Category Archives: Articles of Interest

Some Practical Contract Law Advice for Business

 

by Michael V. Coyle, JD*

The law of contract is to business what air is to a human being. You can’t live without it. The whole business world is based on contract law.

For the purposes of this short article, there are essentially two kinds of business contracts.

First, there are routine, pre-printed contracts that we all sign, sometimes on a daily basis, for things like sending a parcel (yes, that is a contract you are signing) or a photocopier lease or a software license agreement, and even insurance policies. These are prepared by the vendor, for the vendor, and they often have pages of “fine print” containing terms that are for all practical purposes “non-negotiable”. You can’t negotiate better contract terms for your parcel delivery with the FedEx guy who comes to pick it up. It’s basically “take it or leave it”.

Most people don’t actually read these contracts before signing them and are content to assume that they must be “standard”. They trust that competition for their business in the marketplace must mean that these contracts are “all the same” among competing vendors. That may or may not be true and, while I would be remiss if I didn’t say “be careful what you sign”, the fact is you don’t really have much choice if you want the product or service. Most people understand – and are willing to accept – that if there is ever a dispute under one of these “agreements” you probably won’t have the proverbial leg to stand on. That’s just how it is.

Then there are the contracts – often much more critical to the success of your business – like premises leases, major sales or supplier contracts – where you do have more control over “the deal”. Most business people understand that there is some kind of role for a lawyer with these contracts, but many, in my experience, seem to have little idea what that is. All they really know is that seeing a lawyer will cost them money and that is to be avoided as much as possible.

In the typical scenario, “the deal” is negotiated by the business people and one will announce (magnanimously) that he will have his lawyer “write it up” and that the other party can have her own lawyer “look it over”, followed by smiles and handshakes all around. Done deal, right?

Wrong. What a lot of people don’t seem to understand is that, in the eyes of the law, “the deal” is actually the written contract, not what the parties promised each other during negotiations.

It seems that we’ve gotten so used to signing whatever document is put in front of us that some people now think that it literally doesn’t matter what the contract actually says. I can’t tell you how many times I’ve had a business person tell me, “I know what the contract means because I was there when the deal was done.”

Many people genuinely believe that that when a dispute arises they can just come into court and tell the judge what “the deal” was and the judge will then ignore the written contract (and, presumably, the competing evidence of the other party) and will go with that person’s version of “the deal” as the contract.  These folks will say that their version of “the deal” is far more credible than the other party’s because, as they always put it, “I would never have agreed to that!”

They are often very surprised to learn that it is the written contract that governs in court, not what the parties said to each other during negotiations. With very few exceptions, any evidence of what the parties said to each other, or about what they believed in their own minds during negotiations leading up to a signed contract, is strictly prohibited in court. It is well established that that the judge is confined by what the contract actually says, and will not consider what one party later says “the deal” was supposed to be.

The reason for that is simple: commercial certainty. If one party’s understanding of what the contract meant to them took precedence over the words used in a written agreement, that would mean that no contract would be safe. Every contract could be overturned and nobody could be sure if any contract could be enforced. Without contractual certainty there could be no commerce.

Put another way, if a person could avoid their contracts just by saying “I would never have agreed to that!” there would be no contract worth having.

So it is the lawyer’s job, whether they are hired to draft the document or to review it for their client, to make sure that the contract would be interpreted by a judge in the way their client understood “the deal”.

That means, of course, that you have to tell the lawyer what you understand “the deal” to be. Many times over the years a business client has sent me a contract to “look over” without saying a word about what they think it means or what they want it to accomplish. It is as though their own intentions for the contract should be completely obvious to me just from reading a document prepared by the other party.

The truth is that, for most people, the thought that there might ever be a disagreement over the contract or that it would ever have to be legally enforced is the farthest thing from their minds. As far as they are concerned, they have just done a fantastic deal and they shook hands on it and now they just “want to get it signed”. The last thing they want to hear about is the possibility that some unknown dispute might arise in the future. “That won’t happen,” they say.

And they might just be right. It could be that no dispute will ever arise and things will go exactly as they hoped for the entire life of the contract. That can happen.

Or they could be wrong. A dispute could arise that might be disastrous for their business. They could be very glad indeed they saw a lawyer who took the time to understand “the deal” from their perspective and who made sure their interests were legally protected.

*Michael Coyle is an experienced lawyer and a neutral mediator and arbitrator based in Kentville, Nova Scotia. Information expressed in this article is meant for general interest only and is not a substitute for legal advice about your own situation. 

©Michael V. Coyle, 2012

 

Human Rights Law: Practical Tips on the Duty to Accommodate

by Michael V. Coyle, JD*

“How long do I have to keep a job open for someone who is off sick?” is a question I have been asked by any number of employers over the years.

The most important thing to understand in answering that question is that it is not strictly an employment law question. It is actually a Human Rights question. The Duty to Accommodate is a doctrine devised by the courts to enforce human rights laws that prohibit discrimination. The duty to accommodate applies to all prohibited grounds of discrimination (age, gender, race, religion, disability, health, political beliefs, family status, etc.), not just sickness or injury; and it applies to all who provide services or accommodations (landlords, for example), not just to employers.

That is important to know because Human Rights laws are “quasi-constitutional” in nature and they take precedence over all other laws except the Constitution of Canada itself.

So, while employment law might say that an employee who is absent from work due to illness has breached their employment contract by failing to come to work, Human Rights law says “not so fast”.

The duty to accommodate is by no means a “new” development in the law. It has been the law in Canada for over a dozen years and it is one that continues to evolve.

Essentially, an employer must accommodate the employee by putting them on a leave of absence without pay, while holding their job for them and keeping it there “to the point of undue hardship” for the employer. You will note that is to the point of “undue hardship”, not simply “to the point of hardship”. The law assumes that there will always be some hardship involved for an employer in every accommodation.

So, what might be considered “undue” hardship? The law has not established a time limit or time formula for determining when a medical absence becomes an undue hardship. Each case has to be looked at on its own. Generally, an extended absence might create an undue hardship for the employer when, for example:

  • The employer is unable to attract or retain persons qualified for the position because it is not being offered permanently.
  • The cost of paying an employee’s benefits while that person is not working becomes unreasonable.
  • The employee’s skills or qualifications become outdated.
  • A new business focus or approach no longer requires the employee’s qualifications or skills.

That is not to say that, at some point, a prolonged absence will not by itself become an undue hardship and violate the employment contract. It is just to say that it can be difficult to show exactly that the point has been reached that the employer can legally let the absent employee go.

