Workers in Ontario are entitled to meal breaks while at work. Under Ontario’s Employment Standards Act, a worker is prohibited from working more than 5 consecutive hours of work without a 30-minute meal break. Workers can agree to take multiple shorter break periods instead of one 30-minute break, but the total break period time must be 30 minutes. Workers should be aware that the ESA does not require these eating periods to be paid by the employers. Nevertheless, under employment law, workplace contracts can provide for specific break time. If an employer attempts to remove a contractual term like paid break time, this could result in significant changes in compensation, and workers may be protected under workplace constructive dismissal laws.

Role of an Electronic or Written Agreement

Constructive dismissal may apply if significant changes to the terms of employment are made by the employers. If a worker’s contract allows for paid break time during consecutive work hours, but the employer attempts to take this away, this could result in a significant change of employment, and indicate an intention of the employers to no longer be bound by the contract of employment. According to the Supreme Court of Canada in Potter v. New Brunswick Legal Aid Services Commission, constructive dismissals occur when a contractual term is breached, and such a breach is sufficiently serious. This includes things like a change in compensation or even hours of work, both of which would apply to the removal of a paid eating period at workplace. However, a minor breach of the employment contract may not justify a constructive dismissal; nevertheless, many small changes as opposed to one big change may also indicate the employer’s intention to no longer be bound by the contract of employment.

Breach of Entitlements

While workers are entitled to break times every 5 consecutive hours at work, many workers have unfortunately been compelled by employers in Ontario to work during their breaks. The Ontario Labour Relations Board has held that workers working into their coffee breaks are entitled to compensation for the time spent working. In Faucher v. 1078845 Ontario Inc., the OLRB held that Ms. Faucher was compelled by her employer to work past her eating periods and was not appropriately compensated for her labour. Consequently, the Board ordered Ms. Faucher to be paid for the time she worked during her eating period. This can also extend into issues of overtime pay. If an employer compels a worker to work past the eating period they are entitled to, the worker may work long hours, enough to earn overtime pay. In Kimberley Hadfield v 1529150 Ontario Inc. o/a The Staffing Connection and Director of Employment Standards, the OLRB acknowledged Ms. Hadfield frequently worked through the break time she was entitled to, and in doing so worked past the consecutive hours of overtime threshold. Consequently, the OLRB ordered that Ms. Hadfield be paid the outstanding wages she was owed on an overtime basis. The OLRB can therefore order employers to pay workers their unpaid wages if they breach the eating period entitlement.

When Serious Interference of an Employment Lawyer is Needed

Some workers may be hesitant to raise concerns about break time being skipped for fear of reprisal by their employers. However, workers should be aware that they are protected under the ESA from reprisals for exercising or attempting to exercise their rights under the act. In 9727868 Canada Inc. operating as Plug & Play Solutions v. Justin McMurray-Zitman, the OLRB held that Mr. McMurray-Zitman was terminated in reprisal for attempting to exercise his rights to a meal break. The board held that if any part of the decision to terminate the worker was made because the worker was trying to exercise their rights under the ESA, like an employee exercising their entitlements to coffee breaks, then the decision to terminate is tainted and in breach of the ESA. Furthermore, the employers must prove that the decision to terminate the employee was not made due to a worker’s attempt to exercise their rights. Failure to do so will be viewed by the OLRB as termination in reprisal against a worker. In this case, Mr. McMurray-Zitman was provided with compensation for the employer’s breach of the ESA. More generally, an employer is prohibited from threatening a worker with termination or discipline or terminating an employee or disciplining a worker in response to the worker attempting to exercise their rights under the ESA. In such circumstances, the board has the power to order the worker to be compensated or even reinstated because their rights have been breached.

In Ontario, workers have the right to take a leave of absence from work for personal illness. Under Ontario’s Employment Standards Act, a worker who has been employed by an employer for at least two weeks is entitled to take a leave of absence without pay due to personal sickness, illness, or medical emergency which can be proven by healthcare professionals. Currently, the ESA limits sick leave to three (3) unpaid days off from work per year. Workers seeking to take the time off under the ESA must inform their employer about it, either before they take the sick days, otherwise the worker must inform their employer as soon as possible that they will be taking the leave of absence.

