Labour and employment law – June 2024

In a recent decision [1], the Court of Appeal had to interpret a contract of employment and determine whether it was for a fixed or indeterminate term. In the absence of concrete evidence demonstrating the parties’ intention to convert an indeterminate-term contract into a fixed-term contract, the Court of Appeal held that the trial judge`s characterization of the contract was erroneous.

The Court of Appeal`s ruling was made in the context of an action for damages brought by an employee following the termination of her employment. Since 1999, she had held the positions of Accounting Assistant and Assistant to the President. In January 2018 she was promoted to the position of general manager. Although her contract of employment was previously verbal, the parties signed a written contract of employment on March 25, 2018 which gave the parties a bilateral termination option.

In May 2018, an addendum to the contract was signed, providing as follows [2] :

[Translation:] “This is to confirm that a lump sum of $10,000.00 will be paid to the employee for the first payable in December of each year for a contract of 5 years from this day being the year 2018 to 2022 inclusively. In the event of voluntary departure or dismissal, the amount for the current year will be paid and the amounts for subsequent years will be cancelled”.

On November 30, 2018, the employer notified the employee of its intention to terminate that  contract of employment. At the same time, the employer advised her that she would resume her previous duties, tasks and salary.

In November 2019, the employee filed a constructive dismissal suit, seeking damages from the employer, as well as wages for the uncompleted years of her contract of employment, which in her view was for a fixed term of five years.

At first instance, the Superior Court judge determined that the contract was for a fixed term and ordered the employer to pay, among other things, the stipulated remuneration  for the remaining term of the contract. [3].

However, the Court of Appeal held that the judgment at first instance is vitiated by palpable and overriding error regarding the characterization of the contract. It reiterated that the party alleging a fixed-term contract with its benefits, must prove that it is such a contract, and that the judge must consider all the provisions of the contract in reaching such a conclusion. The Court also reiterated that the true intention of the parties must be determined on the basis of all the provisions of the contract of employment.

According to the Court of Appeal, the trial judge committed a palpable and overriding error because she failed to take into account the parties’ bilateral termination option, which militates in favor of characterizing the contract as for an indeterminate term. Similarly, the Court held that there was no concrete evidence that the  common intention of parties was to convert an initial indeterminate-term contract into a fixed-term contract, as such a conversion must be expressly and unequivocally stated. The addendum signed in May 2018 did not satisfy these conditions.

Based on the above, the Court of Appeal held that the contract of employment between the parties was for an indeterminate term, which therefore establishes the reasonable notice of termination to which the employee was entitled.

The Arbitration Tribunal (referred to herein as the “Tribunal”) was of the opinion that given the absence of psychological harassment, it had no authority to determine if the employer had been negligent in its handling of the complaint that had been made by the employee.

This  conclusion was reached in a case involving Rolls-Royce Canada [1] in which the complainant, a welder, maintained, that he had been psychologically harassed by his hierarchical superior whose attitude allegedly amounted to abuse of the superior’s right to manage.

In the arbitration, the union sought to tender evidence establishing, after the filing of the grievance, that  the employer had been negligent, specifically by delaying initiation of an investigation. According to the union, when an employer is made aware of adverse conduct, it has a duty to investigate and must do so diligently. That duty is part of the entire process and would be included in the employer’s obligations in complaints of psychological harassment. According to the employer, such evidence is only admissible if the Tribunal has first made a finding of psychological harassment, which was denied in this case.

Regarding the evidence on the issue of psychological harassment, the Tribunal held that there had been interpersonal conflict rather than an  abusive exercise of management rights. In the arbitrator’s view, the alleged conduct could not be characterized as vexatious, hostile or unwanted. The Tribunal held that the complainant and his superior  were engaged in open warfare, and both had been equally confrontational.

The Tribunal further maintained that the obligation to take reasonable measures to prevent and ensure the cessation of harassment pre-supposes an inherent and prior obligation, namely, to assess whether or not the situation amounted to harassment. Therefore, where a complaint of psychological harassment has been made to an employer, its subsequent conduct may be the subject of proof and analysis. However, it was clear to the arbitrator that merely invoking section 81.19 of the Labour Standards Act (referred to in this note as the LSA) in a psychological harassment grievance does not confer competence on the grievance over all matters relating to harassment. Thus, the grievance under consideration remains the legal basis for the arbitrator’s jurisdiction.

In this case, the arbitrator stated that the grievance alleges a situation of psychological harassment. It also constitutes the first report of such a situation to the employer. Thus, at the time the grievance was filed, the allegations of negligence did not exist, since the facts in support of them occurred subsequently. Consequently, he held that the subject of the grievance did not encompass the issue of negligence, and if the Tribunal were to deal with it, it would have the effect of distorting the scope of the grievance.

In closing, the arbitrator maintained that a grievance arbitrator’s powers of intervention in matters of psychological harassment are set out in section 123.15 LSA. However, the conditions giving rise to the exercise of the Tribunal’s powers listed in that section are cumulative:  it must first be found that the person concerned is a victim of harassment, which was not the case here, and that the employer had breached its obligations under section 81.19 LSA.

