Effective January 1, 2025, the federal government changed the law to lower the federal criminal interest rate to 35% annual percentage rate (APR), which equals about 42% effective annual rate (EAR) down from the previous EAR of 60% (equal to roughly 48% APR). These changes make it a criminal offence to offer loans at any interest rate above 35%, with some exceptions.

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3 exemptions remain:

1. commercial loans,
2. pawnbroking loans, and
3. payday loans.

The amendments broaden the scope of activities covered by the criminal interest provision, now including offering or advertising credit at criminal rates, not just entering into an agreement.

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The new criminal interest rate does not apply to agreements made before the amendments came into force. Loans that complied with the previous laws when originally entered into are unaffected by the changes. However, clients should seek legal advice when modifying such agreements to ensure continued compliance with the new laws. Lenders and brokers should be aware of these changes and take the time to learn their responsibilities under the new rules. Violations can result in fines of up to $25,000, or imprisonment of up to 5 years.

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Understanding how copyright interacts with employment relationships is important for employers, as it helps them protect their business interests and maintain control over copyrighted works created within their organizations. This article outlines some of key employer rights and considerations regarding copyright in Canada.

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Copyright and the Copyright Act

Copyright in Canada is governed by the Copyright Act (the “Act”). The Act provides authors with exclusive rights over their original works, such as the right to reproduce, distribute, and license their creations. It is noted that Copyright is not limited to “artistic” works. Copyright extends to works valuable to businesses, such as website contents, catalogs, logos, etc.

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Employer Ownership of Copyright: The Default Rule

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In the context of employment, the Act includes provisions that alter the default ownership rules. Under section 13(3) of the Act, copyright in works created by employees in the course of their employment typically belongs to the employer, unless there is an agreement to the contrary. In short:

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1. The author of the work must be in the employment of another person;
2. The work must be made by the author in the course of employment; and
3. There must be no agreement to the contrary.

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In the absence of an employment relationship, the general rule in Canada is that the author owns the copyright in an original work. Accordingly, when a work is created by an independent contractor, the above does not apply and the contractor retains the copyright. Payment for services does not translate into the transfer or ownership of the copyright in the work. In order to own a work created by a contractor, a written agreement explicitly transferring the ownership of the copyright must be implemented. Without such an agreement, the ownership in the copyrighted work is not transferred, and the rights remain with the author.

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Written Agreements and Customizing Copyright Ownership

We recommend employers to use written agreements to clarify the terms and conditions of employment, including copyright ownership. Employment contracts can include terms that

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• Confirm that all works created during employment are owned by the employer;
• Extend employer ownership to works created outside regular duties but using company resources; and
• Address moral rights, which allow authors to protect the integrity of their works.

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Even if the employer owns the copyright, employees retain their moral rights unless they explicitly waive them. Moral rights are granted exclusively to the author and include the author’s right to maintain the integrity of the work and the right to be cited as its author. Importantly, moral rights cannot be assigned, even if the employer is to be the owner of the copyright.  Accordingly, it is important that any employment agreement provide for a waiver of the employee’s moral rights.

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For independent contractors, contracts should explicitly include clauses transferring copyright ownership to the employer.

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Best Practices for Employers

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To protect their rights and ensure compliance with copyright laws, employers should:

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1. Draft clear employment and contractor agreements, including specific terms addressing copyright ownership and moral rights waivers.
2. Ensure proper classification of workers: distinguish between employees and independent contractors.
3. Educate employees: provide training on the organization’s IP policies, especially regarding the use of company resources and the creation of works.
4. Consult legal professionals: work with legal counsel to ensure contracts and policies align with the Act.

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Conclusion

In Canada, employers generally hold copyright in works created by employees in the course of their duties. While so, written agreements help avoid disputes and ensure clarity. By understanding their rights under the Act and implementing written agreements, employers can safeguard their rights while maintaining productive working relationships with employees and contractors.

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Note to Readers: The information in this article is not legal advice. If you are looking for legal advice in relation to a particular matter, please contact Junki Hong.

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Employers have several legal obligations and, as explained in Workplace Policies 101 by Jenson Leung, having a robust set of polices is important to meet those obligations.

