To wrap up 2023, we have highlighted the key developments in Canadian labour and employment law, with a focus on Ontario.

1. Ontario’s Working for Workers Acts

In 2023, the Ontario government continued building on previous legislation by passing Bill 79, Working for Workers Act, 2023, and introducing Bill 149, Working for Workers Four Act, 2023. These two bills are the latest in a series of legislative changes expanding employee rights which started with Bill 27 and Bill 88, passed in 2021 and 2022, respectively.

Bill 79, Working for Workers Act, 2023, received royal assent on October 26, 2023. Some of its key changes include:

• The inclusion of remote employees in the head count for mass termination thresholds under the Employment Standards Act, 2000 (“ESA“);

• An increase from $1.5 million to $2 million in the maximum fine that may be imposed on a corporation under Ontario’s Occupational Health and Safety Act; and

• An expansion of eligibility criteria for reservist leave to include employees in treatment, recovery or rehabilitation for an illness or injury resulting from participation in certain reservist operations or activities.

Please consult our previous blog post for more detailed information on this Bill.

If passed, Bill 149, Working for Workers Four Act, 2023, which carried second reading on November 23, 2023 and was referred to a standing committee on social policy, would also introduce significant changes to a number of Ontario employment-related statutes. Among them, the Bill would require employers to disclose pay information in job postings (i.e., expected compensation or a range of expected compensation), and whether they use artificial intelligence in the hiring process. Additionally, and in an effort to eliminate discriminatory requirements towards immigrants, employers would also be prohibited from requiring Canadian experience. For more information on these changes, please read our previous blog post on the topic. 

2. Legislative Push for Pay Transparency in Canada

The past year has also seen a growing pay transparency trend, both in Canada and abroad, intended to help bridge the pay gap for historically-disadvantaged groups. Among the latest developments in this area, British Columbia passed the Pay Transparency Act, creating new obligations for employers to disclose certain pay information in publicly-advertised job postings, and to prepare annual pay transparency reports if they qualify as a “reporting employer” under the legislation. This new law also prohibits reprisal against employees for discussing or inquiring about their pay or for asking the employer to comply with its statutory pay transparency obligations.

Other provinces, including Newfoundland and Labrador, and Prince Edward Island have passed similar legislation. We covered this pay transparency trend in greater detail in two blog posts, accessible here and here. Ontario is also expected to amend the ESA to require the disclosure of certain pay information in job postings as part of Bill 179, as discussed above.  

3. New Tort of Harassment

Alberta recently became the first Canadian province to recognize the tort of harassment. The development is significant because it departs from Ontario and British Columbia, which have declined to recognize the tort.

In Alberta Health Services v Johnston, 2023 ABKB 209, the Alberta Court of King’s Bench recognized the tort of harassment because the harm in question could not be adequately addressed by any existing torts.  In this case, Alberta Health Services (“AHS”) and two of its senior employees sued Mr. Johnston for defamation, invasion of privacy, assault and harassment. Mr. Johnston, an online talk show host and mayoral candidate, used his talk show to frequently criticize the AHS’ response to the COVID-19 pandemic. He referred to the AHS as Nazis and suggested that they should be subject to violent attacks. He targeted one AHS employee, Ms. Nunn, by sharing photos from her social media accounts, attacking her family and alleging she was an alcoholic.

The Court awarded Ms. Nunn, among other things, $100,000 in general damages for harassment.

In recognizing the tort, Justice Feasby canvassed existing case law across the country and found that no existing torts squarely addressed the harms caused by the harassment in question. Justice Feasby determined the tort of harassment exists where a defendant has:

1. Engaged in repeated communications, threats, insults, stalking, or other harassing behaviour in person or through other means;
2. That he/she knew or ought to have known was unwelcome;
3. Which impugn the dignity of the plaintiff, would cause a reasonable person to fear for his/her safety or the safety of his/her loved ones, or could foreseeably cause emotional distress; and
4. Caused harm.

Besides the tort of harassment, other legal avenues that victims of harassment-related claims may pursue include human rights claims, occupational health and safety claims, a complaint with the police and, in Nova Scotia, an application for a cyber-protection order.

Employers should be aware of the legal remedies that may be available to victims of bullying and harassment, including the newly recognized tort of harassment in Alberta. More information can be found on our blog post here.

4. Change in the Test for Family Status Discrimination in British Columbia

The British Columbia Court of Appeal recently upheld a decision by British Columbia’s Human Rights Tribunal that a change in employment terms is not a necessary precondition for a finding of prima facie discrimination based on family status. Previously, in order to establish discrimination based on family status, an employee needed to show that there was a change by the employer to a term or condition of employment, and that the change resulted in a serious interference with a substantial parental or other family duty or obligation. This was set out in Health Sciences Association of BC v Campbell River and North Island Transition Society, 2004 BCCA 260.

