On June 23, 2022, changes to the Competition Act were passed into law which criminalized wage-fixing and no-poach agreements between unaffiliated employers in Canada.

These changes will come into force on June 23, 2023. It is important for both employers and employees to understand how these provisions operate before that date, as these changes open employers found in breach to significant legal exposure.  

The most important changes from an employment perspective are the creation of two offenses which are new to Canadian law:

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1. It is an offense for unaffiliated employers to conspire, agree or arrange to fix, maintain, decrease or control salaries, wages or terms and conditions of employment; and
2. It is an offense for unaffiliated employers to conspire, agree or arrange to not solicit or hire each other’s employees.

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Penalties under Competition Act

The changes to the Competition Act also include significant penalties for wage-fixing and no-poach agreements, including imprisonment for up to 14 years and/or a fine in the discretion of the court.  Notably, the amendments to the Competition Act removed the previous ceiling on fines of $25 million, so the size of the financial penalty that an employer can face is now theoretically uncapped.

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Why?

The motivation behind the changes to the Competition Act was to address a gap in the law in Canada which was driven into sharp relief during the Covid-2019 pandemic.  In March 2020, various food retailers in Canada introduced a wage premium to, among other reasons, reward employees who continued to provide essential services during the early lockdowns.  Three food retailers subsequently simultaneously terminated this wage premium in June 2020.

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The House of Commons Standing Committee on Industry, Science and Technology conducted hearings to look into the matter in July 2020.  The testimony of the representatives of the food retailers before the Committee confirmed that communication had taken place at the executive level regarding the termination of the wage premiums, but all of the representatives denied any coordination, and maintained that their decisions had been made separately.  Notably, under the Competition Act at the time this communication occurred, coordination for the purposes of suppressing wages (had it in fact occurred) was entirely legal.

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Proving wage-fixing and no-poach agreements

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Notably, the Competition Act allows a conspiracy, agreement or arrangement to be proven through circumstantial evidence.  Accordingly, while the existence of the conspiracy, agreement or arrangement must be established beyond a reasonable doubt to make out the offense, it is impossible to infer the existence of such a conspiracy without direct evidence.  

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There is an interesting exception to the wage-fixing and no-poach agreements, in that if it can be shown that the wage-fixing or no-poach agreement is ancillary to a broader or separate agreement or arrangement involving the same parties, and if it can be shown it is directly related to and reasonably necessary to give effect to the objective of the broader agreement, there can be no conviction under the Competition Act.  What this means, in effect, is that employers who enter into a no-poach agreement in certain contexts, such as the purchase and sale of a business or a joint venture, which may reasonably require such a clause in certain circumstances, are likely not in breach of the new provisions to the Competition Act.  Any employer contemplating such an agreement should approach it with extreme caution, and seek legal advice before doing so.

TAKEAWAYS

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Employers should consult with legal counsel to review any agreements they have entered into with other unaffiliated employers to ensure that they are in compliance with the new provisions of the Competition Act well in advance of the amendments coming into force in June 2023.  

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From the employee perspective, employees who believe that they have been subject to a wage-fixing or no-poach scheme should seek legal advice, as it is possible to ground private civil actions on violations of certain sections of the Competition Act.

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Note to Readers: This is not legal advice. If you are looking for legal advice in relation to a particular matter please contact one of our group members. We communicate all these updates to our clients and readers on our Employer Resources Portal and through monthly Newsletters.

Most Wills remain effective if you move. However, updates are required when a Will gives a spouse or child a right to live at or keep a certain address and that address has changed. 

Moves are also a great time to review documents. Is your new location still convenient for your executors or should you choose new ones? Have you appointed a Power of Attorney in case you lose capacity? Etc. 

Consideration should also be given if you’ve moved between provinces. Each province has their own version of a Power of Attorney and Medical Agreement so it advisable to have one in any jurisdiction where you own property. 

If your Will needs to change, give Dan Grice and his team at KSW Lawyers a call. We can manage all your estate and tax planning needs, business services, disputes and more.

