Posts

Employment Law for Bartenders, Waiters and Waitresses

Bartenders, waiters and waitresses, or “Liquor Servers” as they are referred to in the Employment Standards Act (“ESA”), are given special treatment under the law and by the Ontario Courts. While many of the ESA’s provisions apply equally to all types of employees, there are some important distinctions for liquor servers that hospitality employees and employers should know. This article is meant to highlight some of those important differences.

Minimum Wage

As of January 1, 2018, minimum wage for most workers in Ontario was increased to $14.00 per hour. However, the ESA permits lower minimum wage rates for certain designated groups of workers who receive tips as a significant portion of their income. Liquor servers fall into this category. Since January of 2018, the minimum wage rate for liquor servers is $12.20 per hour.

While the terms “Liquor Server” or “Bartender” are not specifically defined in the ESA, the relevant section on minimum wage provides helpful insight into whether an employee’s minimum wage rate can legally be lowered to $12.20 per hour. The ESA states as follows:

Determination of Minimum Wage
23.1 (1) The minimum wage is the following:
1. On or after January 1, 2018, but before October 1, 2020, the amount set out below for the following classes of employees:
ii. For employees who, as a regular part of their employment, serve liquor directly to customers, guests, members or patrons in premises for which a licence or permit has been issued under the Liquor Licence Act and who regularly receive tips or other gratuities from their work, $12.20 per hour. [emphasis added]

Minimum Wage After October 2020

As suggested in the above section, after October of 2020, the minimum wage rate for liquor servers will increase in accordance with a formula based on the Consumer Price Index. This formula is as follows:

Previous Wage × (Index A/Index B) = Adjusted Wage

In which:

“Previous wage” is the minimum wage rate that applied immediately before October 1st of the year;

“Index A” is the Consumer Price Index for the previous calendar year;

“Index B” is the Consumer Price Index for the calendar year immediately preceding the calendar year mentioned in the description of “Index A;” and

“Adjusted wage” is the resulting new minimum wage rate.

Termination, Reasonable Notice, and Wages

Like all employees in Ontario, liquor servers are entitled to a certain amount of notice, or pay in lieu of notice, when their employment is terminated.

That being said, for liquor servers, more often than not a significant portion of their income comes in the form of tips. Therefore, the biggest question I get as a Toronto employment lawyer, from both employees and employers, is whether tips should be included as wages for the purpose of pay in lieu of reasonable notice. The answer to that questions depends significantly on whether the bartender or liquor server has a valid employment contract that limits notice only to those minimums under the ESA.

Under the ESA, Wages Do Not Include Tips

Under the ESA, generally when an employer terminates an employee who has been continuously employed for at least 3 months, the employer must provide the employee with notice, or pay in lieu of notice. This pay in lieu of notice is often referred to as “termination pay.” The amount of written notice required by the ESA is as follows:

Employment Period Notice Length
3 months – less than 1 year 1 Week
1 year – less than 3 years 2 Weeks
3 years – less than 4 years 3 Weeks
4 years – less than 5 years 4 Weeks
5 years – less than 6 years 5 Weeks
6 years – less than 7 years 6 Weeks
7 years – less than 8 years 7 Weeks
8 years or more 8 Weeks

If an employee, by an enforceable employment contract, is only entitled to the minimums under the ESA, then that worker may NOT be owed tips. Wages under the ESA are defined as:

“Wages” means:
(a) monetary remuneration payable by an employer to an employee under the terms of an employment contract, oral or written, express or implied,
(b) any payment required to be made by an employer to an employee under this Act, and
(c) any allowances for room or board under an employment contract or prescribed allowances,
but does not include,
(d) tips or other gratuities,
(e) any sums paid as gifts or bonuses that are dependent on the discretion of the employer and that are not related to hours, production or efficiency,
(f) expenses and travelling allowances, or
(g) subject to subsections 60 (3) or 62 (2), employer contributions to a benefit plan and payments to which an employee is entitled from a benefit plan. [emphasis added]

Without an Enforceable Termination Clause, Tips Are Owed as Part of Termination Pay

Without an enforceable clause in an employment contract which limits reasonable notice to only the ESA minimums, the Ontario Courts ignore the strict wording of the ESA and require employers to pay tips as part of wrongful termination pay.

