Archive for January, 2009

CUPE Blinks

Published January 28, 2009 Labour , News Leave a Comment

Looks like CUPE just lost the stare-down with the provincial government:  a spokesperson announced today that the union will not challenge the provincial government’s back-to-work legislation.

The union representing striking workers at York University now says it won’t pursue a legal challenge of provincial legislation that would force teachers back to work.

Union officials had said earlier today they were preparing a legal challenge, but later released a statement saying they have decided against pursuing such action.

What’s next?  Actually, lets refrain from asking and instead get on with our lives…

Spoke Too Soon – CUPE to Pursue an Injunction?

Published January 27, 2009 Labour , News Leave a Comment

Looks like everyone might have spoke too soon.  CUPE is not only threatening a Charter challenge if the provincial government doesn’t put York and CUPE back to the bargaining table, but it looks like they may pursue an injunction too:

Once that happens, he said, the union’s lawyers will be instructed to take “any and all legal action.” He said the union’s lawyers believe the legislation would violate the union’s rights under the Charter of Rights and Freedoms and that there is a “strong possibility” of success.

“We know we have a legal avenue and in all likelihood it will result in the strike being prolonged,” Mr. Ryan warned. “We don’t want to go down that road.” [emphasis added]

Sounds like an injunction to me.  Of course, this could all just be posturing, but in any event it shows how seriously CUPE is taking its 2010 coordinated bargaining effort.  You can read the rest of The Globe & Mail’s story here.

Class Action Filed Against York University

Published January 26, 2009 Commentary , Labour , News Leave a Comment

It looks like the other shoe finally dropped, meaning someone is finally suing York over their decision to suspend classes when CUPE went on strike.  But this isn’t just someone, it’s someones - a class action has been filed.  Interested litigants can read about it at www.yorktookmymoney.com.  They can also read a copy of the statement of claim that’s been filed here.

Note:  Nothing in this post should be construed to constitute a recommendation that potential class members sign up for the aforementioned class action.  Interested litigants should receive independent legal advice before signing up for any class action.  Nothing in this post should be considered legal advice with respect to the class action, or in any respect whatsoever.

The interesting thing to note is that the plaintiff class is relying on provisions of the Consumer Protection Act which govern ‘quality of service’, and is seeking to apply to them to education.  In terms of services, the CPA usually covers things like lawn mowing services, plumbers, or personal trainers at the gym.  Is education a bit of a stretch then?

For the CPA to apply, do you think “student” fits into the following definition of “consumer”, and  ”university” fits into the definition of “supplier”?

“consumer” means an individual acting for personal, family or household purposes and does not include a person who is acting for business purposes;

“supplier” means a person who is in the business of selling, leasing or trading in goods or services or is otherwise in the business of supplying goods or services, and includes an agent of the supplier and a person who holds themself out to be a supplier or an agent of the supplier;

Even if the CPA applied, which it may not because the CPA could have been “contracted out” of, the plaintiffs would still have to get around the very explicit disclaimer in the York Undergrad Calendar.  Take a look at the second last paragraph.  Also, per the last time someone tried to sue York over a strike/lockout, the class will likely have to show that damages have, in fact, been incurred.  In that decision, Winkler J. (now Chief Justice of Ontario) also emphasized that educational institutions have wide discretion in how their services are delivered.

The emphasis on the CPA this time around may be because of its numerous provisions for contract rescission (basically, getting a refund of what you paid).  In that case, the question will be whether students, under the CPA, “still got substantially what they bargained for” with respect to their education as a whole.  If damages can’t be proven (yet), the lawyers handling this class action could still do very well for themselves by taking a 25% cut of each of 50,000 students’ tuition reimbursement.  

Perhaps the more important question of all is whether each student deserves to receive 75% of any potential refund (with the aggregate of 25% of each going to those two lawyers…), or whether any funds York “stole” should remain with the University in light of worsening economic conditions and substantially diminished enrollment.  Perhaps the best of both worlds would be for York to use these funds to set up a “relief fund” for students… unless, of course you, happen to be one of the class action lawyers, in which case that idea is terrible.

Employment Law Quadrilogy 2008, Part 1

Published January 25, 2009 Cases , Commentary , Employment 3 Comments

Evans v. Teamsters Local Union No. 31

Introduction

2008 was certainly a busy year for employment law.  There were no less than four major cases heard by the Supreme Court, providing clarification, and in some cases re-writing, the law on employees’ good faith obligations (RBC Dominion Securities) and duty to mitigate (Evans v. Teamsters), and employers’ duty to accommodate (Hydro Quebec) and sanctions for bad faith conduct (Honda v. Keays).

