The common employer doctrine allows individuals who have been wrongfully dismissed to extend liability past the employer who technically employs them to the “true” employer who has effective control over the employee. The limits of the common employer doctrine have yet to be strictly defined by the courts, but recent decisions have begun to test the limits of the doctrine.
The common employer doctrine was established by the Ontario Court of Appeal’s decision in Downtown Eatery (1993) Ltd. v. Ontario,  O.J. No. 1879 (Ont. C.A.) (“Downtown Eatery”). In Downtown Eatery, the Court of Appeal articulated the common employer doctrine as follows:
“It seems clear that, for purposes of a wrongful dismissal claim, an individual may be held to be an employee of more than one corporation in a related group of corporations. One must find evidence of an intention to create an employer/employee relationship between the individual and the respective corporations within the group…the true employer must be ascertained on the basis of where effective control over the employee resides . . . . I stress again that an employment relationship is not simply a matter of form and technical corporate structure.”
In Hibbs v. Murphy, 2015 NSSC 48, the Supreme Court of Nova Scotia considered the common employer doctrine and concluded that a company cannot be considered a common employer where it did not carry on any business operation at the same time as the plaintiff’s employment with the defunct company whose corporate assets it purchased.
In a further test of the doctrine’s boundaries, the Ontario Superior Court of Justice inde Kever v. Nemato Corp., 2014 ONSC 6576, allowed the plaintiff to pursue a wrongful dismissal claim against the director of the employer company under the common employer doctrine. Leave for appeal was granted in this matter by the Ontario Superior Court of Justice (Divisional Court) on March 19, 2015. In granting the motion for leave to appeal, Justice Lederer stated that “if the decision is correct, it suggests that all operators and directors may be subject to such a lawsuit simply as a result of their position of control and without any allegations of action taken specific to the case at hand. This being so, the matter, in my opinion, is one of such importance that leave to appeal should be granted.”
The Divisional Court’s upcoming decision in de Kever v. Nemato Corp. should offer Ontario employment lawyers further guidance respecting the limits of the common employer doctrine. Stay tuned!
In the landmark February 2015 decision, Nissen v. Durham Regional Police, 2015 ONSC 1268 (Nissen), the Ontario Superior Court established a private law duty of care in an informer privilege matter. In its decision, the Court awarded $345,000 in general and $115,000 in loss of guidance, care, and companionship damages to plaintiffs Chad Nissen and Margaret Stackas a result of the Durham Regional Police force’s failure to preserve Ms. Stack’s anonymity.
In Nissen,the Court was asked to determine whether Ms. Stack, a confidential police informant, had a civil cause of action against the police if her informer privilege was breached.
In this case, the Durham Regional Police force’s duty to protect Ms. Stack’s identity from disclosure arose from Ms. Stack’s agreement to disclose a rum our she had heard regarding guns stolen by the teenage sons of her neighbors, the Ellisons, in exchange for the “absolute”promiseof a Durham Regional Police Officer that she would never be identified. Ms. Stack had not been told that her police interview was being videotaped. The lawyer of the accused teens subsequently obtained the videotaped interview with Ms. Stack from the Crown through disclosure and the tape was viewed by the Ellison family.
Mr. Ellison reacted very vindictively after viewing the videotape. His aggressive reaction escalated quickly from threatening comments to violently attempting to run Ms. Stack over with his truck.
The police were informed of the harassment by Mr. Nissen and Ms. Stack, but refused to take any action against Mr. Ellison. Ms. Stack testified that Mr. Ellison’s harassment became so unbearablethat she and her family were forced to move. During this time, Ms. Stack was also diagnosed with post-traumatic stress disorder.
The Court found that it is clear that informer privilege arises if information is provided to the police in exchange for a promise of confidentiality as was the case here. The resulting duty of care is to protect his or her identity from disclosure.
In Nissen, the Court concluded that Ms. Stack had a civil cause of action against the police for the breach of her informer privilege on the grounds that there is sufficient proximity between Ms. Stack and the Durham Regional Police to give rise to a duty of care. The Court also held that no residual policy considerations existed that should negate that duty of care.
The Ontario Superior Court’s decision in Nissen establishes that informer privilege can give rise to a private law duty of care.
The Federal Court of Appeal’s decision in Wilson v Atomic Energy, 2015 FCA 17 has added a new layer to the already exceptionally nuanced standard of review analysis where the decision under review is the subject of disagreement among administrative decision-makers.
In Wilson, the Federal Court of Appeal was required to decide the appropriate standard of review of the labor adjudicator’s interpretation of section 240 of the Canada Labor Code. The parties, in line with years of jurisprudence, agreed that the Federal Court correctly determined reasonableness to be the applicable standard. Interestingly, the Federal Court of Appeal found that since the standard of review is a question of law, it was not bound by the parties’ agreement.
Generally speaking, in determining the correct standard of review, the first considerations is whether existing jurisprudence has satisfactorily established the applicable standard of review.