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If so, you may have received a letter from the B.C. Government stating the need to file a report with the Land Owner Transparency Registry (LOTR) by November 30, 2022. The filing’s purpose is to disclose the true owners, or “interest holders”, of land in B.C. If the deadline is missed, there are significant penalties that can result in fines of up to $50,000 or 15% of the property’s assessed value.

The Government requires a legal professional to file the report on your behalf because legal professionals are experts in land and title matters. They can advise on issues with respect to land ownership that may have far reaching effects on estate planning, taxation and other legal matters. The Government is relying on lawyers to protect the integrity and accuracy of the information in the registry, since they will complete the required identity verification.

If you received this letter from the Government or think you may own land in B.C. through a company, a partnership, or a trust, please reach out to us at 604-591-7321 or [email protected]. We can assist with your filing before the November 30, 2022 deadline and help you avoid any penalties.

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With the passing of Queen Elizabeth and her funeral set for Monday September 19, 2022, governments throughout the world are looking to see how to honour Her Majesty’s passing.

In Canada Prime Minister Trudeau announced there would be a National Day of Mourning.  The government published a Proclamation of the Governor General stating, inter alia, “…by this Our Proclamation request that the people of Canada set aside September 19th 2022 as the day on which they honour the memory of Her late Majesty Queen Elizabeth the Second, who passed away on September 8th 2022.”  The Proclamation requires that the “Loving Subjects…take notice and to govern themselves accordingly.”

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Is September 19, 2022 a Statutory Holiday?

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Unlike the September 30 NDTR holiday, this day of remembrance is NOT a statutory holiday under the Canada Labour Code or (federal) related legislation.

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Nor is it a statutory holiday under the BC Employment Standards Act (provincial). The Premier has made it clear that while the BC government will give the day off with pay to provincial employers and shut down government offices including schools and courts, there will be no amendment to the Employment Standards Act to make it a holiday applying to all provincial employers.

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The Prime Minister has declared that federal government employees will have a paid day off. But his Minister of Labour, following the outcry of federal employers led by the banks, made it clear that this holiday would not affect non-government federally regulated employers such as banks, telecommunications, or aerospace employers. In a tweet he stated:

September 19, 2022 will be a holiday for federal government employees. It will be a day of mourning for the passing of Her Majesty Elizabeth II, Queen of Canada. Federally regulated employers are welcomed to follow suit, but they are not required to do so. [emphasis added]

Therefore, provincially regulated non-union employers are not required to give their employees the day off with pay.  We encourage employers to follow the direction to provide employees with the opportunity to take a moment of silence on Monday to show their respect for Her Majesty.

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Unionized Employers and Collective Agreements

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The more difficult question relates to those BC unionized employers who have in their collective agreements language that provides for listed Paid Holidays but adds holidays declared or proclaimed by the federal government.  For example, the BC government collective agreement stated:

Any other day proclaimed as a holiday by the federal, provincial, or municipal governments for the locality in which an employee is working shall also be a paid holiday.

The BC Government relied on that language to say they were obligated to give September 30, 2021 off as a paid holiday to its unionized employees notwithstanding that the NDP chose not to make it a statutory holiday.

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The language of the collective agreement in question will be the deciding factor as to whether you as an employer are bound to treat September 19, 2022 as a paid holiday. Therefore, each case will be decided on the specific language in the collective agreement including bargaining history.  We suggest that you consult with your professional advisors including legal counsel if you have a question about your collective agreement.

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However, with that caveat, in our view there is a strong argument that the September 19, 2022 day of remembrance will not likely be covered by the various collective agreements that might otherwise incorporate federal holidays.  This day has not been declared or proclaimed as a federal holiday with pay.  The statement by the Prime Minister and as reflected in the Proclamation does not have legal force nor does it purport to impose an obligation on any employer.  That is made clear by the Minister of Labour’s statements that non public service employers are not bound to provide a paid holiday.  Both the federal government and the provincial government are making decisions to give the day off as employers, not as government.

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This is of course a one-off holiday so it might be hard for unionized employers to refuse to provide that day off if government employees have the day off with pay.  But the precedent set by giving the day off might be a problem down the road.

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If you have any questions about this topic, please do not hesitate to get in touch with us for legal advice specific to your workplace.

