Krista: I think we'll get started. We'll start with just introductions. So that people showing up late won't miss the substantive material. So I want to do a quick introduction of who are speakers are today. My name is Krista Schofer. I'm a partner in Gowlings and I practice in employment, privacy and immigration law and lead the Western Canadian Immigration practice. So we do immigration coming into Canada, of all nationalities, and I'm also a US attorney so we do immigration into the US, of all nationalities. I do a lot of work in the tech sector and for companies that are starting, or scaling up their operations, in Canada. We also have two other lawyers here today, speaking. The first one is Kristen Cruise. She is an associate in the Employment, Labour and Equalities group in Gowlings Vancouver office. She has experience working with a broad range of clients, including many tech companies, given the growing industry in Vancouver. She has experience assisting with everything from general HR advice, drafting employment agreements, incentive plans and employment policies, employment related litigation and employment advice with respect to mergers and acquisitions. We also have Cheryl Cotton here today. She's one of our new associates in the Employment, Labour and Equalities group out of our Vancouver office, again. She has experience drafting employment agreements and policies, assisting with terminations, human rights matters, implications of remote work, privacy considerations and general Employment Standards compliance. So if we move to the next slide, please.
So today we are going to speak about legal tips for your tech scale up, focusing on employment and immigration law. So here's an outline of the presentation. There will be a Q&A period at the end so feel free to enter your questions, throughout the presentation, in the Q&A function at the bottom of your screen. We will do our best to answer them at the end, if there's time for a question period, and we may also try to answer them throughout the presentation. I will now hand it over to Kristen to speak about the importance of employment agreements.
Kristen: Thank you, Krista. Okay, so first and foremost, it is so important to have employees sign a well drafted employment agreement. I've worked with a number of junior companies in the process of scaling up and often the growth is so fast that this important step is often missed. A written employment agreement will clearly delineate terms of employment to protect the rights and set out the obligations of both the employee and the employer. Not only during the employment relationship but after the employment ends as well. So as a bit of background, in Canada you may know each Province has some form of Employment Standards legislation that addresses an employee's minimum entitlements. Even if there's no written agreement in place there are certain minimums that must be granted to employees. For instance, employees in BC are entitled to at least 2 weeks of vacation time and 4% vacation pay, even if their written agreement doesn't set that out. However, there are a lot of things that Employment Standards legislation doesn't address, or that don't apply in the way that you might expect. So a good example of this, and one of the most important things that your employment agreements can address, is an employee's entitlement to notice following termination of employment. So a lot of people think that under Employment Standards the amount of notice that an employee is entitled to receive, if they're terminated without cause, is what's set out in the Employment Standards Act that's applicable in each Province. For instance in BC, and this is fairly consistent across the Provinces although they vary a little bit, but in BC this is approximately 1 week per year of service, up to a maximum of 8 weeks. So really not very much, however, Canadian Courts have come up with this separate concept called common law reasonable notice of termination. While this is a really rough rule of thumb, and the courts have told us not to use it as a rule of thumb but we still do just to establish the point, common law reasonable notice often amounts to something close to about 1 month per year of service, which varies depending on a whole range of factors. But it can go up as high as 24 months for very senior, long tenure employees, and in rare circumstances courts have actually even awarded slightly more than this. So it's significantly more than what's set out in the Employment Standards legislation and this comes to a big surprise to a lot of employers. You can imagine, especially where you have a well paid employee with a long tenure, this could mean a significant payout following a termination without cause, which that's what most terminations are. It's really hard to establish just cause in Canada.
However, if you have a properly drafted employment agreement in place, this can actually limit an employee's entitlement to notice. So you can't limit it to nothing but you can go as low as the minimum amounts set out in the Employment Standards legislation, although we do recommend going a little bit higher just to avoid court scrutiny of the agreement, but you have the ability to place some limits on it. Unfortunately these provisions are really hard to draft so you definitely need to reach out to an employment lawyer if you want to have a termination provision that will be enforceable. Without it, if you go to terminate someone without cause, you are likely going to be owing them a fair amount in common law reasonable notice, plus the legal bills wrack up pretty quick when you're negotiating back and forth with their counsel about how much that common law reasonable notice actually is, because there is no fine line. So the agreement provides certainty as well.
