HR Law with Ellen Swan | E073

HR best practices and making sure you protect your business.

In today’s episode, Jason Pereira talks to Ellen Swan. She is a Barrister and Solicitor at Caravel Law. Ellen has a specialization in HR Law, and Jason brought her on the show to talk about best practices when bringing on, maintaining, and firing your staff and even addressing what to do during Covid with some of these more interesting cases for dealing with.

Episode Highlights:

  • 1.01: Ellen supports employers with HR issues in the workplace that range from onboarding, management of the relationship, including disability issues, leaves of absence, performance management, compensation issues. She also helps when things go wrong, and the relationship ends for various kinds of reasons.  

  • 1.46: Ellen answers when someone is looking to hire someone. What are the best practices from HR law standpoint when it comes to onboarding them? 

  • 1.53: When hiring an employee, the most important thing is to have a well-drafted employment agreement that the employee sees and signs before starting work. That can be a template that you get reviewed periodically by your lawyer. Still, it should be something that is initially drafted by a lawyer who practices in employment law, not just your general commercial lawyer.

  • 2.48: Ellen says more than 50% of her practice is dealing with terminations where the employment agreement is non-existent, poorly drafted, out of date. The law has evolved, and the employee has not signed a new agreement with every promotion or every change in salary that is considered for the agreement, and those things are constantly evolving. 

  • 3.15: The big issue with an employment agreement is that it doesn’t have to be in writing under the law, so you will have an employment contract with someone you employ, even if you never present them with an agreement in writing. 

  • 4.08: People are typically surprised by termination clauses, so how specifically they have to be drafted to be compliant with the law with respect to minimum entitlements, not contracting out of the minimum entitlements, as well as what the law fills in when the clause is not drafted effectively.

  • 4.32: The bulk of litigation that relates to employment contracts comes up for essentially, one reason there is someone who has been let go who has not been worth making an investment in to manage performance. 

  • 7.46 Ellen says lawyers draft agreements to bring people together, keeping in mind that at the end is when everything becomes important that we’ve written down.

  • 8.14: In hiring, you are making sure those terms and conditions and the clauses, and then the general schedule contract is done by somebody knows what they’re doing, but specifically the biggest area looking after what happens when this relationship ends, so it is your work employment prenup for lack of better term on, says Jason.

  • 8.51: You want to know, just like any consumer, you’re a consumer of services, and so you want to know as an employer what you are getting for your money. But you can be accused of using information for inappropriate purposes if you get too much information, says Ellen.

  • 9.10: Ellen affirms, information with respect to medical issues, disabilities, alcoholism, which is the disability, marital status, family status all those kinds of things that is why you get that sense out there in the marketplace that there are certain questions you can’t ask in an interview. 

  • 10.06: At the end of the day, humans have a right to our own privacy in medical situations, and we have a right not to be discriminated against for it, says Jason.

  • 12.16: There is absolutely no point in creating a sense of security that should not exist. Ellen avoids using words like, not a good fit because not a good fit creates a sense of otherness in people who already have a sense of otherness.

  • 13.30: Ellen suggests, if you have a well drafted employment agreement probationary period matters less from an actual liability perspective because you will have limited their persons entitlements on termination in such a way that you are comfortable exit in them at any time.  

  • 15.26 Ellen explains there are two lenses applied to consider whether someone is an employee or contractor, one under employment legislation and one with the CRA.

  • 15.50 Ellen says, if you think of a pure contractor relationship, you engage a third party to build an app for you, and if that third party it can be an individual, or it can be like an app producing mega-company that has 100 developers working for it. 

  • 18.35: You always have the possibility of an audit from the Ministry of Labor under a Conservative Government in the middle of a pandemic that is not really what they are focusing on right now in terms of where they are spending their enforcement dollars, but back when the Liberals were in power and before the pandemic hit, it was very big economy focus and that legislation and those kinds of enforcement measures were around.

  • 21.23: People get scared when there is a huge surprise, and that is when you end up with the union organizing drives or workplace sort of uprisings that you may not want or just people that aren’t really happy, and you have a talent retention problem, says Jason.

  • 22.50: If you are not going to go down the performance management route, then don’t say performance reasons at the time of termination because you are just going to make somebody mad that they didn’t get a chance to meet your expectations. 

  • 28.03: If you purported to temporarily lay someone off in accordance with the temporary layoff provisions of the Employment Standards Act and you did not have the Employment Employees agreement to do so, whether in an employment agreement or at the time of layoff, then that was constructed dismissal outlaw, and that meant that you had effectively terminated the person even though you’re ported to keep them on layoff, and they were entitled to wrongful dismissal damages. 

  • 28.28: During COVID, the government changed the rules with respect to temporary layoff and said essentially, if you can’t work because of COVID, whether it is because of your own exposure, needing to quarantine, or because of a loss of business, then it became infectious disease leave.