The Federal Court of Appeal in Wilson avoided following existing jurisprudence by re-characterizing the nature of the question being reviewed. In doing so, it relied on the discord among labor adjudicators regarding dismissals without cause under the Code. The Court did not consider the issue one of a labor adjudicator interpreting a home statute, which the jurisprudence is clear is review able on a reasonableness standard; rather, the question became the applicable standard of review of a statutory interpretation question that has been the subject of “persistent discord” (see paragraph 52).
By re-characterizing the issue, the Federal Court of Appeal effectively carved out a new niche in the standard of review analysis. While an administrative decision maker is entitled to deference when interpreting a home statute, if that interpretation is the subject of disagreement at the administrative level, the courts will not necessarily exercise great deference.
With existing jurisprudence inapplicable in determining the applicable standard of review, the Federal Court of Appeal reasoned that, on the facts, both a principled approach and the presumptions set out by the Supreme Court in Dunsmuir v New Brunswick, 2008 SCC 9 result in the applicable standard of review being correctness.
Specifically,the Court found that the rule of law considerations which promote consistency in the application of the law outweigh any deference that would normally be accorded administrative decision makers under the constitutional principle of Parliamentary supremacy. In addition, according to Dunsmuir, which created the modern standard of review analysis, if the issue is a question of law of central importance to the legal system and outside the specialized expertise of the labor adjudicator, the applicable standard of review is presumed to be correctness. The Court characterizes the disagreement among labor adjudicators concerning whether an employer can dismiss an employee without cause under the Code as a question of central importance in that it impacts the administration of justice, such that it requires uniform and consistent answers.
The Wilson decision does not open any floodgates for court intervention in administrative decisions. In this case, the Federal Court of Appeal made clear that it is not simply because some labor adjudicators did not agree on the issue that intervention was justified; in the normal course, where there is dis accord among administrative decision-makers, the courts should give them time to work out their differences. According to the Federal Court of Appeal, only where, as in Wilson, decision-makers operate independently, not bound by the decisions of their peers, and time has not resolved the dis accord, is judicial intervention warranted to end the dis accord and determine the legal issue once and for all.
Though only time will tell as to how this decision will be used, it is clear that it is an important precedent for lawyers and parties alike seeking consistency in areas of the law that administrative decision makers are unable to provide.
On March 17, Andrew Pinto appeared on the TV news channel CP24 to provide commentary regarding a Jewish camp's desire to restrict its membership to Jewish children. The legal issue raised by the camp’s position is whether a summer camp with a substantial religious, cultural and ethnic heritage preservation component may lawfully restrict its membership to persons who are similarly identified.
Andrew Pinto, said that in this particular case, the law may side with the camp.
"There is a provision in the Ontario Human Rights Code which gives organizations that have a particular fraternal, religious or philanthropic or educational purpose the actual right to discriminate to maintain membership or restrict membership or participation to people who are similarly identified," he said.
"The challenge with some of these cases however is whether in fact, the organization’s purpose fulfills that mandate."
The Federal Court of Appeal recently released an important decision that clarifies the law relating to unjust dismissals under the Canada Labour Code (“Code”). In Wilson v Atomic Energy, 2015 FCA 17, the Court overturned a labour adjudicator’s decision that any dismissal without cause under the Code was an unjust dismissal.
Wilson was an employee of Atomic Energy for four and a half years prior to his dismissal without cause. He argued that pursuant the Canada Labour Code, any dismissal without cause was an unjust dismissal warranting a remedy under the Code. Atomic Energy argued that nothing in Part III of the Code precludes an employer from dismissing its employee without cause.
Prior to the Federal Court of Appeal’s decision in Wilson, there were two lines of cases coming from labour adjudicators:
At first instance, the labour adjudicator decided that the Code provides a comprehensive framework for the dismissal of federally regulated employees. As such, any dismissal without cause is unjust.
Atomic Energy sought a judicial review of the labour adjudicator’s decision to the Federal Court. The Federal Court granted the judicial review, and Wilson appealed. Both the Federal Court and the Federal Court of Appeal found that a dismissal without cause is not automatically unjust under Part III of the Code.
In rendering its decision, the Federal Court of Appeal relied on the principle that a legislator is presumed to not depart from the prevailing common law unless it does so with “irresistible clearness” (see Goodyear Tire & Rubber Co of Canada v T Eaton Co,  SCR 610 at page 614). In addition, the Court disagreed that any provision of the Code could be read as replacing the established common law that employers may dismiss their employees without cause, with reasonable notice and compensation. Moreover, the Court characterizes Part III of the Code as creating an alternative forum outside the courts where employees can seek remedies for unjust dismissal. The Court further noted that the remedial powers afforded to adjudicators under the Code are meant to supplement, not replace, existing common law remedies. In so finding, the Court dismissed a prevailing notion that the Code intended to provide non-unionized employees with the same protections as unionized employees. Furthermore, and of import for the impact of this decision on future allegations of wrongful dismissal, the Court noted that nothing in its decision precluded or inhibited adjudicators from examining the circumstances of a dismissal and ordering remedies where they saw fit.
The Federal Court of Appeal’s decision in Wilson gives much needed clarity to unjust dismissal adjudication under the Canada Labour Code. Going forward, this decision signals that federally regulated employees need to place more emphasis on establishing how their termination was unjust.