Canada Labour Code Release

Written on behalf of Peter McSherry
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The Remedy

The Canada Labour Code applies to employees working in companies which are governed by federal, as opposed to provincial, law. This includes industries such as public broadcasting, railroads, trucking companies which cross provincial borders, banks, federal government employees and public harbours, to name the most evident.

This law gives the right of arbitration to a dismissal decision based on cause allegations[1] to every federally regulated employee who is not a “manager” with a minimum of one year of service.

The remedy can lead to a claim for lost income to the date of the hearing and also reinstatement and, in certain situations, to an award of aggravated damages for injured feelings where the termination was based on seriously unfair conduct.

The Release Issue

Many decisions have held that it is illegal for the employer to require the employee to sign a release waiving their rights under the Canada Labour Code as a term of a settlement offered at the time of termination.[2]

This issue was revisited recently by the Federal Court[3]. In this case, the employee was presented with and accepted a severance offer. She signed a release by which she gave up all rights to file an “unjust dismissal” complaint under the Canada Labour Code.

After she signed the release document and was paid the settlement sum, she proceeded to do what the release document forbade.

She succeeded in court on her right to pursue her remedy.

The Right Way

It is possible for an employer to settle such a case but it requires that the employee file the complaint and then proceed to mediation settlement with the Department of Labour, which is indeed a cumbersome procedure.

Employees’ Take Away

As has been stated many times before, the words on the contract may not be determinative of your rights. This remedy, in particular, may be quite powerful. It may well be foolish to believe that your rights are as straightforward as first appears on the written document.

Get Advice and Know Your Rights

Get advice. Know your rights. Contact the offices of Guelph employment lawyer Peter McSherry. We can guide you through the issues, help you understand your rights, and defend your position. Contact us online or by phone at 519-821-5465 to schedule a consultation

[1] It may also apply to a “not for cause” case as well in certain situations.

[2] Such as National Bank v Minister of Labour Federal Court of Appeal

[3] Bank of Montreal v Li