  • 34.52: Ellen answers what vaccine mandate means? Does that mean you are saying you will lose your job if you don’t get vaccinated because it is probably not just cause, which means you are paying out this termination package? 

 

 3 Key Points:

  1. Jason brought Ellen on this show specifically to tackle best practices and policies from an HR standpoint. They both will look at it through the lifecycle of an employee. 

  2. Ellen talks about the “Probationary Period” what that is and what that cannot be? 

  3. One thing that has come up quite often in Jason’s practice with some people is basically dealing with employees versus contractors. When can someone or a candidate consider a contractor? and when is there an employee-employer relationship there that the employer needs to recognize contractually otherwise, they could be in trouble?

Tweetable Quotes:

  • “The law of employment agreements is one of the most heavily litigated areas of contract law.” – Ellen

  • “The law typically protects the ones that considered weaker of the two in any endeavor.” – Jason

  • “You can make your probationary period as long as you want. The only caveat is that you cannot let someone go without notice or pay in lieu of notice if the probationary period extends.” - Ellen

Resources Mentioned

Transcript:

Producer: Welcome to The Financial Planning for Canadian Business Owners Podcast. You will hear about industry insights with award-winning financial planner and entrepreneur, Jason Pereira. Through the interviews with different experts with their stories and advice, you will learn how you can navigate the challenges of being an entrepreneur, plan for success and make the most of your business in life and now, your host, Jason Pereira.

Jason Pereira: Warm welcome. Today on the show I have Ellen Swan, barrister and solicitor at Caravel Law. Ellen's got a specialization in HR Law and I brought her on the show to talk about best practices when bringing on, maintaining and firing your staff and even addressing what to do during COVID with some of these more interesting cases we're dealing with. So, I hope you enjoy this and here's my interview with Ellen.

Jason Pereira: Ellen, thanks for taking time.

Ellen Swan: Hi.

Jason Pereira: So, Ellen, tell us a little bit about what it is you do.

Ellen Swan: I support employers with HR issues in the workplace that range from onboarding, management of the relationship including disability issues, leaves of absence, performance management, compensation issues and then I help when things all go wrong and the relationship ends for various kinds of reasons.

Jason Pereira: Keep it on a positive note. You're the representative bias, you don't get the, "Oh, you know what, they left to do X and I'm so happy for them." You never hear that, you only hear the bias.

Ellen Swan: Right. People don't come to me and say, "Everything went well, we don't need you". That doesn't come up very often.

Jason Pereira: So, I brought you on the show specifically to tackle best practices and policies from an HR standpoint. Let's look at it through the life cycle of an employee. So, someone's looking to hire someone, what are the best practices from an HR law standpoint when it comes to onboarding them?

Ellen Swan: The most important thing when you're hiring an employee is to have a well drafted employment agreement that the employee sees and signs before they start work. That can be a template that you get reviewed periodically by your lawyer, but it should be something that is initially drafted by a lawyer who practices in employment law, not just your general commercial lawyer, because the law of employment agreements is one of the most heavily litigated areas of contract law.

Jason Pereira: So, don't go Googling random templates because you may be getting something from a different jurisdiction that may not apply here. If I haven't said this before on this show, there's a reason why I deal with lawyers who tend to specialize in single verticals or maybe no more than two simply because, you can't do everything and any lawyer or any professional [inaudible 00:02:35] who is supposed to be doing everything in that category is probably falling short in every category. That's my little plug for dealing with someone like yourself for that contract. I'm curious, how often do people get into trouble for not having that in place?

Ellen Swan: I'd say it's more than 50% of my practice-

Jason Pereira: Oh my God.

Ellen Swan: ... is dealing with terminations where the employment agreement is either nonexistent, poorly drafted, out of date because the law has evolved and the employee has not signed a new agreement with every promotion or with every change in salary that is consideration for the agreement and those things are constantly evolving so, it comes up a lot. The big issue is with an employment agreement, it doesn't have to be in writing under the law. So, you will have an employment contract with someone that you employ, even if you never present them with an agreement in writing. The agreement in writing crystallizes the terms so that everybody knows what they are. If you don't have an agreement in writing, then the law fills in the gaps and more often not those gaps are filled to the benefit of the employee, because there is presumed unequal bargaining power between employers and employees.

Jason Pereira: As usual, the law typically protects the ones that be considered to be the weaker of the two in any endeavor. So, they fill in the gaps and those gaps, I guess the real message here is, those gaps may not be what you think they are.

Ellen Swan: That's correct.

Jason Pereira: A lot of people come, in any form of law, with a lot of preconceived notions of the way they think things work. Can you speak to what people are typically surprised by?

