Employees on Long term sickness – when can an employer dismiss?

The Employment Appeal Tribunal (EAT) has recently confirmed that employers should take care when dismissing an employee who is entitled to participate in a permanent health insurance (PHI) scheme and is absent from work by reason of long term ill health. It held that there is an implied term that an employer will not dismiss an employee for incapacity if that would prevent the employee being entitled to long term disability benefits.

Where an employee is absent due to ill health then on termination of employment, the employer may face a claim for unfair dismissal and for disability discrimination.   Capability is a fair reason for dismissal, but the employer would have to show that it adopted a fair procedure in dismissing the employee, for example, by seeking medical advice and reviewing the likelihood of the employee returning to work.  A claim for disability discrimination can be defended by the employer if it can show that the dismissal was a proportionate means of achieving a legitimate aim and that the employer made all reasonable adjustments to ensure that the employee could return.  The situation becomes more complicated where the employer provides a PHI scheme.

In the case, the employee was employed as a security agent at Heathrow Airport by American Airlines. Under the terms of his contract of employment he was entitled to the benefit of an insured long term disability benefit plan.  The terms of the plan stated that the employee would be entitled to those benefits as long as he remained an employee and until he returned to work, death or retirement.    The employee went on long term sick leave and during that period the security department was outsourced and the employer’s obligations under the plan transferred to the new employer under the Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE).

The employee was dismissed by reason of lack of capability and he brought a claim for both unfair dismissal and disability discrimination. The Employment Tribunal held that the employer had dismissed the employee fairly and had acted reasonably.  It also held that the dismissal was a proportionate means of a achieving a legitimate aim and so there was no unlawful disability discrimination.

The employee appealed to the EAT and the appeal was upheld. It held that following a line of cases, a term should be implied into the contract that, once the employee has become entitled to payment of disability income under the long term disability plan,  the employer will not dismiss him on the grounds of continuing incapacity to work.  The term effectively limited the right of the employer to terminate on notice by preventing the exercise of that right in circumstances where it would frustrate the contractual entitlement to long term disability benefits.

As a result, the Employment Tribunal’s conclusions could not stand, and the EAT held that the matter should be remitted to a fresh tribunal to determine the fairness of the dismissal and whether it was a proportionate means of achieving a legitimate aim.

The case itself does not represent new law. In most cases it is the intention of the parties that the dismissal power will not be operated so as to remove accruing benefits under the income insurance scheme except cases of summary dismissal, redundancy, or a repudiatory breach by the employee.  For the most part employers will not be concerned by the individual remaining employed as the cost is covered by the insurance company.  However, in this case, the new provider,  following the TUPE transfer refused to cover the two individuals who were already on sick leave, of which the claimant was one.  Therefore, the employer would be responsible for covering the cost of the PHI.  Employers should therefore take care on a TUPE transfer to determine what cover can be sought  for employees on sick leave prior to the transfer.

Another issue for employers, who have employees on PHI schemes, is to remember that employees continue to accrue holiday during sick leave. Employers should therefore ensure effective absence management and include clauses limiting the carryover of the holiday for a certain period into the next holiday year.  For example, a clause should be included which states that any such carried over holiday accrued during a period of sickness absence which is not taken within eighteen months of the end of the relevant holiday year will be lost.  This means that when the employment is terminated, the employee will only be entitled to accrued holiday for a limited period of time.

Can an express term in the contract override the implied term regarding termination? It has generally been thought that an express termination clause allowing the employer the right to terminate for incapacity notwithstanding that the employee is on the PHI scheme would override the implied term.  However, the EAT in this case did cast some doubt explaining that such a clause would be inherently contradictory as either the claimant had a meaningful entitlement to disability benefits or the employer had an unfettered right to terminate his contract on notice even for incapacity.

As a result of the case it is clear that the contract should be drafted to ensure that the terms of the PHI in the contract are subject to the rules of the PHI scheme and the agreement of the insurance provider. It should also expressly state that the employer shall only be obliged to make payments to the employee if it has received payment from the insurance provider.  The employer should also retain the right to discontinue, vary or amend the scheme at any time on reasonable notice.   In addition, although the inclusion of an express clause allowing termination while absent on sick leave may be cast into doubt, it is worth including such a clause in case the employer may seek to rely on it.

