How did the Ontario Court of Appeal rule on unpaid COVID-19 layoffs and constructive dismissal. What were the key facts of the Taylor v. Hanley Hospitality case. Why did the Court of Appeal refuse to make a definitive ruling on this employment law issue.
The Taylor v. Hanley Hospitality Case: Background and Key Facts
The Taylor v. Hanley Hospitality case centered around Candace Taylor, an Assistant Manager at a Tim Hortons location in Whitby, Ontario. In March 2020, as the COVID-19 pandemic hit Canada, the Ontario government ordered restaurants to limit their services to takeout and delivery only. As a result, Ms. Taylor was laid off without pay on March 27, 2020, though the Tim Hortons location continued to operate with reduced staffing.
On July 3, 2020, Ms. Taylor initiated a constructive dismissal lawsuit against her employer, Hanley Hospitality Inc. She argued that her layoff was merely “a business decision” and constituted constructive dismissal under common law. In September 2020, Ms. Taylor was recalled to work and returned to her position.
The Employer’s Defense
Hanley Hospitality, the employer, argued that due to the Ontario government’s declaration of a state of emergency, they had “no choice but to temporarily lay off over 50 employees.” They also claimed that Ms. Taylor was not actually laid off, but rather placed on Infectious Disease Emergency Leave (IDEL) as per Section 50.1(1.1) of the Employment Standards Act, 2000 and Ontario Regulation 228/20.
The Lower Court Decision: Justice Ferguson’s Ruling
Justice Jane Ferguson of the Ontario Superior Court of Justice made her decision based on the legal issues presented in the employee’s Statement of Claim and the employer’s Statement of Defense. She took judicial notice of several facts related to the COVID-19 pandemic and its impact on businesses and employment in Ontario, including:
- The widespread interruption of employment for hundreds of thousands of Canadians
- The declaration of a state of emergency in Ontario on March 17, 2020
- Government-mandated closure of storefronts and limitations on business operations
- The implementation of various emergency measures and legislative actions to address the pandemic’s impact
Justice Ferguson’s decision, found at 2021 ONSC 3135, was made without a trial, based solely on the pleadings submitted by both parties.
The Court of Appeal’s Non-Decision: Refusing to Resolve the Central Question
Employment lawyers eagerly anticipated the Ontario Court of Appeal’s decision in Taylor v. Hanley Hospitality Inc., 2022 ONCA 376, expecting it to resolve the debate over whether unpaid layoffs during the COVID-19 pandemic could constitute constructive dismissal at common law. However, the Court of Appeal’s ruling, released on May 12, 2022, disappointed many by refusing to decide on this central question.
Why Did the Court of Appeal Refuse to Make a Definitive Ruling?
The Court of Appeal, led by Justice Lois Roberts, criticized Justice Ferguson’s decision on technical grounds. They argued that Justice Ferguson erred in deciding the case on a Rule 21 motion, which should only be used for decisions that do not require any evidence and can be determined solely based on pleadings.
The Court of Appeal noted that Justice Ferguson incorrectly assumed that Ms. Taylor’s lack of a Reply to the Statement of Defense constituted an admission of the facts alleged by the employer. In reality, a Reply is not necessary when the issue has already been addressed in the Statement of Claim.
The Continuing Legal Uncertainty Surrounding COVID-19 Layoffs
The Court of Appeal’s refusal to address the central question of whether unpaid layoffs or deemed Infectious Disease Emergency Leave (IDEL) constitute constructive dismissal at common law has left the legal landscape as murky as it was at the start of the COVID-19 pandemic over two years ago.
What Are the Implications for Employers and Employees?
This non-decision by the Court of Appeal leaves both employers and employees in a state of uncertainty regarding the legal status of COVID-19-related layoffs. Employers may face potential liability for constructive dismissal claims, while employees remain unsure of their rights and options when faced with unpaid layoffs during the pandemic.
The Intersection of Common Law and Statutory Provisions
One of the key issues at play in the Taylor v. Hanley Hospitality case is the interaction between common law principles of constructive dismissal and the statutory provisions introduced to address the unique circumstances of the COVID-19 pandemic.