We can see an example of this in the case of Giacomo Violo v. Delphi Communications, Incorporated. Violo had worked as a waiter and bartender for a small restaurant in Ontario for 29 years. At the time of his termination, he was 51 years old. The parties did not have an employment contract, and the restaurant contended that Violo had been legally terminated due to excessive tardiness, alcohol abuse, and discourteous behaviour. After examining the evidence, including work records from the defendant and testimony from current employees, the Court determined that “there was no cause for the plaintiff’s dismissal.” The Court then turned to the issue of determining the reasonable notice period Violo was due. After examining numerous factors, including Violo’s age and the availability of similar jobs at the time he was terminated, the Court determined Violo was entitled to a reasonable notice period of 15 months. The Court then addressed the issue of damages, noting that tips would be factored in as such wages constituted a significant portion of his overall income: “… in 2010 he claimed $9,025 in tip income, almost as much as his income from wages.” In total, Violo was awarded $45,250, representative of his base salary and tips over the course of the 15 month notice period.

Final Thoughts

For employers, it is important to have a valid written employment contract with all bartenders, waiters, and waitresses. While the amount of notice cannot be below the minimum amount required by the ESA, employers can fashion contracts which provide for less notice than the employee would otherwise be entitled to at common law. When it comes to employees who receive customary tips, this can mean a substantial difference in the amount of termination pay. If you need assistance drafting employment contracts, we strongly recommend that you speak to an experienced employment attorney for guidance and assistance.

For terminated employees who received tips as a significant portion of their overall income, it is crucial to remember that they likely have rights under the common law that are far greater than the rights afforded to them under the ESA. It may be best for liquor servers and waitresses to sue their former employer in court for “wrongful dismissal,” seeking additional damages which would include tips. If you have been recently terminated from a position where you received tips as part of your income, we suggest that you speak to an employment attorney to help you determine the best course of action for your situation.


Contact Justin W. Anisman

Contact Justin W. Anisman, the author of this blog, about any employment law related questions or issues you may be facing. Call 416-304-7005 or email him at janisman@btlegal.ca.

Justin W. Anisman is an Employment Lawyer at the Toronto law firm Brauti Thorning LLP. Justin advises both companies and individuals in all aspects of employment law including wrongful dismissal, human rights and discrimination.


The publications made on this website are provided and intended for general introductory information purposes only. They do not constitute legal or other professional advice, or an opinion of any kind. Speak to a professional before making decisions about your own particular circumstances.

Time to Update your Workplace ESA Poster

The Ministry of Labour has just released version 8.0 (January 2019) of its mandatory Employment Standards Act poster. The poster is available in multiple languages on the Ministry of Labour website, but you can downloaded it English right here:

All workplaces governed by the Employment Standards Act (the “ESA“) are required to:

  1. Display this poster in a conspicuous place;
  2. provide a copy to each current employee;
  3. provide a copy to all new employees within 30 days of hiring.

Employees can be provided with a physical copy of the the poster or it can be sent to them electronically. Failure to do the above is a breach of the ESA and can have serious consequences for employers.


Contact Justin W. Anisman

Contact Justin W. Anisman, the author of this blog, about any employment law related questions or issues you may be facing. Call 416-304-7005 or email him at janisman@btzlaw.ca.

Justin W. Anisman is an Employment Lawyer at the Toronto law firm Brauti Thorning Zibarras LLP. Justin advises both companies and individuals in all aspects of employment law including wrongful dismissal, human rights and discrimination.


The publications made on this website are provided and intended for general introductory information purposes only. They do not constitute legal or other professional advice, or an opinion of any kind. Speak to a professional before making decisions about your own particular circumstances.