Minority trade unions make good bedfellows

In UASA, Solidaity and NUM v Lonmin Platinum PLC and AMCU (HO1312-18), the CCMA was tasked with determining the question of whether three minority trade unions, acting jointly, could obtain organisational rights at Lonmin in order to challenge the influence of the majority union (AMCU).

Section 18 of the Labour Relations Act, 1995 (the LRA) allows an employer and a majority trade union to conclude a collective agreement establishing a representivity threshold which effectively excludes minority trade unions from gaining organisational rights at the employer’s workplace.  This is part of the principle of majoritarianism endorsed by the LRA.

Section 21(8C) however allows a minority trade union, or minority trade unions acting jointly, to obtain organisational rights (despite the fact that they do not meet the threshold) if they represent a “significant interest or substantial number” of employees in the workplace.

Typically such attempts to gain organisational rights have met with little success due to the institutional desire to avoid the proliferation of trade unions at a workplace.

In a novel development, three rival trade unions (UASA, Solidarity and NUM) joined forces to create a self-styled ‘Coalition’ in order to gain organisational rights in competition with AMCU. Lonmin and AMCU in turn both opposed the application.

In a well-reasoned award, the CCMA ruled that despite the protestations from Lonmin and AMCU that the granting of organisational rights to the Coalition would lead to a proliferation of trade unions and thus inter-union rivalry and possible violence, it was fair to grant organisational rights to the Coalition, essentially because it represented a substantial number of the employees at Lonmin and could not be proven to be a sham.

The Commissioner thus granted organisational rights to the Coalition, subject to certain safeguards so as to ensure that the unprecedented cooperation between the three minority trade unions was not simply a marriage of convenience. In summary, the Coalition will henceforth be obliged to exercise those organisational rights as a single entity.

Clients who are exposed to multi trade union workplaces will need to take heed of the possibility that rival trade unions may see the sense in increased cooperation.  This will no doubt render more complex, the collective bargaining environments at play.  Clients may also wish to revisit the recognition agreements that they have with the majority trade union in order to ensure that the principle of majoritarianism remains entrenched for practical purposes.

This article was written by Jason Whyte, Director, Norton Rose Fulbright South Africa Inc

Brexit – English Soccer and dispute over foreign players

Another interesting and unforeseen consequence of Brexit is the power struggle that has been triggered between the Premier League and the FA in relation to post Brexit quotas for “home grown” players and the visa requirements for overseas players.

The FA is seeking to use Brexit as an opportunity to boost the longer term health of the national team by reducing the number of overseas players in each squad. This is not proving popular with the Premier League which takes the view that a continued influx of high profile international players adds to the global appeal of the league.

Following the UK’s exit from the EU and the end of any relevant transition period, the freedom of movement of people within the EU will cease and the terms of movement of people within the EU is subject to change depending on the agreed terms of exit. The immigration requirements which would apply for “highly skilled” workers is yet to be determined but the government has indicated that preferential access to the UK for EU citizens and their families will cease after the transition period and so workers from the EU will be treated in the same way as those from other countries seeking the right to work in the UK. Would this apply to those seeking to play football in the UK?

Currently, the FA operates the visa system for non-European players together with the Home Office. Players are considered for work permits with a sliding scale of appearances required or clubs can seek an exemption by arguing the case for a work permit before a panel.  Clubs also have a maximum quota of overseas players of 17 in a 25 man squad.  The FA’s post Brexit proposal would be that the Premier League clubs would be allowed to sign whichever overseas players they want but they would be restricted to 13 overseas players (down from the current quota of 17).

The Premier League has rejected these proposals, arguing that there is no evidence that reducing the number of overseas players would in fact strengthen the national team. Instead the Premier League have argued that the global interest in the Premier League is increased by having overseas players playing in the UK.

This is a continuing battle between the FA and the Premier League and Brexit is simply bringing it to a head. In fact the FA have indicated that they will argue for the change in the quotas even if there were to be a second referendum.

Brexit will also make a difference to young players who don’t fall within the other visa requirements. Currently 16 and 17 year old players can be transferred between European countries, but after Brexit, clubs would only be allowed to sign players over the age of 18.

This dispute could have ramifications for current overseas players as clubs may be reluctant to agree long term contract extensions when the permitted quota for overseas players going forwards is so uncertain.

We look with interest to see how the discussions between the two sides, with different interests and priorities concludes

Bill 47 receives royal assent: Changes to the Employment Standards Act, 2000 and the Labour Relations Act, 1995

On November 21, 2018, Bill 47, the Making Ontario Open for Business Act, 2018, received royal assent. Bill 47 amends both the Employment Standards Act, 2000 (ESA) and the Labour Relations Act, 1995 (LRA). The full text of Bill 47 can be found here.