Another example of something that needs to be addressed in an employment agreement, and this came up a lot especially during the beginning of COVID, is the concept of a temporary layoff. So in Provinces like BC, and some of the other Provinces as well, while the Employment Standards legislation mentions the concept of temporary layoff there are significant limits on when it can actually be used without technically terminating an employee's employment. In other words, employers typically aren't just allowed to temporarily layoff their employees as of right, and if they do it without falling into one of the exceptions or having it set out in an employment agreement, then they're terminating the employee and then all of sudden they're entitled to all of that notice that we were just talking about. So again, having that in your employment agreement in writing can give you that ability as the employer to be able to institute temporary layoffs when you need to. When something crazy like COVID happens or when the company's going through a difficult transition period. There's a myriad of other items that could be addressed in an employment agreement. Things like bonuses and commissions. Particularly important is what happens to any entitlements following termination. Restrictive covenants like non-solicitation and non-competition provisions, which I'll discuss in a bit more depth later in the presentation. Things like confidentiality and IP protections, which are very important in the tech industry, and of course much, much more that we won't go into every single detail you can add in there because that would be a long presentation.
However, as important as it is to have an agreement in place, it is equally as important to ensure that you're following the proper procedure for obtaining an employee signature on an agreement, otherwise the whole agreement will be unenforceable despite all that work and the cost to pay in order to have it drafted for you. For a new employee you must provide them with the agreement and a reasonable period to review it and seek legal or financial advice. Usually we recommend allowing about 7 days and then the employee must sign the agreement before their first day of work. Otherwise that contract could be unenforceable. This is an issue I've seen often with companies who are doing significant hiring because everything is happening so fast, so many people are being hired and the employer wants them to start right away. They need the help but this extremely important step is missed. Agreements are being signed on or even after the employee start date, if they remember to be signed at all, and often I have to break it to the client down the road when they're looking now to terminate that employee without cause, because the company's contracting for one reason, or they're going through a transaction, or whatever the case may be, I have to break it to them that that termination provision is likely unenforceable because the employee didn't sign it before they started work. That employee's entitled to a large sum of termination notice under common law, not whatever the entitlement was that was set out under the agreement. So because of this situation, once employers find out that many of their employment agreements are unenforceable due to improper signing issues or they just don't even have one in place, they want to know what they can do about getting an existing employee to sign an agreement. In that case an employer must provide the existing employee with what we call fresh consideration in exchange for their signing of that agreement, otherwise the agreement will be unenforceable. Fresh consideration can be something like a signing bonus, that's the most common thing, or it can be something like an increase in pay if you want to do it that way. Basically it just has to be something more than what the employee was otherwise entitled to receive, that they are getting in exchange for signing that agreement. So as a really quick note, something else I see often with companies that are scaling up and are in need of a lot of man power quickly, is that they often engage independent contractors to get this work done. However, often is the case of the roles taken on by these contractors would actually be deemed to be employment. There a variety of tests out there that set out when someone will be an employee and when someone will be a contractor, and we don't have time to go through all of that here, but know that it is a common issue and that this type of misclassification can lead to a lot of legal problems for both the individual and the company. So I would highly recommend speaking with employment counsel before entering into an agreement with an independent contractor, and although it's not determinative, ultimately the court will look at the entire relationship and what's actually being done. Having a properly drafted agreement in place with the contractor can assist if that arrangement is ever challenged by a court or tribunal. So I'm turning it over to Krista now to talk about some more immigration related issues.
Krista: Great, thanks, Kristen. So we're seeing a lot of movement right now with employees working in multiple jurisdictions and/or working remotely. We're seeing this movement across Provincial borders within Canada and then also across international borders. From an employment perspective, the question is which jurisdiction's legislation governs? This is relevant and very important as an employer, as many pieces of legislation govern the employment relationship, including Employment Standards, Occupational Health and Safety, Human Rights, Privacy, Workers' Compensation. Different Provinces have different rules around when the legislation governs and then what the requirements are. So an assessment of the governing jurisdiction is important. You need to consider what the employment agreements state as the governing law but, also probably more importantly, where the employee is physically present and where the work is carried out. This gets even more complicated if employees are working remotely outside of Canada as both employment laws and immigration laws need to be considered in the place of employment and there will very likely be tax implications, for both the company and the individual, so that adds kind of more complications to the relationship.