Ellen Swan: People are typically surprised by termination clauses. A, how specifically they have to be drafted to be compliant with the law, with respect to minimum entitlements and not contracting out of minimum entitlements, as well as what the law fills in when the clause is not drafted effectively. I call it, for lack of a better expression, bad employees making bad law. The bulk of litigation that relates to employment contracts comes up for essentially one reason. There is someone who has been let go, who has not been worth making an investment in to manage performance. So they're not very good at what they do, and they can't get a job really quickly so they're out of work for some time. They may have a CV that has two years here, a year and a half there, three years somewhere else, and then it starts to look like someone who's been working for 16 years, but no employer has been willing to make a significant long term investment in them.

Ellen Swan: So, they are out of work for six plus months, they bring a summary judgment motion on the enforceability of the employment contract. The judge can see that they've reasonably tried to find alternative employment and were unsuccessful, so that actual out-of-work time becomes the reasonable notice period that fills in the gaps in the employment contract. That means that you have this whole body of case law with these employees, particularly with short service, getting very large reasonable notice awards or wrongful dismissal damage awards from the courts. Just to back up a bit, when we talk about what the law fills in, in a termination clause, that is ineffective or not there because there's no written agreement, the law says that an employee is entitled to reasonable notice of termination. What that means is, notice sufficient to enable this employee to find reasonable alternate employment without experiencing an interruption in earnings.

Ellen Swan: So how much notice would the employer actually have to give them to find a new job that is comparable, in terms of comp and seniority level and/or respect level in the organization, and/or pay in lieu thereof. If it's pay in lieu thereof, because you didn't actually give that notice, then that's a total compensation package. You put the employee in the position they would have been in, had you given them actual notice. That means stock options continue to vast, bonuses continue to be payable if they're not entirely discretionary, benefit coverage continues. So, if you cut off your short term disability plan and the employee gets disabled, you're potentially self-insuring for that liability or long term disability. Even worse, self-insuring for their losses up to the age of 65. That's the risk of not having an effectively drafted employment agreement.

Ellen Swan: So what the law fills in can be quite onerous for an employee to satisfy after the fact. I'm not making a judgment on whether that's fair or what, that's what employees deserve. The employer holds all the cards for when that employment relationship ends if the employee doesn't want to go. So, there is an unequal bargaining power. This is a significant relationship breakdown. People define themselves by what they do. It is the first thing you're asked at every party. It's how you support your family. It's how you pay for your mortgage.

Jason Pereira: It's part of your identity.

Ellen Swan: Exactly. So, it's a big deal to end it.

Jason Pereira: It is. Essentially, almost like marriage, in some cases, but definitely business, you have to plan for the exit before you even get there.

Ellen Swan: Exactly. That's what lawyers do. We draft agreements to bring people together, keeping in mind that at the end is when everything becomes important, that we've written down.

Jason Pereira: Exactly. The bias, again, is that you only see when things go wrong, when things go right and everybody's happy, you don't end up with that. People never assume you know what the law is. I'm always astonished by some of these rumors that go on out there, it just never ceases to amaze me. In hiring, you're really making sure those terms and conditions, and the clauses in the general standard contract, is done by somebody who knows what they're doing. But specifically, the biggest area, looking after what happens when this relationship ends. So it is your work employment prenup, for lack of a better term.

Ellen Swan: That's exactly right. The other thing I would say about hiring, is that I remember distinctly the first question I ever got asked as a lawyer that I could answer without having to look it up. The question was, "I keep hiring sick people. Can I do medical testing before I hire a new employee?" I was like, "No, no you can't."

Jason Pereira: No.

Ellen Swan: You want to know just like any consumer. You're a consumer of services. So you want to know as an employer, what you're getting for your money, but you also can be accused of using information for inappropriate purposes if you get too much information. So, information with respect to medical issues, disabilities, alcoholism, which is a disability, marital status, family status, all those kinds of things. That's why you get that sense out there in the marketplace that there're certain questions you can't ask in an interview. The reason is because if you ask them, even just from a making conversation perspective, or because you just had a baby and you want to talk about having babies with someone, that means that you're getting information you can be accused of misusing

Jason Pereira: Yeah, for discrimination. That makes a lot of sense.

Ellen Swan: Exactly.

Jason Pereira: I mean, that's also a problem ongoing. One of the well known issues that used to exist in the group insurance space was that there was a lot more disclosure as to who was spending what money on what drugs and medications back in the day. Whereas, now it's all anonymized in group to prevent that thing because firing decisions were based off, "Oh, that guy's the one who's costing me this percentage of my claims." Three months later he's not there. To some employers, it seems unfair if that's the case, but at the end of the day this is a human right. We have a right to our own privacy and medical situations, and we have a right not to be discriminated against for it.