The changes to the ESA come into force on January 1, 2019. The changes to the LRA came into force on November 21, 2018.

A summary of the changes to each of these statutes is provided below.

Legislative history

Bill 47 repeals or amends many of the employer obligations introduced by the previous government under the Fair Workplaces, Better Jobs Act, 2017 (Bill 148).

Bill 47 was first introduced on October 23, 2018. We reported on the proposed changes to the ESA and LRA here and here. The Bill subsequently received a second reading and was referred to the Standing Committee on Finance and Economic Affairs. The Standing Committee made minor amendments to the Bill, which can be seen here. Bill 47 was then ordered for a third reading and received royal assent on November 21, 2018.

 

Summary of Changes – Employment Standards Act, 2000 – In force January 1, 2019

Subject Matter Current Entitlements under the Employment Standards Act, 2000 New Entitlements
(Bill 47, January 1, 2019)
Minimum Wage $14 minimum wage

$15 minimum wage on January 1, 2019

Minimum wage is frozen at $14 until October 1, 2020

Minimum wage will be subject to an annual inflation adjustment starting October 1, 2020

Scheduling Starting January 1, 2019, employees can request changes in their work schedule or location. Employers have to provide reasons for denial

Starting January 1, 2019, employees are entitled to three hours’ pay if their shift is cancelled within 48 hours before it begins

Starting January 1, 2019, employees will have a right to refuse a change in schedule or on-call shift if the request is made fewer than 96 hours before the shift was scheduled to start

Starting January 1, 2019, employees are entitled to three hours’ pay if they are on-call and not required to work, or if they work fewer than three hours

Employers must keep records of dates and times employees were scheduled to work or be on-call and any cancellations

All of the changes in respect of scheduling are repealed, except:

Employees who regularly work more than three hours a day and are required to present themselves for work, but who work fewer than three hours, will be entitled to a minimum of three hours’ pay

 

There is an exception to this three hour minimum if the shift is shortened because of events beyond the employer’s control (e.g. fire, power failure)

Personal Emergency Leave Ten days of leave due to personal illness, injury, or medical emergency for employees and/or certain family members

The first two days are paid

Employers are prohibited from requiring a doctor’s note to substantiate these absences

Personal emergency leave is repealed and is  replaced with sick leave, family responsibility leave, and bereavement leave, each of which apply separately from each other

Employees are entitled to three sick leave days, three family responsibility leave days and two bereavement leave days

Each new category of leave is unpaid

Eligibility for these leaves begins after two consecutive weeks of employment with the employer

These leave days are deemed to be taken as entire days, regardless of whether or not the employee is off work for the entire day

Evidence reasonable in the circumstances can be requested by an employer, including a doctor’s note

Sick leave: three unpaid days for personal illness, injury, or medical emergency

Family responsibility leave: three unpaid days for illness, injury, medical emergency, or urgent matters relating to a parent, grandparent, child, spouse, sibling, or dependent relative of the employee

Bereavement leave: two unpaid days for the death of a parent, grandparent, child, spouse, sibling or dependent relative

Leaves, Generally Two new categories of leave:

  • Domestic and sexual violence leave (up to 10 individual days and up to 15 weeks, with the first five days paid); and
  • Death of a child or crime-related disappearance leave (up to 104 weeks)

Increased entitlements for parental leave (61 weeks if the employee took a pregnancy leave and 63 weeks if the employee did not take a pregnancy leave); family medical leave (28 weeks in a 52 week period); critical illness care leave (37 weeks in a 52 week period for a child, 17 weeks in a 52 week period for an adult)

New leaves and increased entitlements remain the same, however, if an employee takes a paid or unpaid leave under an employment contract in circumstances for which he or she would also be entitled to take sick leave, family responsibility leave, or bereavement leave, then the employee is deemed to have taken the statutory leave
Employee Classification Employers face a reverse onus to prove that a worker is not an employee if an employee’s status is in question Repeals the reverse onus provision

Employers must still classify employees correctly

Public Holiday Pay and Vacation Time/Pay Public holiday pay is calculated as all regular wages earned by the employee in the pay period immediately preceding the public holiday, divided by the number of days the employee worked in that pay period