Is Doctor’s Note a Reasonable Evidence?

Under the ESA, employers can require workers to provide evidence when taking sick leave. However, employers can request a sick note written by licensed healthcare providers. The evidence must be reasonable in the circumstances. Labour Arbitrators have provided some guidance regarding what constitutes reasonable evidence when requesting leave with a sick note. In Ontario Energy Board v. Society of United Professionals, Arbitrator Surdykowski held that employers are entitled to notice of time off with medical notes and the expected duration of the absence for legitimate work force management and absenteeism control purposes. According to Surdykowski, the onus is on the worker to establish that they were taking time off appropriately and must provide satisfactory explanations and reasonably required documentation for their leave. However, Surdykowski also states that employers are only entitled to the least degree of a worker’s private medical or other information necessary for the purpose. The primary question is what information is reasonably required for the circumstances of the sick leave. The arbitrator establishes that employers are entitled to know only that the worker is unable to work due to illness or injury, the expected return date, and what the worker can or cannot do. The length of the expected leave is an important consideration regarding what sort of medical evidence will be reasonably required, and longer leaves of absence due to sickness may warrant employers requiring updated or additional medical information.

Arbitrator Surdykowski continued by establishing a general standard for workers providing medical certificates and other evidence to their employers. So long as a medical document has a qualified doctor or regulated healthcare provider certifying the worker is unable to work for a generally described medical reason, and the duration of the absences is also estimated, the document will generally be sufficient to justify employees absence. Employers have no immediate right to a worker’s medical history, diagnosis, symptoms, treatment plan, or prognosis other than the doctor’s notes and expected return date to work. If employers want to have access to these particulars, they must first demonstrate a legitimate need for such information before they can compel workers to disclose these details. There are significant constraints around what details and evidence an employer can require from workers regarding sick notes. However, the Arbitrator’s decision also indicates that workers should provide reasonable information regarding doctor’s sick note.

Administrative Rules for Termination

Failure to provide reasonable evidence regarding sick notes could result in your employer conducting a workplace investigation. As stated above, workers have the onus to establish time off work is justified rather than the result of wanton absenteeism. Consequently, it is prudent for workers to provide reasonable information regarding their sick leave to avoid any allegations of unexplained absenteeism. Nevertheless, while absenteeism may justify termination for cause in limited circumstances, the Ontario Court of Appeal in Minott v. O’Shanter Development Company Ltd., consistent with the Supreme Court of Canada’s later ruling in McKinley v. BC Tel, held that missing a day of work unexplained will rarely justify just cause in the absence of prior warnings, especially if the worker has long worked for the employer.

Workers who are terminated after taking a leave with a doctor’s note, may have recourse to the anti-reprisal provisions in the ESA. Workers are protected from termination when they exercise or attempt to exercise their rights under the ESA. The Ontario Labour Relations Board in 2325671 Ontario Limited v. Susan Benson has held that if any element of a worker’s termination or discipline was due to the worker seeking to exercise their rights under the ESA, this constitutes reprisal. In other words, if a worker taking time off with doctor’s notes was in any way related to their termination or discipline, this would constitute reprisal under the ESA. Since sick note leave and other leaves of absence are covered under the ESA’s anti-reprisal provisions, the Board in Guy Morin v. Huawei Technologies Canada Co. has made it quite clear that termination for exercising or attempting to exercise these rights constitutes reprisal. In Haley Thompson v. 580062 Ontario Inc. (c.o.b. Slainte Irish Gastropub) the Board held that reinstatement with backpay is the presumptive remedy for the termination in reprisal, otherwise the worker can be provided monetary compensation. Overall, workers have a strong remedy when they exercise or attempt to exercise their rights under the ESA and are terminated or otherwise disciplined.