In British Columbia (Human Rights Tribunal) v Gibraltar Mines Ltd, 2023 BCCA 168, the Court of Appeal found that the Campbell River test is not meant to be exhaustive, meaning that a change to a term or condition of employment is not the only factor to be considered when determining whether prima facie family status discrimination has occurred. This finding is in line with the statutory interpretation of BC’s Human Rights Code, which does not suggest any limitations on a finding of prima facie family status discrimination. Furthermore, to accept a narrow reading of the Campbell River test would be contrary to the long-standing idea that human rights legislation must be given a broad and liberal interpretation.

A full breakdown of this case can be found in our blog post here.

5. Amendments to Ontario’s Mining Regulation

On July 1, 2023, Ontario implemented a number of amendments to Reg. 854: Mines and Mining Plants under Ontario’s Occupational Health and Safety Act, with additional amendments taking effect September 1, 2023. The amendments require employers in Ontario’s mining industry to update their occupational health safety policies and procedures to strengthen protections for Ontario’s miners. In particular, employers must add, amend and/or clarify requirements related to ventilation, independently powered conveyances, equipment related to mine hoists, the security and storage of explosives, ladderways on surfaces, eye wash facilities and emergency showers, and the use of electronic devices to conduct examinations in areas where drilling and blasting is taking place.

We have summarized the specific health and safety requirements that are relevant for employers in the mining industry here.

6. Changes in Licensing Requirements and Other Rules for Temporary Help Agencies in Ontario

On July 1, 2023, the ESA was amended to require temporary help agencies (“THAs“) and recruiters to obtain a license to operate in Ontario as of January 1, 2024. The Ontario government has also published Reg. 99/23: Licensing – Temporary Help Agencies and Recruiters as of May 23, 2023 and amended Reg. 288/01: Termination and Severance of Employment and Reg. 289/01: Penalties and Reciprocal Enforcement as of July 1, 2023 which provide guidance on the new licensing regime and related requirements.

Key changes include:

• Licensing Requirements and Transparency: THAs and recruiters will need a license to operate in Ontario. Under Reg. 99/23, businesses and prospective employees in Ontario will be able to check an online government database before working with a THA or recruiter to ensure they have met the province’s licensing requirements. A business will violate the ESA if they knowingly engage or use an unlicensed agency or recruiter.

• Record-Keeping Obligations: Recruiters will need to retain records of prospective employees and employers who engage their services for three years after the recruiter ceases to provide services to that individual or business. Records must be retained and readily available for inspection as required by an employment standards officer, to ensure accurate remuneration for employees.

• Penalties: If a THA or recruiter provides false or misleading information in their license application, they can face a fine in the range of $15,000-$50,000. Employment standards officers may issue penalties to THAs and recruiters if they operate without a license, and to those who knowingly use an unlicensed THA or recruiter. If businesses hire unlicensed recruiters, they will be responsible for compensating workers for any illegal fees charged to them.

Businesses and those working with THAs and recruiters must ensure they are aware of and comply with these new licensing requirements. More information can be found on our blog post here.

7. Canadian Government Issues New Rules for Federal Employees Using AI

The federal government has issued new guidelines for public service employees who use generative AI tools like ChatGPT on the job. The goal of these rules is to ensure that federal employees use artificial intelligence technology responsibly and to address instances where using AI may constitute malpractice and result in cybersecurity threats, misinformation, or may produce discriminatory outcomes.

The guidelines refer to the federal government’s Directive on Automated Decision-Making, which defines Generative AI as technology that “would ordinarily require biological brainpower to accomplish, such as making sense of spoken language, learning behaviours, or solving problems”. These tools produce content to support tasks including writing, coding, brainstorming, translation, research and providing support to clients.

The federal government has also included a set of best practices to inform employees’ use of AI in the workplace, including addressing issues related to the protection of information, bias, inaccurate content, employee autonomy and legal risks concerning human rights, privacy, intellectual property and procedural fairness. It is expected that more employers will follow the government’s example and issue specific directives to their employees to ensure the responsible use of AI in their work.

8. Supply Chain Transparency Legislation in Canada

On May 3, 2023, Canada passed its first supply chain transparency law: Fighting Against Forced Labour and Child Labour in Supply Chains Act, the “Act”, introduced through Bill S-211. The Act came into force on January 1, 2024 and imposes greater transparency obligations upon businesses to disclose measures taken to reduce the risk of forced labour and child labour within their supply chains.

The Act also amends the Customs Tariff to include “child labour” within the prohibition of importing goods that are mined, manufactured or produced wholly or in part by forced labour.

• Qualifying Businesses: The Bill imposes reporting requirements upon private-sector entities that i) produce, sell or distribute goods to Canada; ii) import into Canada goods produced outside of Canada; or iii) directly or indirectly control an entity that is engaged in these activities. Qualifying business entities must either be listed on a Canadian stock exchange or be a privately held entity that meets certain defined criteria, but may also include non-resident importers that are “doing business in Canada”.

