FTR Now

Beyond COVID-19: 2021 Year in Review – Cases and Legislation of Note

FTR Now

Beyond COVID-19: 2021 Year in Review – Cases and Legislation of Note

Date: December 22, 2021

Employers and human resource professionals will undoubtedly remember 2021 as another year shaped by the pandemic.

But … there were also legal developments in 2021 that were not related to COVID-19. In this FTR Now, we look at some of the year’s notable “non-pandemic” cases and legislative developments of interest.

Cases of Note

Human Rights

Discrimination

  • Imperial Oil Limited v. Haseeb: The Divisional Court quashed a decision of the Human Rights Tribunal of Ontario, which treated “permanent residence” as intrinsically included in the protected ground of “citizenship.” On judicial review, the Court held that “citizenship” and “permanent residence” are separate in meaning and that expanding the definition of “citizenship” to include “permanent residence” goes beyond applying a liberal and purposive interpretation to the Ontario Human Rights Code.
    • On November 10, 2021, leave to appeal to the Ontario Court of Appeal was granted.
  • United Nurses of Alberta v Alberta Health Services: The Alberta Court of Appeal clarified the applicable test for prima facie discrimination in family status human rights cases. The Court of Appeal rejected the Johnstone test and instead adopted the test for discrimination as articulated by the Supreme Court in Moore. As a result, the employee was not required to show she first made efforts at self-accommodation in order to prove prima facie discrimination.
    • On July 21, 2021, the employer filed an application for leave to appeal this decision with the Supreme Court of Canada. The decision on leave has not yet been rendered.

Damages

  • Francis v. BC Ministry of Justice (No. 5): The British Columbia Human Rights Tribunal ordered the BC Ministry of Justice to pay over $900,000 in damages to a former correctional officer who had been subject to racial discrimination. The award included a record $176,000 as compensation for injury to the complainant’s dignity, feelings and self-respect.

Labour Relations

  • Northern Regional Health Authority v. Horrocks: The Supreme Court of Canada held that a labour arbitrator in Manitoba had exclusive jurisdiction over a human rights dispute involving a unionized workplace. The Supreme Court’s analysis focused on the specific wording in the Manitoba Labour Relations Act. Whether an arbitrator holds exclusive jurisdiction in other provinces will likely depend on whether its legislature has provided concurrent or exclusive jurisdiction to another adjudicative body.
  • Unifor Canada Local 594 v Consumers’ Co-Operative Refineries Limited: The Saskatchewan Court of Appeal dismissed the union’s appeal from a lower court decision which permitted picketers to delay traffic in and out of the employer’s workplaces, but provided for an exception which allowed persons crossing the picket line to decline to listen to the union’s message and to proceed without delay. The Court determined that the order appropriately struck a balance between allowing free access and right to use the employer’s property, while also protecting the picketers’ Charter rights. The Supreme Court of Canada dismissed the union’s application for leave of appeal.
  • Ontario Power Generation v Society of United Professionals: The employer terminated the grievor’s employment for his harassing, discriminating and bullying behaviour. Arbitrator Stout concluded that while the employer did not have just cause to terminate the grievor, the employment relationship was no longer viable and awarded the grievor damages in lieu of reinstatement.
  • Community Living Atikokan v Ontario Public Service Employees Union: Arbitrator Nairn found that a former employee’s online posts and “civil protest” against the employer breached the confidentiality and non-disparagement clauses of the parties’ Memorandum of Settlement. As a result, the Arbitrator ordered the employee to make a repayment to the employer in the amount of $3,000.00.

Occupational Health and Safety

  • Ontario (Labour) v. Sudbury (City): The Ontario Court of Appeal held that an “owner” of a construction project can also be considered an “employer” under the Occupational Health and Safety Act, even where it does not employ or exercise control over workers performing the construction work on the project.
    • On December 9, 2021, leave to appeal to the Supreme Court of Canada was granted.

