Good afternoon Professor Doorey,
I am an accounting student at york and I read your blog a couple of times a week; I find it extremely interesting, and useful for finding relevant topics to debate with other students and friends. Recently we were discussing the ESA, and the rights prescribed under it, when someone asked ” Why not get rid of common law notice and increase the minimum standard under the ESA ? ” If its not to much trouble could you please discuss on your blog.
Hi Stuart, the question you raise is a subject of ongoing debate. It would be easy to do what you suggest. All we need do is amend the ESA to include language saying that the notice of termination section in the ESA is a deemed term of every employment contract unless the parties agree in writing to a higher amount of notice, and to be clear, that the deemed term replaces any common law implied right to notice of termination.
Should we do that?
Since the common law notice requirement is mostly for the benefit of employees who have the means, knowledge, and courage to hire lawyers and sue their ex-employer, there is an argument that few would miss it if it was supplanted by a new, elevated statutory notice and that overall, employees would benefit from that change. Employers would benefit too, at least in terms of certainty and less civil litigation. In practice, common law “reasonable notice” is mostly a tool for privileged workers–high level managers and executives–while most workers have only the ESA to protect them, if that.
As I have noted before on this blog (here and here ), some employers ignore the “reasonable notice” requirement in any event and just pay ESA notice or slightly above. Plus, an employer can always avoid “reasonable notice” by simply including a term in the employment contract that says only statutory notice is required, so it is already a tenuous right for employees. By abolishing “reasonable notice”, we would cut down on the use of courts for employment matters, freeing up judges to deal with the real important matters–like bankruptcies, divorces, shareholder actions, and slip-and-fall cases.
These are all reasons to justify the argument you make.
On the other hand, there are arguments against your proposal. One is that the common law model takes into account a greater number of factors beyond length of service, and that can make for a more flexible, fair, and responsive approach overall.
Another is that the common law model sometimes scores victories for employees. In recent years, common law judges have occasionally held employers to account for their mistreatment of employees. This takes the form of increased damages award, such as through the Wallace, now Honda process for punishing employers for “bad faith in the manner of dismissal”, or the new “ancillary damages” approach just applied in the Cuba v. Global Egg Corp case. Judges have also been developing the concept of an “implied duty of decent and civil treatment of employees” by employers, to give another example.
These interpretations of employment contracts can be useful to employees overall, and can signal to employers the need to treat employees with respect and fairness. These rules tend to emerge from lawsuits brought primarily to recover common law reasonable notice damages. So if we move away from “wrongful dismissal” cases and towards a purely statutory model, employees may lose out on progressive developments that are occasionally crafted by judges.
Another problem with moving to a purely statutory model is that the rules of notice would then be subject to political whims and trends. An NDP government might increase the amounts, only to see a Conservative government cut them right down to almost nothing. Who knows, perhaps we could drawn into a debate about whether we should be moving towards the American “at will” model, under which employees can be dismissed at any time, for any (or no) reason, without any notice. In labour law, we have heard the argument many times before that our workplace laws need to move down to the American standards in order to compete.
True, the amounts in the current Ontario ESA have been fixed for some time, through governments formed by all three political parties. But the existing amounts are so low that hardly anyone pays any attention. If we start jacking up the periods of notice, then it could become a political hot button issue, like we have seen with the union certification process in recent years. At least the Bardal v. Globe and Mail factors courts use in deciding how much notice is reasonable have been in place for decades, even if their application is uncertain from case to case. Once we abolish the common law model, the statutory model may become more prone to the prevailing political winds.
These are just a couple of thoughts off the top of my head. There are others. So I open up the question to the community.
Should we abolish the common law “reasonable notice” rules and rely exclusively on statutory minimum notice periods?