by Isabelle East-Richard

Throughout Canada, whether under article 2088 of the Civil Code of Québec in Quebec or the common law elsewhere, employees have a duty to act faithfully and honestly toward their employer once the employment relationship has ended. That is the case even when there is no noncompetition clause in an employment contract.

Although some have thought that this duty to act faithfully and honestly may give employers protection against competition from their former employees, that protection may be limited. Indeed, in 9129-3845 Québec inc., the Quebec Court of Appeal recently said that it was reasonable for such a duty to last only three months following the termination of employment.

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by Marisa Victor and Christopher Copeland

Can a Canadian employee who is fired for cause sue for outstanding bonuses? What about if those bonuses relate to the period of the employee’s wrongdoing? This was the issue in Mady Development Corp. v. Rossetto, when a terminated executive sought to claim his bonuses for a period when he was found to be misappropriating company resources.

Facts

Leonard Rossetto was employed as an executive with a group of corporations (Mady). In fall 2007, he diverted labor, materials, and funds from Mady to renovate his house. He was fired on December 12, 2008, when Mady discovered his wrongdoing. Mady then sued him to recover the misappropriated corporate funds and resources. Rossetto counterclaimed for his bonuses for 2007 and 2008. Pursuant to his employment contract, he was entitled to an annual bonus equal to 30 percent of Mady’s profits after overhead. The parties ultimately submitted their dispute to arbitration. read more…

by Gilda Villaran

Fraud in Canadian citizenship applications has been a concern. Following an investigation by police and the Canadian border agency, the Immigration Minister announced on September 10 that Citizenship and Immigration Canada (CIC) is proceeding to revoke the citizenship of 3,100 people who obtained it by fraud.

The discovery of this amount of fraud has resulted in a dramatic increase in the level of scrutiny of current applications. This also will no doubt affect future applications. There will be an impact not only on fraudulent applicants but also on honest ones. read more…

by Kyla Stott-Jess

Is a Canadian employer justified in terminating an employee for cause when that employee has disobeyed company policy? What if the consequences of the employee’s failure to follow policy put other employees at serious risk of harm? Not necessarily, said the Ontario Supreme Court recently in Barton v. Rona Ontario Inc.

Rather, the potential severity of any misconduct must be balanced against the employee’s attitude and past history when evaluating whether termination for cause is warranted.

Background

Kerry Barton was a longtime employee of Rona until the company fired him for cause in 2009. At the time of termination, Barton was the assistant store manager in Barrie, Ontario, and was responsible for managing about 140 employees. He had received good performance appraisals and had no disciplinary record. read more…

By Antonio Di Domenico

On Christmas Eve 2009, a swing stage (a work platform) suspended on the 14th floor of an Ontario apartment building collapsed. Four workers including the site supervisor died after falling to the ground.

Metron Construction was charged with criminal negligence causing death under Canada’s Criminal Code. The company’s owner and sole director, Joel Swartz, was charged under Ontario’s Occupational Health and Safety Act. Both the company and Swartz pleaded guilty. In two decisions, R. v. Metron and R. v. Swartz, both were fined significantly.

The basis for the charges and fines? The expanded scope of criminal liability under Canada’s Criminal Code, which is no longer confined to the “directing mind” of a corporation. Here it applied to an independent contractor. read more…

by Sara Parchello

While the summer has come and gone, employees’ photos of their summer activities may not be. If employees post those photos on Facebook or similar sites, employers may be confronted with just what employees did with their time over the summer. And what if, on a day an employee called in sick, you see photos of that same employee enjoying herself at a cottage, sunbathing on a dock with a cocktail in her hand?

Worse yet, what if the site allowed you to see the actual time that the employee posted the picture, being right in the middle of regular working hours? A recent arbitration case out of Alberta, Canada Post v. Canadian Union of Postal Workers, confirms that Canadian employers can rely on such evidence of inappropriate behavior. read more…

by Emilie Paquin-Holmested

Generally when employees decide to leave their jobs, they are considered to have quit. But in Canada, if they leave their jobs because the employer substantially changed essential terms of their employment, they are considered to have been constructively dismissed.

The line separating these two notions is often unclear. It’s especially so when terms of employment are changed after a corporate merger or integration. In a recent decision (St-Hilaire c. Nexxlink inc.), the Court of Appeal of Quebec reviewed the principles of constructive dismissal in this very context. read more…

by Karen Sargeant and Clayton Jones

Last week, we reported on the Ontario Court of Appeal’s decision in Bowes v. Goss Power Products Ltd., which found that an employee does not have a duty to mitigate where an employment contract contains a fixed severance entitlement but no express requirement to mitigate.

The Court of Appeal relied on a number of factors in coming to this conclusion, which should provide a clear warning to employers across the country. This article sets out those factors and suggests ways in which employers can make their employment agreements or offer letters more bullet-proof. read more…

by Keri Bennett

It has been a fundamental principle of employment law that terminated employees generally have an obligation to seek alternate employment to minimize or mitigate their resulting losses. Their right to get from the terminating employer the pay they would have received during a period of reasonable notice is usually net of any other earnings during that period. But does this same rule apply where a contract specifies the employee’s severance entitlement?

In an important recent decision, Bowes v. Goss Power Products Ltd., the Ontario Court of Appeal concluded that the duty to mitigate does not, in fact, apply where employment contracts contain specific termination payments and the employment relationship is terminated without cause. This is important because Canadian law on this point has been mixed. read more…

by Rosalind H. Cooper
Employers and others are generally protected by actions against them that occur outside of limitation periods. That applies to charges under Canadian occupational health and safety legislation, too. But when do those limitation periods begin to run?

A recent decision of the Ontario Court of Justice in R. v. Corporation (City of Guelph) has said they may begin to run at different times for different entities. In this case, the court said that although the limitation period in the Ontario Occupational Health and Safety Act (OHSA) began to run for the employer when the accident occurred, it began to run much sooner for the architect and engineer involved in the construction of the project that led to the accident. As such, charges could proceed against the employer, but not the architect or engineer. read more…