1856-00-ES Aboutown Transportation Limited, Applicant v. Nona Oliver, and Ministry of Labour, Responding Parties.

Employment Practices Branch File No. 63001624

BEFORE: David A. McKee, Vice-Chair.

APPEARANCES: Denise T. Brown for the applicant; Nona Oliver appearing on her own behalf; Brian Fukuzawa for the Ministry of Labour.

DECISION OF THE BOARD; April 30, 2001

1. This is an application for a review of a decision by an Employment Standards Officer pursuant to section 68 of the Employment Standards Act, R.S.O. 1990, ch. E-14 (“the Act”). The order appealed from is a decision of an Employment Standards Officer finding that the responding party, Nona Oliver, was employed by the applicant, Aboutown Transportation Limited (“ATL”) and was discharged by ATL without notice on February 16, 2000. The Officer found that Ms. Oliver had been employed continuously since October 11, 1995. The Officer found that there was no notice and Ms. Oliver was therefore owed four weeks’ termination pay plus vacation pay ($1,168.46).

2. The employer appealed on three grounds, which were expanded to four in argument. These were:

(1) Ms. Oliver was discharged from the School Bus division, though was not discharged from employment entirely with ATL, and specifically its City Delivery division;

(2) Ms. Oliver was discharged and was not entitled to termination pay by virtue of section 57(10)(c), that is, that she had been guilty of wilful misconduct or disobedience or wilful neglect of duty;

(3) the employer made an offer of reasonable alternate work which was declined by Ms. Oliver, or from which she resigned shortly after commencing;

(4) in the event that termination pay is found to be owing, Ms. Oliver was hired for a series of fixed terms, the last of which commenced on September 9, 1999, and that therefore the quantum was excessive.

Facts

3. ATL is a transportation company situated in London. It operates a number of divisions. These include the School Bus division, the City Delivery division, and the Jamieson Delivery division. The School Bus division drives physically or mentally challenged children to and from school at the beginning and end of each day. City Delivery delivers large parcels in vans to London addresses. Jamieson Delivery division delivers small packages and envelopes within the London area.

4. Ms. Oliver was employed by ATL to work in the School Bus division, and as well the City Delivery division. She worked from 7:00-9:00 a.m. and 2:00-4:30 p.m. transporting children to and from school on one or two routes. Children were bussed in an “extended-van” type of vehicle (longer than average) which required an “E” driver’s licence. Between 9:00-2:00 Ms. Oliver delivered parcels for City Delivery, generally using the same type of extended van (if not the same vehicle used for the school runs). The City Delivery division also utilized smaller and shorter vans, although Ms. Oliver did not drive them. She was paid $11.00 per route for the school bus driving and $7.50 per hour for the City Delivery driving. All vehicles were owned, fuelled, and maintained by ATL. Each paycheque was a single cheque from ATL, although the statement of earnings indicated the two different sources of income. The cheque was treated as wages and taxable income under the Income Tax Act. There is no dispute that this was income derived from employment.

5. Work for the Jamieson Delivery division (for which Ms. Oliver did work after February 16, 2000 briefly) is different. Persons performing the work are called brokers. Payments are made on a “per package delivered” basis. Employees supply their own vehicle and pay for their own gas. Income is not treated as income from employment, and no income tax, CPP or EI deductions or contributions are made. There are some features of employment status: a dress code, standards of customer service, standard dispatching, two-way radios supplied by ATL, standard invoicing and pricing, and minimum quality of service defined in rules and policies. ATL offers discount fuel and maintenance at its shop. Brokers may choose to utilize that service. ATL pays for insurance above what is required for an employee’s personal coverage, i.e. the business use premium.