Ellen Swan: There's so much information that you don't actually need. If you're not giving your employee a truck, or requiring them to drive for their job, you don't need to know if they have a driver's license. That's just information you don't need to know. You don't need to run a credit check on every employee that comes to work for you. Criminal record checks are a little bit different, and that really is jurisdiction specific on how you're going to use that information and what information you're going to get. So that's a more nuanced analysis but-

Jason Pereira: Well pardon again, in some jobs, especially those in finance that have to do with actual exposure to people's finances, credit checks are typically required simply because you don't want someone in a difficult position being put in a position of temptation. There're little areas, but in general, if you're operating in Joe's widget manufacturer, or a service company, it's not going to be a thing.

Ellen Swan: Right. So, from a best practices perspective, I would say, have some hiring protocol, that's in writing, that you can use to evidence how you've trained your hiring managers to conduct interviews, and what information they should and should not request because chances are the detailed notes of those meetings don't exist in any way that really give a narrative or a transcript of what was asked and not asked. So, having that buttressing document that says, "Well, we would never have asked that because this is what we go through in our interview process and this is how we apply it consistently," is a very good way of backing yourself up that way.

Jason Pereira: So once you've hired someone, they started, let's talk about ongoing practices. So first thing I want to address is the early period, when they're in their, "probationary period," let's talk about what that is and what that cannot be.

Ellen Swan: My brother always says, in his business, now you can tell really quickly if someone's going to be a good fit. If they are not a good fit, and the reason why they're not a good fit is related to particularly skill set, acumen, common sense or judgment, then you should exit that person as soon as possible. There is absolutely no point in creating a sense of security that should not exist. I would avoid using words like "not a good fit", because "not a good fit" creates a sense of otherness in people who already have a sense of otherness. You say "not a good fit", and you're talking to the only black person in your workplace, there's going to be an assumption or potentially the assumption that the fit is related to race. If it's the only woman, you would have that same potential assumption. If it's the only person with young children, you would have that same potential assumption. I would typically recommend framing it in terms of skills set, or what the actual needs are for the role. Then, I would exit them as quickly as possible.

Ellen Swan: You should really be paying attention to how that person is working right off the bat. So, don't onboard someone when the manager is going to be out of the office for the first month. It's a waste of your time in that period. There's so many other competing things at that time. You want to give this candidate a job so they don't go somewhere else and you will prioritize across those different interests, but you will lose the effectiveness of that probationary period. The other thing is that if you have a well drafted employment agreement, probationary period matters less from an actual liability perspective because you will have limited their person's entitlements on termination in such a way that you're comfortable exiting them at any time. You know what that cost is. If you go past the probationary period, so be it. The cost is crystallized in the employment agreement and it is what it is.

Jason Pereira: But probationary periods in general, those are stipulated by employment law within a jurisdiction, correct? I don't get to say you're on probation for two years.

Ellen Swan: Well, you can, in the sense that you can make your probationary period as long as you want. The only caveat is that you cannot let someone go without notice or pay in lieu of notice if the probationary period extends past whatever the statute recognizes as the period during which they have no entitlements to termination notice or pay in lieu.

Jason Pereira: That's really what I was more getting at. At what point did the statutory requirements kick in? If it's statutory, then there really is no getting around that contractually, right? We're on the hook for that. If it's three months, and I'm not sure if it's three months, and I think I'll give him one more month at that point I crossed the threshold.

Ellen Swan: Yes, you have. So, most jurisdictions recognized a three month probation period. The one caveat I would make to that, is fixed term agreements. So, if you have a fixed term agreement, that's less than one year long, you've already given notice of the end date. So, there would be no statutory entitlements that arise on the end of that agreement. You can necessarily end it early, depending on the language of the agreement, and those are universally poorly done. If you let it roll over the end date, there are even worse consequences. So, I'm not advocating fixed term agreements, but it is. You're actually giving notice of the end and that's why there are no obligations at the end of it.

Jason Pereira: One thing that's come up quite often in my practice with some people, either both ends of the equation, is basically dealing with employees versus contractors, right?

Ellen Swan: Mm-hmm (affirmative).

Jason Pereira: When is someone considered, or can be considered, a contractor? When is there an employee-employer relationship that the employer needs to recognize contractually otherwise, they could be in trouble?

Ellen Swan: There's two lenses that are applied to consider whether someone is an employee or contractor. One is under employment legislation, and one is with the CRA. So, both employ a similar or substantially the same test, which is that it really comes down to control. Who controls when this person works, who this person works for, and how they deliver the goods? If you think of a pure contractor relationship, you engage a third party to build an app for you. If that third party, it can be an individual or it can be an app producing mega company that has a 100 developers working for it, either one, it's an arms' length, Its discreet project service that is being delivered. You don't tell them how to build the app. You tell them what the app should look like, and then they build it and you don't tell them whether they do it on a Saturday, Sunday, Monday or Tuesday. They decide when they do it.