The next question (more of a statement, really) that employers typically ask is: “Well, if I have to accommodate this person then I have the right to know the precise details of their medical condition, right?”

The answer is “no”. An employer is only entitled to receive the information necessary to enable it to accommodate the employee. This will include medical verification that the employee has a legitimate illness, and a professional estimate of how long the employee will need to be accommodated.

It is important to understand that just because a person had a right to be accommodated that does not mean that their privacy rights go out the window.

Although they rarely admit it, some employers (and, sadly, even some lawyers) seem to think that they can thwart the employee’s human rights and, in effect, make them “go away”, by demanding  embarrassing or unnecessary medical information. That can be a very dangerous tack for an employer to take.

If the doctor is unable to say how long the employee will likely be off work that may, or may not, end the employer’s duty to accommodate. If the doctor is simply saying that the prognosis is uncertain at present or perhaps that further tests are needed or that a specialist is being consulted, that would probably not end the employer’s duty. If, on the other hand, the doctor is saying firmly that the person will be off work “for the foreseeable future” and there is no “return to work date” available, then that may well end the duty.

On the other hand, the employee is required to co-operate with the employer and obtain medical verification that can reasonably assist the employer in its duty to accommodate. An illegible or cryptic note scrawled on a prescription pad saying something like “Joe is off work until further notice” is not likely to be sufficient. Frankly, the problem here is often with the doctor, not with the employee. Some doctors still believe that a handwritten “doctor’s note” is all that anyone needs and some doctors may  take offence at any suggestion that their authority to “put someone off work” is apparently being questioned by anyone.

A lot depends on how the employer approaches the question of medical verification with the employee. If they do so with obvious suspicion and mistrust – as though they are trying to drive a wedge between the employee and their doctor – the  results and the quality of information they receive are often predictable. However, if they take a more open-minded approach from the perspective of an employer who is genuinely trying to accommodate their employee, the results in my experience are much more satisfactory for all concerned.

In cases where the employee is able to return to work on limited or modified duties, the employer is entitled to have professional verification that the employee has a legitimate functional limitation, a description of the limitation to help the employer accommodate that limitation.

I have only discussed here the most common situations where an employee has been “put off work” because of an illness, be it physical or mental. That would, of course, include what are often called “stress leave” situations. More complex situations where employees have on-going disabilities that need to be accommodated in the workplace, or that might involve workplace safety concerns, or ones that involve determinations of “bona fide occupational qualifications”, will require different assessments.

So, too, will cases where the discrimination that must be prevented by accommodation is based on grounds other than illness or disability, such as those based on gender, religion or family status.

I cannot emphasize enough how important it is for employers to get competent advice before committing to a course of action in these cases. This is a highly specialized area of law. The fact is that early, knowledgeable advice can actually save you a lot of money in these cases. There is very little that a lawyer can do for you once a Human Rights complaint is filed except provide expensive representation at a human rights hearing or in a lawsuit that probably could have been avoided with experienced legal advice in the first place. If in doubt, you should seek a second opinion.

For legal advice about your personal or business situation, please contact me.

*Michael Coyle is an experienced employment, labour and human rights lawyer based in Kentville, Nova Scotia. Information and opinion expressed in this article is meant for general interest only and is not a substitute for legal advice about your own situation. Michael can be reached by email at michael@mvc-private-law.ca  For more information and tips, visit his website at www.michaelcoyle.ca

 ©Michael V. Coyle, 2012

 

Employment Law Basics – What Every Employer and Employee Should Know

by Michael V. Coyle, JD*

Every employee in Nova Scotia has a contract with their employer – whether they work full time, part time, seasonal or casual. The contract exists whether they have been working there 10 years or 10 minutes. In relatively rare cases the contract might be in writing, but in the vast majority of cases the contract of employment is unwritten. But it is still a contract in the eyes of the law.

The essence of the contract of employment is that the employee will faithfully carry out their assigned duties and the employer will pay the employee an agreed wage or salary and benefits. The contract continues until it is lawfully terminated by one party or the other.

In theory, an employer is free to terminate the contract at any time.

If the employee has breached the contract by failing to live up to his/her end of the bargain as a faithful employee that is called a “termination for just cause”. In plain language, the employee is “fired”. In that case, the employer owes the employee nothing except wages and benefits due to the date of firing.

But if the employer fires the employee without “just cause”, the employer must pay the employee an amount of money in lieu of the “reasonable notice” that they should have received from the employer. If the employer refuses to pay, the employee can sue the employer for wrongful dismissal. Generally, the employer’s financial position is not “just cause” for dismissal, nor is a decision by the employer to “restructure” or “down-size” their operation.

The determination of the amount that the employer must pay for wrongfully dismissing an employee is based on a variety of factors. These include the employee’s age, education, training and family circumstances, the time that it would likely take to find comparable employment in that business, trade or industry in that geographic area, the length of time the employee has worked for the employer and the kind of job or position they held with the employer. On the other hand, a unjustly dismissed employee has a legal obligation to look for work and take a comparable job if it is offered.

If the employer tries to avoid its obligations under the contract of employment by forcing the employee to quit, for example, by changing the employee’s fundamental terms of employment without their agreement, that is “constructive dismissal”. In that case, even though the employee quit, they can still sue the employer for wrongful dismissal.

Employers cannot discriminate against employees – before and after hiring – on  any of the grounds set out in the Human Rights Act. They have a legal duty to accommodate employees who are sick or who have disabilities. Employees are forbidden from harassing other employees on any of the prohibited grounds of discrimination under the Human Rights Act.

Employers and employees must abide by the Labour Standards Code and, generally, employers have an obligation to continue additional benefits they have customarily provided to their employees beyond the Labour Standards Code. The Labour Standards Code provides that, once an employee has worked for an employer for 10 years, they can only be dismissed for “just cause”. A 10 year employee who has been fired without just cause can seek reinstatement to their former position, with back pay for lost wages, under the Labour Standards Code.

A “lay off” is a reduction in the workforce due to a shortage of work caused by the employer’s inability, in good faith, to secure orders or work or other circumstances (like fire, natural disaster, strikes or lockouts by suppliers or key customers, etc.) that are beyond the employer’s control. A “lay off” should not be confused with a “termination” or “dismissal”. Laid off employees are not “fired” and they have a contractual right to be recalled to work once the reason for the “lay off” has gone away. An employer who hires a new employee to replace one who has been “laid off” risks being sued for wrongful dismissal.