When terminating workers, employers have an obligation of good faith and fair dealing. In Wallace v. United Grain Growers Ltd., the Supreme Court of Canada aptly outlined that this obligation demands employers be candid, reasonable, honest, and forthright with their employees. Additionally, this demand also precludes employers from engaging in any conduct that is unfair or in bad faith, including conduct that is untruthful, misleading, or unduly insensitive. With this breakthrough, workers could receive extended damages through aggravated, moral, and punitive damage awards for employer misconduct in the manner of dismissal. Nevertheless, the generalized rule as outlined in Wallace requires a case-by-case articulation to determine what sort of conduct actually breaches the established rules.

Actual Breaches of the Obligation of Good Faith and Fair Dealing in the Manner of Dismissal

In a recent Ontario Superior Court Case, Koshman v. Controlex Corporation, Mr. Koshman himself was terminated by Controlex Corporation at age 69, after working for 18-and-a-half years, as a Vice President of the company, making $228,000 per annum. Mr. Koshman was on track to retire at 75 yet was terminated without cause. The court conducted a focused analysis of Mr. Koshman’s common law reasonable notice period and ruled that he was entitled to 24 months’ notice. On top of this robust notice period, Mr. Koshman was also awarded both aggravated and punitive damages. The court ruled that Mr. Koshman was entitled to $50,000 in aggravated damages for Controlex’s misconduct in the manner of dismissal. The misconduct outlined in this case constitutes a veritable litany of breaches of the obligation of good faith and fair dealing in the manner of dismissal. When Controlex acquired a new principal, Mrs. Dent, she carved a warpath against Mr. Koshman. She:

• Advised Mr. Koshman that he would no longer wield signing authority, which was a key component of his job;
• Personally visited Mr. Koshman’s customers, advising them not to deal with him, and criticized his character and honesty, telling some of them that he had been terminated prior to his termination;
• Offered Mr. Koshman’s job to a subordinate prior to his termination;
• Failed to meet with Mr. Koshman to discuss any concerns she may have had;
• Ostracized him from management duties;
• Provided only 2 weeks’ notice;
• Refused to pay Mr. Koshman’s accrued vacation pay;
• Terminated him by way of letter sent by courier;
• Further insinuated to clients that her husband, Mr. Dent, the former principal of Controlex Corporation, had been murdered and that Mr. Koshman was involved;
• Made defamatory comments about Mr. Koshman being dishonest; and,
• Baselessly alleged in court that Mr. Koshman had breached fiduciary duties.

Each of these acts of misconduct could satisfy the test for aggravated damages. Based on the entirety of the above, the court ruled that Mrs. Dent took significant steps to destroy Mr. Koshman’s reputation, and thus warranted an award of $50,000 in aggravated damages. But the court did not conclude the award of damages after the veritable litany of misconduct perpetrated against Mr. Koshman. In addition to the aggravated damages award, Mr. Koshman was also awarded a separate $50,000 as punitive damages. The court outlined that punitive damages are to be awarded only for the purpose of punishing defendants for misconduct, and only after all further damages have been awarded. Mrs. Dent embarked on a malicious, scorched earth campaign against Mr. Koshman, undermining the plaintiff’s ability to perform his job functions, attempting to destroy his reputation with customers and clients, making defamatory statements about him, and accusing him of criminal conduct and dishonesty. As if the laundry list of misconduct discussed regarding aggravated damages was not enough, during trial, Mrs. Dent:

• Pursued a baseless counterclaim against Mr. Koshman alleging termination for cause and seeking repayment of the eight weeks of severance paid out to Mr. Koshman since termination;
• Caused Controlex to default on a court order to appoint new counsel;
• Caused Controlex to abandon its defence of the proceeding;
• Chose not to attend the trial; and,
• Refused to communicate with the court or Mr. Koshman’s counsel.

