Disclaimer: This article does not constitute legal advice. Information contained herein is intended to provide knowledge about Canadian employment laws to small business owners and to encourage small business owners, entrepreneurs and independent contractors to seek further education about the laws and statutes that govern their businesses. This article is the property of Okanagan Small Business Services, Inc. © 2019. All Rights Reserved. This document may not be reproduced, distributed or transmitted in any form without the prior written consent of the publisher (Okanagan Small Business Services, Inc.).
Canadian employment law is a complicated web of laws, statutes and regulations. It can be daunting for a small business owner to know where to begin when it comes to getting educated about employment laws and how to avoid legal issues. Canadian courts expect every employer – regardless of size, industry, or years of experience – to be aware of and comply with employment laws. In the event of a legal issue, the defense of "I didn't know" will not stand up in court. For this reason, it is important for every employer in BC to have a general understanding of the laws and statutes that govern them.
In an effort to provide you with this general understanding in a 15-minute read, we will discuss the two main sources of employment law that apply to British Columbia employers: Statute Law & Common Law.
Statute law is law created by the government (both federal and provincial). “Statutes” are often called “legislation” or “acts”. Federal statutes only govern about 6% of employees in Canada because they only apply to federally regulated industries (in other words, industries of national importance – such as banking, railways and pipelines). The remaining 94% of Canadian employees are governed by provincial statutes.
For small business owners in BC, there are 6 main provincial statutes to be familiar with:
We have provided links to each of these statutes on our website and we strongly encourage all our clients to familiarize themselves with them. However, in the interest of saving you time, here is a brief summary of what each of these statutes are about:
BC Employment Standards Act (ESA): the ESA outlines the “minimums” for all employees in BC – including minimum wages, working age, working hours and overtime, statutory holidays, leaves, and terminations. If an employee believes their employer (or former employer) has violated any of the ESA requirements, they can bring a complaint to the Employment Standards Tribunal.
BC Human Rights Code: this is the provincial version of the Canadian Human Rights Act. The BC Human Rights Code does not exclusively apply to the employer-employee relationship, it applies to everyone in BC. The objective of the Human Rights Code is to protect everyone in BC from discrimination based on twelve prohibited grounds - including race, religion, family status and sexual orientation. Section 11, 12 and 13 are of particular importance to small business owners, as these sections cover discrimination in employment ads, wages and the duty to accommodate. If an individual feels they have been discriminated against on one or more prohibited ground, they can bring a complaint to the BC Human Rights Tribunal.
BC Labour Relations Code: the Labour Relations Code deals with unions and organized labour. Even if you are a small business owner of a non-unionized workplace, it is a good idea to familiarize yourself with the Labour Relations Code. This statute enables employees of any sized workplace (yes, even two employees) to join or form a union to collectively bargain with their employer. It also prohibits employers from interfering with this process. Please note that Okanagan Small Business Services does not provide HR services to unionized work environments.
BC Occupational Health and Safety Regulation (OHSR): OHSR is not technically a “statute”, however it outlines the legal requirements for employers to comply with the Workers Compensation Act. The objective of OHSR is to protect workers from work-related risks, injuries and illnesses. OHSR becomes more important when an employer has a workforce of 20+ workers.
BC Workers Compensation Act (WorkSafeBC): The Workers Compensation Act is an employer-funded, no-fault insurance program. It is designed to compensate employees in the event of a work-related accident, injury or illness. Every small business owner that employs one or more employees must register with WorkSafeBC and pay into the program. If you are a “solopreneur” without any employees, you can purchase optional coverage but are not required to do so.
Lastly, BC Personal Information Protection Act (PIPA): PIPA governs the collection, use and disclosure of personal information in the private sector. This statute is relevant to small business owners when it comes to employee surveillance, computer monitoring, managing personnel files, providing references, collecting information from your customers, and more.
Common law is not as “cut and dry” as statute law. Common law is law made by judges. It is based on past decisions (also known as “precedents”) and is applied in situations when there is no statute in place to address a particular issue. Common law is continuously evolving. Two important branches of common law that BC employers should be familiar with are Contract Law and Tort Law.
Contract Law: Contract law deals with employment contracts. Regardless of whether your employment contract is written or verbal, all employer-employee relationships are contractual and are governed by the common law. Over the years, judges have developed what are called “implied terms” which can be thought of as default rules for employment contracts. What this means for employers is that if you do not expressly state your own contractual terms of employment in a contract, your employer-employee relationship will be governed by the implied contractual terms of common law. This can be troublesome throughout the employment relationship for many reasons, but especially when it comes to terminations. For this reason, we strongly advise our clients protect themselves by having professionally drafted employment contracts with their employees.
Tort Law: Tort law addresses wrongs and damages that one party causes another, and provides legal remedies (usually in the form of financial compensation) to resolve the issue. A “tort” can be either deliberate (intentional) or negligent (unintentional). In an employment context, an example of a deliberate tort would be providing a false statement about one of your ex-employees during a reference check. This situation may result in either the ex-employee or their new employer bringing a tort action against you. If successful, the courts may award the ex-employee or their new employer significant damages (a.k.a. money) that you would be required to pay them.
Although it is not possible for us to cover the infinite implications of common law on employment relationships in this article, there are two key takeaway points here:
Okanagan Small Business Services, Inc.
Phone: (778) 738-0338
Want more helpful information?
If you liked this article, please consider joining our mailing list. We send monthly emails with special offers and helpful information for small business owners in the Okanagan.
Danielle Harshenin, BBA, leads the HR department at Okanagan Small Business Services. She is passionate about sharing her knowledge with small business owners.