The law has changed in recent years concerning probationary employees. A judge of the Supreme Court of Nova Scotia recently summed it up this way: “The era when an employer could arbitrarily terminate a probationary employee without obligation or explanation is past.” In most cases, probationary employees can now only be dismissed for “just cause”, like regular employees.

In a unionized workplace, the employer and the Union bargain for terms of employment which are set out in the Collective Agreement. Generally speaking, a unionized employee cannot sue the employer for breach of the Collective Agreement, but instead must go through the Union by way of the grievance procedure in the Collective Agreement to seek justice. Unions, in turn, owe the employees they represent a “duty of fair representation” under the Trade Union Act.

If you are an employer or an employee and an employment law issue arises you should consult with a knowledgeable employment lawyer before taking any actions. Employment law is a specialized field. Most employment law cases can be resolved out of court with the help of experienced legal counsel.

 

*Michael Coyle is an experienced employment lawyer and a neutral mediator and arbitrator based in Kentville, Nova Scotia. Information expressed in this article is meant for general interest only and is not a substitute for legal advice about your own situation. Michael can be reached by email at michael@mvc-private-law.ca  For more information and tips on employment and labour law issues, visit his website at www.michaelcoyle.ca

 

©Michael V. Coyle, 2012

Huge Defamation Damages Awarded to Nova Scotia Businessmen Against US Blogger for ‘Cyber Libel’

by  Michael V. Coyle, JD*

In a written decision released on August 7, 2012, the Supreme Court of Nova Scotia awarded damages of $425,000, plus an injunction, plus costs against a US-based blogger for the defamation of two Nova Scotia business owners and their company.

The judgement includes rare awards of both aggravated and punitive damages and an injunction prohibiting the blogger from publishing or posting any comments or images on the internet about the businessmen or their company and a “mandatory injunction” requiring him to remove the defamatory comments or images from any web sites on which he had posted them and to remove any links to those sites.

It all began when a mainstream US newspaper in Louisiana published a story about an allegedly corrupt local politician. The allegations were that the politician was involved in kickbacks, money laundering and fraud while in office. The story erroneously identified the two NS businessmen as being involved with the corrupt politician and the article falsely stated that their Nova Scotia company was owned by that politician.

When the newspaper found out that those allegations against the Nova Scotia businessmen and their company were untrue, it printed a full retraction and it apologized to them.

The blogger, however, continued, despite the retraction, to repeat those false allegations and he took it much further. He said in his blogs that the businessmen had misled a Canadian government funding agency and had committed perjury in litigation here. He said that the business was verging on bankruptcy and would soon close because of the investigation of the corrupt Louisiana politician and his inability to continue to support it.

The blogger claimed that the Nova Scotia businessmen were involved in a series of failed businesses and that they are con men and liars. He claimed that they had pulled strings to get the story retracted in the US. His allegations were laced with anti-gay rhetoric and homophobic comments and images.

He did not defend, or even formally acknowledge, the defamation suit against him in Nova Scotia, instead he continued to publish false and hateful allegations against the two business owners even as the case was before the Court. He said in his blogs, right up to the day of the hearing, that the two were improperly using the legal system by suing him for defamation.

Because the blogger failed to file a Defence to the lawsuit, the businessmen were awarded “default judgement” against him, without a trial. That meant that the statements made by the businessmen in their claim were deemed to be proven. They then asked the Court to hold a hearing to determine the damages.

Notice of that hearing was sent to the blogger but he ignored it. The judge was clearly not amused.

After hearing evidence from the two businessmen about the impact these defamatory statements had on them, personally and on their business, the judge ordered the blogger to pay damages for defamation of $50,000 to the company, plus another $100,000 to each of the businessmen. On top of that, she ordered him to pay each of the businessmen another $50,000 for “aggravated damages” plus another $25,000 to each of them as “punitive damages”.

Because the businessmen were not represented by a lawyer (although one of them had legal training but was not a practising lawyer) she fixed costs at only $2,000, plus expenses.

In awarding damages, the judge made special mention of the fact that the defamation in this case was carried out entirely on the internet, which she clearly held to be an aggravating factor. She quoted with approval an Ontario Court of Appeal judge who said in an earlier case:

“Is there something about defamation on the Internet – ‘cyber libel’, as it is sometimes called – that distinguishes it, for purposes of damages, from defamation in another medium? My response to that question is ‘Yes’.”

That judge went on to say:

“Communications via the Internet is instantaneous, seamless, inter-active, blunt,  borderless and far-reaching. It is also impersonal, and the anonymous nature of such communications may itself create a greater risk that the defamatory remarks are believed…”

In rebuke to those who may think that you can get away with anything on the internet, the Ontario appeal court judge continued, with the obvious approval of the Nova Scotia judge:

“Any suggestion that there can be no effective remedy for the tort of defamation (or other civil wrongs) committed by the use of the Internet (or such wrongs must simply be tolerated [as] the price to be paid for the advantages of the medium) is self-evidently unacceptable.”

This case makes it clear that ‘cyber libel’ will not be tolerated in Nova Scotia and that those who commit it against Nova Scotians will pay dearly for it.

While the damages awarded in this case – particularly the aggravated and punitive damages – may seem small by US standards (the plaintiffs were asking for total damages in the $1 million range), by Canadian and Nova Scotia standards they are huge. The fact that both aggravated and punitive damages were awarded at all by a Nova Scotia court is remarkable in itself.

The judge in this case paid careful attention when assessing damages to the intensity and repetition of the defamation, the homophobic slurs and images that accompanied it and the deliberate, calculated attack on the character and reputations of the individual Plaintiffs and the clear intent to cause harm to their business. That the Defendant was thumbing his nose at the Court by refusing to acknowledge the Court’s jurisdiction while continuing to issue his defamatory statements, even as the Court was hearing the case, certainly did not help his cause.

The fact that there was no Defence filed and that notice of the damages hearing was given to the Defendant and he still did not appear means that an appeal would be, from a practical perspective, virtually impossible.

For information about how this case might apply in your situation, please contact me.

*Michael Coyle is an experienced lawyer, mediator and arbitrator based in Kentville, Nova Scotia. Information and opinion expressed in this article is meant for general interest only and is not a substitute for legal advice about your own situation. Michael can be reached by email at michael@mvc-private-law.ca  For more information and tips, visit his website at www.michaelcoyle.ca

©Michael V. Coyle, 2012

 

 

 

 

Private Dispute Resolution – MVC Private Law

Private matters should stay private.

That is especially so with disputes. Whether they are business or personal disputes, differences between family members or neighbours or issues within organizations, they should stay private and yet be resolved quickly, fairly and economically.

