The Supreme Court of Canada has confirmed in Wilson v. Atomic Energy of Canada Ltd., 2016 SCC 29,  that for federal sector employers, employees may claim “unjust dismissal” under the Canada Labour Code (CLC) and obtain remedies including reinstatement with back pay even where the employer is not asserting just cause for “firing” the employee and has offered or paid contractual severance.

A limited number of businesses in Canada are covered by the federal CLC rather than provincial employment laws. Most are either federal Crown corporations or involved in aboriginal government, banking, telecommunications, television, aviation or inter-provincial or international communications or transportation.  Since 1978 the CLC has included a right for dismissed non-union federally-regulated employees with at least 12 months of service to make a complaint of “unjust dismissal” within 90 days of the dismissal.  If a complaint is successful, an adjudicator has broad discretion to order a variety of remedies, including monetary damages and reinstatement.  A dismissal will not be found “unjust” where the employee was terminated for just cause and the remedy is not available in certain situations, such as where the termination is due to the discontinuance of a job or layoff for lack of work or where the employee has another remedy available (e.g. a discrimination complaint).  In the original court decision in Wilson, the Federal Court had ruled that the unjust dismissal remedy should not be available where the employer terminated without cause and offered contractual severance.

The court confirmed that the intent of Parliament in enacting the unjust dismissal provisions of the CLC was to provide non-union federally-regulated employees with protection against dismissal without cause similar to that enjoyed by unionized employees. Accordingly, the offer or payment of severance, however generous and whether or not it satisfies common law contractual notice or severance entitlements, does not make a dismissal “just” and deprive a dismissed employee from seeking a remedy under the CLC.

While this case has attracted a lot of attention, the decision actually confirms a long line of adjudicator and federal court decisions prior to Wilson, and therefore the result is not surprising.  It is important for employers to remember that a dismissed employee only has 90 days to make an unjust dismissal complaint.  Also, an employer can (and should) insist on a release of all claims, including unjust dismissal, as part of a negotiated severance package.  Further, a dismissal due to the discontinuance of a position or layoff cannot be challenged as “unjust” under the CLC.

The purpose of this update is to provide information as to developments in the law. It does not contain a full analysis of the law nor does it constitute an opinion of Roper Greyell LLP or any member of the firm on the points of law discussed. Interested parties are urged to seek specific advice on matters of concern and not to rely solely on the text of this bulletin.

The provinces and federal government have reached an agreement in principle to make changes to the Canada Pension Plan (CPP). The changes will be phased in over several years starting on January 1, 2019.  A brief summary of the changes is as follows:

1. by the end of 2023, CPP contributions will rise by 1% (to 5.95% of pensionable earnings) for both employers and employees;

2. by the end of 2025, the upper limit of pensionable earnings will increase in increments from the current $54,900 (in 2016) to $82,700; and

3. income replacement benefits will increase from one-quarter (25%) to one-third (33%) of pensionable earnings or from the current maximum of $13,110 to approximately $27,000 per annum.

The amount of the premium increase is relatively modest and will be phased in over five years. Employers should start budgeting for this increase in premiums and reviewing whether they should adjust their retirement contributions to reflect this cost and the corresponding increase in employee’s CPP pension benefits.  For Ontario employers, the CPP agreement means Ontario will not proceed with its much more costly Ontario Retirement Pension Plan legislation according to the Ontario government. Quebec, which has long operated its own separate Quebec Pension Plan in lieu of CPP plans to make its own enhancements later.

The purpose of this update is to provide information as to developments in the law. It does not contain a full analysis of the law nor does it constitute an opinion of Roper Greyell LLP or any member of the firm on the points of law discussed. Interested parties are urged to seek specific advice on matters of concern and not to rely solely on the text of this bulletin.

We are pleased to announce that five of the firm’s lawyers were recognized by Lexpert as leading employment and labour law practitioners in the 2016 Canadian Legal Lexpert Directory.

Join us in congratulating the following lawyers:

• Thomas A. Roper Q.C.– Employment Law (Employer), Labour Relations (Management)
• Delayne Sartison Q.C.– Employment Law (Employer), Labour Relations (Management), Workers’ Compensation (Employer), Workplace Human Rights (Employer)
• Gavin Marshall– Employment Law (Employer)
• Sandra Guarascio*- Workplace Human Rights (Employer)
• James D. Kondopulos– Employment Law (Employer and Employee)

*Lawyer listed for the first time in the Canadian Legal Lexpert Directory

For the complete directory, click here.

About the Canadian Legal Lexpert Directory

Published since 1997, the annual Canadian Legal Lexpert Directory profiles leading practitioners across Canada in over 60 practice areas and leading law firms in over 40 practice areas.

Update by: Meaghan J. McWhinnie

On March 31, 2016, British Columbia became home to the lowest minimum wage in Canada at $10.45 per hour. However, that is set to change through two upcoming increases to the province’s minimum wage rate.

Last year, the B.C. government announced that it would index the minimum wage to the Consumer Price Index (CPI). Based on the province’s 2015 CPI, the minimum wage this year was set to increase by 10 cents per hour. However, with British Columbia expected to lead the country in economic growth this year and next, the government has now announced an increase to the minimum wage rate beyond the province’s CPI indexed amount.

The BC government will increase the minimum wage in two stages:

• Effective September 15, 2016: The first increase of 40 cents will take effect and bring the minimum wage rate to $10.85 per hour. This new rate includes the 10 cents scheduled for the 2015 CPI, plus an additional 30 cents.
• Effective September 15, 2017: A second increase of 30 cents plus an amount based on the 2016 CPI (estimated to be 10 cents) will take effect and bring the minimum wage rate to $11.25. The minimum wage rate for liquor servers will increase by the same amounts and on the same dates as the general minimum wage. The differential of $1.25 between the general minimum wage and liquor server minimum wage will continue to apply.Employers paying the minimum wage will need to increase their wage budgets and consider labour efficiencies. Employers will also have to consider increases to employees earning near minimum wage, such as supervisors and lead hands, to ensure appropriate wage differences are preserved.
• The daily rate for live-in home-support workers and live-in camp leaders as well as the monthly rates for resident caretakers and the farm-worker piece rates will also increase in amounts proportionate to the general minimum hourly wage increases.
• The 2016 CPI will be available from Statistics Canada by March 2017.

Our new office space at 745 Thurlow was designed to create a collaborative experience for both clients and employees. For more details please read our article on BCBusiness.ca.