6. Ms. Oliver was first hired October 11, 1995 and worked continuously until June of 1997 driving the buses for the School Bus division during the year and for summer school in 1996. She ceased to work in each of June of 1997, 1998 and 1999. The reason given on her Record of Employment was “ “A” - shortage of work”. Denise Brown testified that ATL regards each of these severances from employment as terminations at the end of a fixed term. She testified that she understood from a publication of Human Resources Canada that “A” on a Record of Employment is used to indicate the end of a fixed term of employment as well as a shortage of work. She said that some employees were not hired the following August and some were. She did not give evidence that this belief about the significance of checking Box “A” on a Record of Employment was ever communicated to Ms. Oliver. The Records of Employment themselves do not say that. Each Record of Employment gives an expected date of recall (box 14 on the Record of Employment) as a date in September of each year, i.e. a date nine or ten weeks away from each of the dates of lay-off. Her final Record of Employment gives no expected date of recall.

7. During the course of employment with ATL, in the School Bus division and the City Delivery division, she was involved in three vehicle collisions. One involved a vehicle with a child on board, and two involved collisions while Ms. Oliver was driving the same type of extended van used for the school runs while delivering parcels for City delivery. In all three cases, ATL takes the position that Ms. Oliver was at fault. It concluded that she simply lacked the skill and ability to drive the extended van type of vehicle.

8. The third collision occurred on Friday, February 11, 2000. She continued to work that day and Monday and Tuesday of the following week. She was concerned about her employer’s response to the collision and made several inquiries to her supervisor. She also left a note for Denise Brown asking her to speak to her supervisor, Mike McLaughlin, and to ensure that she was not fired. On Wednesday, February 16 at midday, she spoke to Mike McLaughlin. She testified that Mr. McLaughlin said “I am sorry we can’t keep you on the insurance” and told her not to make the afternoon run. He directed her to Denise Brown (in charge of the Jamieson Delivery division) saying, “If you want to go over there, you can”. He did say he could not promise anything, “We are sister companies but we are not that connected”.

9. This was the evidence given by Ms. Oliver. Mr. McLaughlin was not called to give evidence.

10. Ms. Oliver spoke to Ms. Brown, who offered her work as a broker. Ms. Oliver was initially reluctant to try it, but ultimately did so. After a short time, Ms. Oliver ceased to work for the division. There was some dispute as to why she did not find it possible or acceptable to work for Jamieson Delivery. Ms. Oliver said she found the mechanical strain on her car (an older vehicle) was such that it would not withstand the pressure of driving quickly and short irregular distances. She also found the work difficult. She acknowledged that she could not keep up with the speed of deliveries required by Jamieson for fear of damaging her car.

11. Ms. Brown testified that she understood Ms. Oliver had a job during the day with a Subway store and was only available late afternoons. Ms. Oliver denied this and said that she started the job with Subway only two weeks after she left Jamieson. However, she agreed she was not available to Jamieson until 3:00 in the afternoon.

12. Whatever the reason, both Ms. Oliver and Ms. Brown found that this arrangement was not satisfactory. Ms. Brown confronted Ms. Oliver and said that if she could not provide the company with more hours of availability for work, the company wanted the two-way radio back so that this asset could be given to a more productive broker. Ms. Oliver returned the telephone and left. She did not say “I quit” or any similar phrase.

13. Ms. Oliver’s evidence was that she did not have the job at Subway while she worked for Jamieson Delivery. She did however say that she wanted to work only from 3:00-5:00, to preserve the life of her vehicle. She said Ms. Brown said “We need you for more time than that” and that Ms. Oliver refused. She testified that Ms. Brown said, “Then give me the radio” and had a brief conversation with another manager. The other manager then said, “We will call you if we need you”. He never did.

Issues and Decision

Was Ms. Oliver discharged and was she guilty of wilful misconduct or wilful neglect of duty?

14. For reasons set out below, I conclude that Ms. Oliver’s departure from Jamieson Delivery does not constitute a “quit” from employment. Accordingly, I am concerned at this point only with the severance of the relationship between Ms. Oliver and the School Bus division and City Delivery division. This was clearly a termination. Although Ms. Brown had some evidence about her understanding of the circumstances of the departure, the only direct first-hand evidence we had was from Ms. Oliver. This evidence was consistent only with a discharge. Accordingly, the employer’s first issue arises, that is, whether Ms. Oliver was guilty of wilful misconduct or wilful neglect of duty. Section 57(10) of the Act says:

