Thoughts from a Management Lawyer

A Reminder about What We (Lawyers) Do

Patrick Lamb has been blogging for a long time and I've been following his writing for years.  While I've never met him or, for that matter, spoken to him (though I'd like to), I've found his insights to be so on the money.  He's a true rebel. Don't believe me?  The ABA labeled him as such.  Need more proof?  Check out his firm Valorem.

Recently, Patrick discussed the matter of advice.  It's not complicated - people pay us for our advice.  Pretty straightforward.  But what sometimes happens is that either no advice is given at all (this usually starts and ends with "you can't" or by quoting law but without taking it to the next level - providing a practical opinion) or advice is given that is so qualified that it can barely be called advice at all. There's nothing easier (or safer) than siting on the fence, but that's not what we get paid for.

Patrick puts it far more eloquently than I could:

A client has an inherent, unqualified right to know what his or her lawyer thinks, what the lawyer would decide if he or she was the "decider."  Sure, it can be a close call with no sure right or wrong answer.  I'm sure client's react by saying "easy decisions never make it this far north in the organization and we live with incomplete information and uncertainty every minute of every day. Welcome to my world, now get over yourself and TELL ME WHAT YOU THINK."

It is amazing that lawyers don't have their hands cut off just so they can't say "on the one hand ..."

This is a great reminder well worth taking to heart.

Using Strike Replacements

Strikes and lockouts are never fun events.  No one "wants" these things.  Companies are in business to make a profit and employees want to work to provide for themselves and their families.  I wouldn't go so far as to say that a strike or lockout means that the union and company have failed, but it certainly means that their negotiations were unsuccessful in getting a negotiated deal.  Maybe that's lawyer-speak

I was interviewed yesterday by CBC Radio Sudbury on the thorny and emotional issue of using strike replacement workers.  Employers (in Ontario under the Labour Relations Act, 1995) are free to survive a strike through the use of replacement workers.  There is a narrow exception where they use "professional strike breakers" but that is exceedingly limited.  Some jurisdictions, such as Quebec, have anti-replacement laws (derogatorily and colloquially called anti-"scab" laws) preventing, except in limited circumstances, the use of replacements during a strike. 

The decision to operate during a strike is a complex one (e.g. the City of Toronto decided not to fully engage replacement workers during the recent strike and were criticized by some for that decision).  In Sudbury, news that Vale Inco has decided to engage replacements to continue operations has generated criticism by others.  

Employers have a right in Ontario to operate during a strike.  Whether they chose to do so is another matter.  The short (and sometimes long) term impact of this decision on labour relations can be significant. If labour relations are power relations as I was taught in my Industrial Relations days at McGill, then either party should be at liberty to use all lawful means to shift the balance of power in its favour with a view to having the other side yield to accepting its terms.  

Online Anonymity Going, Going .... Almost Gone

Interesting piece in the Globe following a recent decision out of New York where a Canadian fashion model filed a claim against a blogger.  The article points out that before "she could launch a defamation suit, she had to know who the blogger was. The court ordered Google, which manages the blog's publishing platform, to produce the information." 

Anonymity and the web is a subject that yields strong and divided opinions often centered around "privacy".   

However, the cloak of online anonymity seems to be coming down.  This may result in more online accountability and responsibility.  I find that these web brawls (and there are many) where people "drop the gloves" on each other to be quite bizarre.  Often one anonymous "poster" is going at it with another anonymous "poster" and the discussion degenerates into a schoolyard verbal joust where they end up saying things that, but for the anonymity, would never be said or written.  Maybe, these recent cases will stem some of this behaviour. 

UPDATE: There is a post over at Slaw.ca that takes up the issue of online anonymity and the case that is discussed above.

Up and Running At Slaw.ca

I wanted to thank Professor Fodden at the excellent Slaw.ca for contacting me a few months ago and inviting our firm to be the "Guest Firm Bloggers" this week.  Today there will be a couple of employment law posts from myself and Kate Zavitz (see Kate's post Facebook:  Employee's Lives on Display) with the balance of the week being a mix of posts from our different practice groups. 