From an immigration perspective, I have two main considerations to mention with respect to remote work. First, where an employee wants to work outside of Canada, it's critical to consider the country where they want to work from. Each country has its own immigration laws, and some countries are more relaxed with respect to working remotely from that country, where the employer is outside of the country. However, many countries are not and for example, Canada and the US are not relaxed about this. So for both Canada and the US there are compliance risks, to both the company and the employee when working remotely, even when it's for an employer that is outside the country and even where you're not getting paid by an employer within the country. The main reason for this is that immigration laws just have not caught up to the reality of the current workplace. So when you're working in a country, even when your employer's outside of that country, it can be considered work where you need a work permit. Second, for an individual that requires a work permit to work in Canada, so a foreign national here. So that's someone that is not a Canadian citizen or a permanent resident in Canada. You need to make sure, as the employer, that that employee's work permit allows them to work remotely. Most work permits are closed, in that the work permit is both employer specific and location specific. So it's not as easy as just permitting remote work at a different location than what was approved and represented on that initial work permit application. It could be that an entirely new work permit is required before remote work is permissible. So as an employer you don't want to have compliance issues down the road, so it's best to look at the specific work permit and the specific representations made when that work permit was applied for, to confirm that those terms and conditions can be changed.
So we're going to move onto the next slide. On the next two slides I have outlined some options for bringing foreign workers to Canada. A lot of my clients needs to bring in their most senior and very specialized workers to Canada as part of scaling up their operations. Generally Canada has great programs for bringing in foreign workers, especially in the tax sector. This is definitely the case in BC and we also have some new great programs in Alberta. So this first slide here discusses options that are available nationally across the country. So these are some Federal programs. So very generally, the temporary immigration programs for Canada are split into two broad categories. The first one is a temporary foreign worker program. This a test of the labour market to show that there's no Canadians or PRs that could do the position. So this is called a LMIA and the second mainstream, or main category, is international mobility program. These are the different work permit options where an LMIA is not required. So starting with the temporary foreign worker program, so that's the LMIA process. I wanted to mention, and I've listed it here, the Global Talent Stream LMIA process. It is a great program. It's for employers who are seeking highly skilled workers with unique and specialized talent where the position is listed on, it's called the Global Talent Occupations List, and the positions included on that list include computer and information systems managers, computer engineers, software engineers and designers, computer programmers and maybe the developers. I just wanted to mention this one because often people are hesitant to use the LMIA process but this is a specific LMIA program that is very facilitative and very quick. Specifically I see decisions within about 10 to 15 days after submission and the program is meant to help new, or companies that are scaling up, bring in their specialized workers.
The second category I've listed here are free trade agreements. So this is an LMIA exempt category. So this is where you don't need to show that there's no Canadian to do the role. So Canada has free trade agreements with many countries. The one that often comes to mind is former NAFTA. So that's the free trade agreement between Canada, the US and Mexico. It's now called USMCA or CUSMA. Some other examples of countries we have free trade agreements that have immigration provisions within them include Chile, Peru, Colombia, South Korea, the UK, the EU, Japan, Australia and Singapore. There are free trade agreements, if they have immigration provisions, it's often a great option to use for professionals and technicians and there's often also investor based options under those free trade agreements.
The next category here is inter-company transfers. So this is a category for those employees that have worked for at least 1 year in the last 3 years for an affiliated entity abroad, in a managerial or specialized knowledge role, and you want to transfer them to Canada in a comparable role. I've listed here short term options under a Global Skills Strategy. I wanted to mention this one because you may have someone that needs to come in for a shorter period of time. This program specifically is 15 consecutive days or 30 consecutive calendar days. This may just be a good option so that you don't actually have to apply for a work permit but they can still work here for that short duration. Lastly, on this slide, I wanted to mention express entry. This is Canada's Federal points based PR program. Invitations have been hold since last September, largely due to COVID, but invitations for PR are set to start in July. It is a great option as the processing time is around that 6 month mark to get PR for Canada, which is extremely quick. So maybe something to consider for some of your employees that are here temporarily but want to stay permanently.
On this slide I've listed one BC specific broad program. Each Province has its own Provincially based PR programs. I wanted to mention BC's Provincial Nominee Program because in my opinion BCPNP is the best provincial PR program in the country, especially for tech based roles. It has quick processing times and it allows for applicants to apply for a temporary work permit to bridge that processing time for the PR application. BCPNP has a PR stream tied to express entry which means the entire application is quick, as well as there's a tech pilot program which allows professionals to obtain their BCPNP nomination in a fast-tracked fashion and it is a very great program. I will leave it at that and I will pass it back to Kristen to speak about employee retention.