Pay Equity

  • Ontario Nurses’ Association v. Participating Nursing Homes: The Supreme Court of Canada denied leave to appeal from this Ontario Court of Appeal decision. The Court of Appeal upheld the union’s position that, to maintain pay equity, seeking employers (i.e. those employers who are required to use the proxy method of comparison) are required to return to their proxy employers to obtain up-to-date information including job rates.
  • Ontario Nurses’ Association v. 10 Community Care Access Centres: The Ontario Divisional Court affirmed the long-accepted principle that, under the Pay Equity Act, maintenance of pay equity rests on the shoulders of the employer. The Court confirmed that a union does not have the right to negotiate the maintenance of pay equity for the bargaining unit.

Workers’ Compensation

  • Morningstar v. WSIAT: The Ontario Divisional Court partially overturned a decision of the Workplace Safety and Insurance Appeals Tribunal which had barred a constructive dismissal claim based on alleged workplace harassment from proceeding in court. In so doing, the Court narrowed the scope of claims that can be barred from proceeding by civil action pursuant to section 31 of the Workplace Safety and Insurance Act. (Editor’s note: the Court of Appeal denied leave to appeal this decision on January 20, 2022.)

Employment Law

Termination of Employment

  • Nahum v. Honeycomb Hospitality Inc.: The Ontario Superior Court of Justice awarded five months’ reasonable notice to a plaintiff with four-and-a-half months’ service. The Court clarified that pregnancy should not function to lengthen the notice period in every case, but a court may consider it a factor in cases where the pregnancy is reasonably likely to negatively impact the dismissed employee’s ability to find alternative employment. This finding was upheld by the Ontario Divisional Court.
  • Russell v. The Brick Warehouse LP: The Ontario Superior Court of Justice awarded 24 months’ notice to a 57-year-old plaintiff with 36 years of service. The Court also awarded $25,000 in moral damages for the manner of dismissal, which included the defendant’s failure to advise the plaintiff that if he rejected the offer in the termination letter, he would still receive his statutory entitlements and benefits continuation throughout the statutory notice period, and the failure to meet all the statutory entitlements including paying out accrued vacation pay.
  • Currie v. Nylene Canada Inc.: The Ontario Superior Court of Justice awarded the plaintiff 26 months’ reasonable notice. The Court held that the worker’s long service, limited educational background, low chance of securing alternate employment and age created the exceptional circumstances required to award a notice period in excess of the typical “24-month” maximum.

Employment Contracts and Termination Clauses

  • Waksdale v. Swegon North America Inc.: On January 14, 2021, the Supreme Court of Canada denied the employer’s application for leave to appeal from this decision of the Ontario Court of Appeal which held that termination provisions in employment contracts must be read as a whole and not on a piecemeal basis and if one contravenes the Employment Standards Act, 2000 (ESA), all are unenforceable.
  • McGuinty v. 1845035 Ontario Inc. (McGuinty Funeral Home): The Ontario Court of Appeal upheld a lower court decision awarding the respondent over $1.27 million in damages for constructive dismissal after determining that the employee had not condoned a change to their terms of employment.

Calculating Severance

  • Hawkes v. Max Aicher (North America) Limited: The Divisional Court held that the calculation of payroll for the purposes of determining an employee’s severance entitlement under the ESA should be based on the combined payroll of the Ontario employer and its global parent company.

Sexual Harassment

  • Hucsko v. A.O. Smith Enterprises Limited: The Ontario Court of Appeal found that an employer had cause to terminate the employment of a senior employee who had sexually harassed a co-worker and refused to take remedial steps required by the employer. In so doing, the Court of Appeal reversed a lower court decision, which found the employee was wrongfully dismissed, and awarded damages to the employee in lieu of 20 months’ notice.

Employment Status

  • Heller v. Uber Technologies Inc.: The Ontario Superior Court of Justice certified a class action brought by Uber drivers, finding that there were certifiable common issues with respect to whether drivers may have been misclassified as independent contractors within the meaning of the ESA.
  • O’Reilly v. ClearMRI Solutions Ltd.: The Ontario Court of Appeal found that a motion judge erred when she concluded that a parent company was a common employer for the purposes of an action brought by the plaintiff. It clarified that a corporation will not be found to be a common employer absent an objective intention to create an employer-employee relationship between the employee and the related corporation.