As anyone who has tried to use the public courts to resolve a dispute knows, court cases are the opposite: the Courts are crowded, expensive, painfully slow and very public. It is often said, for good reason, that ‘nobody wins’ in court.

Private dispute resolution is more economical, much quicker and yet it carries the full force of the law.

Under provincial legislation, private arbitration rulings have the same legal effect as a court order – and they can be registered and enforced like any order of the Supreme Court of Nova Scotia, without the expense and delay. Private arbitrations proceedings are  relatively informal and they are confidential by law. There are no spectators, no media and no public airing of the dispute. The parties can have lawyers if they wish, but it is not mandatory.

Disputes that are resolved by mediation result in written agreements that are enforceable as binding contracts that can also be registered with the Supreme Court.

There is a combination of mediation and arbitration, called a Med-Arb, that is becoming very popular in which the arbitrator first attempts to bring the parties to a mediated settlement and, only if that fails, the arbitrator will make a binding decision.

You may wonder why people still go to court when private dispute resolution is available. The answer, in many cases, is that they don’t. Businesses of all sizes, sophisticated individuals and even government agencies these days resolve their disputes privately by arbitration or mediation, without going to court. Most modern commercial contracts (including some public sector contracts) have a ‘mediation-arbitration clause’ that explicitly requires the parties to use these avenues instead of going to court. And, of course, labour grievances and bargaining impasses have been settled outside the court system, exclusively by arbitration, for many decades.

If your lawyer has not discussed private arbitration or mediation with you before embarking on tedious and expensive litigation, you may want to ask why that is.

I am available to act as a neutral mediator and arbitrator throughout Atlantic Canada, in both labour and non-labour cases, at reasonable rates. I am recognized by the Government of Canada as a neutral arbitrator and adjudicator under several federal programs and I am Chair of the Nova Scotia Election Commission.

For more information, please see my Private Dispute Resolution FAQs.

 

The Liability of Political Volunteers in Nova Scotia

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The Personal Tort Liability of Political Volunteers in Nova Scotia

Michael V. Coyle, JD*

This article may interest you if you volunteer for a political party, whether during elections or at other times, and if you have ever wondered about your exposure to personal legal liability as a political volunteer.

On April 7, 2009, just before the last provincial general election, the Government of Nova Scotia quietly amended the “Designation of Non-Profit Organizations Regulations” made under the Volunteer Protection Act to declare that Registered Political Parties in Nova Scotia are “non-profit organizations” under the Volunteer Protection Act.

Registered Political Parties are the political parties who maintain their registered status with the province’s Chief Electoral Officer under the Elections Act.

So what does that mean?

It means, quite simply, that political party volunteers are exempted, with certain exceptions, from personal legal liability for civil wrongs (torts) committed while working as party volunteers.

This is important because the exact legal status of political parties in Canada still remains unclear. While some Canadian Courts have shown a willingness in recent years to treat political parties as being ‘corporation-like’ for some legal purposes, that has not stopped even the Attorney General of Canada from arguing that political parties (even Registered Political Parties) have no corporate legal status whatsoever. If that position is correct, it means that political parties cannot be sued in their own names and they cannot defend claims in court that are brought against their volunteers. So, without the Volunteer Protection Act, political volunteers may be personally on the hook.

So what are these protections?

The Volunteer Protection Act says that

“3 (1) Notwithstanding any enactment, no volunteer of a non-profit organization is liable for damage caused by an act or omission of the volunteer on behalf of the organization if

(a) the volunteer was acting within the scope of the volunteer’s responsibilities in the non-profit organization at the time of the act or omission; and

(b) the volunteer was properly licensed, certified or authorized, if required by law, by the appropriate authorities for the activities or practice undertaken by the volunteer at the time the damage occurred…”

Since there are generally no special licenses required for political volunteers, the protection is broadly available to political volunteers who are “acting within the scope of [their] authority” and who cause “damage” to another person “on behalf of the [political party]”.

“Scope of authority” generally means what they have been authorized by the party to do. If, for example, if a person is volunteering on a sign crew for a party and they are alleged to have, say, trespassed on someone’s property while putting up a sign, the property owner would likely have no claim against the volunteer.

If, on the other hand, the sign crew member, who had no authorization from the party to do so, took it upon himself or herself to write and distribute an unauthorized leaflet that defamed the character of another person, they would probably be acting outside their “scope of authority” as a sign crew volunteer and, hence, they would not have the protection provided by the Volunteer Protection Act.

There are further exceptions for volunteers, even those acting within their scope of authority. Those exceptions are applicable when:

(c) the damage was caused by willful, reckless or criminal misconduct or gross negligence by the volunteer;

(d) the damage was caused by the volunteer while operating a motor vehicle, vessel, aircraft or other vehicle for which the owner is required by law to maintain insurance;

(e) the act or omission which caused the damage constitutes an offence; or

(f) the volunteer was unlawfully using or impaired by alcohol or drugs at the time of the act or omission which caused the damage.

So, let’s say that the sign crew volunteer mistakenly thought that he had permission to put up a sign on a particular property and he parked his vehicle lawfully on a public street and proceeded on foot across that property and erected the sign. In that case, he is likely protected by the Volunteer Protection Act cannot be (successfully) sued for, say, trespass.

But if he drove across the property in his vehicle, or if he deliberately erected a sign where he knew full well it was not permitted, or if he didn’t care whether it was permitted or not, or if he was drunk or high at the time, or if he vandalized someone’s property while putting up the sign, he would not be protected from civil liability under the Volunteer Protection Act.

If a protected political volunteer is sued, however, the person suing him must pay for the costs and fees of the volunteer’s lawyer. Section 3A of the Volunteer Protection Act says:

“3A Where an action that is brought against a volunteer for damages caused by an act or omission of the volunteer on behalf of a non-profit organization does not result in a judgment against the volunteer, the volunteer is entitled to costs on a solicitor-and-client basis.”

This is, of course, a very strong disincentive against suing political volunteers.

Please note that the Volunteer Protection Act only protects volunteers in cases involving civil wrongs, or “torts” as they are called, alleged to have been committed by volunteers. This protection likely covers things like most instances of trespass, defamation and negligence. It does not exempt political volunteers from criminal liability or from breaches of the Elections Act.  And it does not prevent political volunteers from being sued for debts that have voluntarily taken on, for example, when they agree to sign a note with the bank for a party’s campaign line of credit.

