Employee or Contractor? Cormier v. 1772887 Ontario Limited c.o.b. as St. Joseph Communications, 2019 ONSC 587
This case touched on two important issues for employers: how to tell the difference between employees and independent contractors and how to ensure that your termination clauses don’t conflict with the Employment Standards Act (ESA).
Ms. Cormier worked with St Joseph Communications for a period of 23 years – first as a freelance contractor, then in two different roles with two different employment contracts. Her last employment contract included a termination clause that provided that her benefits would only be continued at the discretion of the employer’s insurers and would not include long- or short-term disability during the notice period. The Court found that this termination clause was void and unenforceable because it conflicted with the ESA, as it failed to ensure the payment of all of Ms. Cormier’s benefits for the entirety of the ESA notice period. Any reduction or removal of benefits upon termination, regardless of what an insurer says, conflicts with the ESA rendering the termination clause unenforceable.
Since the termination clause was void, the Court was required to determine the applicable period of common law reasonable notice. When Ms. Cormier was terminated without cause in 2017, she was offered severance calculated for the 13 years that she was deemed an employee by St. Joseph Communications. However, Ms. Cormier sought severance calculated based on her entire 23 year history with the employer, including both her years as an employee and as a contractor.
Ultimately, the Court found that prior to becoming an employee Ms. Cormier was a dependent contractor and that those years of service as a contractor must therefore be considered when calculating the applicable notice period. However, the judge went even further and stated a novel proposition in employment law that even if Ms. Cormier was truly an independent contractor during her years prior to becoming an employee for the employer, he still would have included those years of service in calculating the reasonable notice period at common law. The judge ruled that Ms. Cormier was therefore entitled to 21 months of severance based on the entire duration of her relationship with her employer.
As this case demonstrated, all employers must attach significant importance to ensuring that they have enforceable termination clauses in their employment contracts, otherwise they can be subject to massive severance payments that they never expected or prepared for when terminating employees..
For more on employees and independent contractors see our recent article “Don’t Mistake Your Employees for Independent Contractors”
Workplace Harassment to Constructive Dismissal – Colistro v Tbaytel 2019 ONCA 197
This case demonstrates that re-hiring someone previously dismissed for harassment can result in the employer being found to have constructively dismissed the complainant.
In 2007, the City of Thunder Bay announced that it was hiring Mr. Benoit as a Vice-President. What was unusual about this announcement was that Mr. Benoit had been dismissed by the City of Thunder Bay 11 years earlier for engaging in harassment against several employees. The plaintiff in this case, Ms. Colistro, was one of those employees and was still employed in the same department.
Despite Ms. Colistro raising concerns about Mr. Benoit’s hiring due to the reasons for his dismissal 11 years earlier, the employer went ahead and hired Mr. Benoit and refused to terminate his probationary employment. Ms. Colistro was offered an equivalent position in an adjacent building separate from Mr. Benoit’s workspace but she refused. Ms. Colistro went on stress leave, before eventually being diagnosed with PTSD. Ms. Colistro did not return to work, and she sued her employer for wrongful dismissal—that she was constructively dismissed because she was placed in a hostile work environment.
Ultimately, the Court found in favour of Ms. Colistro and ruled that she had been wrongfully dismissed. In doing so, the Court stated that there are “consequences that flow from a company’s decision to place its business interests above the expectations and concerns of a valued, long-time employee…”
For more on your legal obligation to provide employees with a harassment free workplace, read our article: “Protecting Your Employees – Workplace Harassment”
Cannabis Impairment-related Safety Risk – International Brotherhood of Electrical Workers, Local 1620 v Lower Churchill Transmission Construction Employers’ Association Inc. 2019 NLSC 48
This case demonstrates that an employer may be able to legally deny employment to a medically-prescribed cannabis user where the position is deemed to have impairment-related safety risks.
In 2016, a company with the Lower Churchill Transmission Construction Employers’ Association hired a member of the International Brotherhood of Electrical Workers, Local 1620 to work on a project, conditional on pre-employment drug and alcohol screening tests.
Due to medically-prescribed marijuana use, the prospective employee did not pass the drug screening tests and was not hired for the position, which was deemed to have impairment-related safety risks. The worker was also not successful in securing a second position with the same employer. The employer declined to hire the employee even after reviewing his medical files, at which time the union grieved, citing the employer’s failure to accommodate the prospective employee’s disability.
On the grievance the arbitrator decided in favour of the employer. It stated that since the residual impairment of the marijuana use cannot be accurately measured, the employer’s inability to measure and monitor the risk of harm in the safety sensitive environment constituted undue hardship. The employee and his union sought to overturn the arbitrator’s decision, but the Newfoundland and Labrador Supreme Court upheld the arbitrator’s decision.
This case is another example of how, as Canada moves forward with Bill C-45 and the decriminalization of marijuana use, employers must pay attention to the impact on their organizations, in particular to situations where it may be necessary to measure or prove impairment.
For more on your right to design the Drug and Alcohol Policy that makes sense for your workplace, so long as certain accommodations are met for a small minority of marijuana users, see our article “Marijuana Legalization: Helping Employers See through the Smoke”.