15. (10) Subsections (1) and (2) do not apply to,

(a).......... an employee employed for a definite term or task;

(b).......... an employee who is temporarily laid off, as defined in the regulations;

(c).......... an employee who has been guilty of wilful misconduct or disobedience or wilful neglect of duty that has not been condoned by the employer;

15. Section 57(10)(c) of the Act creates a very limited exception to the obligation to pay notice. This distinguishes it from the “just cause” concept under most collective agreements and what a court will imply as a contract term into a contract of employment. It has been defined in earlier decisions under the Act as follows:

… Thus, in defining the term “wilful misconduct” in Argo Cleaners (Windsor) Inc., July 10, 1985, at pp. 10-11, I had occasion to say:

Wilful misconduct for the purposes of the statutes requires some deliberate or intentional act on the part of an employee. It is not enough to show that the employee failed to perform the duties he was required to perform or performed them incompetently if it is not also shown that his acts or omissions were the product of deliberation and design on his part. Thus acts which are done carelessly, thoughtlessly, heedlessly or inadvertently are not acts of wilful misconduct even if they are done repetitively and may have been the basis for summary dismissal at common law.

And in defining the nature of wilfulness in the context of both “misconduct” and “neglect of duty” in The Aylmer Express Ltd., October 31, 1985, at p. 8, Referee Brown said:

The “misconduct” or “neglect of duty” referred to in the Act is preceded by the term “wilful”. Therefore, it is not sufficient merely to show that an employee was indifferent, casual, thoughtless or neglectful in the performance of, or in the omission to perform, his or her duties or responsibilities. These acts or omissions must be the product of some deliberate or intentional act. The employee must consciously and deliberately engage in some positive act of misconduct or deliberately refrain from performing duties or responsibilities that he or she was required to perform.

Similarly, in Charles Caldwell doing business as Canadian Tire (May 6, 1986, ESC 2197, M.R. Gorsky), the Adjudicator stated:

It is necessary to first establish (the onus being on the Applicant) that the conduct of the Claimant can be categorized as being “wilful”. In Re Pentagon Mold & Tool Co. Ltd., April 11, 1974 (Magerman), E.S.C. 97, it was stated:

“A person cannot be said to be guilty of wilful misconduct or wilful neglect of duty unless he is conscious of doing the act which is complained of or in omitting to do the act which is said to have been done knowing he was committing a breach of his duty and also recklessly careless, whether it is a breach of duty or not.”

In Re Twin City Disposal Services, June 1, 1977 (Picher), E.S.C. 429, it is stated:

“Used in the legal context the word ‘guilty’, ‘wilful’, and ‘disobedience’ connote actions that are deliberate, intentional or so reckless as to be, in effect, intentional.” (emphasis supplied)

Inadvertent or unintentional acts or omissions of an employee are not within s. 40(3)(c) [now s. 57(10)(c)] and do not relieve the employer of its duties under s. 40(1) or (7) of the Act [now s. 57(1) and (7)]…

16. The behaviour of Ms. Oliver does not approach this standard. Her driving may have been substandard, characterized by unacceptable poor judgement, or simply careless or negligent. Even if it was all of those things, and I do not decide that, this does not meet the “wilfulness” standards set by the Act.

17. This case can be decided more simply than that, however. I do not for a minute criticize the decision to remove Ms. Oliver from her bus-driving responsibilities. The concern about the welfare of disabled children will lead an employer to be very careful. However, Ms. Oliver also drove for City Delivery. She could have continued to drive the shorter vans. That is, there was work within the scope of her original employment that she could have continued to do. Ms. Brown stated that Ms. Oliver may have been dismissed from driving for the School Bus division which used only extended vans, but was not discharged from her employment with City Delivery. However, Ms. Brown was not the person who altered Ms. Oliver’s status, and was not present when Mr. McLaughlin did so.