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Understanding how certain key terms are defined in those policies, and how the terms are interpreted, will help to ensure that you and your employees know what conduct is not acceptable in the workplace.

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There are several sources of law and policy that define harassment and bullying and discrimination.

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Bullying and Harassment

WorkSafeBC policy defines harassment and bullying as

any inappropriate conduct or comment by a person towards a worker that the person knew or reasonably ought to have known would cause that worker to be humiliated or intimidated, but excludes any reasonable action taken by an employer or supervisor relating to the management and direction of workers or the place of employment.

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(reference Policy Item P2-21-2 Employer Duties - Workplace Bullying and Harassment)

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The Workers’ Compensation Appeal Tribunal (WCAT), through its consideration of appealed claims for injury compensation, has said that bullying and harassment is interpersonal conflict which, in order to constitute a significant workplace stressor, must contain an element of abusive or threatening behaviour (Decision # 2014-02791).

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Discrimination and Sexual Harassment

If harassment in the workplace involves conduct that targets personal characteristics like race, ancestry, disability, Indigenous identity, sex, gender expression and identity and/or sexual orientation then the BC Human Rights Code offers protection to employees.  The BC Human Rights Tribunal allows employees to make complaints against the individual who committed the discrimination and/or sexual harassment.

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Examples of discrimination and harassment in the workplace, as decided by BC Human Rights Tribunal, include:

• Comments and unfounded allegations that are based on stereotypes (2024BCHRT 204, 2023BCHRT 137).
• Treating someone differently because of a personal characteristic (2022BCHRT 98, 2014BCHRT 150).
• Disparaging comments based on false assumptions (2022BCHRT 68, 2011 BCHRT 310).
• Making racially charged comments, slurs and/or jokes (2022BCHRT 129, 2018BCHRT 238, 2007 BCHRT 197).
• Racially profiling someone in the workplace (2008BCHRT 293).
• Touching in sexual way, showing or displaying porn, repeatedly asking someone for a date, imposing adverse consequence because someone said no to sexual advances (2020BCHRT 138, 2019BCHRT 97).

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Are employers liable for an employee’s bullying and harassment and discrimination in the workplace?

If an employee’s misconduct was known to the employer, and the employer failed to discipline it, or otherwise condone the employee’s misconduct, an employer can be found liable for the actions of the employee.  This is known as vicarious liability and Robichaud v. Canada (Treasury Board), 1987 CanLII 73 (SCC), [1987] 2 S.C.R. 84 is the leading case.

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In 2024, the BC Human Rights Tribunal decided a case that found an employer was not vicariously liable because they properly investigated the employee’s misconduct and acted appropriately. Based on that decision, the following recommendations will minimize findings of vicarious liability:

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Have workplace policies that are clear that bullying, harassment, and discrimination in the workplace is not tolerated, and the policies are:

• Updated regularly.
• Accompanied by mandatory training and/or regular reminders about the policies.
• Warnings about the consequences of policy breaches, including potential discipline for breaches of the policy.
• Have a misconduct complaint investigation process that:
  • Communicates confidentiality, quickly and clearly to the parties.
  • Interviews all the parties including the complainant, the offending employee (the respondent), and relevant witnesses.
• Ensures that employee mental health is taken care by:
  • Offering an employee assistance program.
  • Acknowledging the employer’s duty to accommodate. (2024 BCHRT 119)

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By considering and implementing workplace policies, employers can easily meet their legal obligations and minimize the risk associated with employee misconduct.

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To learn more about KSW Lawyers, how we help clients, and how I can assist you with your workplace investigation, workplace policies or human rights matter, call (604) 591-7321 or visit kswlawyers.ca or email to fmcfarlane@kswlawyers.ca

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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.

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A well-written employment contract is useful both for employees and employers.  If drafted with proper care and consideration, a written employment agreement serves to clarify the expectations for both parties during the term of employment, and at its end.  If drafted poorly, a written employment agreement, instead of limiting potential issues, may instead exacerbate them.

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Below, I have outlined a few common mistakes I have seen in my practice.