It is well established that misconduct during the course of litigation can justify an award of extended damages, as held in the case of Galea v. Walmart Canada Corp. The court in Koshman carries this ruling even further, extending such misconduct beyond engaging in attrition to include refusals to participate in the hearing and stonewalling. At every stage of the manner of dismissal, the employer engaged in malicious misconduct against Mr. Koshman, whether before termination, during termination, and after termination. The aggravated and punitive damages awarded to Mr. Koshman indicate the obligation of good faith and fair dealing in the manner of dismissal are not trifling aspects of Ontario’s employment law.

Time Theft in Arbitral Jurisprudence

The phrase “time theft” itself is particularly loaded to paint the alleged misconduct of a worker as exceptionally severe and associate their alleged misconduct with criminality. However, this sort of language framing has been targeted by arbitral jurisprudence on the matter. In Grand & Toy Ltd. v. United Steelworkers of America, Local 9197 (Natal Grievance), Arbitrator Paul Craven stated that the phrase “time theft” presumes the time belongs to the employer and is being misappropriated by the worker. Instead, Arbitrator Craven stated that the time actually “belongs” to the worker, along with the worker’s strength, intelligence, skills, and innate capacities. In the employment context, the worker undertakes to accept the employer’s direction for the duration of employment in exchange for wages and subject to the terms of employment. The time still belongs to the worker, but the worker agrees to use that time under the employer’s direction. In this context, Arbitrator Craven indicates that “time theft” is more closely related to the industrial offence of insubordination rather than theft. Furthermore, Arbitrator Craven held the company’s particular rule against “time-theft” in this case was inconsistent with just cause provisions in the contract, as it prescribed termination for any instance of “participating in activities on company time that do not constitute company business”. Ultimately, Arbitrator Craven upheld the long-established standard of progressive discipline rather than immediate termination in response to violations of the “time-theft” policy.

Arbitrator Craven’s account was adopted by the Ontario Labour Relations Board in International Union of Elevator Constructors, Local 50 v. Otis Canada. In this respect, “time theft” may not necessarily involve an outright refusal to obey a direct order from an employer, but rather is a form of “culpable inefficiency” in the face of well-understood performance expectations. Indeed, there are similarities between such behaviour and the long-standing practice among workers referred to as soldiering. In a unionized context, collective soldiering, or deliberate reduction of productive output, can be considered an unfair labour practice under Ontario’s Labour Relations Act unless it is done while workers are in a legal strike position. It is very important how time theft is categorized and understood, lest the language be used to imply that a worker’s time, and hence their life, is owned by their employer throughout the duration of their employment. This simply is not the case. Characterizing time theft as theft rather than as insubordination results in a misapprehension of the offence and an overly severe response to the misconduct.

Insubordination and Dismissal

While “time theft” may be more akin to insubordination, both Ontario law and Canadian law more broadly consider insubordination misconduct justifying discipline by employers. It is well established that workers can be subject to discipline for insubordination in an employment context. However, it is also well established that the discipline must be a proportionate response to the worker’s misconduct. If an employer attempts to terminate a worker for cause because of “time theft”, the degree of discipline may be too severe to warrant termination for cause based on the circumstances. As outlined by the Supreme Court of Canada in McKinley v. BC Tel, dismissal for cause is only warranted in the most severe circumstances. Instead, employers are expected to utilize progressive discipline to temper and manage worker misconduct prior to termination, unless the misconduct is so aggravating and severe as to warrant immediate termination. If the employer fails to apply progressive discipline, the termination for cause may be unduly severe. If the worker after being subject to progressive discipline continues to engage in the misconduct, in this case, insubordination, the employer may be able to justify for-cause termination.

In the case of “time theft” insubordination, a minor instance of this occurring may be too meagre to warrant termination for cause. However, several repeated instances may cumulatively justify termination without notice, as outlined by the Ontario Superior Court in Daniels v. Canadian Gift and Tableware Assn. While minor and individual instances of such insubordination may not warrant termination for cause, repeated and cumulative instances can justify such termination.