Three weeks’ vacation time/pay for employees with five or more years of service

Two weeks’ vacation time/pay for employees with less than five years’ service

Public holiday pay is calculated as the total amount of regular wages earned and vacation pay payable to the employee in the four work weeks before the work week in which the public holiday occurred, divided by 20

The entitlements to vacation time and pay remain the same

Equal Pay for Equal Work Equal pay for equal work, on the basis of sex, for those who perform substantially the same (but not necessarily identical) jobs for the same employer

Equal pay for equal work on the basis of employment status (part-time, full-time, seasonal, casual) and for temporary help agency employees

Equal pay for equal work, on the basis of sex, is maintained for those who perform substantially the same (but not necessarily identical) jobs for the same employer

Equal pay on the basis of employment status and for temporary help agency employees is repealed

Penalties for Contravention $350/$700/$1500 for first/second/third administrative contravention Penalties are reduced to $250/$500/$1000 for first/second/third administrative contravention
Wage Review Employees can request a review of their wages and the employer must respond with a pay adjustment or a written explanation for why the request is denied Repealed
Scope of the Act The ESA currently exempts an individual who performs work in a simulated job or working environment if the primary purpose in placing the individual in the job or environment is his or her rehabilitation Repeals this exemption. Those who perform work in a simulated job or working environment (for the primary purpose of his or her rehabilitation) are covered by the ESA

Note: this change comes into force on a day to be named by proclamation of the Lieutenant Governor

 

Summary of Changes – Labour Relations Act, 1995 – In force November 21, 2018

Subject Matter Current Entitlements under the Labour Relations Act, 1995 New Entitlements
(Bill 47, in force November 21, 2018)
Union Certification Card-based certification for home care and community services industries, building services industry, and temporary help agency industry Card-based certification in each of these industries is repealed – regular certification rules apply
Remedial Certification Where an employer’s contravention of the LRA results in (a) the true wishes of employees in the bargaining unit not being reflected in the representation vote, or (b) the union being unable to obtain membership cards from at least 40% of the proposed bargaining unit, the OLRB must certify the unit This power is repealed. The original pre-conditions for the OLRB to certify a union as a remedy for employer misconduct are reinstated: remedial certification is only available if no other remedy would be sufficient to counter the effects of the employer’s contravention

 

First Collective Agreement Mediation In addition to arbitration, first collective agreement mediation is available. Where mediation is unsuccessful, mediation-arbitration is available First collective agreement mediation and mediation-arbitration are repealed

First collective agreement arbitration in accordance with the pre-Bill 148 legislation is restored

Employee Lists On application, where a union can establish at least 20% support of the employees involved, it will be granted access to a list of employees and certain contact information Trade unions can no longer obtain a list of employees or their contact information from an employer

A trade union must destroy any employee contact list obtained under the previous version of the LRA

Educational Support Parties can request educational support in the practice of labour relations and collective bargaining Repealed
Review of Bargaining Unit Structure An employer or union can apply to the OLRB to review the structure of a bargaining unit after certification (but prior to entering into a collective agreement) Repealed
Strike or Lock-out Timelines Where there is no collective agreement in force, no strike or lock-out is permitted until seven days after the conciliation report has been released, or 14 days after the release of a notice that the Minister will not appoint a conciliation board The timelines are lengthened: no strike or lock-out is permitted until nine days after the release of the conciliation report, or 16 days after the release of a notice not to appoint a conciliation board
Reinstatement of Employees after Strike No time limit on the employer’s obligation to reinstate an employee at the end of a legal strike or lockout The pre-Bill 148 legislation is restored: an employer must reinstate an employee where an application is made within six months following the commencement of a lawful strike
Notices and Communication Notices and communications have to be by mail For any proceeding under the LRA, any notice or communication may be sent by mail, courier, fax, or email
Penalties and Fines The maximum penalties for a conviction for an offence are $5,000 for individuals and $100,000 for organizations The penalties are decreased to $2,000 for individuals and $25,000 for organizations, which restores the pre-Bill 148 amounts

Do managers typically think of personal liability when making decisions to dismiss? They perhaps should

Directors and senior managers and their employers should consider the recent Court of Appeal decision in the Osipov whistleblowing case very carefully. Briefly, by way of scene-setting, Osipov had made a series of protected disclosures and he was ultimately dismissed as CEO of the employer company pursuant to a decision of two non-executive directors (NEDS) of the company. He brought a  whistleblowing claim (for approx. £1.7m) against the company.  He also added the two NEDS as respondents on the basis that they had subjected him to a detriment for (amongst other allegations) their part in the decision to dismiss him.