18. I have direct evidence only from Ms. Oliver. I did not hear from Mr. McLaughlin. Nothing in Ms. Oliver’s evidence is inherently untenable and therefore her evidence is what I am left with. He told her she could no longer drive as she had done in the past and that the only work possibly available was through Jamieson Delivery. In telling her that she could no longer drive in the manner she had previously done, notwithstanding that there were shorter vans she could have driven, Mr. McLaughlin’s action can only be characterized as a discharge. Since work continued to be available which ATL says she could do, no issue of misconduct arises at all. Therefore, this ground of the appeal is dismissed.

Reasonable Alternate Work

19. No employee has a right to a specific set of job duties. An employer may change or reassign duties over time if it is necessary to do so, provided that this reassignment of duties is not so complete as to constitute a discharge. When an employer dismisses an employee, it may avoid the obligation to pay termination pay if it offers the employee “reasonable alternate work”. Section 2 of Regulation 327 provides as follows:

20. Section 57 of the Act does not apply to a person who,

(a) is laid off after refusing an offer by the employer of reasonable alternate work;

(b) is laid off after refusing alternate work made available through a seniority system;

(c) is on lay-off and does not return to work within a reasonable time after being requested to do so by the employer;

(d) is laid off or terminated during or as a result of a strike or lock-out at his or her place of employment;

20. The sole issue here was whether the job with Jamieson Delivery was reasonable alternate work. Since the Employment Standards Act deals with employment rather than with work in general, the term “work” in section 2(a) refers to employment rather than to any work at all (see Canadian Protection Services Ltd., [1991] OESAD 110 (Peter A. Cumming, Q.C., as he then was). It is questionable whether the work for Jamieson Delivery is employment. Certainly, for the purposes of the Income Tax Act, the employer does not act as an employer. However, I prefer not to deal with the issue on that basis.

21. “Reasonable alternate work” has been the subject of a number of decisions under the Act. A useful definition and a review of the caselaw to that point is given in Canadian Protection Services Ltd., supra. The adjudicator gave this definition:

What is meant by “reasonable alternate work” and “reasonable alternative employment?” A “reasonable” test in legislation or by the common law is considered generally as being an objective one and that normative approach must apply here. The test is not whether the particular employee would have considered the offer reasonable alternative employment. Rather, the test is whether a reasonable employee, under the same or substantially similar circumstances, would have considered the employment offered as a reasonable alternative to the existing employment position then held with the same employer (see Re Hart and Cooley Manufacturing Co. of Canada Ltd., a decision dated June 27, 1986, by Referee Brown).

To understand this, it is enough to consider two hypotheticals. An employer moving its entire operation out of the country might say to its employees that they can retain their identical jobs in the new location (and be moved free of moving expenses), but a “reasonable” person (in reality, the referee on appeal becomes the “reasonable person”, a juristic construct) would say that the workers, given the tremendous dislocation to their social and personal lives, could reasonably reject such alternative employment. The employer’s offer to relocate might be very reasonable from its own subjective standpoint, but would not be reasonable on an objective basis.

On the other hand, if an employer did away with an employment position, say that of a telephone receptionist taking messages, due to a change in technology (for example, introducing a computerized phone mail system to its business operations), but offered the employee a new position at the same location with at least the same rate of pay and the same prospects for career advancement or promotion, an employee would be unreasonable in rejecting the position simply because he or she enjoyed talking on the phone with the business’ customers and did not want to give this up. The employee’s refusal might be very reasonable on a subjective basis, but would not be seen as reasonable on an objective basis.

That is, both employer and employee must be “reasonable”, on an objective basis. To state the “reasonable” test by employing hypothetical factual scenarios that involve ‘extreme’ situations is relatively easy, whereas applying the test to real situations, as here, is much more difficult.

As is evident from this decision, the standard is an objective one. That is, an employee is not entitled to refuse alternate work simply because it is new or challenging if, on an objective basis, a reasonable employee would be prepared to accept the alternative employment. As the adjudicator in Re Houri, [1995] OESAD 72 (Bradbury) said:

It is clear from her evidence that the Applicant takes the position that the only reasonable offer is a return to her former position as bakery cashier. It is also clear that her personal preference was influencing her view about the reasonableness of the offers. When she was asked about other positions in cross examination, specifically, work as hostess or waitress, her answer was that she could not do the job because she had never done it. While I can understand how difficult it may be to try a new position after such a long time, I am also satisfied that personal preference is not an appropriate basis for deciding the issue. The Applicant’s reason for refusing is essentially subjective and not objective and was based, at least in part, on an accurate view of what the position entailed. I am also satisfied that the Employer acted in good faith, given the slowdown in his business, in making the decision that he no longer needed a full-time person as cashier in the bakery section on a daytime shift. Therefore, I conclude that a reasonable employee in similar circumstances would have considered the offer set out in Option 2 as a reasonable alternative to the former position.