Aside from our stuff this week, Slaw has an eclectic mix of posts on a whole range of legal issues and areas of interest to lawyers and those interested in the profession and where it is heading.  Definetly check out this great resource.

Ontario Human Rights Commission Annual Report

The Ontario Human Rights Commission released it's 2008-2009 Annual Report, the first since the Ontario Human Rights system was re-vamped. 

The Commissions' new, more proactive and educational role, is laid out in the Report. As is acknowledged by the Chief Commissioner, the Commission has attracted controversy.   Among other things, the Report identifies the following areas of focus this year:

".... The Commission aims to educate, empower and mobilize partners in communities across the province to raise awareness, help them identify their concerns and implement solutions.

... the OHRC will give priority to Ontarians affected by issues of race and hate crimes, housing, family status and mental health. It will work to move the issue of discrimination from the pages of various reports and inquiries (such as Ipperwash, Hate Crimes Working Group and the Falconer “School Safety” report), into real action that the people of Ontario can see, feel and contribute to."

It remains to be seen how the Commission will deliver on these promises. 

Thoughts on Employer Reactions to the Elimination of Mandatory Retirement

This is old news, but I got to thinking about it as I was clearing out my home office and came across an article in the Fall 2008 issue of Industrial Relations by Andrew Templar and Marjorie Armstrong-Stassen from the Odette School of Business at the University of Windsor.  I've been a member of the Canadian Industrial Relations Association for some years now, an Industrial Relations is the publication that you receive as a member (among other benefits).  The article is entitled The HR Management Perspective on the Elimination of Mandatory Retirement in Ontario.

There had been little research on what HR was doing, if anything, to deal with this and the study tries to explore this.  As a generalization, the authors state that:"

"In general, organizations with and without a fixed retirement policy in place are doing relatively little in developing HR policies and procedures to recruit and actively retain older workers.  While disappointing, this is not out of line with other research findings pointing to a general lack of pro-active HR practices directed towards older workers."

Furthermore:

"Despite the limited number of significant differences, our results do support the notion that human capital assumptions may be at work.  Thus, it does appear that HR managers in organizations which practice mandatory retirement may hold a depreciation view of their employees' contributions [employees lose value as they age] and feel there is little value-added for engaging in HR practices directed at older workers because such employees will be leaving anyway."

For whatever reason, most employers (another sweeping generalization) do not seem to be actively engaging in the development or implementation of policies that are aimed at recruiting or retaining older workers.  

Fast forward, and we now find ourselves in the worst recession in memory.  Pension plans and investments are getting hammered.  I suspect that many employees will, from necessity if for no other reason, forego retiring if that was in the cards, in favour of continued employment. Employers that have not responded to the reality of an aging workforce in the context of the elimination of mandatory retirement on the expectation that "such employees may be leaving anyway" might want to revisit that assumption in light of the current economic circumstances.   

Governing Law, Appropriate Jurisdiction and a Plea for Employment Contracts

Increasingly, it seems, Canadian employees are reporting to U.S. companies while continuing to live in Canada.  There are many reasons for structuring the employment relationship in this way and, when the employer and employee are working together, the it works.  As is often the case, the rubber hits the road when the relationship sours or ends. 

That's what happened in Hilton v. K & S Services Inc., a recent case out of the Ontario Court of Appeal.

Mr. Hilton lived in the Windsor area, and worked for Ford Motor Company for 12 years.  K & S Services Inc. is a US company having its head office in Michigan.  The Company had plants in a number of states as well as in Oakville, Ontario "through a wholly owned subsidiary, MCS Facility Support Ltd."

The Company approached Mr. Hilton about employment and Mr. Hilton made it clear that he had to remain in the Windsor-Detroit area because of certain parental responsibilities.  The Company said that this could be accommodated.  Mr. Hilton accepted the offer of employment as Vice-President in Charge of Operations and quit his job with Ford.  The offer was reduced to writing and, according to the court:

".... stated that the offer would serve as a 2 and a half year contract and, thereafter, employment would be the “same” as all other K & S employees.  It then stated that K & S is an “at will” employer and, therefore, either party could sever the employment relationship at any time, with or without cause."