A worker has the right not to be subjected to detriment on the ground that they have made a protected disclosure (e.g. a disclosure of some wrongdoing). This protection applies to detriments caused by the employer as well as a detriment by the worker’s colleagues or an agent of the employer. Since 2013, in the case of detriment by a colleague, it will be treated as also having been done by the employer (vicarious liability).

A worker who is also an employee will have a claim for automatically unfair dismissal (no cap on compensation) if they are dismissed by the employer for the sole or principal reason that they have made a protected disclosure.

An employee cannot bring a claim for detriment where “the detriment in question amounts to dismissal” (within the meaning of the unfair dismissal provisions of the relevant statute).  The employee would need to bring a claim for unfair dismissal instead. However, a worker who is not an employee (and so who is not eligible to claim unfair dismissal) can bring a detriment claim in respect of termination of the engagement.

The question posed in Osipov was whether, although the only claim for Osipov against the employer arising out of the dismissal would be unfair dismissal, the claims against the NEDs could include a detriment claim where the detriment was the dismissal itself?  The answer was yes, it could. This made the NEDS jointly and severally liable with the employer for the full amount of the £1.7m.

Naming individuals as respondents to claims is common in discrimination cases and has been for quite some time. There is a psychological and practical advantage to the claimant in doing this. The individual respondent is made to feel uncomfortable by the personal nature of the accusation and, in some cases, financially vulnerable too.  Naming an individual respondent also offers a practical advantage to the claimant if the employer is subject to solvency issues. Adding individuals in whistleblowing cases will I think increase as a result of cases such as Osipov.

In the majority of cases the employer will indemnify the individual employee or officer (the NEDS had the benefit of D&O insurance in Osipov) for any liabilities in relation to such a claim (which would otherwise be joint and several). However, there may be instances where the culpability of an individual becomes more apparent as the evidence develops through an investigation or trial and the employer’s appetite for indemnifying the individual may change. I doubt whether such a potential liability is in the contemplation of many senior managers when they take decisions to dismiss.

Osipov also highlights why employers should think through carefully who is involved in decisions to dismiss. Each person who has a part to play in the dismissal is likely to be called as a witness and may also be named as an individual respondent. It might be, for example, that a “c-suite” director who only had a cursory input to a decision to dismiss, would nevertheless have to give evidence in determining what the “sole or principal reason” for the dismissal was. Most employers would want to avoid their senior executives having to give evidence in such cases and therefore they should give some thought to how such decisions might be contained. If a decision to dismiss is escalated – as good governance might dictate in some circumstances – it should only be done in the full  knowledge of this possible outcome. For their part managers involved in decisions to dismiss might want to think about their potential personal liability.

Another reason why this decision is significant is that a detriment claim (not available to an employee against the employer when a dismissal has occurred and the claim is about the dismissal itself) may be more attractive to a claimant because of the lower burden of proof. For whistleblowing dismissal claims it must be shown that the sole or principal reason for the dismissal is the protected disclosure, whereas for a detriment claim it need only be established that the protected disclosure was a materially influential cause of the detriment.

 

“Daddy day-care” some highlights on paternity leave

In November 2015 the Labour Laws Amendment Bill (the Bill) was tabled to parliament.  The Bill was adopted with the intention of amongst others, regulating (and extending) paternity leave.  As of 22 August 2018, the Bill has been passed by the National Assembly and the National Council of Provinces. All that remains is authorisation and signature by the President.

What is the current leave entitlement?

As it stands, adoptive parents and commissioning parents are not included in the definition of parents in terms of the family responsibility leave provisions of  section 27 of the Basic Conditions of Employment Act, 1997 (BCEA).  Biological fathers are entitled to three consecutive days’ leave at the birth of their child.   Biological mothers are entitled to four months maternity leave which can be paid or unpaid leave as per the employer’s discretion.

What will the Bill change?

In essence, once signed into law, the Bill will amend family responsibility leave in two ways:

  • First it will increase the family responsibility leave entitlement from three days to 10 consecutive days. Fathers and/or parents who are non-primary caregivers will therefore be entitled to 10 consecutive days of parental leave.
  • Secondly, it extends the definition of parental leave to include adoptive parents and commissioning parents in a surrogate motherhood agreement. Parents who adopt a child below the age of two will be entitled to 10 weeks of consecutive leave (or 10 days leave if they are non-primary caregivers) from the date the adoption is granted or upon the pronouncement by a court.  Commissioning parents are also entitled to 10 weeks consecutive leave.

