LABOUR AND NEWSLETTER Spring 2007

TABLE OF CONTENTS LATEST DECISION ON RANDOM DRUG Arbitrator Picher based his decision on the TESTING existing Canadian arbitral jurisprudence Latest Decision on Random Drug regarding drug testing in safety sensitive Testing 1 Background workplaces which he coined the “Canadian Model”. Arbitrator Picher summarized the Update on Mandatory In a frequently cited decision from 2000 elements of the Canadian Model as including 3 regarding drug and alcohol testing, Entrop the following elements: Employment Standards v. Imperial Oil Limited (“Entrop”), the Ontario Act Provisions Court of Appeal struck down Imperial Oil’s 1. Random alcohol or drug testing is not Enforceable in a Civil random drug testing policy on the basis that Action 3 permitted, unless it is part of an agreed the test could not detect actual impairment rehabilitation program. Collective Agreements on the . and the Duty to 2. Employers can require alcohol or drug Accommodate 5 In response to the decision, Imperial Oil testing in the following circumstances: ceased random drug testing until July B.C. - Alberta Trade Investment and Labour 2003 when it reinstituted random drug (a) If the employer has reasonable cause Mobility Agreement 7 testing using saliva testing that could detect to suspect an employee is under the current impairment. The Union influence of alcohol or drugs; challenged Imperial Oil’s random alcohol and drug testing. (b) If there has been a significant incident, accident or near miss where it Decision is important to identify the root cause of In a 2005 preliminary award, Arbitrator what occurred; and Picher dismissed the Union’s challenge to (c) As part of an employee’s alcohol or random alcohol testing since the employer had engaged in this practice since 1992 drug rehabilitation program. In the case without challenge by the Union. of rehabilitation, employers may require random unannounced alcohol or drug In a December 11, 2006 award, Arbitrator testing for a limited period of time. Picher held that random drug testing was not a permissible exercise of management 3. An employee’s refusal or failure to submit rights, despite the fact that Imperial Oil’s to an alcohol or in the circum- testing could detect current cannabis stances set out in (2) above will be viewed impairment. as a serious violation of the employer’s alcohol and drug policy and may be grounds for serious discipline.

 In summarizing the arbitral would not pass the test because the jurisprudence on drug testing, results from the saliva tests were not Arbitrator Picher noted that industrial available for several days following relations experience for over 20 years the test during which time the established that the Canadian Model employee was sent back to work in a was effective in achieving safety goals safety sensitive environment. without imposing random alcohol or drug testing on employees. He stated Implication that random drug testing outside the This award reinforces the existing context of a rehabilitation plan is: arbitral jurisprudence which does not “an unjustified affront to the dignity permit random drug testing unless and privacy of employees which evidence establishes a significant falls beyond the balancing of any safety risk. Given the threshold of legitimate employer interest, including an “out of control drug culture” set deterrence and enforcement of safe out by Arbitrator Picher, it will be practices.” difficult for employers to establish the requisite safety concerns to justify Arbitrator Picher noted that random random drug testing. testing might be justified in some With regard to random alcohol testing, extreme circumstances such as if the Union had not acquiesced to an “out-of-control drug culture the random breathalyser testing for taking hold in a safety sensitive 12 years, it is our view that on the workplace.” basis of Arbitrator Picher’s analysis, Arbitrator Picher distinguished he may well have struck down this the Entrop decision in which the portion of the policy as well. Ontario Court of Appeal held that Imperial Oil has applied for judicial random drug testing was not allowed review of this arbitration award to because it could not detect current the Ontario Divisional Court. impairment, on the basis that the Court in Entrop was applying the Imperial Oil Ltd. and Communications, Human Rights Code to the situation Energy and Paperworkers Union of of a recovering alcoholic not to the Canada, Loc. 900 (2006) (Picher) application of a collective agreement (unreported) in the context of the Canadian arbitral jurisprudence. In addition, Nicole Skuggedal even if Entrop was applicable Picher held that Imperial Oil’s revised policy

 UPDATE ON MANDATORY Legislation has been introduced to RETIREMENT eliminate mandatory retirement in Saskatchewan. Effective May 2007 mandatory retirement will not be generally Deborah Cushing permissible in Newfoundland and Labrador.