 

* Michael Coyle is a lawyer and Chair of the Nova Scotia Election Commission. This article is intended as general information only and it is not a substitute for professional legal advice on the specific facts of any case. Examples are given only to illustrate the general principles involved. This article does not necessarily represent the views of the Election Commission or of Elections Nova Scotia.

Resignation or Termination: Fixed Term Employment Contract

by Michael V. Coyle, JD*
This question often arises in termination cases: Did the employee resign, or was she fired?

Leaving aside the ‘constructive dismissal’ cases where the employee says that he/she was pushed into a corner where he or she had no other reasonable alternative except to quit, it may surprise you how often employers will say “I didn’t fire her, she quit” in response to a wrongful dismissal claim.

A recent decision from the Supreme Court of Nova Scotia sheds some useful light on that subject. It also affirms the law about the damages an employer will have to pay if it breaches a fixed-term employment contract.

In that case, a teacher in a non-union setting was discussing her continued employment with her employer. There was a difference of opinion about her teaching methodology. The meetings went badly. A few days later, the employer “accepted” the teacher’s “resignation” in an email. The teacher said she did not quit, although she was certainly thinking about it, and she maintained that she was fired when the employer “accepted” her non-existent “resignation”. She commenced an action for wrongful dismissal. The Judge agreed that she did not quit and ordered the employer to pay her to the end of her contract as damages for wrongful dismissal.

Resignation

This case reminds us that the test for whether or not the employee resigned is an objective one. That is, the question is not whether the employer subjectively believed in all honesty that the employee quit. The legal question is: “Would and objective, unbiased observer looking at all the circumstances think that the employee quit?”

Further, the law tells us that a resignation must be clear and unequivocal. It is not good enough for an employer to assume or believe that the employee resigned or for the alleged resignation to be read into the employee’s ambiguous words or conduct. It has to be clearly conveyed to the employer in unmistakable terms that the employee has quit his/her job.

The Court quoted this passage from the text “Employment Law in Canada”:

8:10 RESIGNATION

The test for determining whether an employee has resigned is an objective one. As Millward, J. stated: “Given all the surrounding circumstances, would a reasonable person have understood by the plaintiff’s statement that he had just resigned?”

 In order to tender an effective resignation, an employee must have the legal capacity to contract. An offer of resignation may be revoked before there is acceptance thereof. If a letter of resignation is not accepted as offered, it is not binding on the employee and does not terminate the employment relationship. An employee may resile from a resignation, provided the employer has not relied upon it to its detriment.

For an employer to successfully argue that an employee has resigned, the evidence must be clear and unequivocal that the employee has actually resigned. To be clear and unequivocal, the resignation must objectively reflect an intention to resign, or conduct evidencing such an intention.

It is easy to understand why an employer would be tempted to quickly “latch onto” a supposed resignation, as though it were “music to their ears”. It certainly makes the employer’s life easier if they can say, “I didn’t have to fire her, she quit.” It relieves the employer of both legal and moral responsibility to think that their “problem” has so conveniently solved itself. The difficulty arises when this belief turns into the employer’s mantra, and from that into their “position” in defence of a wrongful dismissal claim, without the benefit of objective analysis. I don’t know, of course, whether that is what happened in this particular case or not, but I’ve seen it happen in others.

Fixed Term Employment Contracts

This case, also reminds us that the calculation of damages for breach of fixed-term employment contracts is significantly different from the calculation used in the more usual open-ended employment contracts, which are generally unwritten.

The Judge in this case quoted the law as stated by other Nova Scotia judges in earlier cases:

The damages arising from termination of a fixed term contract was explained by Cacchione, J. [citation omitted] as follows:

 60. The measure of damages for breach of a fixed term contract is the recovery of wages the plaintiff would have received had the defendant performed the contract in the manner least disadvantageous to itself. In Employment Law in Canada (3rd) ed. (Butterworths Canada, 1998), the authors discuss damages under a fixed term contract by stating at 14.3:

Where an employee has been hired for a definite term, in the absence of just cause for summary dismissal he or she can be terminated only by full payment of the contract amount of wages.

61. In [citation omitted] Hall, J. was dealing with an action for wrongful dismissal under a fixed term contract. In addressing the issue of damages he states as follows at page 337:

This is not the ordinary case of wrongful dismissal where the court is obliged to fix the appropriate period of notice. The term of employment was fixed by the contract between the parties. The defendant breached that contract by dismissing the plaintiff without just cause. Subject to any reduction for failure to mitigate, the plaintiff would be entitled to recover for the unexpired term of the contract or $46,000 as claimed by her counsel.

Accordingly, the Judge in this case ordered the employer to pay the employee the balance owing under the contract to its end. This was probably significantly more than an employee with this teacher’s length of service would have otherwise received had there not been a fix-term contract. As well, the Judge rejected the employer’s argument that she had failed to mitigate her losses by not looking for a job in another field even at minimum wage.

And finally, the Judge brushed aside the employer’s suggestion that the teacher was merely a “probationary employee” with this comment:

The Court does not accept that [the plaintiff] was a “probationary” employee as that term is typically understood. As [her supervisor]confirmed in his evidence, that term was utilized in the Memorandum of Agreement as reflecting that the School was not obligated, after the term of the contract, to re-hire [the plaintiff] in subsequent years. Even if she was “probationary” in the usual sense, the fact that this dispute involves a fixed term contract, would not impact on the calculation of damages.

While the dollar amount of the damages awarded was fairly small (because the employee’s salary was just $28,000 per year) the cost of proceeding to trial, plus costs and interest could have easily exceeded the damages as awarded by a wide margin.

Obviously, with the benefit of hindsight, the employer would have been much better off had it known that the teacher’s “resignation” was just wishful thinking on its part.

For more information on how this case might apply in your situation, please contact me.

*Michael Coyle is an experienced employment-labour relations lawyer and a neutral mediator and arbitrator based in Kentville, Nova Scotia. Information provided in this article is meant for general interest only and is not a substitute for legal advice about your own situation. Michael can be reached by email at michael@mvc-private-law.ca  For more information and tips on employment and labour law issues, visit his website at www.michaelcoyle.ca

©Michael V. Coyle, 2012

 

 

 

 

 

Workplace Harassment

Isn’t harassment just a matter of opinion?

No. Because of variances in life experiences, different people may have different perceptions of what harassment is, but we can still develop some common understandings. Any unwelcome behaviour that demeans, humiliates, or offends a person, or puts sexual conditions on a person’s job, is harassment.

Harassment is not just one thing. It is a continuum of behaviours that run from comments, jokes, name calling and offensive displays all the way to criminal assaults (sexual and physical) and, in extreme cases, to “criminal harassment”.

