a mental disability. Dr. Levine further stated that Mr. Bottiglia’s condition had been relatively treatment resistant, that Mr. Bottiglia had required an extended period of time off work, that it was his clinical judgement that a return to the current workplace would place Mr. Bottiglia at serious risk of relapse, and that Mr. Bottiglia would lose the gains that he had made so far during his time with Dr. Levine.  Dr. Levine indicated that his opinions were based on the regular one-hour meetings he had been having with Mr. Bottiglia over the prior ten months.

Five months later in August 2012, after all of Mr. Bottiglia’s sick days had been used, Dr. Levine stated that he believed that Mr. Bottiglia would be able to return to modified work duties sometime in the next two months.

About three weeks later, Dr. Levine provided a “Five Point Plan for Resumption of Career” that provided for a return to work.

In these circumstances, the employer took the position that a second medical opinion was warranted and requested that Mr. Bottiglia undergo an independent medical examination.

This request was contemplated under the employer’s Guide to Workplace Accommodation for Employees which provided in part that “The Principal or Supervisor or other employer representative has the right to request additional information from the employee when there is insufficient information provided by the employee relating to a request for accommodation”. In addition,”Where … the Terms and Conditions of Employment permit, the employer may request (through the Human Resources Department) a ‘request for a second medical opinion’ where the employer has been unable to obtain from the employee’s own health practitioner information concerning the employee’s own limitations and/or restrictions on his/her essential duties of his/her position, the employee’s medical prognosis related to the accommodation request and any recommendations with respect to the accommodation or where, in the opinion of the employer, circumstances warrant a second opinion.”

Mr. Bottiglia refused when the parties could not agree on the information that would be provided to the doctor conducting the independent medical examination and commenced a human rights complaint.

The Decision

An adjudicator appointed under the Ontario Human Rights Code concluded the employer had the right to demand an independent medical examination in the circumstances.

This decision was upheld by the Divisional Court, and Ontario’s Court of Appeal.

For more information on our October seminar which discusses an employee’s duty to accommodate an employee’s disability, click here.

Lessons to Be Learned

  1. Bill 148 which is currently before the Ontario legislature would, if passed into law, prohibit an employer from requiring medical notes to confirm illness in limited circumstances.
  2. An employer should consider adding a term to its employment contract giving it the explicit right to require an employee to submit to an independent medical examination in certain circumstances.
  3. An employer has the right to demand that an employee requesting accommodation submit to an independent medical examination in limited circumstances. The issue in these cases is often resolving the competing interests of an employer’s right to information in order to manage an accommodation process and employees wanting to restrict access to their medical information on the basis of personal privacy.

For over 25 years, Doug MacLeod of the MacLeod Law Firm has been advising employers on all aspects of the employment relationship. If you have any questions, you can contact him directly at 416 317-9894 or at [email protected]

The material and information in this blog and this website are for general information only. They should not be relied on as legal advice or opinion. The authors make no claims, promises, or guarantees about the accuracy, completeness, or adequacy of any information referred to in this blog or its links. No person should act or refrain from acting in reliance on any information found on this website or blog. Readers should obtain appropriate professional advice from a lawyer duly licensed in the relevant jurisdiction. These materials do not create a lawyer-client relationship between you and any of the authors or the MacLeod Law Firm.

 

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