Regardless of the size of the employer, even if they only employ a single person, Alberta employers should consider a regular review of their employment policies, practices and documents. Legislative amendments may have been made over the year that will impact the workplace. Courts may also have released decisions that change the common law, giving rise to the need for changes to an employer’s way of doing things in order to mitigate potential risks.
Below is a compilation of common issues that Alberta employers should consider and a summary of upcoming legislative changes.
Employment contracts
During the pandemic, many employers had no choice but to temporarily lay off employees due to a lack of work. However, employers generally do not have the inherent right to do so under common law. Therefore, without a provision in the employment agreement, an employee could refuse a temporary layoff and instead assert constructive dismissal and demand termination pay. While no one is crossing their fingers for another pandemic (or anything else that may lead to more temporary layoffs), employers should consider adding this provision, if it doesn’t already exist, to their employment agreement templates. Additional information about temporary layoffs can be found in our Temporary Layoff Toolkit here.
Employers should also conduct a regular review of the termination provisions in their employment agreements to ensure they are enforceable. Considering the power imbalance in an employer-employee relationship, adjudicators will typically interpret employment agreements in the employee’s favor. Therefore, without the right language in the termination provision, when an employer terminates an employee “without cause,” the employee may be able to claim significant damages for wrongful dismissal, up to 24 months (or more in rare circumstances) in common law notice, instead of being limited to the maximum 8 weeks provided for by the Employment Standards Code (Alberta). This issue is frequently before the courts, so it is important for employers to regularly review their termination clauses and revise them as needed to ensure they correspond to the latest applicable common law decisions.
Further, many employers are unaware that bonuses may also potentially be payable upon termination, even where the employer calls the bonus a discretionary bonus. Many companies award bonuses to their employees for retention purposes, so it is antithetical when these amounts must be paid to employees upon termination. The common law regarding this topic continues to evolve and thus, similar to termination provisions, employers should review the bonus provisions in their employment agreement, or separate bonus plan documents, to ensure the right language is in place.
Workplace policies
While Alberta employers are not required to have a detailed employee handbook, certain policies are required by legislation.
For instance, Alberta’s Occupational Health and Safety Code (Code), requires employers to develop and implement violence and harassment prevention plans that include prevention policies and prevention procedures. Depending on the number of employees, this must be done in consultation with the joint health and safety committee, health and safety representative, or affected workers. The Code enumerates several items that must be contained in these documents. It also provides that these plans need to be reviewed regularly, at least every three years or sooner if there is an incident, or if the joint health and safety committee or health and safety representative recommends a review. The Code also requires that the plans contain investigation and reporting procedures for incidents of harassment and violence.
Alberta’s Occupational Health and Safety Act (OHSA) requires that employers with 20 or more employees must establish a health and safety program. The OHSA does not set out what the program must contain, but defines “health and safety program” as “a co‑ordinated system of procedures, processes and other measures that is designed to be implemented by organizations in order to promote continuous improvement in occupational health and safety.” Elements that are mandatory for employers to have in place, such as hazard assessments and emergency response plans, are typically part of the health and safety program.
Depending on the nature of the workplace, employers may want to implement a telecommuting policy. During the pandemic, for health and safety reasons, many workplaces allowed some measure of telecommuting or hybrid work. For many workplaces, these initial concessions are becoming permanent. Telecommuting can introduce additional liability for an employer if not properly managed, such as security of the company’s confidential information, issues with performance management and managing workplace hazards. A properly drafted telecommuting policy may mitigate some of these concerns.
Employers may also want to consider reviewing, or implementing, policies related to the Alberta Human Rights Act. Respectful workplace policies will often address discrimination issues in addition to harassment and violence. There is technically no “cap” on human rights damages in Alberta and the Alberta Human Rights Tribunal is awarding increasingly higher awards.
Worker’s compensation
Pursuant to the Worker’s Compensation Act (WCA), registration for workers’ compensation is mandatory for most employers in Alberta. Employers that operate in an applicable industry are required to inform the Workers’ Compensation Board, the administrative body that adjudicates claims under the WCA, within 15 days. As the statutory employer-worker relationship extends beyond the common law definition, employers may also be liable for premiums for their contractors.
Changes in legislation
A small percentage of Alberta employers are federally regulated. As of December 1, 2022, federally regulated employees became entitled to 10 days of paid sick leave per year. Federally regulated employers should ensure their existing policies reflect this change.
Effective March 31, 2023, the Code will require additional obligations from the employer to ensure the health and safety of their employees. Amendments will be in place for various parts of the Code, including a requirement for employers to develop an emergency transportation plan, new standards for first aid kits and personal protective equipment, a reduced threshold for noise exposure and other changes associated with oil and gas wells, explosives, mining, overhead powerline and electrical utility workers, work in confined spaces and the control of hazardous energy. Some employers may need to make changes to their policies, procedures and safety equipment as a result of these amendments.
On June 23, 2023, significant amendments to Canada’s Competition Act, RSC 1985, c C-34, will come into force. Employers will be expressly prohibited from “wage-fixing” and “no-poaching” agreements between companies. Considering these amendments, employers may want to review any non-solicit or non-competition provisions in their employment agreements to ensure they are not in violation of these prohibitions. Additional information about these amendments can be found here and here.
Conclusion
Employers may often place the review of their employment agreements, policies and practices on the back burner in order to deal with more pressing day-to-day matters. However, what seems convenient at first can lead to substantial issues down the road. Given the significant changes that have occurred over the course of the pandemic, as well as recent and upcoming legislative amendments, employers should prioritize this task and ensure that they are aware of their obligations and the associated risks.
If you have any questions in the course of completing your review, or any other employment and labour questions, please reach out to Cristina Wendel and Jenny Wang or any member of our team.