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Mike Weiler - Contact Info: [email protected]; Cell: 604 250 0090

September 15, 2022

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Note to Readers: This is not legal advice. If you are looking for legal advice in relation to a particular matter please contact one of our group members. We communicate all these updates to our clients and readers on our Employer Resources Portal and through monthly Newsletters.

We’ve all heard the term child support, but what is it really? 

The courts view the payment of child support as a right of the child and this right is taken very seriously.

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The parent or guardian who pays support is called the “payor.” The parent or guardian who receives the support is called the “recipient.” 

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Child support is the obligation of a parent or guardian to pay support for a child based on the paying parent or guardian’s income. The child support also varies depending on the number of children for whom support is paid. In other words, the child support amount increases with the number of children. For example, if the payor lives in BC and has an income of $50,000, the payor would pay $470/month in child support for one child, $781/month for two children, $1,029/month in child support for three children, and so on.

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 What happens when you get behind?

What happens when you get behind on making these child support payments also known as being in arrears? The answer really depends on the facts that will inevitably be unique to your situation. But broadly, here is what can happen:

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1.  You and the recipient can talk about the change that may have led to you being behind in payment. For example, if you lost your job and haven’t been able to find another one, the recipient may be willing to cooperate with you and wait a few months before taking steps to seek or obtain a court order for child support or enforce an existing court order or agreement.
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2. If there is a court order or written agreement, and the recipient has already registered the court order or written agreement with the Family Maintenance Enforcement Program (or “FMEP” for short), then FMEP can start taking enforcement measures against you. For example, FMEP can garnish your wages, intercept any federal incomes or money you are going to receive such as income tax refunds or EI, cancel your driver’s licence or prevent its renewal, take you to court for unpaid support payments, and so on.
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3. If there is a court order or written agreement, whether or not FMEP is taking enforcement steps, the recipient can go to court to enforce payment in accordance with the order or agreement. You will in a position then to explain why you are behind in payments. You may also want to consider making a court application, if you haven’t already, to vary or change the child support payable by you.
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4. If you and the recipient don’t agree to any changes in your child support obligations, then you can (and likely should) make a court application to vary or change the child support payable by you under a court order or agreement.

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Follow the agreement

Keep in mind that if there is a court order or written agreement between you and the recipient, you should be following it. But if for some reason you cannot, and you and the recipient don’t agree on the change, then you should make a court application to vary or change that court order or agreement. Part of that court application could be to cancel or set aside any arrears of child support.

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If you are behind in making payments for child support or need help navigating the court system on this issue, come see us and we’d be happy to assist you in determining the viability of your case.

In an attempt to enhance consumer protection for homebuyers, the B.C. government has introduced a new 3-day “cooling-off period” on residential real estate sales. The “homebuyer protection period”, asit is referred to by the B.C. government, is a first of its kind in Canada, and becomes effective on January 1^st, 2023.

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The cooling-off period is meant to protect B.C. homebuyers from being pressured into high-risk sales. Amendments to the Property Law Act made in April 2022 grant the B.C. government the power to enact regulations which enhance buyer protection in the real estate market. The regulations will come into force by January 1, 2023, and will add a right of rescission (cancellation) to the Property Law Act, under which a buyer of residential real estate will have 3 business days (the “cooling-off period”) following an accepted offer to conduct research on the property, such as carrying out inspections, securing mortgage loan financing, and seek ng legal advice, before deciding whether to rescind their offer. The new cooling-off period is intended to apply to resale property and newly constructed homes. Cooling-off periods for pre-construction sales of multi-unit development properties, like condominiums, are already in place under the province’s Real Estate Development and Marketing Act.

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Buyers can still make offers conditional at any time (for example, on things like obtaining financing or a satisfactory home inspection). The cooling-off period is meant to offer homebuyers the opportunity to conduct research on the property at times when their offer does not have any conditions in place, as was often the case during the booming market over the past several years.

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The new cooling-off period includes a rescission (cancellation) fee of 0.25% of the property’s purchase price, or$250 for every $100,000, for those buyers who choose to back out of a deal. For example, if the buyer exercises its right to cancel its offer on a $1-million property, they would be required to pay $2,500 to the seller. Commentators have noted that the penalty could be small enough that there could be increased activity in buyers backing out of deals after big announcements, such as substantial Bank of Canada interest rate hikes or particularly jarring inflation reports.

