Canadian Employment Laws

If you operate a hotel anywhere in Canada, you need to consider employment-related laws in the province or territory where the hotel is located. The following is a summary of some important differences between U.S. and Canadian laws.

No “Employment at Will”
The U.S. concept of employment at will does not exist in Canada. In Canada, both employment standards legislation and the common law require an employer that terminates an employee’s employment without just cause to provide certain entitlements.

Under the employment standards legislation in each province, an employer must provide an employee notice of termination of employment in lieu of notice (usually one week per year of service to a maximum of eight weeks: more for group terminations), unless the employee is terminated for willful misconduct or willful neglect of duty. Some jurisdictions also require an employer to pay severance pay in addition to providing notice. For example, in Ontario, an employee with five or more years of service with an employer that has an annual payroll of at least $2.5 million is entitled to one week’s pay per year of service up to a maximum of 26 weeks.

The common law requires that an employer provide an employee “reasonable” notice of termination or pay in lieu of notice unless just cause exists, there is a clear agreement otherwise, or a union represents the employee. Reasonable notice for each employee is determined on a case-by-case basis and depends on a number of factors, such as the employee’s position, age, and length of service, and the availability of similar employment elsewhere. Reasonable notice at common law almost always exceeds the notice required by applicable legislation.

Pregnancy and Parental Leave
Whereas the U.S. Family and Medical Leave Act (FMLA) requires an employer to provide an employee up to 12 weeks of unpaid leave, employment standards legislation in all Canadian jurisdictions require an employer to provide up to at least 52 weeks of pregnancy and parental leave. In addition, the right to pregnancy and parental leave applies to all employees in Canada, not just to those employed by employers with 50 or more employees (as provided by the FMLA).

Discrimination and Harassment
Prohibitions against discrimination and harassment in employment under various U.S. statutes, such as Title VII of the Civil Rights Act of 1964, the Americans with Disabilities Act, and the Age Discrimination in Employment Act of 1967, may be found in each province’s or territory’s human rights legislation (e.g., in Ontario, the Human Rights Code). Canadian human rights legislation in all jurisdictions prohibit discrimination and harassment on the basis of sex, disability, age, race, national or ethnic origin, color, religion or creed, marital status, and sexual orientation.

An employee in Canada may not file a civil action for discrimination, as is permitted in the United States. An employee may complain only to an administrative tribunal in the province he or she works, which adjudicates complaints. Administrative tribunals across Canada have wide powers to order reinstatement of employees, to require an employer to take steps to prevent discrimination and harassment, and to award monetary compensation. Monetary awards, however, are generally much lower than U.S. jury awards.

There are other significant differences between Canadian and U.S. employment laws. Local legal counsel can help to ensure that you are in compliance with all applicable laws. Other Canadian employment-related laws with which you should comply include:

  • Employment standards legislation, which regulates minimum wages, hours of work, breaks, overtime pay, vacation and holidays with pay, entitlements on termination, and leaves of absence.
  • Labor relations legislation, which governs certification/decertification of unions and collective bargaining.
  • Occupation health and safety legislation, which governs an employer’s obligation to provide a safe workplace.
  • Statutory workers’ compensation/workplace safety and insurance legislation, which governs an employer’s obligations respecting workplace injuries and accidents.
  • Pay equity and employment equity legislation, which require equal pay for equal work and equal employment opportunities for employees.

For more information on Canadian employment law issues, contact James R. Hassell or Patricia S.W. Ross of the Employment and Labor Law Department of Osler, Hoskin & Harcourt LLP Barristers & Solicitors:

(416) 362-2111

P.O. Box 50
1 First Canadian Place
Toronto, Ontario, M5X 1B8

Or log on to www.osler.com, Osler, Hoskin & Harcourt’s website, which contains numerous articles on Canadian labor and employment law: canadaonline.about.com/od/labourstandards/Canada_Employment_and_Labour_Standards.htm for links to Ministry of Labour websites across Canada that provide information on employment standards, health, and safety, and labor relations, and to www.ohrc.on.ca, for Ontario’s Human Rights Commission, and links to other human rights agencies across Canada.

Provided by James R. Hassell and Patricia S.W. Ross of Osler, Hoskin & Harcourt LLP, Toronto, Ontario. www.osler.com.

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