How Do the IDEL Provisions Affect Common Law Rights?
The Infectious Disease Emergency Leave (IDEL) provisions introduced by the Ontario government were intended to provide relief to employers and protect employees during the pandemic. However, the question remains whether these statutory provisions override or coexist with common law principles of constructive dismissal.
The Court of Appeal’s reluctance to address this issue leaves open the possibility that employees may have different rights under common law than they do under the Employment Standards Act, 2000 and its associated regulations.
The Role of Government Emergency Measures in Employment Law
The COVID-19 pandemic has highlighted the complex interplay between government emergency measures and existing employment law principles. The Taylor v. Hanley Hospitality case underscores the challenges faced by both employers and employees in navigating this new legal landscape.
How Have Emergency Measures Impacted Employment Relationships?
Government-mandated closures and restrictions on business operations have forced many employers to make difficult decisions regarding their workforce. These measures have raised questions about the extent to which employers can be held liable for actions taken in response to government directives.
At the same time, employees have faced unprecedented uncertainty regarding their job security and legal rights during the pandemic. The lack of clear legal guidance on issues such as constructive dismissal in the context of COVID-19 layoffs has left many workers in a vulnerable position.
The Need for Further Legal Clarification
The Court of Appeal’s non-decision in Taylor v. Hanley Hospitality has highlighted the urgent need for further legal clarification on the status of COVID-19-related layoffs and their relationship to constructive dismissal at common law.
What Steps Can Be Taken to Resolve This Legal Uncertainty?
Several potential avenues exist for addressing the ongoing legal uncertainty surrounding COVID-19 layoffs and constructive dismissal:
- Future court cases: Other cases addressing similar issues may make their way through the court system, potentially providing the opportunity for a definitive ruling on the matter.
- Legislative action: The Ontario government could choose to enact legislation that explicitly addresses the relationship between COVID-19 layoffs, IDEL provisions, and common law principles of constructive dismissal.
- Legal scholarship: Legal scholars and practitioners may continue to analyze and debate these issues, potentially influencing future court decisions or legislative actions.
- Alternative dispute resolution: Employers and employees may increasingly turn to mediation or arbitration to resolve disputes related to COVID-19 layoffs, potentially establishing precedents outside of the court system.
The Broader Implications for Employment Law in Canada
The Taylor v. Hanley Hospitality case and its non-resolution by the Court of Appeal raise important questions about the future of employment law in Canada, particularly in the context of unprecedented events like the COVID-19 pandemic.
How Might This Case Influence Future Employment Law Developments?
While the Court of Appeal’s decision (or lack thereof) does not provide clear guidance on the issue of constructive dismissal during COVID-19 layoffs, it may still have several important implications for the development of employment law in Canada:
- Increased scrutiny of the relationship between statutory provisions and common law principles in employment law
- Greater attention to the role of government emergency measures in shaping employment relationships
- Potential reform of legal procedures to better address complex employment law issues in times of crisis
- Renewed focus on the importance of clear communication between employers and employees during periods of uncertainty
As the legal community continues to grapple with the fallout from the COVID-19 pandemic, cases like Taylor v. Hanley Hospitality serve as important reminders of the ongoing need for adaptability and clarity in employment law.
Taylor v. Hanley Hospitality Inc., 2022 ONCA 376
Author:
P.A. Neena Gupta
Have you ever seen a movie and eagerly anticipated the sequel, only to be bitterly disappointed?
Employment lawyers felt the same way when they read the long-awaited decision of the Ontario Court of Appeal in Taylor v. Hanley Hospitality Inc., 2022 ONCA 376, released by the Court of Appeal May 12, 2022.
Justice Lois Roberts drafted the reasons for decision for the unanimous panel of three. This decision was expected to resolve the debate whether unpaid layoffs in the wake of COVID-19 could constitute constructive dismissal at common law, even if statutory notice and severance under the Ontario Employment Standards Act, 2000 were not owing. Some offices even had informal betting pools as to how the Court of Appeal would decide.