Ellen Swan: That is a very clear contractual relationship. If that's what's being built, it doesn't matter the nature of the entity that's providing the service. But if this person is going to be doing something that looks a lot like what your other employees regularly do, you're on the other end of the spectrum because they are managed by the same people. They participate in team meetings. They may have a company email. So, they just look more like someone who's an employee, they're going to be an employee. There's a whole spectrum of things that fall in between. My colleague has developed a five or six page questionnaire that we can use to figure out where on the spectrum someone might fall. But the reality is that it comes up in two scenarios.

Ellen Swan: This issue arises in two scenarios. One is that the CRA feels short changed. So, the person who's engaged to provide the service, whether their contractor employee or not, has taken advantage of inappropriate deductions from income or not paid any income tax for a period of time and the CRA says, "Hey, we should be getting our cut here. It'd be a lot easier for us to get our cut if this company that you're providing services to, which is one of the only companies or the only company that you provide services, you're really an employee and they should be making source deduction so that we don't feel shortchanged." So that's scenario one, and I'm not a tax lawyer. So I can't really comment on how the CRA may get tweaked to that stuff or what's the best way to resolve it.

Jason Pereira: Sometimes I've seen it in the past where it actually had nothing to do with someone else's failed remittance. They came subject to another audit for other purposes in blemo it's like, "Oh, you think that these people who have been working for you for three years, are all contractors when you're basically taking a 100% of their time?" Sorry, that's not it.

Ellen Swan: Yeah. Right. So again, the CRA feels shortchanged about that. There's some reason why they're in there. So the second scenario is the person who's done the work feels shortchanged, whether it's at the time of termination or some other friction point in the relationship, and that would usually come up with respect to the other things that flow from it being an employment relationship like overtime pay or vacation pay or termination and severance pay. So those are the three main triggers of that dispute, but there has to be something else going on in that employment relationship. You always have the possibility of an audit from the ministry of labor, under a conservative government in the middle of a pandemic. That's not really what they're focusing on right now in terms of where they're spending their enforcement dollars. But back when the liberals were in power and by for the pandemic hit, it was very gig economy focused and that legislation and those enforcement measures were around.

Jason Pereira: Yep. So besides the... I guess, making sure you have the proper definition of your relationship with your employees and, once they've been onboarded beyond the probationary period, what other best practices, HR practices are there they should be contemplated from a legal standpoint?

Ellen Swan: Well, the two things that I most often consider the overarching principles are communication and that communication has two components communication up, so do employees feel empowered to take concerns or issues or wants or needs to management and is management making employees feel informed and a part of the journey. And then the second overarching principle is the perception of fairness. So it's not actual fairness. You don't need to be fair strictly speaking life isn't fair, but people need to have the perception that they're beating treated fairly and the biggest, I think, way to achieve that is consistency. So consistency in how you treat people, consistency in how you manage requests for certain things and consistency in discipline and discharge. What are the factors that you will consider and how will you apply them? That's a significant factor. Consistency, unfortunately, you can achieve it without having written policies, practices, and procedures. Absolutely. You can achieve consistency.

Ellen Swan: It's much harder to evidence consistency without policies, practices, and procedures, and I tell my clients all the time like, "I'm not saying that what you're doing is wrong, or what you have been doing is wrong. I'm saying, how do I prove that what you've done is the right thing. And if you haven't documented what your policies, practices, and procedures are, and that you've trained people on how to follow them, how do you know what people are doing?" So consistency goes to communication as well in the sense that making sure everybody has a equal opportunity for raising issues, whether that's an anonymous tip line or whistleblower setup, if you're in a larger organization, whether it's having AMAs with leadership and town halls that give employees the chance to provide feedback, something more anonymous could just be an annual survey or a biannual survey of where people are, even something as simple as a net promoter score, like would you recommend working here to anybody else, and then telling employees what they need to know, so that decisions about downsizing or reorgs are not a huge surprise.

Ellen Swan: People get scared when there's a huge surprise and that's when you end up with union organizing drives or workplace uprisings that you may not want, or just people that aren't really happy and you have a talent retention problem. That's a straightforward issue depending on who has the bargaining power in that relationship. So yeah, those are my main best practices.

Jason Pereira: All valuable. So, okay. Let's talk about when the relationship comes to an end. Best practices around firing, besides the fact that... assuming they have a contract in place that did check the right boxes, what are the best practices around letting someone go?