Kristen: Thanks, Krista. Okay so we're going to move onto discussing things that can be done to increase employee retention from a legal perspective. So I'll discuss close employment restrictions and retention bonuses and afterwards Cheryl will join to talk about some other ways keeping employees happy so that they want to stay. First, if we have a carrot and a stick, the stick would be the post-employment restrictions. Specifically here we'll talk briefly about non-solicitation and non-competition clauses. Non-solicitation clauses can be drafted to prevent former employees from soliciting the company's customers, other employees, or contractors or things like suppliers. In contrast, non-competition clauses prevent former employees from working for a competitor, or in a competitive capacity in some degree, or starting a competing business themselves. So as a general rule, post-employment restrictions are hard to enforce and must meet strict enforceability tests, in terms of scope and reach, duration and the drafting clarity, in order to be enforceable. So you want to ensure that they are as clear as possible and that they restrictions are as narrow as is absolutely necessary to protect the company and their legitimate proprietary interests, otherwise a court will generally find that the entire clause is unenforceable. In other words the court won't go in and fix your drafting to make it more narrow or to make it more clear. They'll just say it's just unenforceable. So it's much easier to enforce a non-solicitation clause than it is to enforce a non-competition clause.
On the next slide is an example of a non-solicitation clause. If anyone's not familiar with what these clauses look like, I figured I would just include just a very general one in here. We could do a full presentation on going through all the requirements for drafting these but obviously I'll just address a few details here. First you'll notice the time period restriction. It's about 3 to 12 months is generally where we recommend. It's ideally to be tailored to the specific situation for certain businesses, for certain employees. 3 months will be the most reasonable restriction. While up to 12 months will be reasonable in other scenarios. You can go longer than 12 months in certain circumstances. We've seen those provisions upheld by courts, but it's just broader and it's more likely to render the clause unenforceable, so we generally don't recommend doing that unless it's absolutely appropriate in the situation. There's a reason why that amount over the 12 months is appropriate. You'll also notice that we limit the definition of customer and client, for instance, to only those that the employee had direct contact with while they were working for the company. It can be narrowed even further where we could say, only in the 12 months leading up to the end of their termination. This is just to make it abundantly clear to the employee who it is that they are restricted from soliciting. So if you leave this open to you cannot solicit any customer or client of the company, but there's no reason why the employee should be limited to that degree to an extent if they never dealt with a lot of those customers, for instance. Also, it might be impossible for the employee to actually know who was a customer or client of the company. For instance, in a very large company where there are various different sectors. So that employee will not know at the time they sign an agreement, or they leave their employment, who the customer is they're being restricted from soliciting might be. So again, just something to think about when you're considering these types of clauses.
So the next slide is would talk about non-competition clauses. As I noted earlier, these are really difficult and I might even go to say almost impossible to enforce. In fact, Ontario recently passed the Working for Workers Act, which voids contractual non-competition obligations for Ontario based employees. There are a couple of minor exceptions for C-level executives and for sellers when they're selling their company. So in those cases they're not void but those are pretty narrow. We're still awaiting for a lot of information on getting that flushed out but for now those are the basics. We don't have this legislation in any other Provinces, yet, but in my view, in effect, the Ontario legislation is almost just codifying what the courts have always said for years. That unless you're a really, really senior employee or you're selling your business, for instance, and you're getting a whole bunch of money for agreeing not to compete with the company you just sold, these clauses just are not enforceable. So we always tell clients this, but sometimes they hear it but they still want to include it, because knowing it's likely not enforceable they view it as potentially being a deterrent to employees who are looking to leave. That's fair. It very well may act in that way but one thing I do caution clients about is that there are actually cases in BC and Ontario, maybe other Provinces, where a court has actually increased an employee's termination entitlements, following termination, because the employee believes that they were subject to a non-competition provision for a certain period of time, which arguably made it more difficult for them to find new employment to replace the employment they had lost. The court did this without even deciding on whether the provision was actually enforceable, which it likely wasn't in the cases that I reviewed. So just something, again, to think about if you do want to bring in a non-competition clause.