Some take-home points

It is important to note that the Bill does not seek to legislate paid parental or paternity leave.  Therefore, it still remains unpaid leave unless otherwise agreed to by the employee and the employer.  As it stands employees may be able to claim from the Unemployment Insurance Fund.

The amendments have been drafted to provide more beneficial minimum terms and conditions of employment for working parents, whether biological, adoptive or commissioning.  The amendments also offer equal treatment to same-sex and LGBTQI families.

A number of employers, in anticipation of the amendments, have adopted more liberal parental leave policies.  It may only be a matter of time before this Bill becomes law.  In order for employers to be considered employers of choice within their respective industries, employers across South Africa would do well to reconsider their leave policies.

This article was written by Nomazizi Dlamini, Candidate Attorney, Norton Rose Fulbright South Africa Inc

Taking the lot: Account of profits for breach of fiduciary duty

A party affected by a breach of fiduciary duty may elect to claim equitable compensation, or to pursue an account of the profit or benefit derived by the party committing the breach and any party who knowingly assisted the breach.

Pursuing an account of profits is often more attractive because it spares the innocent party from having to prove the loss it has suffered from the breach. Such loss may be difficult to prove – for example, clients who have been snatched away by an employee in breach of his/her fiduciary obligations are unlikely to agree to give evidence about the affair.

Moreover, the value of the provable loss may be modest and compare unfavourably with the legal costs involved in obtaining the relief. The results of an account of profits can be much more substantial.

This is illustrated by a recent decision of the High Court of Australia (Ancient Order of Foresters in Victoria Friendly Society Ltd v Lifeplan Australia Friendly Society Ltd [2018] HCA 43) in which it was held that an account of profits can include the total net capital value of a business that was established by reason of the breach, including future net profits.

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Family Responsibility Leave – Bereavement rights

South African labour law does not have any specific legislation solely dealing with compassionate leave in the event of bereavement. However, the Basic Conditions of Employment Act, 1997 (BCEA) provides for what is termed family responsibility leave.

The BCEA was introduced specifically to give effect to the right to fair labour practices by establishing and enforcing basic conditions of employment and also regulating the variation of the basic conditions of employment.

Section 27 of the BCEA provides that an employee who has been in employment with his/her employer for a period longer than four months and who works for at least four days a week for that employer must be granted three days paid family responsibility leave during each annual leave cycle. An annual leave cycle means the period of 12 months employment with the same employer immediately following an employee’s commencement of employment or the completion of that employee’s prior leave cycle.

An employee is entitled to take the family responsibility leave when the employee’s child is born, when the employee’s child is sick, in the event of the death of the employee’s spouse, life partner, parent, adoptive parent, grandparent, child, adopted child, grandchild or sibling.

Section 27(7) allows for collective agreements entered into between employers and employees (usually represented by a trade union) to vary the number of days and the circumstances under which family responsibility leave is to be granted.

The BCEA requires an employer to pay an employee the wage the employee would ordinarily receive. An employer may require an employee to provide it with proof of the event that required the family responsibility leave.  This requirement should be incorporated in the contract of employment, alternatively into a policy dealing with family responsibility leave.

At present, the legislature is planning to amend the BCEA and in particular section 27 sealing with family responsibility leave to increase an employee’s entitlement from three days to 10 days leave. The amendment bill has not yet been signed by the President and as such, the status quo of three days’ entitlement remains.

This article was written by Phathutshedzo Rambau, Candidate Attorney, Norton Rose Fulbright South Africa Inc

Can an employee be compelled to give evidence in a coronial inquiry where the employer is facing a WHS proceeding?

A coronial inquiry being conducted at the same time as a criminal proceeding may constitute interference with the due administration of criminal justice amounting to contempt of court.

A recent Federal Court decision[1] has considered whether the examination of an employee witness at an inquest will constitute ‘interference’ for the purposes of the criminal proceeding against the employer.