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The cooling-off period is one of several recommendations which the B.C. Financial Services Authority  (BCFSA) made in May 2022 to cool down the province’s white-hot residential real estate market. The B.C. government had initially pitched a 7-day cooling-off period, but the B.C. Real Estate Association had pushed back. Instead, the realtors’ association proposed a5-day pre-offer period, which would require that a listing remain on the market for at least 5 days before an offer could be accepted, which should theoretically have the intended effect of stemming bidding war by desperate buyers. The BCFSA included the real estate sector’s proposed 5-day pre-offer period in its list of recommendations in May.

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Contrary to the BCFSA’s recommendations, the new legislation does not include the 5-day pre-offer period, legal provisions to ensure that a buyer gets reasonable access to the property during the cooling-off period to conduct an inspection, or a requirement for a buyer to have to inform the seller whether or not the buyer has active offers on other properties before the seller accepts the buyer’s offer.

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Although the new regulations are intended to protect individual buyers of houses and condos, they use the term“ residential property”, which is quite broad. This means that sales of apartment buildings and seniors homes may be caught by the changes, even though such sales are typically considered business transactions. If the regulations that come into force at the end of this year do not provide exemptions, commercial brokers and investors will need to be aware of the new cooling-off provisions and account for them under their contracts of purchase and sale. As the new laws will come into force at the end of the year, the full details, including potential exemptions for residential properties such as apartment buildings and seniors homes, are not yet clear.

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If you have any questions regarding the new cooling-off period, please contact Christine Wang or Aman S. Bindra of our Surrey office, or Tyler Evans or Dan Grice of our Abbotsford office.

Two recent cases from the BC Supreme Court involving employees over 60 highlight two important employment law principles.

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Okano v Cathay Pacific Airway Limited, 2022 BCSC 881

In Okano v Cathay Pacific Airway Limited, 2022 BCSC 881 ("Okano"), the plaintiff was 61 years old and worked for the defendant airline company for just under 35 years when she was terminated without cause during the pandemic. At the time of dismissal, the plaintiff was in a middle management position where she was responsible for some financial decisions and had the ability to hire and fire employees.    

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The plaintiff did not have a written contract dealing with severance. Therefore, she sought a notice period of 26 months at common law. The court ruled that apart from exceptional cases, the upper limit for reasonable notice is 24 months:

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[45] Our courts have been clear that, absent exceptional circumstances, the upper limit for reasonable notice is 24 months: Ansari at 42. The mere fact that the plaintiff was a long-term valued management-level employee does not constitute an exceptional circumstance that would lead to an increase in the upper limit of 24 months: Waterman v. IBM Canada Limited, 2010 BCSC 376 at paras. 20–24, aff'd on other grounds 2011 BCCA 337.

The court determined this case was appropriate to award the maximum 24 months given the employee’s long service, age, and management status.

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Importantly, the court reduced the plaintiff’s damages by 3 months for failure to mitigate (with an additional contingency reduction of 15% to the 7 months remaining in the notice period). The plaintiff made no efforts to find work in the first two months, then made passive efforts until the next summer. Most significantly, she decided not to apply for work in the airline industry. In making this deduction, the court confirmed that reasonable mitigation requires that terminated employees actively pursue employment in their field of employment and/or industry.

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Toy v 0954516 BC Ltd., 2022 BCSC 1161

In Toy v 0954516 BC Ltd., 2022 BCSC 1161, a 62-year-old fuel and scale attendant making about $40,000 pear year with 5 years of service brought a wrongful dismissal claim. In considering the Bardal factors, the court determined that 5.5 months of notice was appropriate.

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However, this employee also failed to mitigate his damages by only applying for 3 jobs in the year following the dismissal. The judge found that had the employee made reasonable efforts, he would have found work sooner. As a result, the court reduced damages by 2 months. After factoring in the one month already paid at the time of dismissal, the employee only ended up with an award of 2.5 months pay or less than $10,000.