Then again on the next slide there's just a quick example. Again, a very general clause just to show you what these might look like. Again, you'll see the range in the length of the restrictions, similar considerations apply as do with non-solicitation clauses that we discussed earlier. You'll also see that territory is defined here and pretty specifically. Sometimes we see these clauses where the territory is deemed to be global and in almost no case would that be enforceable. There might be a case out there. I haven't seen it where that's been enforceable, but generally speaking, to have any chance of enforcing one of these things you need to have some degree of a clearly defined territory or boundaries in which the employee cannot compete with you. So in the tech industry this can be really challenging because employees often can work really easily remotely. Or there is no office to base some sort of boundary around. So, again, working with an employment lawyer to try and tailor these as narrowly and clearly as you can is really, really important.
The next slide we'll move onto, so that was the stick. This is the carrot. So the retention bonuses. Something that you can do if you want to keep employees as opposed to scaring them to stay. So one of the techniques we're seeing increasingly being used by employers to retain key employees, sometimes larger workforce in general, is the use of these retention bonuses. A retention bonus is typically paid out at the end of a specified time period, if the employee remains employed with the company at that time. They're often used when a company is about to go through some sort of change or upheaval, such as a transaction, however, they're also being used more generally as one of the ways of just decreasing employee mobility. Especially right now when that's a huge issue for a lot of client's companies. So if you think a retention bonus might be useful to your company you'll want to consider what amount will be meaningful to the employee. If you have a key employee earning $200,000.00 a year, then a $10,000.00 retention bonus that ends up at $5,000.00 after taxes, may not really be enough to encourage them to stick with you a tumultuous period. Or you may need to conduct some market research to see if competitors are offering signing bonuses for new employees. You'll want to make sure that your retention bonus is at least equal to any of those signing bonuses, likely more, to keep your employee. Also how long do you want to encourage them to stay in order to receive it? Is there something coming up like a merger that might shake the employee's confidence in the company or their role? Or are you just trying to get them through the tail end of the pandemic? You don't want to make it too short. It doesn't really help usually. Or you don't want to make it too long otherwise it just becomes kind of irrelevant to the employee. The other thing you can do is structure it as a forgivable loan. So if the employee stays long enough to receive it, and it's paid out, then they have to stay for a certain period after that otherwise they have to pay it back in that pro rata form to the company.
In addition to payment terms, there are other things to consider. For instance, what happens if the employee is terminated by the company without cause? Usually a company will payout the full amount, or at least a pro rated amount, if they decide to terminate. Income trust. If the employee resigns or is terminated for just cause then often the company will forfeit the entire amount. What happens if the employee takes an extended leave of absence during that retention period? Do they still get the full amount of the bonus or do you reduce it by the length of the leave or extend the retention period? What if the employee becomes permanently disabled or passes away during the retention period? You need to draft these policies carefully to ensure that the company's only paying out what it intends to pay out, when it intends to pay it out. So again, speaking with an employment lawyer to draft one of these is really important. So all the intentions are set out clearly. A question that often gets asked is, how effective are retention bonuses? Some would argue they're not that effective. This strays a little bit from legal considerations, but just some things to consider if you're thinking about rolling out retention bonuses, based on what we've seen and heard from clients. An issue that comes up is that the employee works up until he or she earns the bonus and then they leave. As mentioned earlier, there's ways we can structure this as a forgivable loan if you want to try and recoup some of that amount. But again, that needs to be drafted really carefully and it can be difficult to claw that money back. Even then they could still leave at the end of the forgivable loan period so kind of stuck there. Also, a lot of companies as I mentioned previously, are offering significant signing bonuses right now because they're so desperate to get employees. So the loss of retention bonus may not sting as much as you might expect if they're getting a comparable signing bonus with the new employer. They can be ineffective if the primary reason for the employee's departure is not to do with money. So Cheryl will be discussing, shortly here, many employees are looking for work/life balance and flexibility. Again a $10,000.00 bonus, after tax, may not solve that issue for them. Another thing to think about, do you want to encourage an employee to stay who really doesn't want to be there? You have to think about who gets a bonus? Is it everyone or just certain employees? If it's only certain employees, and this information is shared despite it being confidential, what will this do your workplace culture? They also don't encourage employee performance. An employee literally gets paid for just sitting in their seat, at the end of the retention period. Something to think about that other clients of mine have done, because of all the concerns I just mentioned, is instead of doing a retention bonus you do an equity grant. You extend it over a certain number of years. There's a cliff. They have to stay for at least a certain period of time before they get even the first amount investing. Again, we won't go through it all here. There's a lot of considerations that need to come into play if you want to go this route. Again, definitely speak with an employment lawyer before you do that. So, just as some retention bonuses are best to keep key employees through the end of a transaction, or some sort of other major upheaval in a company, just to get over the finish line. Give them a chance to see the company's continued on and there's reason to stay. Similarly, trying to get through the end of the pandemic and all the employee mobility that's going on right now, until hopefully the job market stabilizes a little bit, and employees become a bit more connected with their workplace and realize they want to stay and don't necessarily want to test the waters. I will now flip it over to Cheryl to sort of expand on the retention strategies a little more.