The inquest, which commenced in September 2017, was concerned with the death of Captain David Wood (Captain Wood) in Antarctica on 11 January 2016.  The inquest raised questions about the responsibility of Captain Wood’s employer, Helicopter Resources Pty Ltd (Helicopter), and the responsibility of the Commonwealth.  Subsequent to the commencement of the inquest, Helicopter was charged with three summary offences under Work Health and Safety Act 2011 in relation to 3 separate incidents.  One of those alleged contraventions related directly to the circumstances giving rise to Captain Wood’s death.

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Bill 47: Making Ontario Open for Business Act, 2018 – Employment Standards Act, 2000 Considerations

Overview

On October 23, 2018, the Ontario Government announced its much anticipated legislation in relation to employment and labour law matters. The legislation, dubbed the Making Ontario Open for Business Act, 2018 (Bill 47), will remove or modify many of the obligations placed on Ontario employers by way of the Fair Workplaces, Better Jobs Act, 2017 (Bill 148). Please see the summary below for an overview of the changes to the Employment Standards Act, 2000 and the table thereunder for a more thorough review. For the Ontario Ministry of Labour’s Backgrounder on the issues, please click here. For the full text of Bill 47, please click here. For an overview of changes to the Ontario Labour Relations Act, click here:

Summary of Changes – Employment Standards Act, 2000

Minimum Wage

  • The minimum wage will be frozen at $14.00 until October 1, 2020.
  • The minimum wage will be subject to an annual inflation adjustment starting on October 1, 2020.

Scheduling

  • Employees will no longer be able to submit a request to the employer requesting changes to the employee’s schedule or work location.

Leave Provisions Generally

  • Family medical leave, family caregiver leave, critical illness leave, child death leave, crime-related child disappearance leave, and domestic or sexual violence leave will no longer be in addition to any of the aforementioned entitlements of leave.
  • If an employee takes a paid or unpaid leave of absence under an employment contract in circumstances for which they will be entitled to take sick leave, family responsibility leave, or bereavement leave, the employee will be deemed to have taken the leave under that section.

Personal Emergency Leave to be Replaced by Sick Leave, Family Responsibility Leave, and Bereavement Leave

  • Personal emergency leave will be repealed and replaced with unpaid sick leave, family responsibility leave, and bereavement leave, each of which will apply separately from, and in addition to each other.
  • In order to be eligible for sick leave, family responsibility leave, and bereavement leave, employees must have worked for two consecutive weeks.
  • Under these new categories of leave, the employer will be able to require evidence reasonable in the circumstances, which may include a doctor’s note.
  • Additionally, leave days will be deemed to be taken as full days.

Sick Leave

  • Bill 47 will establish three days unpaid leave per year for personal illness, injury or medical emergency.

Family Responsibility Leave

  • Bill 47 will establish three days unpaid leave per year for illness, injury, medical emergency or urgent matters of a parent, grandparent, child, spouse, sibling or dependent relative.

Bereavement Leave

  • Bill 47 will establish two days unpaid leave per year for the death of a parent, grandparent, child, spouse, sibling or dependent relative.

Public Holiday Pay

  • Bill 47 proposes that public holiday pay will be calculated by the pre-Bill 148 formula of regular wages earned and vacation pay payable to the employee in the four weeks before the work week the holiday lands in, divided by 20.

Employee Misclassification

  • The reverse onus requiring the employer to prove that an individual is not an employee where there is a dispute over whether the individual is an employee will be repealed. However, the employer obligation to properly classify employees will remain.

Equal Pay for Equal Work

  • The definition of “difference in employment status” will be been repealed, thereby no longer requiring equal pay for equal work on the basis of number of hours regularly worked (i.e. part-time or full-time) or differences in the term of employment (i.e. permanent, casual, temporary, seasonal).
  • Bill 47 will repeal the right of employees to have their rate of pay reviewed by employers. Additionally, employers will no longer be required to provide a written response with reasons if an employee does request a review of their rate of pay.

Penalties for Contravention

  • The government will be returning to the previous administrative penalties for contraventions of the ESA by decreasing the maximum penalties for first, second, and third contraventions from $350/$700/$1500 to $250/$500/$1000, respectively.On October 23, 2018, the Ontario Government introduced Bill 47, Making Ontario Open for Business Act, 2018, which was created to repeal many of the employment and labour reforms that were introduced by the previous Ontario Government as part of Bill 148, Fair Workplaces, Better Job Act, 2017.

