McCague Borlack LLPLitigation Boutique, GLOBAL Litigation Law Firm

 

 

 

Articles and Publications

September 2016

Employee & Employer Obligations

Part 2 of 6

Sabrina Lucibello
Sabrina Lucibello,
Partner

Aryeh Samuel
Marla Rosenblatt-Worth,
Associate

By Sabrina Lucibello and Marla Rosenblatt-Worth
First presented at a Client Employment Seminar

(I) EMPLOYEE COMMON LAW IMPLIED OBLIGATIONS

Whether or not expressly mentioned in the employment contract, all employees have the following fundamental obligations.1

Duty of obedience, attendance, and competence

  • Obey the employer's reasonable orders falling within the terms of the employment;
  • Attend work on time; and
  • Perform the work contracted for competently.

Duty of good faith and fidelity

  • Maintain confidentiality of the employer's trade secrets and other information;
  • Act honestly and faithfully, putting the employer's interests first and avoiding any conflicts of interest; and
  • Not take any secret profits or commissions from the relationship.

Duty to provide notice of resignation

  • Provide reasonable notice of the termination of the employment relationship

NOTE: Determining the "reasonableness" of notice is fact specific. Consideration is given to the following factors: employee's responsibilities; length of service; salary; and, the time it would take to find a suitable replacement.

(II) EMPLOYEE CONTRACTUAL OBLIGATIONS TO RESTRICT COMPETITION

Employment contracts often contain a provision that restricts an employee from competing with the employer after the relationship ends. Such a covenant is valid and enforceable only if it is "reasonable between the parties and with reference to the public interest."2 In this context, the public interest is to discourage restraints on trade, and the rights for parties to contract freely.

When determining the reasonableness of a restrictive covenant, the courts consider the following:

  1. Does the employer have a proprietary interest entitled to protection?

    • A business with little or no goodwill or few trade secrets is unlikely to succeed in enforcing a non-competition clause.

  2. Are the temporal or spatial features of the clause too broad?

    • Temporal features include the duration during which the employee cannot compete.
    • Spatial features include the geographic scope in which the employee cannot compete.

  3. Is the covenant unenforceable as against competition generally and not limited to proscribing solicitation of the former employer's clients?

    • There is a distinction between covenants that restrict competition in a general sense, and those that restrict the solicitation of clients.
    • The courts prefer to enforce a non-solicitation clause over a broad non-competition clause.

(III) EMPLOYER COMMON LAW IMPLIED OBLIGATIONS

Whether or not expressly mentioned in the contract, all employers have the following obligations:3

Duty to provide work and pay for work done:

  • Provide employees with work, and pay for the work completed; and
  • Not lay-off or suspend an employee without pay (unless the contract stipulates otherwise).

Duty to provide a safe work environment:

  • Use all reasonable precautions to safeguard employees from workplace dangers, whether from the work environment, machinery, or tools;
  • Provide proper and safe systems of work; and
  • Select properly skilled managers to instruct and supervise employees

Duty to provide notice of termination:

  • Provide indefinite-term employees with notice of termination, unless there is just cause; and
  • Provide a reasonable period of notice.

(IV) EMPLOYER STATUTORY OBLIGATIONS

Employment Standards Legislation

The Employment Standards Act (the "ESA") sets out the minimal employment standards for most unionized and non-unionized employees. The following minimum standards are set by the ESA:

  • Payment of wages and overtime
  • Hours of work and eating periods
  • Minimum wage
  • Public holidays
  • Vacation with pay
  • Equal pay for equal work
  • Leaves of absence
  • Termination and severance of employment

The obligations set out in the ESA do not apply to employees that fall under federal jurisdiction. This includes those employed in the following sectors: banks, international trucking, and radio and television.

The courts have characterized employment standards statutes as benefits-conferring legislation. This means that the ESA must be interpreted in a "broad and generous manner" such that "any doubt arising from difficulties of language should be resolved in favour of the claimant."4

Human Rights Legislation

The Human Rights Code expressly prohibits employee-related discrimination and harassment. For more information, see the "Human Rights" handout.

Health and Safety Legislation

The Occupational Health and Safety Act (the "OHSA") addresses the prevention of injury and disease in the workplace. The OHSA imposes a reciprocal duty on employers and employees. Specifically, employers have a duty to provide a safe workplace, and the employees have a duty to take reasonable care in the workplace to protect the health and safety of themselves and other employees.

Go to Part 3 - Termination / Dismissal


1 The Law Society of Upper Canada: Solicitor Exam Bar Materials (2016), at 314-316.
2 Elsley v J.G. Collins Ins. Agencies, [1978] 2 S.C.R. 916 (S.C.C.).
3 Supra note 1.
4 Rizzo & Rizzo Shoes Ltd., [1998] 1 S.C.R. 27 (S.C.C.).


TORONTO | OTTAWA | KITCHENER | BARRIE

416.860.0001 | mccagueborlack.com | Follow us on Twitter twitter

McCague Borlack LLP is a member of the Canadian Litigation Counsel, a nationwide affiliation of independent law firms. Through CLC's association with The Harmonie Group, our clients have access to legal excellence throughout North America, the U.K. and Europe.

clcnow.com | harmonie.org