Based on the foregoing, the arbitrator held that even were the Tribunal to find the employer negligent, it had no authority to issue remedial orders since no finding of psychological harassment had been made.

The grievance was therefore dismissed .

More specifically, in Taxi Rive-Nord (9029-2814 Québec inc.) et Azizi [2], the plaintiff contested its status as employer, as well as the worker status of Mr. Azizi, a taxi driver. Mr. Azizi filed a claim with the Commission des normes, de l’équité, de la santé et de la sécurité du travail (hereinafter the “CNESST”) for an employment injury sustained after a customer assaulted him in a robbery attempt. The CNESST rendered two decisions, the first acknowledging the admissibility of the worker’s injury and the second recognizing his status as a worker and designating the employer as complainant.

In support of the contestations, the complainant argued that Mr. Azizi is an independent operator and not a “worker” within the meaning of the AIAOD.  The complainant denies being his employer, alleging that Mr. Azizi works for several employers at the same time. the complainant submitted in the alternative that should the Tribunal find that Mr. Azizi is a worker, the true employer would be Mr. Latreille, one of its shareholders, since he leases to Mr. Azizi the taxi with which he works.

In order to determine if Mr. Azizi is a worker within the meaning of the AIAOD, the Tribunal based its analysis on the three criteria that characterize contracts of employments: the provision of work, remuneration, and legal subordination. The Tribunal was of the view that in light of the evidence tendered, the three criteria were satisfied, and thus that Mr. Azizi is a worker, and the complainant is the actual employer.

The Tribunal held that there was provision of work when the worker provided taxi services.

As for the second criterion, the Tribunal was of the view that the worker received remuneration, even though part of it is paid directly by the customer. It noted that for remuneration does not necessarily require that the worker is paid a salary or a sum of money or that the employer makes deductions at source, as the employer maintained. As long as the monetary consideration he receives is proportional to the work performed, the remuneration criterion can be met, which is the case here.

As regards subordination, the Tribunal held that such a relationship existed between the worker and the complainant. This is the criterion to which the Tribunal attached the greatest importance in determining worker and employer status.

According to the Tribunal, the following factors demonstrate the existence of such a relationship:

Customers and goodwill are the property of the employer;

The taxi rental agreement between Mr. Latreille and the worker is a standard contract prepared by the employer and does not contain the essential features of a contract of employment, i.e. the terms and conditions of work;

Although the worker has control over his work schedule and holidays, he has no control over the work itself once he declares himself available to provide taxi services. The assignment of work depends on the complainant’s dispatch system;

The worker is not free to decide who replaces him should he be absent from work;

The complainant exercises control and supervision over the work carried out by the worker. The worker is subject to disciplinary action should he fail to perform his work in accordance with the complainant’s Ethics and Discipline Code governing him

The worker can obtain credit from the complainant for training;

The worker does not own his main work tools, such as the taxi or the call dispatching system;

The worker does not assume risks of profit and loss.

For the above reasons, the Tribunal rejected the employer’s contestation.

Please note that this decision is currently the subject of an appeal for judicial review.

The Administrative Labour Tribunal (hereinafter the “ALT”) had to determine whether the worker, who had received an emergency call directly from her son-in-law rather than through a call center, had intervened in an accident in her personal capacity or as a first responder. The case highlights the realities of volunteer first responders in the regions.

The facts of Lepage et Municipalité de Caplan[ 1] are sad, but straightforward. The worker, who worked as a first responder in the municipality of Caplan in Gaspésie for several years, received an emergency call to intervene at the scene of an accident following an explosion in a domestic fire of a small insulation canister.

In April 2021, a man and his wife decided to light a fire in their backyard to burn some the remains of some construction material. While his wife was sitting outside near the fire, the husband was inside their home when he heard an explosion and his wife’s screams. When he reached his wife, he found her lying on the ground with an open throat wound; she was bleeding copiously and was in respiratory distress. Their neighbour, who had arrived on the scene at the same time, called 911 while the husband called the worker, because he knew she was a first responder and lived very close by. It is important to know that the victim, who unfortunately died shortly after the event, was the worker’s daughter, and that the husband was her son-in-law. The victim also worked as a first responder with her mother, the worker.

The Commission des normes, de l’équité, de la santé et la sécurité au travail (hereinafter the “CNESST”) initially accepted the worker’s claim for a work-related accident resulting in  post-traumatic stress disorder, then, a few months later, reconsidered its decision on the grounds that the worker had actually intervened at the scene of the accident in her personal capacity and not as a first responder.

The ALT took the following into consideration in finding that the worker had acted in her capacity as a first responder :

The worker and her daughter were the only first responders for the municipality of Caplan;

In certain situations, although  generally assigned to an emergency call by a call center, first responders can intervene in the case of impromptu calls or at the direct request of a citizen, according to the testimony of Dr. Roy;

In a small community like Caplan, people know each other well;

The worker had already been called upon to intervene in other immediate and unforeseen situations on at least three occasions;

The worker had completed a first responder’s pre-hospital intervention report;

After analysis, the ALT granted the worker’s contestation. She was therefore entitled to the benefits under the Act respecting Industrial Accidents and Occupations Disease s[2].