In the end, the decision was a complete non-decision. The Court of Appeal refused to decide the central question of whether an unpaid layoff or deemed Infectious Disease Emergency Leave (IDEL) constituted constructive dismissal at common law on technical grounds.
In short, the law is as murky as it has been since the start of COVID-19 over two years ago!
It is important to note that there was no trial in this matter. Justice Jane Ferguson of the Trial Court had made her decision on the basis of the legal issues as stated in the employee’s Statement of Claim and her employer’s Statement of Defence. Justice Ferguson’s decision can be found at 2021 ONSC 3135.
The background facts are quite commonplace. Candace Taylor was the Assistant Manager of a Tim Horton’s location in Whitby. The government of Ontario ordered that restaurants limit their offerings to take out and delivery. Ms. Taylor was laid off on March 27, 2020 without pay. The Tim Horton’s location was not closed, but operated with reduced staffing.
On July 3, 2020, Ms. Taylor started a constructive dismissal lawsuit. She was recalled back to employment in September 2020 and returned to work.
Ms. Taylor argued that her layoff was simply “a business decision” and constituted constructive dismissal at common law.
Her employer, Hanley Hospitality, plead that “as a result of the Ontario government’s declaration of the state of emergency”, it was “left with no choice but to temporarily lay off over 50 employees.” It also plead that Taylor was actually not laid off, but relied on Section 50.1(1.1), the IDEL provisions of the Employment Standards Act, 2000 and Ontario regulation 228/20. The regulation deems employees who are not performing their work due to reasons related to the designated infectious disease to be on IDEL . These employees are not entitled to notice or severance under the statute.
Justice Jane Ferguson took judicial notice of some well-known facts that were not in evidence, but were plead in Hanley Hospitality’s Statement of Defence:
- Hundreds of thousands of Canadians had their employment interrupted by the COVID‑19 pandemic;
- On March 17, 2020, the Ontario Government declared a state of emergency due to an outbreak of COVID‑19;
- As a result of the declaration, Tim Hortons was required by the Ontario Government to close all of their storefronts and was limited to takeout and delivery;
- Various levels of government have undertaken a variety of evolving emergency measures to attempt to mitigate the effects of the pandemic.
Those measures included the complete closure of certain businesses and restrictions on how certain businesses can operate; - Those emergency measures have had an impact on the employment market. Through no choice of their own, some employers have had to temporarily close their businesses or cut back their operations;
- The various levels of government have implemented legislative measures to address both (1) the unprecedented (in modern times, at least) impact of the pandemic; and (2) the impact of the emergency measures on businesses and the employees who work in those businesses; and
- The province undertook legislative measures to address the employment impacts of the pandemic and the emergency measures implemented to mitigate the effects of the pandemic.
Those measures included the complete closure of certain businesses and restrictions on how certain businesses can operate;
The Court of Appeal simply ducked the question. The Court of Appeal criticized Justice Jane Ferguson for deciding the decision on a Rule 21 motion, which should only be used for decisions that do not require any evidence and can be decided simply on pleadings.
Justice Jane Ferguson noted that Ms. Taylor did not deliver a Reply and therefore was deemed to admit the facts relating to the reasons for the layoff as plead by the employer. The Court of Appeal correctly noted that the lack of a Reply cannot be taken as an admission of the allegations in the Statement of Defence, since a Reply is not necessary where the issue has been addressed in the Statement of Claim.
Despite this technical error, counsel for both parties on the appeal were aware of the critical importance of the case and submitted that the Court of Appeal should provide guidance whether IDEL could constitute constructive dismissal at common law. Justice Roberts observed:
[45] The parties are now essentially seeking a standalone declaration of the meaning of s. 50.1 of the ESA and O. Reg. 228/20. Divorced from any factual foundation, the issue is academic at this stage of these proceedings because it would not resolve the fact-driven dispute between the parties: Borowski v.