Pension, Benefits and Executive Compensation

  • Mikelsteins v. Morrison Hershfield Limited: The Ontario Court of Appeal considered the Supreme Court of Canada’s 2020 decision in Matthews v. Ocean Nutrition Canada Ltd. and confirmed its earlier finding that an employee’s common law entitlements upon termination of employment are distinct from any rights the employee may have under a shareholder agreement (and limitations on those rights) where they have purchased the shares separate and apart from their compensation structure.
  • Manastersky v. Royal Bank of Canada: A majority of the Ontario Court of Appeal, again after considering the Supreme Court of Canada’s decision in Matthews v. Ocean Nutrition, confirmed its earlier finding that a trial judge had erred when he found a former executive was presumptively entitled to incentive compensation during the reasonable notice period.
  • Battiston v. Microsoft Canada Inc.: The Ontario Court of Appeal overturned a lower court ruling that an employee whose employment had been terminated without cause was entitled to damages in respect of awarded but unvested stock options that were scheduled to vest during the reasonable notice period. The Court found that the trial judge had erred in concluding the employee had not received notice regarding the termination provisions of the stock award agreement; rather, it held the employee—who provided online acknowledgments that he read the agreement—was bound by the provisions of the agreement (including the termination provisions), whether he had read them or not and the employer could rely upon those acknowledgements. The employee was not to benefit from his own wrong action by acknowledging that he had read the terms when he had, in fact, not read the terms.
  • Meloche v. Meloche: The Ontario Court of Appeal allowed the appeal of a motion judge’s decision in which that judge found that divided pension payments assigned to a non-member former spouse should cease upon the former spouse’s death and benefits should not continue to be paid to the estate. In overturning this decision, the Court of Appeal found that the legislature has not precluded the possibility that pension payments which are divided at source for family law purposes may continue to the non-member former spouse’s estate for the balance of the member spouse’s life in the event the non-member spouse predeceases the member spouse.
  • Brousseau. v. La Cité Collégiale et al.: The Ontario Superior Court of Justice dismissed an employee’s claim against his employer for the breach of a purported verbal agreement regarding the payment of costs to transfer his pensions with previous employers to the employer’s pension plan (including the top up Supplementary Pension Plan), as well as for the negligent misrepresentation of his monthly pension in retirement. In dismissing the employee’s claim, the Superior Court placed significant weight on the employee’s expertise in pension issues and his knowledge of specific restrictions against transfers to the Supplementary Pension Plan.

Litigation

  • Caplan v. Atas: The Ontario Superior Court of Justice recognized a new common law “tort of internet harassment” to address the issue of hateful communication on the internet. The decision comes nearly two years after the Ontario Court of Appeal declined to recognize a common law tort of harassment in Merrifield v. Canada (Attorney General).
  • Wastech Services Ltd. v. Greater Vancouver Sewerage and Drainage District: The Supreme Court of Canada commented on and clarified the principle of good faith in contracts, a principle previously recognized by the Court in Bhasin v. Hrynew. The Supreme Court held that good faith performance will not be breached so long as the party exercising its discretion does so in a manner that is consistent with the purpose for which the discretion was granted.
  • Eynon v. Simplicity Air Ltd.: The Ontario Court of Appeal upheld a jury award of $150,000 in punitive damages against an employer for the “sufficiently illegal and reprehensible” actions of two of its supervisors after an employee’s workplace injury.

Legislative Updates

Set out below are some key “non-pandemic” legislative developments from 2021. Note that not all of these developments have been proclaimed in force at the time of writing.