What is not harassment?

Two or more employees bantering back and forth is not harassment if everyone involved is in agreement. But if any employee feels uncomfortable with this behaviour, and the behaviour continues even after that person has expressed his or her discomfort, or if the others involved should have known the person was uncomfortable, then it is harassment. This type of harassment can create what is known as a “poisoned work environment,” where employees do not feel safe and feel constantly humiliated.

Management and supervisors are expected to know that the worker may not object to the behaviour but feels coerced into accepting it because they think the other person has more power in the workplace than they do. This can also be seen as harassment.

Normal workplace discipline is not harassment. This includes requiring employees to follow (reasonable) employer policies, correcting the conduct of employees, counselling employees on job performance or conducting normal performance reviews. That does not mean, of course, that employers or supervisors can carry out workplace disciple or counselling in a demeaning or humiliating way or use it as an excuse to discriminate against an employee.

What if everyone else in the workplace is comfortable with the behaviour?

People react to behaviour in different ways. A person may think her or his conduct is welcome or innocuous, when in fact the recipient is offended by it, but is going along with it to avoid a confrontation or further humiliation. This can happen especially where there is a difference in age, racial or cultural background, seniority, level of authority, or personal power between those concerned. Sometimes people feel they have to join in to avoid being ostracized, victimized, or teased by their peers.

How does a person know what behaviour is unwelcome?

Sometimes a person can say directly that something that is offending or humiliating. Other times, we have to be aware of non-verbal messages and clues. If someone looks embarrassed or hurt, turns away, leaves the room, or avoids another, chances are they do not welcome certain behaviour.

The courts have created the “reasonable person” rule; in other words, we assume that a reasonable person would know that certain types of behaviour are unwelcome. For example, a reasonable person would know that asking for sexual favours, and threatening someone’s job if they do not comply, is unacceptable. In cases like this, the courts may presume the behaviour was unwelcome, even if the complainant has never said “no” or “stop,” and seemed to go along with the situation.

Employers should be aware, however, that Courts or Human Rights Tribunals do not always strictly follow an objective (“reasonable person”) standard. As a practical matter, they often put themselves in the shoes of the complainant and ask, “How would I feel if this happened to me?”

What if colleagues want a sexual relationship?

A relationship where both people are involved of their own free will is not harassment. However, if one person decides to end the relationship, the other does not have the right to insist, or to continue the sexual attention. And managers should be cautious when getting involved with workers, especially anyone who is under their supervision. The imbalance of power may mean that the worker has not actually consented, but feels coerced into the relationship.

What if the employer doesn’t know harassment is taking place?

Only employers can really prevent harassment in the workplace. So the ultimate responsibility rests with them. The law says that even an employer who didn’t actually know about the harassment is still responsible, if he or she should have known it was occurring. If an employer can show that he or she took all reasonable steps to prevent and deal with harassment, the legal and financial consequences may well be less severe.

For that reason, an Harassment Policy, with a clear statement that harassment will not be condoned or tolerated by the employer is essential for all employers, regardless of their size or the nature of their business. Employers who do not have a formal Harassment Policy in place run the risk that they will be perceived as condoning or tolerating harassment in their workplace or have created a “poisoned workplace”.

Can it be harassment if it only happened once?

Yes. Frequently, harassment is a series of incidents and the older case law used to speak of harassment as being a “pattern of behaviour”. However, more recent cases have held that even something that only happens once can be harassment, in certain circumstances.

What if the harassment takes place outside the workplace, or after regular work hours?

Any place or time that people are gathered for work-related reasons is still considered part of the “Workplace”. This includes business travel, conferences, telephone calls, company social gatherings, and job interviews. Harassment is not permitted in any of these situations, and employers are responsible for dealing with it in these circumstances.

Increasingly, harassment complaints involve the use of social media. This can occur at the workplace, using company computers, or after hours, using personal computers and devices.

What if I didn’t mean to harm or offend anyone?

Even the best intended comment or action may be harassing, if it is unwelcome or offensive to another person. As a matter of law, harassment is not about a person’s intent. This cannot be over-emphasized. It is about how the behaviour affects the victim. You may only have intended to be funny, for example; but if someone else is humiliated by what you did or said, you may have harassed them without meaning to.

What if someone at work tries to retaliate against a complainant?

Retaliation is against the law. Retaliation against anyone involved in a complaint under Human Rights laws may have serious consequences. Generally, the penalties for retaliation are the same as for the original harassment, and may be even more severe.

What does the employee’s “Family Status” have to do with harassment?

It is illegal under the Human Rights Act for an employer to discriminate against an employee because he or she in a parent-child relationship. If an employee is disadvantaged because of a significant conflict between his/her parental obligations and his/her job, the employer has a duty to accommodate that employee. If, for example, the employee can’t work at night or weekends because of legitimate child-care issues, the employer is usually obligated to accommodate that in her schedule. If the employer or others in the workplace criticize or demean that employee for that, that would amount to harassment under the Human Rights Act.

“Family Status” is a complex and evolving area of Human Rights law and employers should seek specialized legal advice.

What if an employer doesn’t deal properly with a problem of harassment?

An employee who feels her or his concerns have not been properly addressed has the right to contact the appropriate human rights commission or other organization. If an outside agency determines that harassment has taken place, the employer may face financial or other consequences: giving an apology, compensating the complainant for lost wages and injury to self-respect, or human rights training, for example. The exact remedy will depend on the complaint.

Employers should understand that the investigation of complaints is extremely intrusive, time-consuming and expensive. Human Rights investigators have the power to require that the employer produce any and all documents that they consider relevant and they can, and will, interview employers, managers and business owners, often at length, during working hours. There is little an employer (or a lawyer) can do about that.

That is why is it best for all employers to have Workplace Harassment policies in place that are designed to ensure that such matters can be adequately and properly addressed “in house”. It is too late to wait until a Human Rights complaint is made to decide to look into an Harassment Policy.

What happens if the police are involved?

Physical and sexual assault are criminal offences. So too is “criminal harassment”. If the harassment involves physical or sexual assault, or if it may have crossed the line into “criminal harassment”, the police will conduct a criminal investigation and lay charges as appropriate. Employers will often not know that the police are investigating until they show up at the workplace, usually with Search Warrants. Employers should immediately go to a private phone and speak with legal counsel with specialized knowledge this area of the law.

Employers should understand that the law defines “assault”, in essence, as “the least touching without consent”. If the assault is committed for a sexual purpose, it is a sexual assault. The Criminal Code states that an assault can be committed by “acts or gestures”.

