The union sought a declaration that three companies (Metalcraft, Manufacturing, and Trillium) were related employers under section 12 of the Employment Standards Act, and therefore jointly and severally liable for over $2 million in unpaid wages, termination, and severance pay owed to former employees of the bankrupt Metalcraft.
The Board found that the companies were related due to common ownership, common management by a key individual, and similar business operations.
The Board further found that the financial arrangements among the companies, driven by their primary lender, had the effect of defeating the purpose of the Act by shielding the assets of the solvent companies while leaving the employees of the bankrupt company as unsecured creditors.
The companies were declared related and jointly and severally liable for the amounts owed.