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Lack of Consideration

A common pitfall for employers arises when the employer attempts to put a new employment contract into place after an employee is already working for them, without offering anything to the employee in return.

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This is a problem, as when you modify a contract, failing to provide consideration (typically in the form of a raise, or a one-off bonus)  for the new agreement renders it unenforceable.  

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While the BC Court of Appeal in Rosas v Toca, 2018 BCCA 191 had appeared to suggest that consideration was not required to modify an existing contract, following Quach v Miltrux Services Ltd., 2020 BCCA 25, the law in BC appears to be that an employee must receive fresh consideration for a revised employment agreement to be binding.  Accordingly, if the employer fails to provide fresh consideration when putting such a contract in to place, the entire agreement can be found unenforceable.  

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Changed Substratum

Where an employment relationship evolves away from the position set out in a contract of employment, typically through change of role, increased compensation, or additional responsibilities, the court will sometimes hold that it would be unfair to apply an existing employment contract, on the basis that the ‘substratum’ of the employment agreement has changed.

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In such a case, unless the contract includes a clause which clearly and unequivocally shows that the contract was intended to be binding even if the substratum changes, the court will find that the terms of the written contract no longer apply, as circumstances are different than those contemplated by the parties at the time of contracting.  

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Clauses Contrary to Statute

The courts have made clear that employment contracts differ from other commercial agreements due to the importance of employment in a person’s life.  As a result, the court will often interpret agreements in a way designed to maximally protect an employee’s interests, particularly around termination clauses.

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Occasionally, employers will attempt to have an employee enter into an agreement which offers less than what an employee is entitled to under the applicable employment legislation; in BC, that legislation is typically (but not always), the BC Employment Standards Act.  In Machtinger v HOJ Industries Ltd., the Supreme Court of Canada held that, where parties attempt to contract out of the minimum termination notice period set out in the ESA, the termination clause is null and void, and the employee is instead entitled to common law notice.

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Drafting Errors

The use of imprecise language can make the result of a contract something other than what is initially intended by one (or both) of the parties.  

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By way of example, in the recent case of Briggs v ABC Insurance Solutions Inc., 2024 BCSC 1918, the employer and employer had entered into an agreement that read as follows:

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The Employee and the Employer agree that reasonable and sufficient notice of termination by the Employer is the greater of two (2) weeks or any minimum notice required by law.

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While the employer’s intent in drafting the clause was likely to restrict the employee to the minimum notice period under the ESA, the court in Briggs found that the reference to ‘minimum notice required by law’ created an ambiguity, as there was no clear reference to the ESA.  In light of the lack of clarity, the court found the clause was unenforceable.  In the result, instead of being entitled to only two weeks wages, the employer was found liable to pay the employee for 4.5 months of wages in lieu of notice.  

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Another error, particularly serious in the case of employees who receive bonuses, commissions, or shares that vest as part of their compensation, is where an employer uses imprecise language on whether bonuses remain payable during the period of reasonable notice.  In Koski v Terago Networks Inc., 2021 BCSC 117, the following clauses were found to create ambiguity as to whether a bonus was payable which vested during the period of reasonable notice:

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. . . any . . . reasonable notice period applicable to an employee who has been dismissed by the Company (whether with or without cause) that overlaps with a bonus payout date shall not be considered as satisfying the "actively employed" requirements of the Program.

. . .. As such, employees who have been terminated or who have resigned prior to the bonus payout date are not eligible for any bonus payments referenced herein.

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In the result, the employee was entitled to the bonus during the notice period, despite the employer’s arguments that the bonus plan, as drafted, made the employee ineligible.

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TAKEAWAYS

There are many potential issues which can arise when preparing employment contracts.

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Employers should consult with legal counsel before preparing a new employment contract or revising an existing contract, to ensure that the agreement  will be binding and will accomplish the goals they have in mind.  

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Employees who are being asked to signed an employment agreement should consult with a lawyer before doing so, so that they have a clear understanding of its impact on their legal rights.

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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.

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What Are They?

Nowadays, more and more business owners and HR professionals are becoming aware of the need to have properly drafted employment contracts for their workplaces.