In British Columbia, the Premier’s

Council on Aging and Seniors’ Issues EMPLOYMENT STANDARDS ACT released its report, Aging Well in British PROVISIONS ENFORCEABLE IN A Columbia in late 2006. One of its key CIVIL ACTION recommendations was that, “the B.C. government immediately change the A recent decision of the B.C. Human Rights Code to extend human Supreme Court has addressed the rights protections to those over enforcement of Employment Standards the age of 65, thereby eliminating Act (“ESA”) provisions through a mandatory retirement in B.C.” In civil action instead of through the the February 2007 speech from the employment standards complaint throne, the provincial government process. In Macaraeg v. E Care Contact stated that it will introduce legislation Centers Ltd., Madam Justice Wedge to end mandatory retirement as ruled that mandatory minimum recommended by the Premier’s provisions of the ESA may be Council. implied terms of an and an employee may In January, the federal Minister enforce those terms through a of Human Resources and Social civil action for breach of contract. Development, Monte Solberg, announced the appointment of a The Facts panel to examine the role of older Canadians in the workplace. The The plaintiff, Cori Macaraeg panel is chaired by retired senator, the (“Macaraeg”), was hired to work as a Honourable Erminie Cohen. Customer Service Representative by E Care Contact Centers Ltd. (“E Care”), As reported in previous newsletters, a payday loan company. Macaraeg mandatory retirement is no longer signed an offer of employment generally permissible in Alberta, which set out her and benefits Manitoba, Ontario, Quebec, P.E.I., but which was silent on pay. the Yukon, the N.W.T. and Nunavut. According to Macaraeg, she routinely

 worked 12 hours on weekdays and requirement, whichever is more eight hours on Saturdays but was generous to the employee. Where told by E Care that the company did no right exists at common , the not pay overtime rates for extended void provisions will be replaced by hours. E Care acknowledged that the statutory requirements. it did not have a practice of paying overtime rates and never agreed to pay The judge found that, “the effect overtime. Macaraeg’s employment of a minimum benefit conferred by was terminated without cause after employment standards legislation is to 30 months of employment and she introduce a further contractual term was given two weeks pay in lieu of into the contract of employment as notice. She brought an action for effectively as if it had been included wrongful claiming damages by agreement of the parties.” The in lieu of notice (including overtime mandatory minimum requirements for the ) and payment of the ESA for overtime benefits for the overtime hours she worked provided in ss. 35(1) and 40 of the during her employment with E ESA were held to be implied terms of Care. Macaraeg’s employment contract.

E Care brought a preliminary (2) Are the implied terms of the employment application seeking a ruling on two contract enforceable in a civil action for questions of law. breach of contract?

The Decision The Court concluded that no provision in the current ESA (1) Are statutory employment rights implied precludes an employee from bringing terms of employment contracts? a civil action to recover minimum statutory employment benefits. Wedge J. summarized the In particular, the Act contains no jurisprudence from the Supreme exclusive jurisdiction clause. Court of Canada and a number of provinces on the effect of statutory The Court found that the ESA does employment rights on contracts of not “expressly or impliedly prohibit employment as follows: an employee from commencing civil proceedings to enforce his or her Terms of an employment contract statutory rights, whether or not the failing to meet minimum statutory claim is part of a requirements will be replaced by action.” The court distinguished either the common law or statutory cases where the cause of action was

 founded directly upon breach of a Most significantly, the decision statute. In this instance, although the permits civil actions to enforce terms of the contract arose from the claims for ESA benefits. Under the standards fixed by that statute, the ESA, claims must be filed within 6 claim itself was a claim for breach months of the date of termination of the employment contract. of employment or contravention of the Act and the employer’s liability In reaching its decision, the court for is limited to six months. departed from the judgment of the In contrast, in a civil action, the time B.C. Supreme Court in Sitka Forest limit for bringing a claim is set by the Products Ltd. v. Andrew, [1988] B.C.J. Limitations Act (six years for breach of No. 2069. contract) and the award of damages could thus extend to the entire term In summary, Wedge J. concluded of the employment relationship. that: Macaraeg v. E Care Contact Centers Ltd., 1. The employment contract [2006] B.C.J. No. 3211 (S.C.). between E Care and Macaraeg included an implied term that Deborah Cushing she would be paid overtime compensation in accordance with

the mandatory requirements of the ESA. COLLECTIVE AGREEMENTS AND THE 2. The ESA does not preclude DUTY TO ACCOMMODATE Macaraeg from pursuing her claim for overtime pay in a This recent decision of the Supreme civil action for breach of her Court of Canada deals with the employment contract. interaction between and the right of a person to be Impact on Employers absent from work due to an illness or disability. The issue before the According to this decision, the Court was the role of the collective mandatory minimum requirements agreement in the assessment of an of the ESA, particularly overtime, employer’s duty to accommodate an will be implied into an employment employee absent from work because contract regardless of the parties’ of personal health problems. subjective intentions, if the employee is not excluded from the application The collective agreement at issue of the ESA or its provisions on hours provided that after a three-year of work. absence an employee was deemed