Canada (Attorney General), [1989] 1 S.C.R. 342, at para. 15. As a result, it is at this court’s discretion whether the issue should be entertained and determined at this stage: Borowski, at para. 16. I would refrain from interpreting the provision and regulations. Not only was this remedy not sought in the parties’ respective pleadings, but for the reasons stated above, this panel has neither the record nor the submissions that would permit us to carry out a proper analysis of s. 50.1 of the ESA and O. Reg. 228/20The matter has been returned back to the trial level to be determined before another judge in the Superior Court of Justice.
The Ontario employment law community continues to wait for guidance from the courts on this critical issue.
Should you have any specific questions about this article or would like to discuss it further, you can contact one of the authors or a member of our Employment, Labour & Equalities Group.
NOT LEGAL ADVICE.
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Jane Taylor Millinery No wonder, because they adorn the heads of royalty, and not only British ones.
Jane Taylor started making hats in 2008. Today, her work can be seen on many titled persons – Catherine the Duchess of Cambridge, Sophie Countess of Wessex, Queen Elizabeth II’s granddaughters Princess Eugenie of York and Zara Phillips, as well as Crown Princess Mary of Denmark. At events such as the Ascot Royal Races and the Henley Royal Regatta, Jane Taylor’s hats are consistently recognized as the best. The fashion designer’s products are sold in the most expensive department stores in Britain – Harrods, Harvey Nichols, Fenwicks, Fortnum and Mason, and the House of Fraser store has launched a line of Jane’s hats under the Taylor brand.
– How did you get started making hats for the royal family?
Jane Taylor: I think my non-hat education helped me. By profession I am not a fashionista, but an artist. In college, she studied embroidery and other ways of decorating clothes. We drew a lot from life, learned to observe proportions. I was imaginative all the time..jpg)
For example, for embroidery she used not traditional materials, but rubber, copper, wires, pieces of organza, starched lace. I tried to do not flat, but 3D embroidery. In addition, I have always liked sculpture, and I created sculptural forms from fabric. And for the diploma collection I chose the theme “Theatrical headdresses”. So I started making hats. After graduation, I went to the town of Henley, where one of the main social events in Britain takes place every year – the royal regatta. There ladies always appear in hats. I came to the owners of boutiques and offered my work. In the end, I bought the entire collection. Then I opened a workshop in London – in the area where, as I thought, my future clients lived. Gradually, ladies from high society began to appear more and more often at social events in my hats – and my work was noticed by people from the royal environment.
– You have made more than one hat for the royal wedding. How do you work with clients?
Jane Taylor: Making any custom hat takes between one and a half and two and a half months.
I take measurements of the head, then I come up with a design, and only then I start making a hat. We have two fittings, and after that I hand-dye the product in accordance with the chosen outfit and the client’s skin tone. I want to note one more important thing. I really appreciate the attention and honor that members of the royal family show me with their visit, but I approach working with the most ordinary clients with the same care and responsibility.
– What does the production of a headdress involve? And why does it take so long to make?
Jane Taylor: Making a hat by hand is a painstaking process. First, I draw the desired shape on paper or computer, or form a “prototype” from dense fabric. Then I send the sketch to a woodcarver who cuts out a wooden mold/blank for the hat. Having received it, I begin to lay out on it and glue layers of material that is made from palm fibers. When applying layers, it is important to ensure that the fibers form a beautiful grid or geometric pattern.
Usually I use three layers, but sometimes I add a fourth, which I paint in gold or silver. When the layers are dry, I cut and finish the edges, paint the workpiece and begin to shape the hat. The longest procedure is the dyeing of feathers, because they have to be not only dyed by hand, but also dried, so that the paint lies evenly and does not weigh down the feather. If the hat is made correctly, no matter how voluminous it is, it will still remain light and will keep well on the head.
– How to wear a hat so that it not only fits well, but also looks good?
Jane Taylor: I often see inexperienced women wearing a chin band. This is wrong: the elastic should be worn on the back of the head and hidden under the hair. Another common mistake is a hat of the wrong size, which breaks the proportions of the figure. Short women often choose massive hats, which is strongly discouraged. And most importantly – wear a hat so that the edge of the hat reaches the eyebrow line or crosses it.