The court discussed the manner in which the employment operated and I set it out in detail as it is relevant to the point I will make shortly:

"He became a commuter employee, travelling from his home in Tecumseh.  He often worked from home or from the K &  S office in   Oakville.  He was treated as a Canadian employee working in   Michigan.  He was placed on K & S’s Canadian payroll and treated similarly to other Canadian commuter employees who were on the Canadian payroll.  His pay cheque was issued from the Bank of Montreal in   Toronto.  He was paid in Canadian dollars through K & S’s subsidiary in   Oakville.  Canada Pension Plan and Employment Insurance deductions were taken from his pay and remitted to the Canadian government on his behalf.  He was given a Canadian blackberry with a Canadian phone number.  All health and insurance benefits were from Canadian providers."   

It seems that Mr. Hilton was terminated.  According to the court, he was provided with a Record of Employment and received Employment Insurance benefits from the Government of Canada.  He sued the company in Ontario. 

The company brought a motion to have the action stayed on the basis that the matters in dispute had no real and substantial connection to Ontario, and that the employment relationship was governed by the laws of Michigan.  It argued that the Ontario courts were without jurisdiction over the action and, in any event, that Michigan was the more convenient forum. 

The motion's judge disagreed with the Company.   The Court of Appeal also disagreed with the Company and in so doing provides a number of important lessons to employers when hiring employees, generally, but specifically where the reporting relationship is somewhat unusual. 

The Court of Appeal considered the one-page written employment contract and noted that it did not express the governing law nor that the contract represented the entire agreement of the parties.  As a result, which law governed the relationship was "a live issue" that would have to be decided by the trial judge. 

The Court of Appeal also agreed with the motion's judge to the effect that there were many factors that point to a real and substantial connection to Ontario and that Mr. Hilton would lose a juridical advantage if the action was tried in Michigan instead of Ontario. 

The point I want to make is that the opportunity to spell out, in writing, the terms of the employment relationship should not be taken lightly.  I've seen some pretty interesting contracts over the years, including hieroglyphs scrawled on the back of a napkin, water mark from the bottom of a glass and all.  At the time of hire, I'm sure it all made sense.  Some employers are worried about "scaring the employee away" with a written agreement that sets out, clearly, the terms of the relationship including a termination clause.  They believe that it starts the relationship off on a sour note and decide to err on the side of informality.  I get it.

However, when the relationship sours or ends, that is another matter.  Ambiguity in the contract will generally (not always) be decided in the employees' favour.  Where the contract is silent, the court will imply certain terms into the contract.  The best time for setting out the agreement is at the front-end when goodwill is at its highest. 

It doesn't take much time to put one of these agreements or contracts together, but, when done properly, it is well worth the money.  Don't assume that anything is forever.  Spend a few dollars at the front-end and try to save yourself some aggravation at the back-end.  Easy for me to say, I suppose, but this is one proactive way to not only bring clarity to the relationship (not a bad thing, in my view) but also address those things that are important to the parties.

City of Toronto Strike Ends

The City of Toronto Council approved collective agreements with striking unions thus bringing to an end the 39 day strike.  Of course they were going to approve the deal but the margin was 21-17, tighter than most people anticipated.  But the residents of Toronto are not happy with either side. 

As with any strike (or lockout), it's important for both sides to conduct a post mortem and draw hard learned lessons from what has taken place. Strikes and lockouts are part of the labour relations landscape in Canada, and the fact that they take place is not the point.  The point is to learn from them.

What could have been done differently?  How might the negotiation strategy been been approached differently?  What could have been done differently with the strike contingency plan?  How might the communication/messaging  been handled differently?  Add the words "if anything" or "if at all" before the question mark because you might conclude that you would have done everything exactly as you did it.  The point is to examine and take apart what took place in the clear light of day and ask those (and other) hard questions.  It would be unfortunate not to learn from these experiences even if the lesson is that you wouldn't have changed a thing.