Discussions of “time theft” have become more prominent in the wake of the COVID pandemic and remote work. Employers in Ontario are legally permitted to monitor workers remotely via electronic monitoring systems. Ontario’s Employment Standards Act entitles most workers to have their employer provide a written policy on electronic monitoring and make such a policy available and known to them. The policy must also outline how and in what circumstances the employer can monitor the worker, and the purposes for which information obtained via electronic monitoring is used. Nevertheless, employers are not prohibited from electronically monitoring remote workers, and may use such monitoring information to construct accounts of “time theft”. However, workers and employers alike should be aware of the limitations of algorithmically constructed accounts of “time theft”, which may result in inaccurate accounts of time spent on tasks due to algorithmic modelling issues.

ESA Termination Entitlements

Workers who have been terminated are provided minimum statutory entitlements in Ontario’s Employment Standards Act. The act outlines minimum entitlements for notice periods based on how long a worker has been employed. Minimum notice period entitlement under the ESA ranges from 1 week for workers who have been employed for less than 1 year, to 8 weeks if workers have been employed for 8 years or more. The Ontario Court of Appeal in Stevens v. The Globe and Mail has stated that the purpose of minimum notice periods is to soften the economic dislocation of the employee resulting from dismissal. In addition to minimum notice periods, the ESA also entitles certain workers to statutory severance pay. While severance is often used colloquially to refer to any payments made in the wake of termination, statutory severance pay is distinct from statutory reasonable notice. Workers are owed severance pay only under certain restrictive conditions. Firstly, workers must have worked with the employer for 5 years or more. Secondly, one of two things must be the case. Either the workers’ jobs must be permanently discontinued, and the worker is one of 50 or more workers affected by this elimination; or the employer has a payroll of $2.5 million or more. Under these circumstances, a worker is entitled to statutory severance pay, which amounts to 1 week per year of service on a pro-rata basis. In other words, every year of service results in 1 week of severance pay, and partial years of service entitle workers to partial weeks of severance pay.

Common Law Reasonable Notice

In addition to ESA termination entitlements, many workers are entitled to common law reasonable notice. Reasonable notice under common law tends to be more expansive than reasonable notice entitlements under the ESA and can provide workers with a greater degree of security after being terminated. Determining common law reasonable notice is significantly more complicated than the values available under the ESA. Common law reasonable notice is determined by a number of factors known as the Bardal factors, named after Bardal v. Globe & Mail Ltd. These factors include, but are not limited to, the workers:

• Character of employment;
• Length of service;
• Age; and
• Availability of similar employment regarding experience, training, and qualifications of the worker.

These factors, among others, are generally used to determine a workers’ common law reasonable notice period. As the Ontario Court of Appeal in Minott v. O’Shanter Development Company Ltd., has stated, calculating a worker’s reasonable notice period “is an art not a science”. In other words, reasonable notice periods can vary from case to case, based on the circumstances of the worker and their termination. Nevertheless, reasonable notice periods tend to exceed ESA entitlements, and can help workers recover from an unexpected termination of employment.

Reasonable Notice and ESA Entitlements

While reasonable notice typically provides greater relief for workers above and beyond statutory entitlements under the ESA, there are certain aspects of reasonable notice that interact with the minimum standards legislation. Most crucially, workers should be aware that ESA entitlements are included under reasonable notice, as outlined by the Ontario Court of Appeal in Stevens v. The Globe and Mail. In that case, the Ontario Superior Court ruled Stevens was entitled to 21 months’ compensation for reasonable notice; the Court of Appeal confirmed that both ESA notice periods in addition to severance pay were to be deducted from the 21 months’ compensation. The Court of Appeal held that ESA entitlements are specifically minimum entitlements, not separate from common law reasonable notice which can extend above and beyond those minimum entitlements yet nevertheless include those minimum entitlements. The Court of Appeal held that both severance pay and common law reasonable notice serve the same purpose of providing workers with an economic cushion from termination. More recently, in Chalmers v. Airways Transit Service Ltd. and Badder Capital Group Ltd., the Ontario Court of Appeal reconfirmed that severance pay is to be included in calculating common law reasonable notice for workers. Workers can claim both ESA entitlements in addition to common law reasonable notice upon termination, but the Court of Appeal prohibited “double recovery”. In other words, statutory entitlements are to be included in any calculation of common law reasonable notice.