Ellen Swan: So there's basically, I think three kinds of decisions that are made to terminate. The first is this person is not good at their job. So it's a performance termination. If it's a performance termination where you want them to know that they are being let go for performance reasons, it's best to have been quite clear about how you ended up there. So having a performance management program, where there is an annual review, the annual review comes back as sub standard or not meeting expectations, and then you implement, these are the expectations. These are how you meet them. Let's get on a cadence of once every week or once every two weeks to see how you're progressing on them and I will give you clear feedback on how you're progressing on these things so that if there is a termination, it's not a surprise. If you're not going to go down the performance management route, then don't say performance reasons at the time of termination because you're just going to make somebody mad that they didn't get a chance to meet your expectations.

Ellen Swan: That's where I would say something like, "We're looking for a different skill set in the role. We've decided to go in a different direction with this role." Then you just offer a package that is consistent with what's in the employment agreement and maybe a little bit extra to get them to sign a release and you go on your way. The other kind of termination that it could be is like there's been a serious misconduct issue. So some significant trust breakdown or theft, whether it's time theft, product theft, or there was a huge embezzlement scheme figured, I don't know, you wouldn't believe some of the reasons that we've had to fire people over the years. I wish I could tell you all the stupid things that employees do that end up getting them fired. So many relate to porn. I don't know why, but they do.

Jason Pereira: Oh my God. The dangers of having the internet at work. What can I [inaudible 00:23:51].

Ellen Swan: Right, exactly. So if it's that kind of reason and you believe you have what we call just cause I think you really need to talk to a lawyer before you pull the trigger on that termination, because there's a lot of consequences that flow from alleging, just because if you don't have it, and generally speaking, if you give someone a termination letter that gives them nothing to bridge the time between when they're being exited and when they might find a new job, you're going to get into litigation because they've got nothing to lose by starting litigation. And then the third kind is a restructuring and you're letting go of a bunch of people at this same time. There are a lot of issues that can arise.

Ellen Swan: If it's all the people at one work location, if it's 50 plus employees, you get into a mass termination situation that has specific notification requirements, including to the director of employment standards, and so that's another circumstance where it's makes sense to talk to a lawyer, but that would also enable you to use different structures rather than just cash payout. Because if you're shutting down a whole plant or a whole office location, or the operations in the province, then you can take advantage of working notice in a way that you might not be able to with other kinds of terminations, where having someone who's being exited in the workplace, isn't great for morale.

Jason Pereira: So let's say you do get into a conflict with these people, basically what are the best practices once someone is not willing to sign that release and it looks like they're basically going to speak to counsel or pursue what other rights they think they have, what should I do next? Besides call you.

Ellen Swan: Call me? I think one of the things that I tell a lot my clients to do is remember that this is a significant relationship breakdown for the employer as well. In a lot of circumstances, they have felt that they have given this person every opportunity to succeed and the person has squandered it, or they've breached the trust and they're angry. It's a significant relationship for both sides so that means that the lawyer has to also divorce their emotional, maybe the HR person or the managers or the business decision makers, emotional investment in how this dispute is going to go from the commercial reality of fighting with someone. And if it's worth it to fight because the principal is so important or you're just not ready to let go of the principal, that's fine. I'm happy to take your money and fight a litigation with an ex-employee, but there are commercial realities to the cost of litigation.

Ellen Swan: And if my client is the company, I have to advise them of those commercial realities. I understand that, that is the way that the plaintiff sidebar makes money is of the commercial realities that face employers that it's cheaper to settle than it is to keep fighting, but that may be what's in the company's best interests. So there has to be an analysis of the emotional investment versus the commercial reality and a prioritization and it doesn't have to be a particular way that it has to go. You're allowed to prioritize whatever you want as an organization, subject to your duties of fiduciary obligations or whatever. But I think there just needs to be awareness of what those priorities are and then also document preservation. That's a very technical thing that always-

Jason Pereira: As long as you being able to prove it.

Ellen Swan: Right, so you need to tell everybody who's involved in that employment relationship, do not delete your emails, do not delete your calendar appointments, have IT go in and segregate everything related to that person and put it in a secure place where it's not going to be accidentally archived or sent away in some scheduled deletion protocol and get that information gathering when the facts are still fresh.

Jason Pereira: So let's talk about the topic of the day and COVID, which is basically caused any number of issues. I mean, everything from layoffs, to dismissals, to the hot topic of, basically can people get fired for not getting vaccinated. So talk to me about first off, what you've seen on the kind of letting people go side and, and what to be aware of at the time if there's anything special about what's going on right now in terms of letting people go, and then secondly, talk to me about the back to work situation.

Ellen Swan: Okay. So on the letting people go front pre COVID, if you purported to temporarily lay someone of in accordance with the temporary layoff provisions of the employment standards act, and you did not have the employment employees agreement to do so, whether in an employment agreement or at the time of layoff, then that was constructive dismissal at law and that meant that you had effectively terminated the person, even though you purported to keep them on layoff, and they were entitled to wrongful dismissal damages. During COVID the government changed the rules with respect to temporary layoff and said, essentially, if you can't work because of COVID, whether it's because of your own exposure, needing to quarantine or because of a loss of business, then it became infectious disease leave.

