Jurisdictional differences

Date: 2008
Author: Daniel A. Lublin
Publication: Metro
With multi-million dollar judgments routinely awarded to employees in American courts, most Canadian employees would prefer to have their cases heard before an American judge or jury, if presented with that option.  But Canadian employees don’t have it so bad.  In most cases, Canadian workplace laws actually favour their legal position.
Here are the top five legal advantages that Canadian employees possess, when compared to our American neighbours:
Employment at-will: This is an American concept, permitting dismissal without consequence.  That is, employers can discharge at-will employees at their pleasure, with legal impunity.  In contrast, Canadian employees are entitled to the benefit of provincially enacted minimum standards of advance notice of their termination, at least, and in most cases, they receive the more generous severance payments imposed by the courts.
No constructive dismissal: Canadian employees are protected against material changes to their working conditions, or the creation of such an unreasonable situation that there is no other option left but to resign.   While American employment law recognizes the doctrine of constructive dismissal, employment terms may generally be modified without prior notice and the standard to demonstrate that continued employment was intolerable is much more demanding.
Restrictive covenants: To protect themselves from departing employees, companies require them to sign agreements restricting their post-employment ability to compete, solicit employees or key clients, or disclose insider information to their benefit.  But such clauses are seldom enforced or, without any contractual language, Canadian courts will rarely intervene.  This is not so in American courtrooms, where judges are more partial to restrictive covenants, upholding them with greater regularity.
Employment standards and human rights legislation: Canada is among the most progressive jurisdictions in respect of minimum employment standards and human rights laws.  Pre-employment drug and alcohol testing is more prevalent in the United States.
Jury trials and cost consequences: In American courts, jury trials are more common, resulting in larger and more unpredictable damage awards.  Employment litigation in Canada rarely finds its way before a jury and as a result, the awards are usually more predictable.  Further, the formal cost consequences of rejecting a reasonable offer to settle before trial often prevents many cases from ever reaching the courtroom doors.