What Makes a Manager? Saunders v WestJet, an Alberta Partnership

Ms. Saunders was an agency sales representative with WestJet, her employer. She was terminated from this position on July 29, 2019. Following her termination, Ms. Saunders filed a complaint of unjust dismissal under section 240(1) of the Canada Labour Code (the “Code”). A finding that Ms. Saunders was unjustly dismissed under the Code would entitle her to reinstatement with back pay. 

WestJet, however, objected to her complaint on the grounds that she was a manager. If true, this would be fatal to her case. This is because section 167(3) of the Code excludes employees who are managers from making use of the unjust dismissal provisions. If Ms. Saunders was truly a manager, she would be unable to bring her unjust dismissal complaint. 

The problem, however, is that the term “manager” is not defined by the Code. The term has instead been defined over time by the jurisprudence of courts and adjudicators. How have they interpreted the meaning of “manager” for the purposes of the Code?

What Makes a Manager?

In determining whether somebody is a manager, courts and adjudicators have adopted a case-by-case approach which examines the specific context of the workplace and the nature of the work the employee actually performed. The employee’s title (i.e. “business development manager”) or rank within the employer’s organization is not determinative. This means that having the official title of “Manager” does not automatically make one a manager under the Code.

The term “manager” has been interpreted very narrowly so that the protections of the Code’s unjust dismissal provisions are applicable to as many employees as possible. This narrow interpretation reflects Parliament’s intent to extend the rights and standards enumerated in the Code to a broad range of employees.

In practice, the term “manager” is generally defined as an individual who acts as an administrator with the power of independent action, autonomy and discretion. To be a manager, the person must have the ability and authority to direct the work and make administrative decisions. According to the Federal Court, the “fundamental test” is whether the individual had significant autonomy, discretion, and authority in the conduct of the employer’s business. The Federal Court endorsed the following list of factors and guiding principles which should be considered in determining manager status: 

“Guiding principles 

1. the term “manager” has a narrow meaning; 
2. the nature of the work actually performed must be examined;
3. the administrative element of the position in issue must be present; 
4. the term “manager” is administrative rather than operational in nature; 
5. the position can include managers at the upper or lower end of the management chain; 
6. impressions and perception of the position by others as being part of management is insufficient;
7. title or place in the management chain in not determinative; 
8. only exercising some managerial functions without authority is insufficient; 
9. merely a conduit for higher body who is actual decision-maker or makes recommendation to higher body who approves or disapproves is insufficient.

Elements considered essential for a finding of “manager” 

1. power to act and perform duties independently; 
2. is part of management; 
3. primary responsibility is to manage; 
4. power or authority to hire, supervise, and otherwise be in charge of employees, including power to discipline and dismiss; 
5. evidence of firing and disciplining must be proven; 
6. responsibility for employer’s operations and managerial attributes required for that purpose, i.e., accountability for management functions; 
7. sufficient or independent decision-making authority, though not absolute, and a certain measure of discretion;
8. authority to make final decisions of significance.” (emphasis added)

Was Ms. Saunders a Manager?
The adjudicator in Ms. Saunders’ case was tasked with deciding whether or not Ms. Saunders was a manager under the Code pursuant to the above jurisprudential tests and definitions. The burden rested on the employer WestJet to show that she was a manager and thus exempt from the unjust dismissal provisions. 

Ultimately, the adjudicator found that Ms. Saunders was not a manager. 

How did the adjudicator reach this decision?
The adjudicator focused on the nature of the work and duties performed by Ms. Saunders rather than her title or rank in the employer’s organization (the correct approach, as title and rank are not determinative of manager status). Ms. Saunders’ “primary responsibilities” included making sales calls and visiting traveling agencies to promote WestJet’s services. She represented WestJet at tradeshows and conferences and communicated marketing and sales initiatives. Significantly, she did not have any authority to hire, fire, discipline, promote, or determine compensation of any other employees, nor did she have any supervisory duties.  

Employees who occupy a purely operational role within the organization are not “managers” under the Code. It is necessary that the employee have administrative functions, such as hiring and firing and promoting and budgeting. Ms. Saunders had none of these administrative functions – her role was purely operational. As a result, Ms. Saunders could not be a manager under the Code. 

Taking into account all prior jurisprudence, this appears to have been the right decision. It has been positively relied on in subsequent decisions of the Canada Industrial Relations Board and will likely continue to prove influential in future manager cases.