Employees: International Joint Ventures

Originally published in Practical Law Company, 2010.

These questions have been answered using Ontario employment legislation, federal tax legislation (which applies across the country), and both Canadian federal and provincial corporate law references.

1. What level of statutory employment protection do employees receive in your jurisdiction? Are there provisions of "mandatory law" that apply to all workers in your jurisdiction, regardless of the choice of law in the employment contract and the identity, place of incorporation or location of the employing entity?

   Statutory employment protection. There are several provincial laws relating to employees and employment practices, including:

   Employment standards (in Ontario, the Employment Standards Act 2000 (ESA)). Workplace health and safety (in Ontario, the Occupational Health and Safety Act 1990). Human rights (in Ontario, the Human Rights Code 1990). Labour relations (in Ontario, the Labour Relations Act 1995). Pay equity (in Ontario, the Pay Equity Act 1990). Employment equity legislation is also applicable to employees in a federally regulated business.

   The ESA applies to an employment relationship if the employee's work is to be performed in Ontario, or if the employee's work is to be performed both inside and outside of Ontario but the work performed outside Ontario is a continuation of work performed in Ontario (section 3(1), ESA). This legislation does not apply to an employment relationship that is within the jurisdiction of the Parliament of Canada or other provinces. There are several other exceptions, including students participating in work experience programmes (section 3, ESA).

   Mandatory law. No employer (or agent of an employer) and no employee (or agent of an employee) can contract out of or waive a legislated minimum employment standard (section 5(1), ESA). Any waiver or contracting out of the ESA is void. However, if provisions in an employment contract or another statute provide a greater benefit to an employee than the legislated employment standard, then those provisions apply (section 5(2), ESA).

2. Please give details of the following in your jurisdiction (if applicable):

   Maximum working week. Minimum wage. Minimum holiday entitlement. Maximum working week. An employee cannot work more than eight hours a day unless the employer and employee agree to exceed this limit (section 17(1), ESA). The legislated maximum working week is 48 hours, but the employee and employer can also agree to exceed this limit (section 17(1), ESA). Such an agreement must specify the number of hours in the employee's regular work day, and the hours worked cannot exceed that agreed-upon limit (section 17(2), ESA). To vary the weekly limit the employer must receive approval from the Ontario Director of Employment Standards, and the employee's number of hours worked in a week cannot exceed the lesser of (section 17(3), ESA): the number of hours specified in the agreement; and the number of hours specified in the approval. Minimum wage. The prescribed minimum wage for most employees in Ontario is $10.25 an hour (section 5(1.3), Ontario Regulation 285/01) (as at 1 September 2010, C$1 was EUR0.74). There are some exceptions to this (for example, the minimum wage for some employees who are students under 18 years of age is C$9.60 an hour). Minimum holiday entitlement. Employees must receive at least two weeks' vacation time after completing each vacation entitlement year (each 12-month period of employment, starting the day an employee is hired, unless the employer has designated an alternate time period) (section 33(1), ESA). Employees who are entitled to vacation time must receive vacation pay equal to at least 4% of the wages that were earned during the period for which vacation is given. For example, an employee that earns C$16,000 gross wages in the vacation entitlement year is entitled to C$640 of vacation pay (section 35.2, ESA). 3. What statutory rights do workers have against dismissal in your jurisdiction?

   Employers cannot terminate the employment of an employee who has been continuously employed for three months or more, except on written notice of the termination in accordance with legislated requirements (section 54, ESA).

   The requirements for the amount of notice required on an individual employee's termination of employment are (section 57, ESA):

   Less than three months' employment: no notice required. Employment of three months or more, but less than one year: one week's notice required. Employment of one year or more, but less than three years: two weeks' notice required. Employment of three years or more, but less than four years: three weeks' notice required. Employment of four years or more, but less than five years: four weeks' notice required. Employment of five years or more, but less than six years: five weeks' notice required. Employment of six years or more, but less than seven years: six weeks' notice required. Employment of seven years or more, but less than eight years: seven weeks' notice required. Employment of eight years or more: eight weeks' notice required. There are additional notice requirements when a large employer dismisses groups of 50 or more employees within the same four-week period (section 58, ESA).

   Employees can be terminated without notice (or with less notice than is required by statute) if they are paid a sum equal to the amount they would have received if the appropriate notice had been given (section 61, ESA). In addition, employers must continue to make any benefit plan contributions to which employees would have been entitled if they had continued to be employed during the statutory notice period.

   The Ontario Human Rights Code states that "every person has a right to equal treatment with respect to employment...