The “Employment Law Quadrilogy 2008″ roundup will discuss the implications, if any, of these four cases going forward.  I say “if any”, because on one hand unusual facts increase the likelihood of a case being heard by the Supreme Court, but on the other hand, unusual cases can also mean a narrower application.  As they say, “extreme facts lead to extreme law”.

 Does the Duty to Mitigate Require an Employee to Return to the Terminating Employer?

It’s a central tenet of contract law that the innocent party has a duty to mitigate its damages once a contract has been breached.  In the context of employment, this means an employee has a duty to find comparable employment elsewhere upon notice of termination.  The corollary to this is that pay-in-lieu of notice is then subject to earnings from alternative, comparable employment, if any is secured.  But what happens if the only comparable employment available is with the former employer itself?  Does the duty to mitigate require the terminated employee to return to his or her former employer to work out the remainder of the notice period (and thus receive no severance package)?  This contentious question was the subject of Evans v. Teamsters Local Union No. 31.

Evans was decided on May 31st of this year, upon appeal from the Yukon Court of Appeal.  The case concerned a business agent in Whitehorse, Evans, who had 23 years service with Teamsters.  When the union hired a new executive, who Evans had a contentious relationship with, Evans was provided with  notice of his dismissal.  Evans suggested 24 months notice, comprised of 12 months of continued employment and 12 months of pay-in-lieu of notice.  Teamsters rejected the offer and requested that Evans return to work the balance of his 24 month notice period.  When Evans refused, he was immediately terminated and given nothing.  The question for the court was whether Evans had acted reasonably in refusing Teamsters offer of temporary employment, and in doing so had Evans breached his duty to mitigate.

What Would the Reasonable Person Do?

The Court found that Evans had failed to act reasonably in refusing Teamsters offer, and thus was in breach of his duty to mitigate.  The Court held that a reasonable person would be expected to accept such an offer, where the salary offered was the same, the working conditions were not substantially different or demeaning, and where the working relationships were not acrimonious.  In this case, Evans himself had requested 12 months of working notice through the performance of his old job, and admitted at trial that there would be no humiliation in returning to work.  Because of this, the Court did not hesitate to find that Evans acted unreasonably in refusing Teamsters’ offer, and held that in breaching his duty to mitigate, he was entitled to nothing.

What are the Implications of Evans?

On one hand, some may think Evans means an employer can call a terminated employee back to work whenever severance package negotiations aren’t going the way the employer wants them to.  After all, per the Court’s holding, if the salary and position are substantially the same and there hasn’t been any acrimony involved in the decision to terminate, wouldn’t it then be unreasonable for the employee to refuse such an offer? 

Perhaps, but note how fact specific Evans is:  he admitted, both through his request for working notice and through his admission at trial, that there would be no humiliation or acrimony involved in returning to work.  Furthermore, in assessing the reasonableness of Teamster’s offer, one must consider the limited availability of comparable employment for a union business agent in Whitehorse, Yukon.  These factors constitute a “perfect storm” for a Court to say a terminated employee must return to his or her former employer, lest they get nothing, and would likely be difficult to replicate.

There are also practical concerns in threatening to recall a terminated employee if they didn’t accept an employer’s severance package offer.  Would an employer really want to put a terminated employee in the care of its business operations?  Because of such judgment about the viability of such an arrangement, it wouldn’t be hard for the employee’s counsel to argue that returning to work would be demeaning, humiliating, and embarrassing.  

While Evans is the first case to stand for the proposition that it may be unreasonable for a terminated employee to refuse an offer to return to his or her former employer, the facts and practical considerations dramatically narrow its potential application.  However, as we will see over the remaining three parts of the Employment Law Quadrilogy 2008, Evans is nonetheless another judicial tool the Supreme Court has granted employers to better manage their operations.

Ontario Government to Enact Back to Work Legislation

Published January 25, 2009 Commentary , Labour , News 1 Comment

As you may have heard, the Ontario legislature will reconvene on Sunday, January 25th, to pass back-to-work legislation.  Professor Doorey has obtained a draft copy of the bill which can be viewed here.