22. Regardless of whether the “work” must be in an employment relationship (as the Adjudicator in Canadian Protection Services Ltd. found) the work at Jamieson Delivery was not reasonable alternate work. The primary issue is that the work required a capital asset: a vehicle. Ms. Oliver’s vehicle was too old and frail to withstand the stresses of the job and she said that she could not afford to purchase a new one. Any work which requires a significant capital investment to be in a position to perform the work, where no such investment was required in the previous employment, is not a reasonable alternative. Therefore, the employer’s second basis for avoiding the payment of termination pay is dismissed.

Quit

23. Since I have found that the Jamieson Delivery work was not reasonable alternate work, it is not necessary to deal with the argument about whether or not Ms. Oliver quit. The evidence is contradictory and inconclusive. The reality is that she was unable to perform the work. The fact that Ms. Oliver was prepared to try to perform the work, does not constitute an acceptance of alternate work which forecloses her right to treat the discharge from the School Bus division and the City Delivery division as a discharge for which she is entitled to notice. Indeed, it would be inappropriate to penalize employees for attempting to get on with their life in a practical manner rather than relying on legal rights and turning immediately to litigation. If I were to do so, it would tend to lead to an increase in litigation, and a decrease in the number of times employees attempted to find a practical solution to their day-to-day problems. That is not a tendency which any adjudicator should wish to encourage. Therefore, the fact that Ms. Oliver attempted the work (even assuming it could be characterized as employment) that was offered to her for a brief period of time, before finding that it was not possible for her to perform it in any economic fashion, does not constitute an acceptance of the discharge and the commencement of a new type of employment or work with ATL.

Length of Notice

24. The issue here is whether to calculate Ms. Oliver’s employment from October 11, 1995 or from September 7, 1999 to her date of discharge. I do not discount the evidence of Ms. Brown and accept that her evidence as reflective of how ATL thinks of its employees. That is, it considers that they are hired only for a fixed term rather than for an indefinite term of employment, which may be characterized by seasonal lay-offs. However, I have no evidence that ATL ever communicated this to its employees at any time, and certainly not to Ms. Oliver. When an employer enters into a contract of employment and says nothing further, the employee is entitled to assume that this is an indefinite term of employment. If an employer wishes to make that employment for a fixed term, it is necessary for the employer to be extremely clear about this. Probably nothing less than written notice will do. This is an unusual term of employment, and if the employer wishes to ensure that this is a term of the employment contract, the onus is on the employer to ensure that the employee agrees it to.

25. In the case of Ms. Oliver, the facts are relatively simple. At no time was she told that her employment was for a fixed term. Indeed, during the summer of 1996 she was not laid off at all as there was work available for her driving children to and from summer school. The Record of Employment that she was given each time she was laid off gives an expected date of recall. Even if the “Code A” on the Record of Employment indicates either a shortage of work or the end of a fixed term of employment, the addition of an expected date of recall is conclusive. Ms. Oliver was laid off because of a seasonal lack of work and was expected to return to work in September. This is the hallmark of a seasonal lay-off rather than a fixed-term contract of employment. No period of lay-off exceeded 13 weeks and therefore, no termination occurred at any time between 1995 and 2000. Therefore, Ms. Oliver is entitled to 4 weeks’ termination pay.

Disposition

26. I uphold the finding of the Employment Standards Officer. This appeal is dismissed. The Director is directed to pay to Ms. Oliver the sum of $1,168.46 and to remit to the Consolidated Revenue Fund the remainder, being $116.85.

“David A. McKee ”

for the Board