Ellen Swan: So all of a sudden, all the temporary layoffs that were implemented in March or April 2020 became infectious disease leaves that summer. So then leaves and... and they have a right to return to their pre leave employment, but it's not a temporary layoff. So is it constructive dismissal or does the constructive dismissal right under common law still exist and all of us employment lawyers were left saying, "I don't know, it can go either way."

Jason Pereira: Where's the Pandemic precedent. Yes.

Ellen Swan: Right, exactly. Where's my handbook on handling pandemic employment issues and it doesn't exist. So there have been two cases that have gone through the court system where, unhelpfully, one judge has said, no, it's not constructive dismissal. Its infectious disease leave. This is a pandemic. You don't get to take advantage of that right now.

Jason Pereira: And then the other one.

Ellen Swan: Or the other judge has said, "No, its constructive dismissal. So we are waiting for the court of appeal to weigh in on this issue."

Jason Pereira: On which one?"

Ellen Swan: Well, they're going to hear [inaudible 00:29:46] member, which one of them is, it's a complicated matter of civil procedure, but one of them won't go to the court of appeal because it was on an interlocutory matter as opposed to a final matter and where the other one [inaudible 00:29:56].

Jason Pereira: [inaudible 00:29:56] waiting for appeals courts to sort things out.

Ellen Swan: Right.

Jason Pereira: The number of times in the last couple years where it's just like, "You did what at lower court." No, now I have no certainty for the next 12 months. This is ridiculous.

Ellen Swan: And there's also all the employers that settled with packages based on the advice that we gave before these decisions came out and before infectious disease leave came out even, that this was illegal unless you had their agreement. So it's, it's a complicated issue about the layoffs. The reality is, is that there is going to be a COVID bump, I think to notice awards because the availability of alternate employment is one of the issues the court considers when determining the reasonable notice award, that's not going to be true for every person and every industry, like there are definitely industries and sectors of the economy that have received a COVID bump of their own, so it's not necessarily hard to find a job in that industry, so that issue will be significant, I think.

Ellen Swan: There's also the issue with, like you said, terminations that are related to COVID, but for example, breach of policies, you came to work while you were pending a test and you didn't tell anybody that you were pending a test and that's contrary to policy, and that could be just cause in a pandemic, you exposed X number of people in your workplace to this virus, and maybe that is just cause whether it's just cause I think will depend on the climate of the time that the decision is heard. Fair enough. And where are we in that cycle?

Jason Pereira: Yeah. For 90 plus percent vaccination rates, then it's less critical than say earlier on in the pandemic. So speaking of which-

Ellen Swan: Or like in the fourth wave lockdown order. Right.

Jason Pereira: That exactly right. Whatever wave we're in the future. Got it. All right. So hot topic of the day is you're starting to see companies mandate their employees have to be vaccinated and have to return to work. What, and then basically an under penalty of potential dismissal. What are the legalities about that? Or at least as well as we understand them at this point?

Ellen Swan: So I'm really conflicted on this point. I have asked a lot of my clients who have stayed open during the pandemic to consider how it sits in their mouth to say, "It's no longer safe for you to be at work without a vaccine." When they've been saying for 19 months, "No, it's safe for you to be at work without a vaccine." So I call that the second blow issue that you can't say both at the same time. So that's one concern that I have about enforcing vaccination.

Jason Pereira: So basically the policy you took previously is going to either support or bite you in the butt regardless of where you land on this.

Ellen Swan: I think there's a risk of that. I think there is an appetite in the community to require a vaccination, so that trend is going to be on an employer's side, as they shift to requiring vaccination. I have concerns about how simple people think it is to manage this. So if we get to a point where people are going to need boosters, then suddenly you're now keeping track of the cadence and the timing of vaccine doses and when someone needs to receive another dose before they're no longer allowed it in the workplace, and then that's a whole information management machine that you need to implement and who's going to have access to that information and whose sorry job is it now to keep track of all that stuff, and then are there privacy law concerns about where you keep it and how long you keep it and who you share it with that you have to be concerned about.

Ellen Swan: And then how are you stigmatizing the people who can't get vaccinated. There are legitimate excuses for not getting vaccinated. They are very narrow right now, but they are legitimate. So if you're making everybody come back to work and then there's this poor person that's stuck out working from home by themselves and maybe they want to, and it's not an issue, but maybe they feel stigmatized by it. Or maybe they're wearing PPE, but are you really changing your PPE practices? When people who are vaccinated can still take it home to children who can't get vaccinated and things like that. So there's a whole bunch of questions that are not answered by simply saying, we want everybody to be vaccinated before they come back to work. So a lot of my particularly clients with in-house counsel, we go back and forth on this question a lot, where is the ROI for mandating vaccines for those large organizations.