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Takeaways

Employers can take some comfort in knowing that 24 months continues to be the common law maximum for reasonable notice, absent exceptional circumstances. However, 24 months is no small number especially for a senior manager! The best way for employers to avoid such exposure is to have well-drafted termination clauses that limit your liability to something less than the common law. If you would like your contract reviewed or if you would like to have contracts drafted, please contact your KSW lawyer today

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Read more of these updates on our Employer Resources Portal and through monthly Newsletters. If you have any questions or need assistance revising your employment contracts or policies, please reach out to Chris Drinovz at [email protected], or submit a Contact form.

In the recent decision of Render v ThyssenKrupp Elevator (Canada) Limited, 2022 ONCA 310, the Ontario Court of Appeal upheld the just cause dismissal of a high-level manager with 30 years of service after he smacked the buttocks of a female co-worker.

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Facts

The plaintiff worked for the company for 30 years and was in the position of Operations Manager at the relevant time. The incident occurred in the office when the plaintiff was with several co-workers joking around. He crouched down and placed his face near a female co-workers breasts for two to three seconds; as he was getting up, he then smacked her buttocks with a sweeping gesture.    

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The company conducted an investigation into the incident and terminated the plaintiff for cause pursuant to its harassment policy. The plaintiff sued for wrongful dismissal. He did not deny the touching, but claimed it was accidental and non-sexual. He argued that the termination was disproportionate given his 30 year history and otherwise blameless disciplinary record. He also referred to the company’s progressive discipline policy and said that a less discipline should have been considered first under that policy.

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Court Decisions

In the trial, the company showed that it had considered the possibility of less discipline, but deemed them not appropriate because continuing to employ the plaintiff would send a message to other female employees that the misconduct was condoned.

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The trial court, and subsequently the appeal court, upheld the termination for cause. The courts concluded that dismissal was a proportionate response given: the seriousness of the harassment; the existence of a zero-tolerance harassment policy; the employee’s role as a manager and the fact that he weas responsible for implementing the harassment policy; and the employee’s lack of appreciation and remorse for his conduct during the investigation. The court found these factors regardless of the fact that sexual banter and joking around was commonplace in this particular work environment.  

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Interestingly, at trial the successful employer was awarded legal costs of almost $75,000. However, the appeal court disentitled the employer to its costs for making statements to the media before the trial (through a press consultant) that were sensationalist and misleading. The behaviour was classified as misconduct as the court found it had the potential to taint the evidence and witnesses.

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Takeaways

This case follows other recent cases showing courts are increasingly unwilling to treat any instance of sexual touching or harassment as “minor” and uphold a just cause dismissal where a single instance of such conduct is proven. This is amplified where the perpetrator is part of management and responsible for setting an example or enforcing the very policy they have breached. In addition, a half-hearted apology or lack of remorse during the investigation will be a relevant factor.  

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Notwithstanding this precedent and the judicial trend, termination for cause remains a very high bar. The Supreme Court of Canada test of McKinley still requires employers to consider the context of the situation, including the employee’s years of service, any past record, the seriousness of the conduct in issue, and existing workplace policies. In addition, the employers must consider the possibility of lesser discipline and whether it is appropriate in the circumstances under a consideration of proportionality.    

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Employers should consider their current policies and ensure they have strong anti-harassment and discrimination policies in place with appropriate training, in addition to well-developed processes and procedures for the investigation of complaints. A good policy and a solid investigation will go a long way in the event of a lawsuit. Finally, if litigation is contemplated, employers should seek legal advice before making any public statements about the case.

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Our employment and labour lawyers are heavily involved in various local BC Chambers and Policy Committees, attend roundtable discussions and present webinars regularly on the Employment Standards Act and related legislation. We communicate all these updates to our clients and readers on our Employer Resources Portal and through monthly Newsletters. If you have any questions or need assistance revising your employment contracts or policies, please reach out to Chris Drinovz at [email protected], or submit a Contact form.