This article is for general information only. For advice about your own case please contact me.

Sources: Adapted from Canadian Human Rights Commission, “Anti-Harassment Policies for the Workplace: An Employers Guide” (2007); NS Human Rights Commission, “Guide to Human Rights in the Workplace” (2009), and “Interpreting Family” Status (n.d.).

The Legal Liability of Volunteer Board Members

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by Michael V. Coyle, JD*

Board members and prospective board members of incorporated non-profit and civic organizations often worry about the potential for personal legal liability if the organization should get into financial trouble or if they or the organization should be sued for a negligent act or omission. This concern is becoming so prevalent that, in this time of heightened worry about legal liability, organizations sometimes have trouble recruiting good people to their boards. Yet, much of that anxiety is over-blown in that the law already provides much more protection for volunteers than some might have us believe.

Often the source of these anxieties can be traced to some popular misconceptions that are repeated all too often by well-meaning but misinformed members of the public or by insurance agents who want to sell board liability insurance called “Directors and Officers (D&O) insurance. Some government funding agencies have taken it upon themselves to advise groups to buy expensive board liability insurance in the misguided belief that the group’s insurance will limit the Government’s exposure to liability claims. It is well documented that the Canadian insurance industry targeted the non-profit sector in an effort to sell them D&O insurance during times when the poor performance of the stock market (called a “hard market” in insurance lingo) was hurting their profits.

Some  straight talk and some clear information are obviously needed.

Director’s Liability for the Organization’s Debts

 Let’s deal first with debt, because it is in many ways the easiest. As a rule, if the organization is incorporated (under the Societies Act or otherwise), there is little or no real chance that the individual board members would be required to pay the organization’s debts personally, unless, of course, they signed a personal guarantee or in some other way assumed personal responsibility for the debt. That is because the debts are the debts of the corporation (a registered, paid up society is a “corporation”), and not a personal debt of the individuals serving as its directors.

The main exception to that rule is for amounts owing to the government as source deductions made from employees wages (Income Tax, EI, CPP, Workers Comp) and not remitted to the Government. In such a case board members may be held personally liable for those amounts where they cannot demonstrate that they acted with due diligence in causing them to be remitted. This liability arises directly from the relevant statutes. Fraud, theft and criminal acts are other exceptions, although they are very rarely seen.

Then there is the question of liability for wrongful acts or omissions (torts) committed by the organization or by the board or by an employee.

Director’s Personal Liability for Wrongful Acts (“Torts”)

The same general rule applies to torts: individual board members of incorporated non-profit bodies are not personally liable for damages caused by the organization or its staff. At one time it might have been argued that, if a volunteer board member personally made an error or omission that caused harm to a third party, that board member may have been personally liable as well as the organization. That source of personal liability (if it ever existed) was firmly plugged in Nova Scotia on May 30, 2002 when the Volunteer Protection Act was proclaimed.

The Volunteer Protection Act says that volunteers of any incorporated non-profit organization (which includes a society, a municipality, a school board, a regional library board or a hospital), directors and officers specifically included, are not liable “for damage caused by an act or omission of the volunteer on behalf of the organization”. “Damage” under this Act “includes both physical and non-physical losses and both economic and non-economic losses”.

The Volunteer Protection Act requires only that the volunteer must have been acting “within the scope of his/her authority” within the organization at the time of the act or omission (i.e. as a Board member) and that the volunteer was properly licensed or certified to carry out that activity, if the law required any such licenses or certification.

There are some exceptions to the statutory exemption from liability, of course, but they are really quite minimal. There is no exemption from liability if  “the damage was caused by wilful, reckless or criminal misconduct or gross negligence by the volunteer” or if “the damage was caused by the volunteer while operating a motor vehicle, vessel, aircraft or other vehicle for which the owner is required by law to maintain insurance” or if “the act or omission which caused the damage constitutes an offence” or if “the volunteer was unlawfully using or impaired by alcohol or drugs at the time of the act or omission which caused the damage”.

It must be noted, of course, that even if the organization had board liability insurance it would likely be invalid in the circumstances amounting to the exceptions under the Volunteer Protection Act for conduct amount to “gross negligence” or unlawful activity. Indeed, board liability insurance wouldn’t be of much help in a case of failure to remit source deductions either, because it involves a breach of a statute and insurance is generally not available where an insured has broken the law.

(Please note that the legal protections outlined above, under the Volunteer Protection Act  and otherwise at law, only apply to organizations that are incorporated as non-profit corporations or societies. That is, these protections, and the general legal protections that come with incorporation, do not apply to unincorporated clubs or groups, no matter how valid and worthy their activities may be.)

Accordingly, I would not hesitate to reassure voluntary board members that they have little to fear when joining an incorporated non-profit or (unpaid) civic Board about their own personal liability and, that unless there are unusual circumstances present, special board personal liability insurance is a huge waste of the organization’s precious resources.

In fact, if your organization had D&O insurance and if Board members were ever sued, the insurance company would use the Volunteer Protection Act to shield itself from having to pay out on claims. The only real advantage to D&O insurance, then, is that the insurance company would hire a lawyer (of its choosing) to represent “the Board” in a lawsuit. Actually, of course, the lawyer is representing the insurance company’s interests in the matter. Boards can decide for themselves whether this alone justifies the heavy premiums that insurance companies charge for D&O insurance, as the insurance companies say it does.

 General Liability Insurance and Due Diligence

Directors and Officers (D&O) insurance should not be confused with General Liability Insurance for the organization as a whole. Prudent organizations will always continue to maintain appropriate policies of general liability insurance covering the organization, as well as appropriate insurance coverage for any special risks (for example, if alcohol is served at functions). And, of course, directors must make sure that their annual filings have been maintained with the Registry of Joint Stock Companies and that their annual fees are promptly paid. Above all else, boards must act with due diligence in order to maintain the protection afforded by the corporate status of the organization. This involves good risk management and board governance habits including maintaining good record keeping practices for board meetings, proper financial and activity reports, ensuring that employee payroll deductions are being remitted as required, occupational health and safety awareness for the staff and volunteers, and having a realistic assessment of the risks associated with the organization’s programs and activities and insuring appropriately for those risks.

Independent Legal Advice

Voluntary organizations should not hesitate to obtain qualified outside professional advice on these liability issues. Lawyers volunteering on boards may not always in the best position to give this kind of advice because lawyers will usually refrain from giving professional advice on personal liability issues when they are also personally involved as members of a board, because that may be seen as a conflict of interest.