Cheryl: Thanks, Kristen. I'm going to be talking a little bit about retention in the current market. We are seeing things like the great resignation happening, or as some people are calling it, the war on talent. But more people are leaving their jobs. The numbers are quiet staggering actually, in the United States, but Canada is likely to be significantly impacted as well. So we're seeing that not only is it difficult to hire employees but it's really difficult to actually retain them. So this means that the current market that we're operating in is really an employees market. With that employees market we're seeing that they have different demands and their different values that are coming through. There are a few reasons for this. The first is demographics. So we have an aging population which leads to less of an available workforce. We have opportunities so things like the gig economy with these short-term freelance jobs will bring a desire for convenience. Then you have the pandemic which sped up what was already happening with this kind of gig economy and aging population. A result of this is that the concerns of employees are amplified and so employees are feelings now empowered in their demands to request things like flexibility and remote work, higher wages, increase in benefits and we're seeing the flip side of that which is employer's having to pay closer attention to not only employment laws, but also re-thinking their approaches to more traditional employment structures, in order to remain competitive. Next slide.
So I want to talk about a few ways that employers can address these increased demands. So first, keep up with the market. Kristen spoke about restrictive covenants and those kind of being the stick and here we have all of the carrots. We have competitive pay, policies and benefits and perks in order to support your employees personal and professional growth. So there are trends towards finding more inventive ways to reward the employees as well. You're seeing fertility treatment coverage, tuition reimbursement. Many companies, including companies like Netflix and Kronos and even Goldman Sachs, are now offering unlimited vacation policies for either some or all of their employees. Then of course, as Kristen mentioned, things like retention notices as well. Keeping up with their market in terms of all of these things and providing a competitive renumeration package is especially important to retain employees. It's not enough to have these policies, you also have to communicate them effectively so that the employees know how they can access them. One of the ways that we do that is through onboarding. So new hires who experience poorly planned or executed onboarding may form opinions that dictate not only how they are going to perform in their jobs, but also how long they're going to stay with that company. With things like the war on talent, and people leaving these jobs more frequently, it's even more important now to establish that good initial connection.
Then third, a positive workplace culture. It's important to employ mechanisms that show people how their skills translate to more purposeful workdays. They want to know how is what I'm doing contributing to my company, my customers, my communities. That sense of purpose can help keep the employees feeling more connected to their roles and ultimately to the company. Then finding new ways to boost your team boost morale. So things like policies, respect in the workplace, training, team building exercises, all of these things. Requesting feedback and incorporating that feedback can all help your employees feel that their opinions are valued and that they are valued a member of the team. Slide. Thank you.
There were concerns with the advent of remote work with this always on work culture, especially with the business hours getting more as a result of kind of always being online. So the concept of the employee's right to disconnect has developed, which provides workers with the capacity to disconnect from work and generally from related communication technologies. Outside of what is defined as a working hour for them. So France originally pioneered this right to disconnect legislation and then several European countries followed their lead. Now we have it in Canada, only in Ontario, but Ontario has a new requirement that employers with 25 or more employees must have a written policy on disconnecting from work. So under the legislation, and on your slide, it says disconnecting from work is defined as not engaging in work related communications, including emails, telephone calls, video calls or sending or reviewing other messages, to be free from the performance of work. The legislation is not particularly clear as to what this policy needs to look like but just that it needs to exist and it needs to be written down. So we anticipate that other Provinces will be closely monitoring how this pans out in Ontario, as they consider kind of similar measures, but as it stands this is specifically Ontario that has legislated this requirement. The current legislative obligations, again, are vague and a little bit more difficult to enforce but the right to disconnect legislation is a symptom of a more structural issue. I'm talking about burnout and remote work and the pandemic kind of amplifying and bringing these issues to the forefront. It's very important for employers to get ahead of this and actually address burnout and find ways to counteract that before it gets to that point, before it gets to the point where employees feel that they need to disconnect. So some ways we can do that is through health and wellness programs, quick training, benefits, feedback loops and things like encouraging your employees to take vacations. I'll pass it over to Kristen.