 dismissed. The arbitrator in the first arbitrator in any dispute. Deschamps instance found that undue hardship J. also confirmed that an employee was made out by the employer because must facilitate the accommodation an employer does not have a duty to process and found that the grievor retain employees who are incapable in this case did not do so. She noted of performing their duties. The that “…if [the grievor] felt that she Quebec Court of Appeal concluded would be able to return to work that the arbitrator did not assess the within a reasonable period of time, reasonable accommodation issue on she had to provide the arbitrator with an individualized basis but instead evidence on the basis of which he applied the collective agreement could find in her favour.” mechanically. Abella J. wrote a concurring opinion The appellant-hospital submitted on behalf of herself and two other that it was open to an employer and members of the Court. She concluded a union to agree, in their collective that the grievor had not made out a agreement, to the scope of the duty case of prima facie discrimination. to accommodate and thus provide for Abella J. stated she could not “accept a maximum period of time beyond the conclusions of the majority that which any absence would constitute “automatic” termination clauses undue hardship for the employer. automatically represent prima facie discrimination”. Deschamps J. (on behalf of six members of the Court) noted that She found that clauses such as the one the parties to a contract cannot agree found in the collective agreement at to limit a person’s fundamental rights; issue, providing that after 36 months however, she noted that a clause absence an employee would be meeting the minimum employment terminated, were not discriminatory standards as set out by provincial and if found to be so, would remove legislation is not, in and of itself, the incentive to negotiate mutually suspect. She also confirmed that “the acceptable absences. In Abella J.’s importance of the individualized view the claimant did not establish nature of the accommodation prima facie discrimination and therefore process cannot be minimized.” the employer was not called upon to justify the standard it had set in the After reviewing the case law collective agreement, or the steps that Deschamps J. concluded that while it had taken. a clause in a collective agreement is not determinative, it is a significant Employers would be well advised to factor to be taken into account by the attempt to negotiate clauses providing

 for termination of employment Under TILMA, workers who are after an employee has been absent certified for a given occupation in for medical reasons for a defined one province will be recognized as reasonable period of time. being qualified in both provinces. Workers will still be required to McGill University Health Care (Montreal register with the regulatory authority General Hospital) v. Syndicate Des for that occupation. However, they Employes de L’Hopital General du will not be required to undergo Montreal, 2007 SCC 4 significant additional examinations or . Nick Ellegood To date, B.C. and Alberta have identified more than 60 occupations JOINT BRITISH COLUMBIA- with different standards that limit ALBERTA AGREEMENT labour mobility between the two provinces. The governments of On April 28, 2006 B.C. and Alberta B.C. and Alberta intend to work signed the British Columbia-Alberta with occupational regulators to Trade Investment and Labour reconcile the standards by April 1, Mobility Agreement (“TILMA”) at 2009. The agreement also covers a joint B.C.-Alberta Cabinet meeting internationally trained professionals. held in Edmonton, Alberta. If a professional has been licensed in Alberta, that professional will also Under TILMA, B.C. and Alberta be able to be licensed in B.C. and businesses and workers will enjoy vice versa. new market access. For example, it will streamline business registration While TILMA was signed in April and on-going reporting requirements 2006, it has a transition period to April so that businesses registered in 2009 before it comes into full effect. one province are automatically This will allow the governments of recognized in the other. More B.C. and Alberta to make any required regulatory changes in order to effect importantly, for human resource conformity with the other province. practitioners, it will enhance labour Further information on TILMA is mobility by recognizing occupational found at the Ministry of Economic certification of workers in both Development, Government of B.C. provinces. Currently, workers in website at www.ecdev.gov.bc.ca. many occupations face additional exams and training requirements if M.J. (Peggy) O’Brien they want to work outside their home province.

 VANCOUVER 1600 Cathedral Place 925 West Georgia Street Members of the Labour and Employment Group Vancouver, British Columbia Canada V6C 3L2 Telephone 604.685.3456 Vancouver Facsimile 604.669.1620

Nicholas P. Ellegood 604.631.6707 [email protected] CALGARY 3700, 205 – 5th Avenue SW Patricia Gallivan, Q.C. 604.631.6718 [email protected] Bow Valley Square 2 M.J. (Peggy) O’Brien 604.631.9201 [email protected] Calgary, Alberta Canada T2P 2V7 Walter G. Rilkoff 604.631.6719 [email protected] Telephone 403.269.6900 Melanie C. Samuels 604.631.9107 [email protected] Facsimile 403.269.9494

Robert A. Sider 604.631.6722 [email protected] YELLOWKNIFE Nicole K. Skuggedal 604.631.6795 [email protected] P.O. Box 818 200, 4915 - 48th Street Yellowknife, NWT Calgary Canada X1A 2N6 Telephone 867.669.5500 Toll Free 1.888.465.7608 Krista Hughes 403.781.9468 [email protected] Facsimile 867.920.2206 John M. Olynyk 403.781.9472 [email protected] The information provided in this newsletter is for general Yellowknife information purposes only and should not be relied on as legal advice or opinion. If Sarah A.E. Kay 867.669.5523 [email protected] you require legal advice on the information contained in this Sheila M. MacPherson 867.669.5522 [email protected] newsletter, we encourage you Paul N.K. Smith 867.669.5532 [email protected] to contact any member of the Lawson Lundell LLP Labour and Employment Law Team. For more information, please contact any member of the To be removed from this mailing Labour & Employment Law Group list, please contact Lawson Lundell LLP’s Marketing Manager at 604.685.3456 or genmail@ lawsonlundell.com.

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