Ellen Swan: In some cases, you've already got 95% of your people vaccinated. Everybody's on board with it. It's not a big deal, so you do it. Or you are working with children or precarious individuals in some way and it's very easy to say that we should do it, or you're in food manufacturing and it's very easy to say, "We shouldn't have people in here who can spread massive loads of the virus," also makes sense.

Jason Pereira: Yes.

Ellen Swan: But if you're in your regular office and everybody has been working from home quite effectively, and now you're saying, "No, you can't work from home anymore and you have to be vaccinated to get into the office." I'm not sure that the ROI is there. I don't know. It's I'm not saying it's not legal right now. It very well could be legal again. I don't have-

Jason Pereira: [inaudible 00:34:46] flow through the courts anyone challenging it. Right. So well-

Ellen Swan: It's a moving target. What does vaccine mandate mean? Does that mean that you're saying, you're going to lose your job if you don't get vaccinated, because it's probably not just cause which means you're paying out this termination package.

Jason Pereira: Well, I mean, in theory couldn't be. I mean, if you have employees who cannot get for very relevant medical issues, right. Or basically, your job specifically has to have physical contact with people who are at high risk and someone just refusing to do it. In theory, you may have an argument for just defending the rest of the people, correct? [inaudible 00:35:21]

Ellen Swan: Well, from an employment law perspective, the issue is that you are now imposing a requirement into the employment relationship that didn't exist at the time of contract.

Jason Pereira: Kind of like COVID.

Ellen Swan: Right. So is it constructive dismissal by imposing that requirement in the first place? It may be, in some cases, it may not be in other cases, depending like you said, on who you need to protect in that workplace. I mean, I don't know how we're ever going to get back to all the office towers downtown without some guarantee that it's safe to get into an elevator with a bunch of people because no ones ever going to be-

Jason Pereira: Well, that's an argument alone there, right? I mean, how many people going through an elevator per day.

Ellen Swan: Apparently there was a study done. I don't think I ever saw it, but colloquially or in the world or urban myth, I don't know, but that it would take six hours for everybody to get in the morning in one of the towers in Brookfields, and if that takes the six hours-

Jason Pereira: I have someone who was once at a downtown tower and even if one elevator was down fine, if two elevators were down, oh my God, you wait for an hour to get out of the building.

Ellen Swan: Right. And if it's only two or three people or maybe four and those larger elevators that can go at a time, "What are you booking your slot ahead of time?"

Jason Pereira: Yeah.

Ellen Swan: "What about lunch?"

Jason Pereira: Yeah. So you have lunch and then you have, I mean, beyond on that, right? I mean, at some point entire thing with all this is to get us back to a position where maybe we can actually stop wearing masks all the time.

Ellen Swan: Right.

Jason Pereira: So if that's the case that you not vaccinated, then now we're anyway... [inaudible 00:36:47] So bottom line is that the answer is maybe we can never give a definitive one, but-

Ellen Swan: Unfortunately.

Jason Pereira: ... intentional grounds. And it has to be weighed individually as always. Okay, fair enough.

Ellen Swan: I will say I have not got template that I rule out to various clients with respect to a vaccine policy, the same way I would, for example, with a workplace violence and workplace harassment policy, they're not going to all be the same and they have to be specifically created with the needs and issues of that work being considered.

Jason Pereira: Well necessary. I mean, the thing is... again, let's go with the same message with all the advice that we give here is that at the end of the day, all advice has to be customized to some degree, right? It may not be, I'm not talking fully with scope, but if it's a 5% Delta versus the average, then that 5% Delta could be incredibly meaningful, financially and operationally. So Ellen, this has been fantastic. Thank you for tackling all this. Where can people find you?

Ellen Swan: I work with Caravel law. So I'm on the internet. Ellen Swan. I think if you Google me there aren't that many.

Jason Pereira: There are not that many. Well, unlike me. Fair enough. So, yeah, we'll be sure to link down the show notes. So thank you so much for your time.

Ellen Swan: Thank you. Have a great day.

Jason Pereira: So that was my interview with Ellen Swan about all things related to HR best practices. I hope you enjoyed that. I hope you learned a little bit better how to protect yourself as an employer. With that, as always, if you enjoyed my podcast, please leave your review on Apple podcast, Stitcher, SoundCloud, Spotify, wherever it is you are podcasting, and until next time take care.

Producer: This podcast was brought to you by Woodgate financial, an award-winning financial planning firm, catering to high net worth individuals, business owners, and their families. To learn more, go to woodgate.com. You could subscribe to this podcast on Apple podcast, Stitcher, Google play, and Spotify, or find more episodes @jasonpereira.ca. You can even ask Siri, Alexa or Google home to subscribe for you.

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