Something that is often given less attention however is workplace policies (also sometimes referred to as “employee handbooks”). This article is intended to serve as a broad refresher on what workplace policies/handbooks are, and what they aren’t.

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It’s important to first remember that an employee handbook is not the same as an employment contract. Although workplace policies can be used to establish general procedures and expectations, they are generally not the best way to establish key work conditions such as hours, overtime, severance and vacation.

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Minimum Requirements

All employers in BC are required by WorkSafeBC to have, at minimum, “procedures” for responding to reports or incidents of bullying and harassment in the workplace. A written bullying & harassment policy is often the best way to do so. As with all workplace policies however, it is critical that any bullying & harassment policy be consistently applied and followed by the company (subject, of course, to human rights considerations).

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Establishing Policies

This leads to another key aspect of workplace policies: they must be actually followed to be effective. In fact, failing to follow written policies may actually increase rather than decrease potential liability for a business. It is therefore important to avoid blindly implementing a “cookie cutter” policy handbook since policies that are aspirational or inapplicable will often serve to simply increase ways that the company’s conduct will be scrutinized in the event of, for example, a human rights or WorkSafe claim.

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Some Typical Policies

As noted above, it’s important to ensure that any workplace policies are tailored to your specific workplace. Some “standard” or “recommended” policies might be totally inapplicable to a workplace, and some less common ones may be warranted depending on the business’s needs. An employment lawyer’s role is partly to help you determine what policies you need vs. what policies you don’t.

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With that caveat out of the way, some of the more common types of policies that can be worth considering include policies on:

1. bullying and harassment;
2. employee conduct;
3. health and safety;
4. remote work;
5. confidentiality/protection of information;
6. privacy;
7. overtime;
8. attendance;
9. company devices;
10. and drug/alcohol.

The above list is by no means an exhaustive (or universally applicable) list since the needs of, for example, a manufacturing or construction business will be very different from the needs of a tech startup.

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Conclusion

At minimum, it is generally recommended to have in place a written bullying & harassment policy if you have employees in BC. Additionally, it is often good practice to ensure that you have policies in place for addressing at least key areas of concern for your business. For example, if your business has sensitive data that employees will be accessing while working remotely, you may want to consider having a policy restricting how they access and handle that data.

As always, our team of employment lawyers here at KSW Lawyers are happy to help with any questions.

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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.

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Most people only need one will. For those who are not owners of businesses, this is not an important discussion. BUT for anyone that has an incorporated business this is something to pay attention to.

Let’s say that my clients Joe and Jane Above-Average have been very successful. Assuming an early death of Joe, Jane now has business assets worth say $10 million. In addition, Jane, who is under 65, has a nice house and some investments that amount to another $5,000,000. Under a single will Jane’s estate would be worth $15 million. Probate fees that are paid to the government would be about $210,000. By simply doing the paperwork slightly differently, we can eliminate $140,000 of this amount through a dual will. Though it is important to note that Jane would now need two executors, one for each will. With $140,000 saved, Jane leaves more money to her beneficiaries.

At KSW Lawyers, we believe that this strategy is well worth looking into. Although, the legal work on this has some detail to it and is a bit more expensive, it can be achieved more efficiently and cost effectively if done at the same time as the 'main' will.

From age 65 onwards, Jane should review estate planning more frequently and pay close attention to how to reduce probate fees through planning. In fact, she may be able to eliminate ALL probate costs by establishing an alter ego trust to hold all of assets once she turn 65. By doing so, Jane entirely eliminates probate fees.  This is a fair bit more expensive than a dual will approach and does have some ongoing costs for income tax filing (there are no extra taxes, just a paper filing) so this may not be appropriate for everyone.

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If you have to undergo a workplace investigation, you’ll have a few options on who you can choose to conduct it. Here’s a few reasons why you’ll want to reach out to third party to conduct your workplace investigation, rather than handle it on your own.

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No Neutral Investigator in your Organization

If you don’t have someone in your organization who can conduct the investigation fairly, you’ll want to hire a third-party investigator. Hiring a neutral third party can ensure staff are comfortable sharing what they experienced or witnessed, which they may not be if the investigator is someone they work with. If you hire someone within your organization to lead the investigation and they are biased (or even perceived to be) you can run into issues, including losing trust from your employees and damaging your company’s reputation.