Ontario

  • Amendments to the exemptions made under the Police Record Checks Reform Act, 2015: On June 17, 2021, the Ontario government filed O. Reg. 477/21 which amends O. Reg. 347/18, Exemptions, made under the Police Record Checks Reform Act, 2015. The amendments impact employers who use police record checks as part of their hiring process. The amendments add new conditions of disclosure, including requiring the subject’s written consent for police services to conduct a record check and providing disclosure of the results to the subject upon request, with some exceptions.
  • Enhanced protections for students reporting sexual violence on campus: The Ontario government filed O. Reg. 646/21 amending O. Reg. 131/16, Sexual Violence at Colleges and Universities, made under the Ministry of Training, Colleges and Universities Act, to include additional protections for college and university students who disclose or report sexual violence. Among other key provisions, the amending regulation requires universities and colleges to ensure their sexual violence policies prohibit persons investigating sexual violence from asking irrelevant questions, such as those relating to the complainant’s sexual history and expression.
  • Working for Workers Act: On December 2, 2021, Bill 27, Working for Workers Act, 2021, received Royal Assent. Among other things, Bill 27 makes significant amendments to the ESA, including employers with 25 or more employees are required to have a policy on disconnecting from work and, subject to limited exceptions, employers and employees are prohibited from entering into non-compete agreements.
  • Changes to the long-term care sector: On December 9, 2021, Bill 37, Providing More Care, Protecting Seniors, and Building More Beds Act, 2021, received Royal Assent. Bill 37 repeals the Long-Term Care Homes Act, 2007, replacing it with the Fixing Long-Term Care Act, 2021. Notable changes include the establishment of direct hours of care targets and increased fines for offences committed under the legislation. Bill 37 also amends the Retirement Homes Act, 2010.
  • Ontario minimum wage increase: On December 9, 2021, Bill 43, Build Ontario Act (Budget Measures), 2021, received Royal Assent. Among other things, Bill 43 amends the ESA to increase the general minimum wage from $14.35 to $15.00 per hour, effective January 1, 2022. Bill 43 eliminates the minimum wage rate for liquor servers (currently set at $12.55 per hour) such that liquor servers would be entitled to the general minimum wage.
  • Protections for pension plan whistle-blowers: Bill 43 amends the Financial Services Regulatory Authority of Ontario Act, 2016 (FSRA Act) to include protections for whistle-blowers in the pension sector and other sectors regulated by the Financial Services Regulatory Authority of Ontario. In addition to various confidentiality protections, the amendments prohibit reprisals against whistle-blowers. Those who contravene the prohibition against reprisals are guilty under the FSRA Act of an offence, and if convicted, penalties include significant monetary fines. (Editor’s Note: These amendments were proclaimed in force on April 29, 2022.)

Federal

  • National Day for Truth and Reconciliation: Effective August 3, 2021, Bill C-5, An Act to amend the Bills of Exchange Act, the Interpretation Act and the Canada Labour Code (National Day for Truth and Reconciliation), amends the Canada Labour Code (CLC) to designate September 30 of each year as National Day for Truth and Reconciliation. This new public holiday applies only to federally regulated workplaces subject to the CLC.
  • Amendments to the CLC: On June 29, 2021, Bill C-30, Budget Implementation Act, 2021, No. 1, received Royal Assent. Bill C-30 enacts numerous changes to the CLC including an increase to the federal minimum wage ($15.00 per hour), and an extension of the Leave Related to Death or Disappearance of a Child (from 52 weeks to 104 weeks). Bill C-220, An Act to amend the Canada Labour Code (bereavement leave), also received Royal Assent on June 29, 2021. Bill C-220 amends the CLC’s bereavement leave provisions by extending entitlement to the leave by five unpaid days. Bill C-3, An Act to amend the Criminal Code and the Canada Labour Code, received Royal Assent on December 17, 2021. It amends the CLC to add entitlement of up to ten paid days of medical leave per calendar year, based on an accrual formula. It also expands entitlement to bereavement leave for up to eight weeks in the event of a death of a child or stillbirth experienced by the employee or the employee’s common law spouse or partner. These provisions will come into force upon proclamation.
  • Pay Equity Act: On August 31, 2021, the federal Pay Equity Act (Act), together with supporting regulations, came into force. The Act introduces a regime in which federally regulated employers with 10 or more employees must proactively develop a pay equity plan within three years of becoming subject to the Act. Employers must update their plan every five years to identify any gaps that may have emerged during that period.

Editor’s Note: This post has been updated since its original publication.

For more information on any of these developments, please contact your regular Hicks Morley lawyer.


The article in this client update provides general information and should not be relied on as legal advice or opinion. This publication is copyrighted by Hicks Morley Hamilton Stewart Storie LLP and may not be photocopied or reproduced in any form, in whole or in part, without the express permission of Hicks Morley Hamilton Stewart Storie LLP. ©