Right to Disconnect

Ontario’s Bill 148 may have created a right to disconnect – even for supervisors and managers

The right to disconnect – to leave your work at work, instead of buzzing in your pocket – is regarded as an aspiration instead of a reality for most Ontario employees. But there may already be a legal basis for the right to disconnect sitting right under our noses, in none other than the Employment Standards Act the (“ESA”).

What is the right to disconnect?

Given the ease of communication that modern technology has afforded, the lines between an employee’s work and private life are blurring more than was ever possible. Constant connection to the workplace has become the norm — even the expectation for many jobs.

The right to disconnect is a statutorily-protected right to ignore work-related calls, e-mails, and other electronic messages off-work hours. France was the first jurisdiction to legally adopt the right to disconnect in 2016.

Do Canadian employees have a right to disconnect?

No right to disconnect has been formally adopted in Canada, although the federal government is considering a right to disconnect for employees in federally-regulated industries, such as banks and telecommunications.

Is there any right to disconnect in Ontario?

Up until (arguably) the recent amendments to the ESA, no right to disconnect existed for Ontario employees. While being required to answer calls or e-mails on a Saturday morning, for instance, could entitle an employee to overtime pay, categorically refusing to do so could (in many cases) constitute misconduct.

Enter Bill 148’s new scheduling requirements

In 2017, Ontario passed Bill 148 – a retrofit of its employment standards to adapt to the changing realities of the modern workplace.  One of the changes to the ESA was the addition of Part VII.2, which deals with scheduling and on-call work.

Among other things, Part VII.2 of the ESA says this: in most cases, if your employer requires you to work on a day for which you’re not scheduled, they must provide you with: (a) at least 3 hours’ pay, regardless of how much time is actually spent working; and (b) at least 96 hours’ notice of the work. Without 96 hours’ notice of the work, the employee may refuse to work in most cases.

What do the scheduling requirements have to do with the right to disconnect?

The scheduling requirements in Part VII.2 of the ESA might mean that employees on a day off, for all intents and purposes, have a right to disconnect. That hinges on whether answering e-mails or phone calls constitutes “work” under the ESA.

While “work” is not defined under the ESA, Courts and Tribunals interpret the ESA in a way that extends maximum protection to employees. A court or tribunal is very likely to consider a requirement to answer phone calls or e-mails as “work”. That means that, for instance, if your boss emails you an urgent question about budget reports on Saturday morning, you are likely entitled to wait until Monday to figure out the answer.

What about supervisors and managers?

The conventional wisdom in Ontario is that, since supervisors and managers are exempt from all of the ESA’s rules regarding hours of work, those jobs are 24/7 gigs and employees must stay on top of work e-mails, even on their days off.

Interestingly, however, supervisors and managers are NOT exempt from the scheduling requirements Part VII.2 of the ESA. That means that, if a supervisor or manager has a right to specific days off, that employee also likely has the same right to disconnect as any other employees on those days.

Can employers get around this with creative scheduling?

Since this is fundamentally a matter of scheduling, one might wonder whether employers can get around this by simply “scheduling” their employees to answer work e-mails.

For non-managerial and non-supervisory employees, there are going to be at least some days where employees have a right to be off the grid; all such employees are guaranteed at least 24 hours free from work each week, and at least 48 hours free from work every 2 weeks. Employees cannot be required to work during those periods.

It is less clear whether employers can use this technique on supervisors and managers; there is nothing in the ESA preventing supervisors and managers from being on-call 24/7. However, Courts and Tribunals generally seek to avoid interpretations that allow employers to skirt the ESA and might easily reject an employer’s argument that the job requires 24/7 attention unless that is clearly borne out by the evidence.

Does that mean I can turn my work phone off when I’m not at work?