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No Experienced Investigator in your Organization

If no one in your organization has conducted a workplace investigation before, you’ll want to reach out to a third-party. A good workplace investigator will understand what is needed for a fair investigation and be skilled in the process, which can be impossible for someone with no prior experience.

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Potential for Legal Action

If there’s a risk that the issue being investigated could lead to litigation or arbitration, you’ll want to go with a third-party investigator. In the event that you end up in court over what is being investigated, having a detailed report from a fair investigation conducted by an unbiased investigator can make a world of difference.

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There are multiple compelling reasons to contract a third party for your workplace investigation. If you're looking to conduct a workplace investigation, reach out to our highly skilled workplace investigation team to ensure a fair, unbiased process.

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If you have questions or would like to discuss a complaint in your workplace, please contact Fiona McFarlane, Senior Associate,to discuss your legal needs

Starting January 1, 2025, British Columbia implemented a new "Flipping Tax" under the Residential Property (Short-Term Holding) Profit Act. This tax targets speculators by applying to residential property sales made within two years (730 days) of acquisition. The tax is calculated based on net income from the sale, with rates varying depending on how long the property was held. If sold within the first 365 days, the tax rate is 20%, decreasing on a sliding scale after that.

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The Flipping Tax applies to individuals, corporations, and trusts selling residential property, including pre-sale contracts and assignments. Certain exemptions exist, including properties used exclusively for commercial purposes, sales by charitable organizations, or transfers between related individuals. Exemptions also apply for sales due to personal circumstances, such as death or relocation, and for builders or developers involved in construction or renovation.

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Sellers must file a tax return within 90 days of disposal unless exempt. Failure to file can result in penalties, with severe consequences for tax evasion, including fines or imprisonment.

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This measure is part of BC’s broader strategy to curb housing price inflation and increase affordability. Property owners should review their situations carefully, especially in light of exemptions, to determine their potential tax liability.

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If you have questions on the new Flipping Tax or your real estate investments, reach out to Aman Bindra at abindra@kswlawyers.ca or 604-591-7321.

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What are you looking forward to in 2025?

While working collaboratively with employers and fellow lawyers is at the top of my list here are a few other things I am looking forward to:

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1. Great conversations with employers about human rights in the workplace

A lot of workplace investigations occur because of allegations that employee A has made derogatory and humiliating comments about employee B’s personal characteristics, or allegations that employee A has been sexual harassing other employees. If these allegations are true, then employee A has breached the BC Human Rights Code.  This is where I can help by providing advice to the employer about vicarious liability, and I can conduct a workplace investigation.  

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What I like doing more though is advising and updating workplace policies that set out the minimum expectations for behaviour in the workplace.  This is where great conversations about diversity, equity and inclusion occur, and employers can develop policies and a culture that goes beyond their minimum legal obligations.  

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2. Great conversations with employers about fairness in workplace investigations

It is recognized in the courts, and amongst the lawyers I know that conduct workplace investigations, that a fair process when fact-finding is paramount.  For me this means a conversation with the employer about what triggered the need for an investigation, what the scope of work should be, and I discuss how my process is confidential, time-sensitive, proportionate, and culturally and trauma informed.  At the end of the fact finding, I document in my report what I did when so that in the very unlikely event there are legal proceedings and the investigation report is relevant, there is transparency around what steps I took and when.  

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On a more personal note, I am also looking forward to having great conversations about human rights with the teens I volunteer with. These teens, part of Generation Z (born between 1997 and 2012), are educated about human rights and diversity, and are able to articulate what is going right for them and what is going wrong for them in a way that impresses me. The conversations and insights I gain from them gives me hope that when they rule the world there might be less need for workplace investigations.  

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To learn more about KSW Lawyers, how we help clients, and how I can assist you with your workplace investigation, workplace policies or human rights matter, call (604) 591-7321 or visit kswlawyers.ca or email to fmcfarlane@kswlawyers.ca

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