What’s New at the MacLeod Law Firm

Mar 5, 2019

New Website

I am pleased to inform you that we have updated our website. You can check it out by clicking here.

Nominated as Top Labour & Employment Law Firm

For the second year in a row, the MacLeod Law Firm has been nominated as top Canadian labour and employment law boutique in the Canadian HR Reporter Readers’ Choice Awards. If you wish, you can vote for us at question 27 of the nomination form found here. Please note that if you don’t know any of the nominees in a category then you can skip the question.

In this blog, I will briefly outline what you can expect when you call us, and summarize some of the services that we provide employers operating in Ontario.

What To Expect When You Contact the MacLeod Law Firm

We provide you with peace of mind by quickly resolving workplace issues in a way that makes business sense while taking your risk tolerance into account.

How do we do this? We restrict our law practice to workplace law so we are knowledgeable. Our tagline says it all: All we do is WORK. We know you want to solve workplace issues quickly so are readily accessible to you and we quickly respond to your calls and emails with practical solutions.

Our Services

Some of our services are as follows:

Prepare Employee Contracts – Every employer should require all employees to sign a contract that enhances the organization’s rights, and saves the organization money in various situations. If a client is recruiting a sought after individual with significant negotiating leverage we help negotiate the terms and conditions of employment for this individual.

Respond to Employee Complaints – We advise employers how to respond to workplace harassment complaints, human rights complaints, and employment standards complaints filed under the Occupational Health & Safety Act, Ontario Human Rights Code, and the Employment Standards Act.

Respond to Requests for Accommodation – We advise employers how to respond to accommodation requests from disabled employees such as what medical information is needed, a consideration of different accommodation options, and the contents of individual accommodation plans.

Advise on Employee Terminations – We advise employers on the legal exposure associated with proposed terminations, and we prepare termination packages which includes a consideration of whether to allege cause, and if not, how much notice of termination the employee is entitled to receive, how to structure the termination pay, and what terms should be included in the severance package.

Fixed Fee Services – For employers who want cost certainty and/or require employment law services throughout the year we offer fixed fee services. We offer a fixed fee for a specific service like drafting an employment contract, or a monthly fixed fee to advise on numerous employment issues.

For a more comprehensive description of our services click here.

If you have any questions about our services or how we provide them, I invite you to call me directly at 416-317-9894 at your convenience.

There are many ways to attack the termination clause in an employment contract. 

I am now surprised if employee counsel does not claim that their client’s  termination clause is not legally enforceable - usually because the termination clause does not allegedly comply with the Employment Standards Act.

This blog considers a case, McKercher v Stantec Architecture Ltd., 2019 SKQB 100, where an employee successfully attacked the termination clause in his contract because he did not explicitly agree to it after being promoted. 

The Facts

In 2006, Mr. McKercher commenced employment as a staff architect. The termination clause in his employment contract stated: 

Termination other than for cause will be with notice or pay in lieu of notice, based on your length of service. If the Employer terminates your employment for other than just cause you will receive the greater of:

  1. a)   Two weeks notice or pay in lieu of notice during the first two years of employment increasing by one week for each additional completed year of employment to a maximum of three months notice or pay in lieu of notice.

      or

  1. b)   The minimum notice of termination (or pay in lieu of notice) required by applicable statutes.

Eleven years later, when Mr. McKercher was employed as a Business Centre Sector Leader, his employment was terminated. The employer paid him the three months termination pay he was owed under his employment contract.

 

Another way to attack a termination clause: What is the changed substratum doctrine?

An Ontario judge in a 2012 case, MacGregor v National Home Services, 2012 ONSC 2042 (CanLII), described this legal doctrine as follows: "The changed substratum doctrine … provides that if an employee enters into an employment contract that specifies the notice period for a dismissal, the contractual notice period is not enforceable if over the course of employment, the important terms of the agreement concerning the employee’s responsibilities and status has significantly changed."

 

The rationale for this doctrine has been described by one judge, Schmidt v AMEC Earth & Environmental Ltd., 2004 BSCS 2012 (CanLII), as follows: "In my view, it was incumbent on the defendants to advise Mr. Schmidt that they intended to continue to rely upon the termination provision set out in the Agreement when substantial changes in his employment occurred. This would have allowed him to consider the matter and to negotiate for other terms. If the defendants wished to continue to rely on the termination provisions there ought to have been a ratification of the provisions as the nature of Mr. Schmidt’s employment changed."

 

Decision

The judge hearing this case relied on the following factors when deciding not to enforce the termination clause in the employment contract: ”...there is no evidence that (the employer) made it clear to the (employee) that the notice of termination provisions were intended to apply to the positions to which he was promoted. The employment agreement contains no express wording to this effect, nor does it contain any wording to support the inference of such an intent. Further, and in keeping with the analysis in Schmidt, the Court received no evidence that, as it promoted the plaintiff, SAL reasserted its understanding and expectation that the notice of termination limit would remain in effect.”

 

Lesson to be learned:

An employer should make it clear that the termination clause in an employment contract applies when an employee is promoted. This expression of this intent should be in writing and should be clear and unambiguous. I recommend that an organization’s employment be reviewed by an employment lawyer every year or two. If your employment contract does not address this issue then think about doing so the next time it is reviewed.

 

For 30 years, Doug MacLeod of   the MacLeod Law Firm has been advising employers on all aspects of the employment relationship. If you have any questions, you can contact him at 416 317-9894 or at [email protected]

The material and information in this blog and this website are for general information only. They should not be relied on as legal advice or opinion. The authors make no claims, promises, or guarantees about the accuracy, completeness, or adequacy of any information referred to in this blog or its links. No person should act or refrain from acting in reliance on any information found on this website or blog. Readers should obtain appropriate professional advice from a lawyer duly licensed in the relevant jurisdiction. These materials do not create a lawyer-client relationship between you and any of the authors or the MacLeod Law Firm.

 

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