A labour arbitrator appointed to hear an employer grievance for damages in defamation against its union, Unite Here Local 40, has awarded the employer $500,000 but would not award costs.  Yes you read that right — a labour arbitrator operating under a collective agreement and not a court has made that award.  Not only is the amount of the award stunning and potentially crippling to Local 40 it shows just how far the courts, applying the Weber decision have refused to take jurisdiction on any matter that is even remotely connected to the collective agreement. In an earlier award the Arbitrator decided he had jurisdiction because “if the statements were defamatory they would constitute bad faith in the administration, application and performance of the collective agreement which violated the principles laid down in Bhasin v Hrynew, 2014 SCC 71, [2014] 3 SCR 494, and the dispute was therefore arbitrable.” [Page 2]

The full decision is available here: 2022CanLII 51879 (BC LA) | Civeo Corporation v Unite Here, Local 40 | CanLII

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Civeo Corporation is an international company that provides housing to construction projects including the Kitimat Sitka Lodge in Kitimat.  It had a collective agreement applicable to employees at the Kitimat LNG project.  The collective agreement in question ran from 2018 and was in effect in 2021 when the defamatory statements were made.  Local 40 had a dispute with Civeo as it wanted it to open up the collective agreement and increase wages and provide better hiring practices.  To support its agenda it tried to appeal to the public including the Indigenous public by posting the following on its web site:

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Civeo’s broken promises to First Nations people:

·      Low wages

·      Decrease in hiring of Indigenous workers over the past 2 years

This means that Civeo has not showed commitment to improving the living standards of Indigenous workers and their families.

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Civeo had prided itself in how it dealt with Indigenous peoples across the world and especially in Canada and Australia.  “All the lodges in Canada are in First Nations territory and good relations with First Nations are paramount” [page 12].  The Canadian Council for Aboriginal Business bestowed the company with a Gold Level certification in the Progressive Aboriginal Relations program [page 13]. Its commitment to a respectful and inclusive relationship with First Nations was a cornerstone of its success in obtaining contracts such as the one in Kitimat.

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Defamatory Statement Against Employer

In a 114-page decision the Arbitrator summarized his view of the alleged defamatory statement as follows:

An ordinary well informed Canadian reader would take from the website image a message that Civeo had broken its promises to First Nations people. Closer examination of the small print would reveal the message that Civeo had promised higher wages and delivered lower wages. It had promised a certain level of hiring and delivered something less. Further, I find that the message delivered by the impugned words was not just that Civeo had failed to make good on its promises but had cynically and deliberately provided something less.

I find there was an additional “sting” in the allegation, recognizable by the averagely well informed Canadian reader, which associates the employer’s conduct with the history of broken promises at a government level, which aggravates the defamatory meaning of the words used, and amplifies the degree of harm, and therefore damages if no defence is successful, caused to the employer’s reputation by association with this unfortunate history…

To this should be added that the impugned banner headline specifically identifies the “Broken Promises” of Civeo as promises made to “First Nations People” not just anyone. This connection, as well as the deliberate and pronounced prominence of the headline make it very clear as to what the union’s message was intended to convey. The message deliberately associates and links Civeo’s conduct to the historical undercurrent of broken promises to First Nations. Added to that is the fact that among the intended recipients of this message were indigenous people in the region and beyond, who of course were especially sensitive to this history.

In summary, taking the objective common-sense approach referred to above, I find that the impugned statement is defamatory in its natural and ordinary meaning. [pages 6/7]

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Employer Files Grievance

Civeo, through counsel, filed the grievance with the union in the following terms in August 2021:

On behalf of Civeo, we hereby file a grievance at stage 2 of the grievance procedure seeking damages and a cease-and-desist order regarding the following defamatory statements publicly communicated by your union:

Civeo's broken promises to First Nations people: Low wages; Decrease in hiring of Indigenous workers over the past 2 years.

This means that Civeo has not showed commitment to improving the living standards of Indigenous workers and their families. (See attached internet posting by Local 40)

These statements are patently untrue:

(i) The wages being paid are what were negotiated with your union in a letter of understanding covering the duration of the Sitka Lodge; (ii) Indigenous workers make up 47% of the total workforce; and (iii) As evidenced by the recent nomination of Civeo by the Haisla Indigenous community for the Indigenous Joint Venture/Partnership Award given by the Kitimat Chamber of Commerce, Civeo has shown a strong commitment to improving the living standards of Indigenous workers and their families.

