Canada: Circumventing the Disdain for Non-Competes

By John Kloosterman and Nima Rahimi

The Ontario Superior Court of Justice recently upheld a contract requiring a senior executive to provide six months' prior notice before resignation. The court agreed with the employer that the senior executive could not move to a competitor during the notice period, effectively prohibiting him from competing during a contractual notice period.

During and around the time of the executive's promotion, the Company went through some changes, including management changes. In discussions with the new CEO, the executive learned that the future of his role would be ultimately narrower than originally contemplated. Unhappy with this, the executive decided to move to a competitor and provided the Company with two months' notice. The Company took the position that the executive was obligated to provide the six months' notice and could not move until that period had ended.

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"Psychological Health and Safety in the Workplace: A Standard is Born"

There is a growing awareness of mental health issues in the workplace and increasing calls for government to enact legislation to provide employees with a psychologically safe workplace. One of the most recent developments in this area is a standard prepared by the Canadian Standards Association and the Bureau de normalisation du Québec (the "Standard").1 The Standard has been available in draft form since November 2011 and is expected to be published in its final form in early November 2012.

The Standard's Requirements

The draft Standard, the first in the world according to the creators, sets out optimistic suggested goals and processes for achieving psychological health and safety ("PHS") in the workplace. The draft Standard requires employers, among other things, to: draft a PHS policy; develop and implement a system to implement that policy; identify, assess, and reduce the risk of PHS hazards; investigate PHS incidents; and, monitor, audit and improve the PHS system. These steps are in addition to all of the existing steps being taken to develop and manage occupational health and safety ("OHS") systems.

It is expected that the final Standard published in November 2012 will have some changes from the draft Standard that was released, but we do not anticipate significant changes to the basic structure and obligations. More compliance tools and models are expected to be provided with the final Standard.

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It's Official: The Supreme Court of Canada Concludes that Employees May Have a Reasonable Expectation of Privacy in Relation to Their Work-Issued Computers

By Christina Hall and Andrew Carricato

The Supreme Court of Canada released its eagerly awaited decision in R. v. Cole, 2012 SCC 53, on October 19, 2012. In the decision, the Court held that employees may have a reasonable, though diminished, expectation of privacy in personal information stored on their work computers - at least where the personal use of such devices is permitted or reasonably expected by employers. This reasonable expectation of privacy is protected by the Canadian Charter of Rights and Freedoms (the "Charter").

The Facts

Mr. Cole was an Ontario high-school teacher. In addition to his regular teaching duties, he was responsible for policing the use by students of their networked laptops. To this end, he was supplied with a laptop owned by the school board and he was given domain administration rights on the school's network. This allowed him to access the hard drives of students' laptops. Mr. Cole was also permitted to use his laptop for incidental personal purposes, which he did. He often browsed the Internet and stored personal information on the laptop's hard drive.

Mr. Cole's difficulties began when a school technician, performing maintenance activities on the school's network, found a hidden folder on Mr. Cole's laptop that contained nude photographs of a high school student. The technician reported his findings to the school principal who seized the laptop and handed the information over to the police. The police reviewed the information contained on the hard drive without first obtaining a search warrant. They proceeded to charge Mr. Cole with possession of child pornography and unauthorized use of a computer.

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Québec Labour Board Draws Line Between Protected Union Activity and Political Protest

By Kevin MacNeill

Desjardins v. Tessier Ltée involved a reprisal complaint under the Act Respecting Labour Relations, Vocational Training And Workforce Management In The Construction Industry (the "Labour Relations Act").

The employer had contracted with mining company Canadian Royalties Inc. to provide cranes and operators on a construction site located in northern Québec.

The complainant, Desjardins, was a crane operator assigned to this site. He also happened to be a union steward.

In October 2011, Desjardins participated in a province-wide protest against Bill 33, An Act To Eliminate Union Placement And Improve The Operation Of The Construction Industry, which has since become law. (Among other things, this law provides for the end of union placement such that union associations and employers' associations that wish to refer employees must do so through the Commission de la construction du Québec, after obtaining a licence to do so. It is prohibited to attempt to force an employer to hire specific employees or a specific number of employees).

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Tribunal Finds Union President's Sexist Blog Posting about a Manager Was Protected Union Speech

The Human Rights Tribunal of Ontario this week released its decision in Taylor-Baptiste v. Ontario Public Service Employees Union, which rejected a female manager's claim that sexist comments made about her on a union blog violated her equality rights under the Human Rights Code. Union rights to expression and association under the Canadian Charter of Rights and Freedoms were key to this outcome. Read the full entry at Heenan Blaikie's Workplace Wire blog.