Kristen: Thanks, Cheryl. Okay so I'm just going to finish up on this last topic here. It's something that I've been asked about a bunch when it comes to employee retention issues. So we do want to leave a bit of time at the end for some questions so I'll try and get through this fairly quickly. One of the questions that often comes up is, what happens when an employee leaves without providing any notice? So this is what we would call, as lawyers, a wrongful resignation. 2 weeks notice is often thrown around as the amount of notice an employee is required to provide, however, this is not actually the law in most Provinces. Most Provincial Employment Standards legislation that I've discussed earlier doesn't actually specify the amount of notice an employee must provide to their employer. Unless the employee has a written employment agreement that sets out how much notice must be provided, then the employee is required to provide a reasonable amount of notice. Of course the question becomes what is a reasonable amount of notice? So according to our courts, they take into account things like the employee's position, how long it will take the employer to replace them or to adjust to the loss. So to this end courts will consider employee's duties responsibilities, their salary, length of service and the time it would reasonably take the employer to have others handle the employees work or to hire a replacement. So what employers want to know is, what I can do if an employee leaves them in the lurch with no notice? Unfortunately my answer is not the greatest. Unfortunately your only legal remedy really is to file a claim against the employee for any losses that have been incurred by the company, resulting from that lack of notice. Which, of course, any time you're taking someone to court is costly and there is no guarantee of success. I'll talk about a couple of cases briefly, at the end, that can show you what can happen. So while you might be able to establish the employee did in fact wrongfully resign by failing to provide a sufficient amount of notice, that's only half the battle, if you were to take an employee to court over this. Unless the company can show that it suffered losses as a result of the wrongful resignation, the company will typically walk away with nothing.
So I'll go to the next slide here. I'll just quickly go through the cases. Just a couple of them, just to give you some examples. This one here is an Ontario case and it is an example where an employer was actually awarded damages by a court when an employee failed to provide sufficient notice of resignation. The employee in this case was a senior employee and a top sales person responsible for about 30% of the employer's sales. He resigned to work with a competitor and did not work pass the date he gave notice. He gave notice, for instance on a Friday, and never showed up to work after that. So he wrongfully resigned. At trial a market analysis showed that the employee would be difficult to replace. The research showed that it would take about 2 months. So in the circumstances the court found that that employee should have provided about 2 months notice, in other words 2 months was a reasonable amount in that case, and awarded the company over $35,000.00 to compensate the company for its losses. So the way that the court arrived at that figure was through expert testimony, providing an estimate of the company's likely revenue losses over a 2 month period, that would be attributable to that employee. It was a somewhat complicated analysis so no doubt that extra report cost a significant sum, not to mention lawyer's time and everything else that would have gone into that litigation, whether or not the $35,000.00 was worth it, not sure. Usually in wrongful resignation cases there's something else going on. There's some other reason why the employer has gone to court, or the employer's already in court because the employee has sued them, and a wrongful resignation is sort of a separate issue because it just typically doesn't make sense to go to court just over a wrongful resignation.
So moving to the next slide here. This is a BC case. So in contrast to the prior case, the employer in the Consbec and Walker case here walked away with nothing. The employee, Walker, was an estimator with Consbec. He resigned with no notice and set up a competing business. The court agreed that Walker failed to provide reasonable notice of resignation and in determining what would have been a reasonable amount of notice, the court noted that walker was not a true manager. He exercised little independent authority. He had limited specialist knowledge or training. So on that basis the court concluded that 1 month's notice would have been reasonable for Consbec to adjust to the loss of Walker. The evidence at trial was that, during the month following his departure and as a result of his departure, Consbec had had to fly another employee in from a different region to temporarily cover his duties. So the court awarded a reasonable amount for those costs. It was about $5,000.00, however, the court found that those losses were offset by the fact that Consbec didn't need to pay Walker's salary during that 1 month, which was about $6,000.00 for the month. So in the end those expenses were offset by the savings in the salary and ultimately Consbec walked away with nothing because they didn't actually suffer any loss as a result, or that they were at least able to establish as a result of the wrongful resignation. So just in sum you can see that this can definitely be a bit of a money pit if you all out pursue it. It often is only pursued in relation to other matters and the best thing you can do to protect yourself from an employee doing this, is to have the resignation notice set out clearly in a written employment agreement, and then if it's breached, it's a breach of contract matter and it's a little bit easier to enforce. Again, it's not perfect but it's at least easier than coming up with what a reasonable amount would be and then trying to go through that process.