Probably not, due to the limits on the right to refuse work in this context. First, the right to refuse work only arises in respect of entire days off – for instance, it does not address after-hours e-mails on a workday. Second, the right to refuse work only arises if you have been given less than 96 hours’ notice. Third, the sections require an employee refusing work to “notify the employer of the refusal as soon as possible”, which in many cases sounds like more trouble than it’s worth.

What can I do about it?

We recognize that most employees do not want to create a conflict by insisting on their strict legal rights. If and when things get contentious, speak to a specialized employment lawyer. Call us today for advice on your workplace issue.

 


Contact Nicholas Goldhawk

Contact Nicholas Goldhawk, the author of this article, about any employment law related questions or issues you may be facing. Call 416-304-7010 or email him at ngoldhawk@btzlaw.ca.

Nicholas is an Associate of the Management-side Labour Group at BTZ. In this role, he advises management on all aspects of employment and labour law, including representation before administrative tribunals, collective agreement negotiations, arbitrations, wrongful dismissal defence, breach of contract, breach of fiduciary duty, and human rights.

Before joining BTZ, Nicholas articled and worked as an associate at a boutique labour and employment firm in Toronto where he assisted both employee and employer clients in formulating practical solutions for a wide variety of workplace-related issues.

Nicholas was called to the bar in 2017, after earning a J.D. from Osgoode Hall Law School. Prior to attending Law School, Nicholas obtained his Honours Bachelor of Journalism from Carleton University.

Before attending law school, Nicholas worked as an investigative journalist for a Canadian current affairs TV program.

Nicholas Goldhawk


The publications made on this website are provided and intended for general introductory information purposes only. They do not constitute legal or other professional advice, or an opinion of any kind. Speak to a professional before making decisions about your own particular circumstances.

Hours of Work and Breaks

The Law about Hours of Work

In Ontario, the Employment Standards Act (“ESA”) sets out the maximum daily and weekly limits on the hours of work. In general, the maximum number of daily and weekly hours are:

  • Eight (8) hours in a day or, if the employer establishes a regular work day of more than eight hours, the number of hours in its regular work day; and,
  • 48 hours of work per week.

An employee’s daily hours of work may exceed the maximum limits in the ESA if the employer and employee agree in writing. Likewise, an employee’s weekly hours of work may exceed the maximum limits if (a) the employee agrees, and (b) the employer obtains approval from the Director of Employment Standards. In addition to the employee’s agreement and the Director’s approval (for excess weekly hours), an employer must provide the employee with the most recent documents published by the Director of Employment Standards on Hours of Work.

If you are looking to apply to the Director of Employment Standards for excess weekly hours, or any reason, please do not hesitate to reach out to me.

Rescinding an Agreement for Excess Work

An employee can revoke an agreement to work excess hours on two weeks notice to the employer. An employer can revoke an agreement to work excess hours on reasonable notice to the employee.

Hours Free from Work

In general, an employee must receive at least:

  • eleven (11) consecutive hours off work each day;
  • eight (8) hours off work between shifts (if combined shifts exceed thirteen (13) hours);
  • either twenty-four (24) consecutive hours off work every week, or forty-eight (48) hours off work in every consecutive two-week period;

Daily Rest: the 11 Hour Rule

The daily rest requirement is mandatory. An employee and an employer cannot agree to less than eleven (11) consecutive hours off work each day. This maximum applies even if there is an excess daily hours of work agreement or an excess weekly hours of work agreement approved by the Director of Employment Standards.

This rule does not apply, however, to an employee who is on call and called in during a period in which the employee would not otherwise be expected to perform work for his or her employer.

It also does not apply in “exceptional circumstances”. The exceptional circumstances exception only applies if the employee is required to avoid serious interference with the ordinary working of the employer’s establishment or operations:

  • To deal with an emergency.
  • If something unforeseen occurs, to ensure the continued delivery of essential public services, regardless of who delivers those services.
  • If something unforeseen occurs, to ensure that continuous processes or seasonal operations are not interrupted. or,
  • To carry out urgent repair work to the employer’s plant or equipment.