For Cause Termination

Workers in Ontario, and indeed across Canada, can be terminated from their employment for cause. For cause dismissal is the most severe form of dismissal, and if cause has been established, workers can face significant disentitlements. Consequently, it is important to be aware of what protections workers have when faced with allegations of dismissal for cause. As outlined in R v Arthurs,if an employer terminates a worker for cause, they must demonstrate that the worker was:

• Guilty of serious misconduct,
• Habitually neglectful of their duty,
• Incompetent,
• Disobedient of the employer’s reasonable orders,
• Engaged in conduct incompatible with the workers’ duties; or,
• Engaged in conduct prejudicial to the employer’s business.

However, even if a worker has proven to meet one of the above criteria, dismissal itself may be too severe a response to the worker’s impugned misconduct. As outlined by the Supreme Court of Canada in McKinley v. BC Tel, 2001 SCC 38, dismissal is only warranted for just cause in the most severe cases. Instead, the norm is to take a proportional and contextual approach to discipline in the workplace. In other words, rather than dismissing an employee for something like incompetence or dishonesty, employers are typically required to utilize progressive discipline to temper and mitigate worker misconduct. It is only in circumstances of severe misconduct that a worker can be terminated for just cause without the employer using progressive discipline. Otherwise, if progressive discipline has been applied and the worker does not correct their behaviour, the worker might be subject to just cause dismissal.

Disciplinary Records and Culminating Incident

Since dismissal for cause typically requires progressive discipline being administered prior to the dismissal, disciplinary records are often admissible to demonstrate that a worker has a chequered record. Even if a worker has not engaged in sufficiently serious misconduct to warrant a dismissal, the worker’s disciplinary record can be used by the employer to demonstrate that the worker does not appropriately respond to discipline. In other words, a worker’s disciplinary record can be used to justify dismissal even in instances of relatively minor misconduct so long as that minor misconduct serves essentially as the straw that breaks the camel’s back.

Nevertheless, there are some restrictions to relying upon disciplinary records to dismiss workers for cause. In unionized workplaces, workers can grieve discipline when it is administered. This means that workers can object to discipline after the fact, and if their objection is successful, the discipline can be set aside and not counted on their record. In federally regulated workplaces, where workers are covered by the Canada Labour Code, even non-unionized workers can enjoy the benefit of this policy. Pursuant to the Supreme Court of Canada’s ruling in Wilson v. Atomic Energy of Canada Ltd., 2016 SCC 29, federally regulated workers covered by the Canada Labour Code are entitled to similar protections that unionized workers are afforded. Consequently, while federally regulated non-unionized workers cannot grieve discipline after it is imposed, if they are later dismissed for cause, they have an opportunity to challenge the disciplinary record that the employer relies upon to demonstrate that such discipline was improper and should not be used to justify dismissal. This concept is confirmed in Granite Transport Ltd. and Golphy, Re, where the adjudicator stated that non-unionized workers under the Canada Labour Code can challenge disciplinary records relied upon by their employer at the time of dismissal. If the prior discipline imposed was baseless or too severe, the dismissal itself may likewise be baseless or too severe a response to the purported misconduct. This is a significant form of protection for workers to avoid being dismissed for cause, although it is not the only form of protection available.

Sunset Clause

Sunset clauses are another form of protection available to workers with regards to disciplinary records. A sunset clause is a term of contract that outlines how long a given piece of discipline is permitted to remain on a worker’s record. Because these are specialized terms under contract, they can be negotiated to specify various lengths of time after which the discipline cannot be relied upon in efforts to terminate the worker. While sunset clauses are most frequently seen under collective agreements in the unionized context, they can also be established by workers in non-unionized fields under their employment contracts. The protections afforded by a sunset clause are quite significant as they eliminate the ability of employers to rely upon prior discipline that has been subject to the clause. Nevertheless, a disciplinary record can still be maintained for the purpose of challenging a worker’s claim to having a spotless or clean disciplinary record, even if the record itself cannot be used to justify progressive discipline or dismissal for cause.

