Law Times

LAW TIMES COVERING ONTARIO'S LEGAL SCENE | JANUARY 28, 2019 11 www.lawtimesnews.com BY MEAGAN GILLMORE For Law Times A recent Court of Appeal decision gives rare guid- ance about how to apply the Employment Standard Act's rules about mass termination, employment lawyers say. In September, the Court of Appeal said CTS of Canada had not erred when it filed no- tice with the government of its plans to close its Streetsville, Ont. plant 13 months after it had given written notice to em- ployees about the closure. This reversed the Ontario Superior Court of Justice's September 2017 decision that said the com- pany should have filed notice of the closure with the government when it told employees about it. "CTS was only required to post the Form 1 information at the beginning of May," Associ- ate Chief Justice Alexandra Hoy wrote for the three-person pan- el, which included justices David M. Brown and Gary T. Trotter. The ruling was unanimous. CTS gave employees written notice about the plant's closure and their resulting termination on April 17, 2014, the decision says. The plant was scheduled to close on June 26, 2015. The Employment Standards Act says employers must give employ- ees notice of at least eight weeks when 50 or more employees are being laid off in a four-week period. The ESA says employ- ers must also give the Ministry of Labour a form describing the reasons for the termination, consultations that are planned with the affected employees, proposed adjustments for em- ployees and a statistical profile of the employees. The form is also to be posted in a place where the employees can see it, the ESA says. CTS did not give the govern- ment that form until May 12, 2015 — 12 days after the man- datory minimum requirements, the decision says. A group of 74 former employ- ees filed a class action lawsuit, saying CTS should have filed the notice with the government when employees learned about the plant closure. In September 2017, Justice John R. Sproat de- cided in the group's favour. Timothy Pinos, a partner in the commercial litigation group at Cassels Brock LLP in Toronto, who represented CTS, says this decision re-affirms employers' requirements under the ESA. "Historically, the under- standing has been that there is a separation between the employ- ment standard rules that man- date minimum severances, no- tice period for various circum- stances and the whole common law for reasonable notice," he says. "The two work in parallel in employment law. One doesn't trump the other. Compliance with one doesn't affect the va- lidity of the other as a general proposition." "The purpose of the ESA is to protect the interests of employ- ees by requiring employers to comply with certain minimum standards, including minimum periods of notice of termina- tion," the Court of Appeal's de- cision says. "Its objective is not to impose requirements on employers in excess of the statutory mini- mums. Tying the requirement to provide Form 1 notice to the director to when the employer gives what it intends to be com- mon law reasonable notice, in excess of the statutorily-required minimum notice period, is not consistent with the object of the Act requiring employers to comply with certain minimum standards." Stephen Moreau, a lawyer with Cavalluzzo Law LLP in To- ronto, who acted for the employ- ees, says this decision could have potential negative impacts wher- ever mass terminations occur. "Any time a decision talks about what a workplace stat- ute requires, it does start to set the f loor for what is required," he says. "This just sets the f loor very low. It really provides no in- centive to employers to actually give longer notice to the relevant ministerial authority. My real concern is that this kind of no- tice won't be given. Employers are going to wait until the last moment because no one's telling them not to, and employers and employees all throughout the country are going to be dispa- rately impacted by it." Pinos disagrees. "The decision didn't lower the bar," he says. "The bar is where it was. Justice Sproat raised the bar at an alpine level. The Court of Appeal said employment stan- dards are minimum." The class members have filed for leave to appeal the Court of Appeal's decision to the Supreme Court of Canada, Moreau says. The Court of Appeal's deci- sion says determining when to file the Form 1 with the govern- ment has many "practical con- sequences." Receiving the form "can trigger the provision of significant government services to the employees," such as career counselling and training for sec- ond careers. The decision says CTS did not provide employees with any such services. "If [employees] don't get these services early on, it means they're focusing on the next part of their career much later in the process and, therefore, quite possibly spending a longer period of time without a new career. They're not focusing on re-employment as early as they ought to," says Moreau, adding long-time employees may be more adversely affected. They have mastered skills particular to the company and may have a harder time learning transfer- rable skills, he says. Mass terminations can sig- nificantly impact communities, Moreau says, which is why laws about mass terminations are of public concern. "It's not good to have a bunch of unemployed people on social assistance when you can have productive employees who are re-trained to work in the econo- my," he says. CTS did not win all points on appeal. The court said work- ers were entitled to 12 days' pay because Form 1 notice was 12 days late. It agreed with the lower court's ruling that the company could not receive credit for any week during the notice period where employees worked over- time contrary to the ESA or when their overtime had a "sig- nificant adverse affect on the ability of the employee to seek new employment." The decision also says that for five employees who worked more than 13 weeks after their original final day of employment, CTS is entitled to credit for "common law working notice from the date of the letter providing them with notice of their actual termination date." The decision says some em- ployees worked 55 hours a week voluntarily during the notice period. Eighteen key employees were "forced to work overtime up to 60 hours a week. They were told that their job required that they stay and work overtime and that they had no option." The court found that, "in de- termining whether the employer is entitled to credit for working notice, it is relevant to consider the quality of the opportunity given to the employee to find new employment." "This demonstrates what em- ployees should expect during a working notice period," says Sean Bawden, a partner at Kelly Santini LLP in Ottawa. Some employees may choose to leave when a mass termina- tion is announced, but this deci- sion shows employers aren't sup- posed to use that as an excuse Timothy Pinos says a recent Ontario Court of Appeal decision re-affirms employers' requirements under the ESA. Company followed standards in mass termination "Any time a decision talks about what a workplace statute requires, it does start to set the floor for what is required." Stephen Moreau FOCUS See Notice, page 12 ONTARIO LAWYER'S PHONE BOOK 2019 The Ontario Lawyer's Phone Book 2019 has more than 1,400 pages of indispensable legal references that can connect you with anyone you need. Updated throughout the year, it contains names, phone numbers, mailing addresses and emails so you don't have to search anywhere else. Order your copy today! Visit www.store.thomsonreuters.ca or call 1.800.387.5164 for a 30-day no risk evaluation. Perfectbound • Published December each year On subscription $87.50* • One time purchase $91* Order No. L7798-8405 • ISBN 978-0-7798-8405-6 Multiple copy discounts available *Plus applicable taxes and shipping & handling. Prices subject to change without notice. CONNECT INSTANTLY TO ONTARIO'S LEGAL COMMUNITY Untitled-2 1 2019-01-23 2:46 PM

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