Breaks and Lunch

Eating Periods, a.k.a. Lunch Breaks

An employer must provide an employee with an uninterrupted 30-minute eating period (lunch break) at intervals to ensure that the employee goes no more than five consecutive hours of work without a break to eat. If an employee and an employer agree, then the employee can be given two eating periods (i.e. two 15-minute breaks) in each consecutive five-hour period.

Unless the employee’s contract says otherwise, lunch breaks are unpaid. Further, lunch breaks are not included for the purpose of calculating hours of work, rest provisions, overtime pay or minimum wage entitlements under the ESA.

Coffee and Other Breaks

Besides eating periods, employees are not entitled to any other breaks.

If an employer elects to give other breaks to an employee then that break must be paid and included in calculating hours of work, rest provisions, overtime pay or minimum wage entitlements under the ESA, unless that employee is not required to remain at the place of employment.


Contact Justin W. Anisman

Contact Justin W. Anisman, the author of this blog, about any employment law related questions or issues you may be facing. Call 416-304-7005 or email him at janisman@btzlaw.ca.

Justin W. Anisman is an Employment Lawyer at the Toronto law firm Brauti Thorning Zibarras LLP. Justin advises both companies and individuals in all aspects of employment law including wrongful dismissal, human rights and discrimination.


The publications made on this website are provided and intended for general introductory information purposes only. They do not constitute legal or other professional advice, or an opinion of any kind. Speak to a professional before making decisions about your own particular circumstances.

Equal Pay for Part Time Work begins April 1, 2018

For Ontario employers, employing part time and temporary workers is about to become a lot more expensive. On April 1, 2018, the “equal pay for equal work” amendments to the Employment Standards Act, 2002 (the “ESA”) by Bill 148, the Fair Workplaces, Better Jobs Act 2017, come into legal effect.

Ontario employees have long had the protection of the Pay Equity Act, and similar provisions in the ESA, that prevented women (and men too) from being paid less than their peers on the basis of sex. As of April 1, 2018, the ESA will now provide for an entitlement for equal pay from an employer regardless of a difference in employment status.

“Difference in employment status”, in respect of one or more employees, will now be defined as:

a difference in the number of hours regularly worked by the employees; or a difference in the term of their employment, including a difference in permanent, temporary, seasonal or casual status

As a result, employers will be required to pay casual, temporary, part-time, and seasonal employees the same rate as permanent and full time employees so long as:

  • they perform substantially the same kind of work in the same establishment;
  • their performance requires substantially the same skill, effort and responsibility; and
  • their work is performed under similar working conditions.

The legislature has attempted to define “substantially the same” to mean “substantially the same but not necessarily identical.” How this will be interpreted by the Ontario Courts is anyone’s guess but likely it will be used to grant discretion to the Tribunal, Judge or Jury on whether two similar jobs are “substantially the same”.

Exceptions

Differences in pay between employees of different sex or similar employment status are permitted so long as the difference in rate of pay is the result of:

  • a seniority system – a system that pays employee based on length of service;
  • a merit system – a system that pays employees based on merit: their skills, education, competence, etcetera;
  • a system that measures earnings by quantity or quality of production – a piecemeal system or similar; or
  • any other factor other than sex or employment status.

Employers should be careful to ensure that any system they are using to determine employee pay is being implemented fairly and communicated to employees in advance. Any measurements of quantity or quality should to the greatest extent possible be objective and recorded.

The Process

Any employee who believes that their rate of pay does not comply with the Equal Pay for Equal Work section of the ESA, may request a review from their employer. Employers are, thereafter, required to either:

  • Adjust the employee’s pay; or
  • Provide a written response setting out the reasons for refusing.

As discussed in my article Important Upcoming Changes to the Ontario Workplace, any written response must be saved according to the new record keeping requirements in the ESA for five (5) years.