Employment Standards

Ontario’s Employment Standards Act requires equal pay for equal work. If workers of a different sex perform the substantially the same kind of work and the job requires the substantially the same level of skill, effort, and responsibility, and the work is performed under similar working conditions, then these workers are entitled to equal pay. The only limits to this are seniority systems, merit systems, systems measuring earnings by quantity or quality of production, or reasons other than sex. These limitations can be particularly restrictive for workers who perform similar tasks as their colleagues yet earn less due to reasons other than sex. Additionally, the ESA protects workers from reprisals when asking fellow workers about their compensation to determine or assist others in determining whether their employer is complying with equal pay for equal work provisions. The ESA also protects workers from having their wages lowered in order to comply with the requirements around equal pay for equal work.

Pay Equity

For many workers, issues about pay parity can be incredibly concerning. In Ontario, the Pay Equity Act has been established as remedial legislation to reduce discrepancies between the earnings of men and women. Specifically, the Pay Equity Act organizes jobs in a workplace as being either male job classes or female job classes. These classifications are not meant to be exclusionary or indicate that one such job is or ought to be delegated to a specific gender of person. Instead, these classifications are established based on material facts, specifically whether 60% of workers are a specific gender within the class, alongside the historical position of the class and gender stereotypes regarding the type of work. The intention behind these provisions is to ensure that the disparity in earnings of female job classes is reduced such that they approach if not achieve parity with male job classes. Achievement of pay equity occurs when the pay rate of a female job class is at least equal to the male job class in the workplace where the work performed by the two job classes is of equal or comparable value. Additionally, workers disclosing their pay scale under the Pay Equity Act are protected from retaliation or reprisals. The Pay Equity Act also protects workers from having their wages lowered in order to achieve pay equity between female and male job classes. The Pay Equity Act is a significant step towards reducing inequalities in earnings between women and men in the workplace.

Pay Transparency

The Ontario government passed the Pay Transparency Act, in 2018, although the legislation itself has not actually had a chance to enter into force. In essence, it provides workers with anti-reprisal protections, giving workers the freedom to inquire about their earnings, disclose their compensation with fellow workers. Additionally, it requires employers to construct Pay transparency records, affording workers the opportunity to see the differences in payment earned by other workers throughout the company. These pay transparency records are to be posted online or conspicuously on site for workers to easily access. Additionally, the Ministry is obliged to publish the pay transparency records. These provisions could make workplaces more open to workers and inform workers of the relative pay grades their fellow workers earn. However, as mentioned earlier, these protections have yet to be implemented, despite the bill being passed in 2018.

Common Law

Workers in Ontario are also protected under the common law regarding termination for cause. If an employer terminates a worker’s employment because the worker disclosed their wages to colleagues, disclosure of wages must be a prohibited term under the company’s policies or the employment contract. In either case, the policy itself must be enforceable as an element of the contract, failing which, the policy cannot be relied upon to terminate the worker’s employment. If the policy or contractual terms are outright or potentially illegal, then the specific provision, if not the entire contract, will be unenforceable. Furthermore, workplace policies or rules must be applicable in the workplace before anyone can be dismissed by them. To determine whether workplace policies or rules are applicable, the starting place is Lumber & Sawmill Workers’ Union, Local 2537 v KVP Co. Ltd. This case outlines that workplace policies must be clear and unequivocal, reasonable, and consistently enforced, in addition, the worker must be made aware of the policy and made aware that breach of the policy could result in termination. If an employer fails to take these steps, they will not be able to rely on the workplace policy to terminate a worker for disclosing their wages.  Even if a rule is reasonable and enforceable, the Supreme Court of Canada in McKinley v. BC Tel, 2001 SCC 38, held that the breach of the rule must be of such a significant degree to justify dismissal in the circumstances. If the breach of the rule did not irreparably harm the employment relationship, dismissal for cause may be too harsh a penalty. Nevertheless, if a rule is found to be reasonable, discipline can still be imposed for breaching the rule, even if dismissal may not be permitted.