• New Reporting Obligations: Qualifying businesses must file annual reports on or before May 31 annually outlining the policies and procedures implemented in the prior fiscal year to prevent and/or reduce the risk that forced or child labour are used to manufacture goods at any step in the business’ supply chain. The first reports are due by May 31, 2024. The Minister of Public Safety and Emergency Preparedness (the “Minister”) will maintain a public registry of all reports received. 

• Enforcement: The Act is a penal legislation granting the Minister broad power to delegate investigative measures to persons appointed by the Minister and to enforce remedial measures to ensure compliance. Failure to comply with the Bill could result in on-site searches, an order, and potentially a summary conviction with a fine of up to $250,000.  On-site searches may involve searching premises, including residential properties.

More details regarding the new reporting requirements under the Fighting Against Forced Labour and Child Labour in Supply Chains Act and the impacts upon the consumer goods and retail industry can be found on our blog post here.

9. Legislative Changes in Quebec

Continued Implementation of OHS Rules: The Act to modernize the occupational health and safety regime (Bill 59) implements numerous amendments to occupational health and safety laws in Quebec, including remote work recognition, new hazard identifications and new protection plans. The Bill received royal assent on October 6, 2021 but its changes will be implemented over a three year period. Employers should continue to make changes towards compliance in 2024.

Notable changes include:

• Businesses with more than 20 employees must maintain records of the analysis of risks that may affect workers’ health and safety, must set up health and safety committees and designate at least one health and safety representative in the workforce.
• Employers must keep positions (or equivalent positions) available for workers who suffer an employment injury.
• Employers have an obligation to take measures to protect workers who are exposed to physical and psychological violence in the physical and remote workplace, including protection from spousal, family and sexual violence.

Please see our full blog outlining Quebec’s changes to the OHS rules here.

The Use of French Language in the Workplace: Quebec passed An Act respecting French, the official and common language of Quebec (Bill 96) in June of 2022 which strengthened Quebec’s French language laws. Employers had until June 1, 2023 to ensure that employment documentation, job postings and official written communication with employees be conducted in French.

Other French-language requirements that employers must have implemented by June 1, 2023 include:

• Employers must provide official written communication and certain employment documentation in French, including offers of employment, written individual employment contracts that are contracts of adhesion, transfer or promotion documents and communications to all of part of the team or staff.
• Employers may communicate with a worker in a different language only where the worker makes such a request.
• Job postings, training materials or documents relating to conditions of employment that are available in English must also be made available in French in a comparable manner.

Employers who are non-compliant with Bill 96 face penal fines of up to $30,000 for a first offence.

Some employers with English-language employment documents have started to use AI to assist with the translation of the required documents into French. Translating legal documents can save time and cost but should always be reviewed by counsel to ensure consistency with legal requirements in both languages.

Quebec language officials have begun levying fines against businesses that are non-compliant with Bill 96 and are expected to continue to do so in 2024. For a full summary of what employers with Quebec-based employees need to know to ensure compliance with Bill 96, please see our previous blog post here.

10. The Changed Substratum Rule in Celestini v Shoplogix Inc., 2023 ONCA 131

The Ontario Court of Appeal recently upheld a motion judge’s award of over $400,000 to an employee on the basis of the changed substratum doctrine.

The changed substratum doctrine recognizes that the employment relationship evolves over time such that sometimes it may be inappropriate to apply the provisions of an outdated employment contract to a job that has changed significantly. The doctrine applies in situations where the employee’s duties have fundamentally expanded to a point where the underlying employment contract has substantially eroded, or it can be implied that the employment contract could not have been intended to apply to the employee’s latest role.

In this case, Mr. Celestini became Shoplogix Inc.’s Chief Technological Officer through a finance arrangement with a venture fund. As part of the deal, he would step down as Shoplogix’s CEO and serve as its CTO under a written employment contract, which he signed in 2005. The employment contract limited Mr. Celestini’s entitlements upon termination of employment.

There was an expansion of Mr. Celestini’s workload and responsibilities that coincided with the execution of the ICA and a change in leadership. In 2017, Shoplogix terminated Mr. Celestini without cause. Shoplogix took the position that Mr. Celestini’s rights were governed by the 2005 employment contract. But Mr. Celestini argued it was unenforceable because of the substantial changes to his position, and he was therefore entitled to reasonable notice at common law. He claimed he was entitled to common law damages for wrongful dismissal on the basis that Shoplogix breached the implied term to provide reasonable notice of termination.

The Court of Appeal ultimately agreed that the changed substratum doctrine applied to Mr. Celestini’s situation. Notably, the Court of Appeal mentioned that the application of the substratum rule could have been prevented had the employment contract contained language stating that the employment contract’s provisions would continue to apply despite any changes to the employee’s position, responsibilities, salary or benefits, or if the parties ratified the 2005 employment contract and explicitly agreed that it would continue to apply to the new role.

While the substratum doctrine itself is not new, the case provides an important reminder with helpful commentary on how to avoid the pitfalls of the doctrine. More details regarding this case can be found on our blog post here.