In the same way that you would not normally expect the accountant on your board to do the annual audit for free, you should not necessarily expect a lawyer who has volunteered to be on your board to provide free legal advice and services on all aspects of the organization’s affairs. Rather, in the same way that an accountant on your board would be sensitive to any accounting issues that the average person might not easily see, a lawyer would normally be quick to flag any legal issues that others might miss. The lawyer should then feel comfortable to recommend that the organization take independent professional advice, and if he or she does not do so, another board member should not be shy about making that suggestion. This is part of due diligence.

*Mike Coyle has been advising non-profit and civic organizations  and conducting workshops throughout Nova Scotia on board governance, risk-management and employment issues for more than 30 years. The information and opinions provided here are of a general nature and they are not a substitute for qualified professional advice on the particular facts and circumstances of your organization.

An earlier version of this article appeared in e-Newsletter of the Dalhousie University Department of Continuing Education (Henson College), Spring/Summer 2004.

Defamation Of Employee Costs Employer $60,000

Defamation and Wrongful Dismissal 

by Michael V. Coyle, JD*

A  Nova Scotia employer was recently ordered to pay a wrongfully dismissed employee over $60,000 in damages, costs and interest for defamatory statements the employer made – including a statement made to EI about why they dismissed the employee. This comes on top of the employee’s reinstatement ordered by the Labour Standards Tribunal, with 18 months back pay.

The plaintiff was the Chief Bar Steward with a branch of the Royal Canadian Legion with over 11 years service. The employer believed that he had been selling draft beer at “Happy Hour prices” outside of Happy Hour, causing the employer to suffer a loss of profits on its bar sales. In the Legion’s view, that loss of revenue was tantamount to theft, so they fired him.

The employee first went to the Labour Standards Tribunal and won reinstatement, with 18 months lost wages, when the employer was unable to prove just cause for his dismissal. There was never any suggestion that the employee had personally gained in any way from his alleged misconduct. The employee then sued the employer for defamation in the Supreme Court.

The employer stated on the ROE that he was dismissed for “willful misconduct or criminal conduct”. When the employees appealed the denial of his EI benefits, the Legion wrote to EI that his conduct “may be considered fraudulent”. Further, at a branch general meeting, the Audit Committee chair reported that the fired employee had been involved in what they considered to be the “misappropriation of funds”. The word in the community was, as one witness put it, that the fired employee had been caught with his “hand in the cookie jar”.

The Court rejected the employer’s claim it had “qualified privilege’ in its statements to EI, saying that while the first statement on the ROE (“wilful or criminal misconduct”) may have been ambiguous (because it was a check-box on the ROE), there was nothing ambiguous about the second statement to EI that the employee’s actions “may be considered fraudulent”. The Court was not at all impressed with the weasel words “may be considered”.  As the judge bluntly put it: “This is a serious allegation, and the use of the word “may” does not, in my view, mitigate from the imputation of criminal conduct. The statement is defamatory.”

So too was the report on the matter given by the Audit Committee chair at the general meeting. In both cases the employer was either deliberately attacking the employee’s reputation for honesty and integrity by imputing criminal conduct, or it was being reckless about how such statements would be understood in the community. In either event, the statements were held to be defamatory.

The Court also pointedly rejected any suggestion that because the Legion is a non-profit body, it should receive special treatment in the Court. The Judge quoted authority that, “A non-profit or benevolent corporation is liable for its torts, including libel and slander, the same as any other corporation.” The same law applies, of course, to small businesses.

Analysis

This case reminds us that defamatory statements are judged, not merely by the words used, but also by what they imply about the person who is defamed. The law books are full of cases where people thought that by using clever wording they could avoid a defamation suit. The question is not merely “What words were used?”, rather the Court will also ask itself, “What would a reasonable person in the community think that those words really meant?”

This case also reminds us that employers should be very careful what they say about their reasons for termination. Some employers believe that taking an aggressive posture with EI is a good strategy. The theory is (and I’ve heard this many times, sometimes attributed to lawyers) that if they can prevent the fired employee from getting EI that will improve the employer’s position in a wrongful dismissal suit.

Some  employers believe, or are advised,  that clever wording like “may be considered” will shield them from the legal consequences of their statements.

On the other hand, the theory goes, if the employer takes a more objective stance with EI, that will simply encourage the employee to file a wrongful dismissal claim. That theory is misguided and this case shows that it can be very dangerous. I always remind employers that whether a former employee gets EI is a matter between that employee and the Government. The employer does not have to take a position on that matter and it is often very unwise, as this case shows us, for the employer to do so.

The truth is that statements of this nature made by employers are often simply emotional responses to the hurt feelings surrounding the dismissal. Some employers will even try to justify their aggressive statements to EI by saying that they have a “moral duty” to see that the fired employee is deprived of EI benefits.

Small business and community organizations are particularly prone to this thinking because of the highly personal nature of their employment relationships and the level of hurt feelings that naturally arise when things go wrong. Unfortunately, many employers do not get objective legal advice on terminations because they see no need to talk to a lawyer about somthing that seems so obvious to them. That can be a costly mistake.

This case demonstrates the importance of obtaining specialized legal advice, preferably before the termination. Legal advice should not be reserved for “doubtful” termination cases but, as this case shows, objective legal advice is just as important where the employer firmly believes that dismissal is justified.

Obviously, with the benefit of hindsight, the Legion branch should have known that it did not have legal grounds to dismiss the plaintiff in this case.  That would have avoided the whole long and expensive mess. It certainly should have been more cautious in its statements to EI and should never have made the statements it did attacking the employee’s honesty and integrity, even at a closed general meeting. They should have sought and heeded legal advice, even if it was not what they wanted to hear at that particular time.

The result of the case is that the fired employee is still working at the Legion, with 18 months back pay in his pocket, plus $60,000 in damages, interest and costs for defamation. The Legion, of course, had to bear its own legal costs throughout, both before the Labour Standards Tribunal and in the Supreme Court. My guess would be that, altogether, it probably cost the Legion something in the neighborhood of $100,000 or more.

For more information about this case and how it might apply in your personal situation, please contact me for advice.

*Michael Coyle is an experienced employment-labour relations lawyer and a neutral mediator and arbitrator based in Kentville, Nova Scotia. Information provided in this article is meant for general interest only and is not a substitute for legal advice about your own situation. Michael can be reached by email at michael@mvc-private-law.ca  For more information and tips on employment and labour law issues, visit his website at www.michaelcoyle.ca

©Michael V. Coyle, 2012