As Ontario employment lawyers, we are often asked important questions about common workplace issues by clients as part of employment law consultations. Many of these questions touch on various topics, such as:
- wrongful dismissal claims
- constructive dismissal claims
- employment contract review
- employment contract preparation or negotiation
- severance package review
- severance package negotiation
- workplace harassment and bullying
- discrimination at work
In this blog, we help provide some general information on the most common workplace issues that top employment law firms in Ontario routinely assist with:
1. Am I an Employee or an Independent Contractor?
This legal distinction is crucial because it determines whether a worker has access to essential employment law protections, such as under the Ontario Employment Standards Act, 2000, including minimum wage, overtime pay, vacation time, job-protected leaves of absence, notice of termination or termination pay, severance pay, and many other minimum statutory entitlements. Independent contractors, however, typically do not.
So, how do you know which category you fall under? It’s not always a clear-cut answer. Courts consider some of the following key factors,
- Control: The degree of control the engager has over the worker’s activities, hours, and manner of work. More control suggests an employee relationship.
- Ownership of tools and equipment: Who owns and provides the tools and equipment necessary for the work? Independent contractors typically own their own.
- Financial risk: Who bears the financial risk of the work? Contractors take on more risk, while employees receive a steady base salary..
- Opportunity for profit or loss: Can the worker increase their income through efficiency or effort, or suffer losses due to poor performance? This suggests a contractor.
- Integration into the organization: How integrated is the worker into the engager’s business structure? Regular tasks and close integration suggest an employee, such as a worker participating in an employee benefits or pension plan.
- Part of a business: Does the worker operate as a separate business with their own clients and contracts? This may suggest an independent contractor.
- Formal agreement: While not definitive, the written agreement’s language can be considered, but the actual practice might differ. Is it an “employment agreement” or an “independent contractor agreement”?
2. Is My Employment Contract Valid?
Another type of common workplace issues occurs at an important time for most employee when starting out with a new company and are asked to sign a new employment contract. This is an important legal document with consequences for their future rights and responsibilities as an employee. Typically, one of the most crucial aspects is the termination of employment clause that attempts to restrict their rights when it comes to end of employment, including setting out how much notice of resignation the employee must provide to the employer and limiting the amount of an employee’s notice of termination or pay in lieu of notice (often called a financial severance package.
Before signing, it is absolutely important to review an employment contract with an experienced employment lawyer not only to understand what it means, but help protect an employee’s rights by suggesting important revisions. Likewise, if an employee is terminated from employment and is given a severance package, an employment lawyer should review the severance package as well as the employment contract to determine an employee’s rights, options and if the employment contract itself is valid. In some circumstances, an employment lawyer may be able to prove an employment contract is not valid because it was signed without fresh consideration, or that a specific section of the employment contract (such as the termination of employment clause) is invalid because it violates the Ontario Employment Standards Act, 2000.
3. What is a Constructive Dismissal?
As part of any employment relationship, an employer and employee agree on the basic terms and conditions, such as salary, job title, responsibilities, work location, and so on. Sometimes, however, an employer makes a significant change to some aspect of an employee’s job that the employee does not agree with, resulting in a dispute requiring an employment lawyer to assist with workplace issues. Essentially, in such cases, an employee may be able to claim a constructive dismissal if the employer has unilaterally made a significant change to an important term of the employee’s job or working conditions, such as:
- demotion
- work relocation
- workplace harassment or poisoned work environment
- workplace discrimination
- temporary layoff without pay not allowed in an employment contract
- significant addition or removal of job duties and responsibilities
However, it is important to know that the test for proving a constructive dismissal is an objective standard, meaning a court would look at the facts as a third-party to determine if the employer’s conduct did, in fact, amount to a constructive dismissal (without regard to an employee’s subjective opinion). As a result, an employee should always seek a constructive dismissal lawyer’s advice and representation before claiming a constructive dismissal, as it is a risky option that if unproven, could result in the employee losing their job if the employer proves the employee had no justification to resign from the job.
If you are an employee who believes you have a good reason to resign from your job but want to ensure a smooth and proper transition to avoid a wrongful resignation claim from your employer due to workplace harassment or hostility, or if you are an employer who believes your employee abruptly left in a wrongful resignation, or are experiencing other workplace, or about any other common workplace issues, please call an experienced Ontario employment lawyer to discuss your options and next steps on how to deal with a wrongful dismissal. As an employment law firm in Toronto, Bune Law has reviewed and negotiated improvements to many severance packages. You will review and get guidance on your severance package before you agree to sign any termination documents, and help ensure that your severance package is fair and reasonable.