Contact Justin W. Anisman

Contact Justin W. Anisman, the author of this blog, about any employment law related questions or issues you may be facing. Call 416-304-7005 or email him at janisman@btzlaw.ca.

Justin W. Anisman is an Employment Lawyer at the Toronto law firm Brauti Thorning Zibarras LLP. Justin advises both companies and individuals in all aspects of employment law including wrongful dismissal, human rights and discrimination.


The publications made on this website are provided and intended for general introductory information purposes only. They do not constitute legal or other professional advice, or an opinion of any kind. Speak to a professional before making decisions about your own particular circumstances.

How much notice/severance should I get after being fired?

That’s a more complicated question then all of those “online severance calculators” make it seem. Before we delve into the factors which play a role, both employees and employers need a little context and exposition on how the Ontario wrongful dismissal system works.

Overview

Firstly, you need to understand that “notice” and “severance”, though often used interchangeably in common parlance, mean different things. Under the Employment Standards Act, severance pay is defined and is an amount of money an employer needs to pay an employee on termination if certain conditions are met. In addition to severance, employers must give notice of termination to employees.

Severance Pay

An employee is only entitled to severance pay if they have been employed for 5 years or more and:

  1. the termination occurred because of a permanent discontinuance of all or part of an employer’s business at an establishment and the employee is one of 50 or more employees who have their employment relationship severed within a six-month period as a result; or
  2. the employer has a payroll of $2.5 million or more.

If an employee is entitled to severance pay, they are to be paid severance in a lump sum amount equivalent to one week of non-overtime wages per completed year of employment up to a maximum of 26 weeks, within 7 days of termination.

Entitlements to severance are relatively well defined. It is the notice requirements of termination that require a more nuanced analysis.

Reasonable Notice of Termination

In Ontario, employers can give notice of termination to employees in two ways. Either,

  1. An employer can give notice ahead of time; or
  2. An employer can fire an employee right away, but provide “pay in lieu of notice” equivalent to what would have been earned over the notice period.

The first step in calculating the amount of notice depends on whether that employee’s termination is subject to a valid employment contract. If the employment contract contains a  clause that sets out the amount of notice an employee gets upon being fired and the contract is valid, then the employee is entitled only to the reasonable notice set out therein.  These contracts may be invalid or void ab initio (unenforceable from the beginning) for many reasons, including if they provide for less termination entitlements than the minimums established by Employment Standards Act.

If there is no contract, or the contract is not enforceable, then an employee is entitled to what the Ontario Courts call “reasonable notice”. Reasonable notice is always more than the minimum notice. The amount of  reasonable notice depends on many factors and is calculated by the Courts after considering all of the surrounding factors. Considerations include (1) age, (2) length of service, (3) character of employment and (4) availability of similar employment. Employees are entitled to more notice if:

  • they are older;
  • they worked somewhere a very short or a very long period of time;
  • their job was very specialized and it will be difficult to find comparable employment; or
  • the employer convinced them to leave another stable job.

An employee might also be entitled to further money on termination if the employer:

  • acted badly in the manner of termination;
  • fired you for a discriminatory reason;
  • fired the employee for insisting on his/her rights under the ESA;

Contact Justin W. Anisman

To contact Justin W. Anisman, the author of this blog, about any employment law related questions or issues you may be facing, call 416-833-8443 or email him at janisman@btzlaw.ca.

Justin W. Anisman is an Employment Lawyer at the Toronto law firm Brauti Thorning Zibarras LLP. Justin advises both companies and individuals in all aspects of employment law including wrongful dismissal, human rights and discrimination.


The publications made on this website are provided and intended for general introductory information purposes only. They do not constitute legal or other professional advice, or an opinion of any kind. Speak to a professional before making decisions about your own particular circumstances.

 

Important Upcoming Changes to the Ontario Workplace

On November 27, 2017, the Fair Workplaces, Better Jobs Act 2017 received royal assent and became Law in Ontario. Set out below are some of the most important changes to Ontario’s workplaces.

Read more