Given the ongoing harmful effect of your false statements on the reputation and business interests of Civeo, we request a step 2 grievance meeting by telephone early next week. Please confirm the availability of your union for this meeting as soon as possible. In the meantime, to limit the liability of your union for the damages caused by your defamatory statements, we recommend that you take immediate steps to publicly retract these statements and apologize for making them. [pages 9/10]

Employer Reputation

The case is important not just for its detailed and scholarly analysis of the law of defamation including the various defences such as fair comment but also for its unique analysis of the importance of reputation when dealing with an employer’s ability to secure and maintain work when dealing with an Indigenous workforce:

Reputations are by their nature fragile, and the law of defamation is there to recognize this and protect reputations where appropriate. The comments earlier quoted from Zhong v Wu (supra) bear repeating:

The impression left by a libel on the reader may never be known but may last a lifetime, Philip Lewis, Gatley on Libel and Slander 8th ed., (London: Sweet & Maxwell, 1981) at 9.2. Thus, the presumption of damage recognizes the importance but fragility of a good reputation and the reality that the harmful consequences of defamation are difficult to prove, much less quantify. Zhong v. Wu, 2019 ONSC 7088, para 35. [Page 110]

Punitive Damages Awarded Against Union

In awarding punitive damages the Arbitrator relied on the following facts:

As in Barrick Gold, punitive damages are appropriate in this case, both because of the need to deter the union’s conduct, and because of the following factors:

1) The union’s contention that Civeo broke its promises to First Nations peoples is a complete fabrication;

2) The statement was published on the union’s website in order to maximize the statements’ distribution, well beyond anyone in the immediate region – including to anyone in the world doing a Google search of “Civeo”, whether they be potential employees, investors, business partners, contractors, governments, or otherwise;

3) The union did not remove this false or misleading, and defamatory, claim from its website for two months after Civeo wrote to the union to request that it take immediate steps to retract the defamatory statements and issue an apology;  

4) The union has refused to issue an apology or retraction, even after removing the statement from its website and continues to assert the truth of its defamatory message. It has indicated every intention, unless restrained, of repeating and continuing its message.

5) The union made these statements to pressure Civeo improperly to renegotiate terms of the Collective Agreement during the term of the agreement;

6) The union’s statements were made in an attempt to circumvent the provisions of the collective agreement dealing with disputes and disagreements between the parties; and

7) The threat to investors in furtherance of these vindictive statements compounds the culpability of the union’s conduct. [pages 106/107]

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The Arbitrator therefore awarded $400,000 General Damages and $100,000 punitive damages [page 111].

Civeo also argued that it was entitled to costs but couched its claim as seeking:

compensatory damages caused by the union’s unlawful and tortious conduct, which includes – amongst other things – the consultation and legal work performed in order to address and repair the harm stemming from the union’s unlawful conduct. [page 60]

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The claim was made in this fashion because section 90 of the Code precludes arbitrators from awarding the costs of the arbitration.  The Arbitrator decided to deny Civeo’s claim stating he decided to “err if at all on the side of adhering to the specific statutory direction provided by the Code” [page 64].  The Union argued that the Grievance should not proceed because the Arbitrator did not have jurisdiction only the court did.  If the matter had proceeded to court then the employer would have likely been entitled to at least taxable costs.

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EMPLOYER TAKEAWAYS

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Arbitration under a collective agreement has always been touted as being an inexpensive and expeditious way to deal with workplace disputes during the term of a collective agreement since employees cannot go on strike to pursue their grievances.  But as this case demonstrates that is a long-ago debunked fallacy.  Arbitrations are expensive and often complicated in terms of legal, evidentiary, and factual issues as this case truly demonstrates and is a prime example of that reality.

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At the same time those businesses that want to do business in Frist Nations territories and with First Nations might find the decision of interest as to the steps taken by Civeo to successfully nurture that relationship and its business model in Canada and Australia.

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Mike Weiler - Contact Info Here

June 30th, 2022

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Note to Readers: This is not legal advice. If you are looking for legal advice in relation to a particular matter please contact one of our group members. We communicate all these updates to our clients and readers on our Employer Resources Portal and through monthly Newsletters.