Table of Changes

Subject Matter Current Entitlement under the Employment Standards Act New Entitlement (Bill 47, once enacted)
Minimum Wage $14 minimum wage

$15 minimum wage on January 1, 2019

Minimum wage frozen at $14 until October 1, 2020

Minimum wage will be subject to an annual inflation adjustment starting October 1, 2020

Scheduling Starting January 1, 2019, employees can request changes in work schedule or location. Employers will  have to provide reasons for denial.

Starting January 1, 2019, employees are entitled to three hours’ pay if their shift is cancelled within 48 hours before it begins

Starting January 1, 2019, employees will have a right to refuse a change in schedule or on call shift if the request is made fewer than 96 hours before the shift was scheduled to start

Starting January 1, 2019, employees are entitled to three hours’ pay if they are on call and not required to work, or if they work fewer than three hours

Employers must keep records of dates and times the employee was scheduled to work or be on call and any cancellations

Nearly all of the changes in respect of scheduling have been repealed

Employees who regularly work more than three hours a day, and are required to present themselves for work, but who work fewer than three hours, will be entitled to a minimum of three hours’ pay

An exception to the three hour minimum still exists for fire, storm, power failure, lightning, and other similar events beyond the employers control

Personal Emergency Leave Ten days of leave due to personal illness, injury, or medical emergency for employees and/or certain family members

The first two days are paid

Employers may not require a doctor’s note to substantiate these absences

Personal emergency leave has been repealed and is being replaced with sick leave, family responsibility leave, and bereavement leave, each of which apply separately from each other

Employees are entitled to three sick leave days, three family responsibility leave days and two bereavement leave days

Each new category of leave is unpaid

Eligibility for these leaves begins after two consecutive weeks of employment with the employer

These leave days are deemed to be taken as entire days, regardless of whether or not the employee is off work for the entire day

Evidence reasonable in the circumstances can be requested by an employer, including a doctor’s note

Sick leave: three unpaid days for personal illness, injury, or medical emergency

Family responsibility leave: three unpaid days for illness, injury, medical emergency, or urgent matters relating to a parent, grandparent, child, spouse, sibling, or dependent relative of the employee

Bereavement leave: two unpaid days for the death of a parent, grandparent, child, spouse, sibling or dependent relative.

Leaves, Generally Two new categories of leave:

o    Domestic and sexual violence leave (up to 10 individual days and up to 15 weeks, with the first five days paid); and

o    Death of a child or crime-related disappearance leave (up to 104 weeks)

Increased entitlements for Parental leave (61 weeks if the employee took a pregnancy leave and 63 weeks if the employee did not take a pregnancy leave); family medical leave (28 weeks in a 52 week period); critical illness care leave (37 weeks in a 52 week period for a child, 17 weeks in a 52 week period for an adult)

New leaves and increased entitlements remain the same, however, if an employee takes a paid or unpaid leave under an employment contract in circumstances for which they would also be entitled to take sick leave, family responsibility leave, or bereavement leave, then the employee is deemed to have taken the statutory leave.
Employee Classification Employers face a reverse onus to prove that a worker is not an employee if the employees status is in question Repeals the reverse onus provision

Employers must still classify employees correctly

Public Holiday Pay and Vacation Time/Pay Calculated as all regular wages earned by the employee in the four work weeks before the work week in which the holiday occurs, plus all vacation pay payable during those four weeks, divided by 20

Three weeks’ vacation time/pay for employees with give or more years of service.

Two weeks’ pay for employees with less than five years’ service

Law remains the same
Equal Pay for Equal Work Equal pay for equal work, on the basis of sex, for those who perform substantially the same (but not necessarily identical) jobs for the same employer

Equal pay for equal work on the basis of number of hours worked (part-time, full-time, seasonal, casual) and employment status (temporary)

Will maintain equal pay for equal work, on the basis of sex, for those who perform substantially the same (but not necessarily identical) jobs for the same employer

Will repeal equal pay on the basis of hours worked and employment status

Penalties for Contravention $350/$700/$1500 for first/second/third administrative contravention Reduced to $250/$500/$1000 for first/second/third administrative contravention
Wage Review Employees can request a review of their wages and the employer must respond with a pay adjustment or written explanation for why they won’t adjust their rate of pay This obligation has been repealed
Scope of Act ESA currently exempts an individual who performs work in a simulated job or working environment if the primary purpose in placing the individual in the job or environment is his or her rehabilitation Repeals this exemption. Those who perform work in a simulated job or working environment (for the primary purpose is his or her rehabilitation) will be covered by the ESA
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