So that sums up our presentation. I see there are a few other notes there in the chat, so we can go through and discuss some of the questions, and if you have any other questions then you can put those in. One of the first questions, Krista and Cheryl, if you want to jump in at any point, one of the first questions is, where can we find more info on signing or retaining bonuses? What is the sliding scale in the amount versus position? That's something that needs to be tailored to the employee, the company, the situation. It can be almost anything so really to get more information and to get an idea of what's reasonable and appropriate you'd be best to talk to someone like an employment lawyer who does these sort of things, commonly. I can't really give general information on that.
Krista, Cheryl, did you want to add anything there?
Krista: I don't think so. I think for that one legal advice is probably needed to answer it. Maybe I'll jump in with another question. So there is a question of, will the presentation be sent to the audience and are the codes for credit? So the webinar will be posted on our Gowling in demand part of what we have online. There are no codes but our team will be sending attendance certificates to those who have opted for a CPTD Certificate when registering. I think that answers that one. I guess also in addition, there will be a checklist that we are preparing and will be sent around to attendees and our contact details will be on that checklist as well.
Kristen: Question here about resignation notice periods. How enforceable are longer resignation notice periods (ie: asking an employee to provide 2 months notice)? If it's set out in a written employment agreement it's enforceable and if they don't provide that amount of notice it's technically a breach of contract. The issues is sometimes when you set out a longer notice period for resignation, you don't actually want them there in the end for that long, and then you're stuck. Unless it's drafted in a certain way you're stuck paying them out 2 months that you otherwise didn't want them there for. Again, there's ways we can draft that to make it so that you're not hopefully stuck with the full 2 months, if you don't need it, but definitely something to be cautious on there. Then again it comes back to if you try to enforce that in court, technically it's a breach of contract if they only provided 2 weeks and they were required to provide 2 months, but ultimately the court will look and see what were your damages resulting from that breach. If you can't really establish that there was much in the way of damages then there's not much point in pursuing it. And then Gagnon was there, cost award as well.
Cheryl: I can answer that one, Kristen.
Kristen: Okay.
Cheryl: No. There was no cost award in Gagnon.
Krista: I see a question here about LMIA applications. I believe the question was, is the online system as good as the usual process and will that, I think, apply to the GTS LMIA process and the general LMIA process. That's a tough one. IRCC and Services Canada are hoping that people use the online, the new online portal, and the goal is for that to be a much quicker process and quicker processing times. Personally, I still use the older school method of submitting, we can still submit by fax. Email is usually how I do it. I haven't been using the portal yet but I certainly have colleagues that are. So it's kind of a preference on that one. I think we'll all move to the portal at some point once the glitches are out of it, but for now I use the email process. I see another question here. I'm just seeing if an employer wants to bring in an employee through one of the immigration programs, should the employer speak with an immigration lawyer or a certified immigration practitioner for Ontario before deciding to do this? So because our immigration is Federal in Canada, you don't necessarily need to use a lawyer in Ontario. There are some Ontario specific programs through the OINP but generally an immigration lawyer that practices in Canada would be familiar with a lot of the Provincial based PR programs. But if it's purely just a work permit application, you should be fine using a lawyer in another jurisdiction. You don't necessarily need to use a lawyer with many areas of the law, but there are a lot of parts to a work permit application, and I know I often get contacted after something has gone wrong which then makes it a lot more complicated and you're kind of red flagged in the system already with our immigration officials. So, yeah, I definitely encourage you to use an immigration lawyer in advance. I'm not seeing any other questions right now.
Maybe I'll just end by saying thank you for attending today. Feel free to reach out to any of us if you have any employment or immigration related questions. Stay tuned for future topics in this webinar series. So thank you again, everyone.