Some workers work under a fixed-term contract. While most contracts of employment are for indefinite term lengths, fixed-term contracts specify how long a worker will be employed by a particular employer. There are certain benefits for working under a fixed-term contract, specifically if such contracts do not specify that the worker can be terminated with or without cause. Without a provision within the contract detailing that workers can be terminated with or without cause, a fixed-term worker cannot be terminated for either reason. Nevertheless, sometimes termination occurs in breach of the fixed-term contract. In those scenarios, it is important for workers to know what protections they are entitled to.

Termination of a Fixed-term Contract

Without a termination clause within a fixed-term contract, termination of a worker under such a contract would be breach of the contract. Typically, when workers are terminated without cause, they can pursue their rights for common law reasonable notice. However, in Howard v. Benson Group, the Ontario Court of Appeal held the common law notice period does not apply for fixed-term contracts. A fixed-term contract specifies precisely when the employment is expected to end, so employers need not provide reasonable notice for termination. Nevertheless, Ontario’s Court of Appeal also held that workers terminated because their fixed-term contract was breached are entitled to payment until the end of the term of the contract. In other words, employers cannot get out of paying the worker merely by breaching the contract or terminating the worker before the contract’s end date. Instead, workers must be paid until the stipulated end date of the contract. Workers are entitled to payment for the remainder of the contract, following the parties’ reasonable expectations of the contract under Honda v Keays. Specifically, this would entail all the payments and benefits expected to be received under the contract, including things like salary, pension, vacation pay, incentive plans, etc., as expressed in Tarras v. The Municipal Infrastructure Group Ltd.

The only circumstance where workers are not entitled to be paid until the end of the contract is if there is a clear and unequivocal provision which specifically allows for early termination. Such a provision must not attempt to contract out of Ontario’s Employment Standards Act, and if it ultimately does so, it will be found to be unenforceable following the Supreme Court’s ruling in Machtinger v. HOJ Industries Ltd. Termination of a worker pursuant to an unenforceable termination provision also results in the worker being entitled to payment until the end of the contract’s term.

Reasonable Notice

As mentioned above, workers under a fixed-term contract are not entitled to the common law reasonable notice period. However, there are circumstances where a worker may oust this presumption. A fixed-term contract must contain clear and unequivocal language that establishes it as a fixed-term contract. Absent such language, the contract will be held to be an indefinite term contract. Sometimes, workers work under numerous successive fixed-term contracts, building up a rapport with the employer over time. As established in Ceccol v. Ontario Gymnastic Federation, when the underlying reality of the employment relationship resembles the traditional indefinite term contract of employment, then the court should treat the relationship accordingly. Namely, when the worker performs continuous service for many years with the employer, alongside verbal representations and employer conduct that signal an indefinite employment relationship, the court will acknowledge such an employment situation as an indefinite length employment relationship. This is done over and above any existing fixed-term employment contracts, like the 17 consecutive 1-year length contracts found in Ceccol.

In circumstances where evidence supports the establishment of an indefinite employment relationship over and beyond any fixed-term contracts, the court has held that a terminated worker is thus entitled to common law reasonable notice for dismissal without cause. This is especially important for workers who have been terminated after many successive fixed-term contracts, as the length of service and experience, both factors to be considered when calculating the length of reasonable notice period, can be carried across each successive contract. The following factors for calculating the length of reasonable notice outlined in Bardal v. Globe & Mail Ltd., which include:

• length of service,
• character of employment,
• age of employee,
• availability of similar employment.

However, Bardal factors are not a closed list, and more can be and have been added since Bardal was decided. If you have been working consecutive successive fixed-term contracts, and have recently been terminated from your employment, you may very well be entitled to reasonable notice or pay-in-lieu thereof.