$200,000 Fine for First Ontario Corporation Convicted of Criminal Negligence Causing Death Following Workplace Accident

On Friday, July 13, 2012, Metron Construction Corporation was fined $200,000 following its June 15th guilty plea to a charge of criminal negligence causing death. Metron is the first corporation in Ontario to be convicted of criminal negligence under amendments to the Criminal Code in 2004 to make it easier to prosecute organizations for criminal offences. The company's president was also fined $90,000 after pleading guilty to four charges under the Occupational Health and Safety Act (OHSA).

The charges were laid after a Christmas Eve 2009 accident in which five workers fell 13 storeys when a swing stage collapsed outside an apartment building killing four workers and seriously injuring another. The penalty imposed on Metron is the highest fine imposed for criminal negligence arising from a workplace accident in Canadian history. The former highest was $100,000 imposed on Transpavé Inc. in 2008 after a worker was crushed in a piece of machinery. Similarly, the $90,000 fine imposed on Metron's president is the highest monetary penalty ever imposed under OHS legislation in Canada.

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When Must U.S. Companies Register with Ontario Workers' Comp Authorities?

In Ontario, workers' compensation is administered by the Workplace Safety and Insurance Board (WSIB), which is governed by the Workplace Safety and Insurance Act, 1997 (WSIA). Appeals from decisions of the WSIB are heard by the Workplace Safety and Insurance Appeals Tribunal (WSIAT).

In its recently published annual review of significant cases from 2011, the WSIAT highlighted Decision No. 382/10, 2011 ONWSIAT 707, which considered the issue of whether employers whose operations are based outside Ontario but whose employees occasionally work in Ontario are considered "employers" within the meaning of the WSIA such that they are required to register with the WSIB and remit premiums just like other employers in the province.

In the case concerned, the WSIAT affirmed a WSIB decision that an employer incorporated under the laws of Michigan and operating in Troy, Michigan was required to register with the WSIB and remit premiums, even though it had purchased workers' compensation insurance for its employees in compliance with Michigan law. One of the employer's workers resided in Ontario but regularly worked in Michigan. However, as part of his duties he also travelled to a number of manufacturing facilities, notably one in Ontario, which later led to his filing a WSIB claim for chemical exposure.

To learn more about the decision and its potential implications for employers, please continue reading at Heenan Blaikie's Workplace Wire blog.

Discrimination on the Basis of Gender Identity or Expression Now Prohibited in Ontario

By Kevin MacNeill

DiversityV.jpgToby's Act (Right to be Free from Discrimination and Harassment Because of Gender Identity or Gender Expression), 2012 was passed on June 13, 2012 and received Royal Assent on June 19, 2012, just days before the start of Pride Week in Toronto.

That Act amends the Ontario Human Rights Code ("Code") such that discrimination on the basis of gender identity or gender expression is now prohibited in services, goods, facilities, contracts, employment and vocational associations such as trade unions, trade or occupational associations or self-governing professions. Similarly, harassment in accommodation or employment on those grounds is now prohibited.

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Proposed Standard for Psychological Health and Safety in the Canadian Workplace

HBOHS&WCJan2012II.jpgA new and surprisingly complex Canadian Standards Association (CSA) Standard may be arriving at and impacting Canadian workplaces soon. A proposed Standard has been developed, setting out optimistic goals and processes for achieving "psychological health and safety" in the workplace. Policies, procedures, hazard identification, incident investigation and monitoring activities may be required, in addition to all of the existing steps being taken to develop and manage occupational health and safety systems.

The CSA, which develops standards for business, industry, government and consumers, released the draft Standard on November 1, 2011 for a period of public consultation which ended on January 6, 2012. The final Standard, which is expected to be published in early 2012, is intended to provide organizations with the necessary tools and guidance to achieve "measureable improvements in psychological health and safety" for Canadian employees and prescribes specific steps for employers to take to develop and maintain psychologically healthy and safe workplaces. As currently drafted, the steps prescribed and obligations imposed by the Standard are significantly broader than those currently imposed on employers under occupational health and safety and human rights legislation and the breadth of the Standard raises concerns about its viability for Canadian employers.

For an introduction to and analysis of the Standard, please see Heenan Blaikie's OHS & Workers' Compensation Update  "National Standard for Pscyhological Harm and Safety in the Candian Workplace Released".

Canadian Association of Pension Supervisory Authorities Releases Pension Plan Governance Guidelines

On November 15, 2011, the Canadian Association of Pension Supervisory Authorities (CAPSA) released two Guidelines on pension plan governance. These Guidelines outline the expectations relating to the investment of pension plan assets, as well as best practices when developing and adopting a funding policy for pension plans that provide defined benefits.

Guideline No. 6: Pension Plan Investment Practices Guideline provides a variety of prudent investment principles that plan administrators should bear in mind when managing investments. In this Guideline, CAPSA encourages plan administrators to assess their current investment practices to ensure prudent practices are in place. The focus of the Guideline is to ensure that plan administrators have a robust, process-oriented decision-making framework in place within which investment management activities are conducted.

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