The province’s decision to enact back-to-work legislation is certainly a controversial one.  For one, it sets a precedent for future labour disputes at universities.  This would presumably include CUPE’s coordinated bargaining effort scheduled for 2010, which would be derailed by the likely imposition of a 3 year contract at York by the back-to-work mediator-arbitrator.

It also sends the message that, when innocent third parties are involved (in this case, students), an employer can simply wait and rely on the public’s negative opinion of unions to pressure the government into passing back-to-work legislation.  Historically, back-to-work legislation has been reserved for public sector employees whose strike constituted a health or safety risk to the public.  (Note however, that the public transit strike in Ottawa is still ongoing despite the crippling effect on the city)

However all is not lost for CUPE.  The has been speculation that the Supreme Court may be ready to recognize a Charter section 2(d) right to strike, in light of international labour treaties that Canada is a party to.  The province’s back-to-work legislation may end up being exactly what CUPE needs to get a judicial proclamation on this right.  This would explain why the province has refused to intervene up until now.  See Prof. Doorey’s blog for a comprehensive explanation.

In the meantime, classes for the 45,000 remaining students at York will likely resume towards the end of this week (if not next week).  First year students at Osgoode can look forward to the resumption of LRW (and welcoming their TAs back) and perhaps Criminal Law (if you’re in that section), in addition to commencing Ethical Lawyering and their perspective option.

Update:  The NDP are following through on their pledge to stall the bill.  Buried in the story was this little nugget of a threat from a CUPE spokesperson:

According to Tyler Shipley, spokesperson for CUPE Local 3903, should MPPs vote to send members back to work, the union would launch a legal challenge “if there is an option.”

Sounds like a section 2(b) Charter challenge is on the horizon…

Woman fired over Facebook: Where art thou, Wallace?

Published January 7, 2009 Commentary , Employment , News 2 Comments

Firing someone over e-mail, Facebook, or even a text message – bad faith and cowardly, or efficient and reflective of the move towards modern, electronic communication?

According to this story, a woman in Vancouver was fired by a Facebook message after failing to show up to a staff meeting during her day off.  While no legal consequences are likely to occur, given the employee had only worked for two weeks prior to her termination, it raises interesting questions about an employer’s obligations to carry out terminations respectfully in this e-everything, post-Wallace world.

On one hand, the veracity of electronic documents is statutorily recognized by the Electronic Commerce Act, 2000. The Act sets out that electronic signatures and electronic documents have the same force and effect as hard copy documents (even including transactions covered by the Statute of Frauds).  However, the Act makes no mention of documents to be used in terminations, or for employment purposes generally.

On the other hand, there is a long list of case law spawned by the Wallace decision that holds that terminations must be conducted respectfully, and employers who fail to do this will be liable for bad faith “Wallace” damages (an extension of the reasonable notice period).

For example, in George v. Imaginnering (2001), a long service employee in poor health received a “Wallace” damage award of 4 additional months after being terminated by way of letter.  Because of the employee’s long service and contribution to the company, the court held he was entitled to a dignified termination.  Perhaps most on point though is Farrel v. Workgroup Designs (2005), where an employee was awarded “Wallace” damages after he was terminated over e-mail in lieu of a face to face meeting.  The court described a termination meeting as “final courtesy”, the absence of which supported an award of 2 months extra notice.

However, as previously discussed, it appears courts no longer have “Wallace” damages available to them to denounce acts of bad faith by employers.  Denying an employee the courtesy of a termination meeting is certainly egregious, but can’t possibly meet the test for punitive damages.  Instead it appears that courts will have to rely on aggravated damages as set out in paragraph 59 of the Keays decision:

If the employee can prove that the manner of dismissal caused mental distress that was in the contemplation of the parties, those damages will be awarded  . . . through an award that reflects the actual damages.

Thus with respect to terminations conducted without the courtesy of a final meeting (that is, conducted by e-mail or couriered letter), the employee would have to prove the parties had contemplated at the time of contract formation that mental distress would be caused by such terminations, and that damages actually occurred as a result. 

Unlike “Wallace” damages, which could be automatically awarded regardless of whether the employee was actually harmed by the egregious termination, the Keays approach requires proof of such harm.  Is this a good thing?  At least under “Wallace”, there was an ominous cloud of arbitrariness hanging over employers which motivated them to adopt best practices.  With Keays, there is no such deterrent, and instead employees who are harmed by disrespectful terminations must prove their injury at trial.

There is no doubt that business is being increasingly conducted by electronic means, but will that ever supplant the basic respect and courtesy owed by employers to their employees?