– Hats are a tradition in the UK. What is it connected with?
Jane Taylor: With the royal family. At some deep subconscious level, a hat is associated with royalty, which is why people like to wear hats. Special “hat” traditions in the UK are associated with the wedding. At British weddings, the mother of the bride wears the largest hat, the mother of the groom’s hat should take second place in size. The rest of the guests also come in headdresses. That’s etiquette. Of course, not everyone follows it, but those families where they know about the existence of a dress code follow the rules. And at the Royal Ascot and the regatta in Henley, you simply will not be allowed to go without a hat – the “hat” police are on duty at the entrance.
– You have been making hats for Ascot and Henley for several years. Have the tastes of your clients changed?
Jane Taylor: Of course. Light feather decorations that are attached to the headband are gradually falling out of fashion, and small cocktail hats are becoming popular.
Another trend is disks on the rim and large, almost flat hats. Beige, red and purple colors are in fashion, as well as prints. The style of the 1940s and 1950s is returning.
– Why are your hats loved by recognized fashionistas?
Jane Taylor: Many hats look very old because of the clutter of elements. I try to keep my hats as simple as possible so that a woman looks younger than her years. I work with unusual shapes and interesting textures, I like to combine vintage materials and modern volumes. It seems to me that hats that have both the shape and the material are modern are only good for 16-year-old models. It is difficult for older women to wear them. When I received my second education at Chelsea College, already in the field of hat making, I worked part-time in a workshop where hats were made only from vintage materials. I constantly went to the markets and looked for ancient feathers, lace, beads. I think this also influenced my style, as did my love for unexpected materials.
– So you also make collections?
Jane Taylor: Yes, I release three collections a year: bridal, ready-to-wear and custom. Wedding and ready-made hats from these collections can be purchased in stores in London, in my workshop or ordered online.
– How are you doing?!
Jane Taylor: Firstly, I have two assistants, and secondly, if I have a lot of orders, I just don’t sleep. It happens that some model becomes so popular that I do not have enough ready-made copies for everyone who ordered it online. Then I just work around the clock, but we always ship all orders on time. This is our principle. But my work is highly appreciated: in 2010 I was invited to dinner with Her Majesty. Now my plans are to enter the international market.
Do you wear hats yourself?
Jane Taylor: I always wear them in winter and to weddings. But I do not have enough time to make a hat for myself, I choose from what is in the workshop.
The designer created beautiful hats for Katherine.
She confirms that Kate has a “special effect” and although so many people ask her to make a copy of the hats, Jane always refuses, since her creations are only made for the Duchess of Cambridge.
Georgie Henley
In her early childhood she appeared in commercials. Georgie later played in a local theater group called the Ilkley Upstagers, where she was discovered by casting director Pippa Hall while casting for the film. Georgie landed the role after beating over 2,000 other applicants. Georgie on filming The Chronicles of Narnia: “I was amazed at the scale of the shooting, at first it was scary even to believe what was happening. But everyone helped me a lot, for which many thanks to our wonderful film crew!”. The film grossed over $700 million at the box office and earned Georgie two awards, the Phoenix Film Critics Society Award and the Young Artist Award.
Lucy Georgie also played the role in the sequel to The Chronicles of Narnia: Prince Caspian (2008), as well as in the third part of The Chronicles of Narnia: The Voyage of the Dawn Treader, which premiered in 2010.
In her early childhood, she appeared in commercials. Georgie later played in a local theater group called the Ilkley Upstagers, where she was discovered by casting director Pippa Hall while casting for the film. Georgie landed the role after beating over 2,000 other applicants. Georgie on filming The Chronicles of Narnia: “I was amazed at the scale of the shooting, at first it was scary even to believe what was happening. But everyone helped me a lot, for which many thanks to our wonderful film crew!”. The film grossed over $700 million at the box office and earned Georgie two awards, the Phoenix Film Critics Society Award and the Young Artist Award.
Lucy Georgie also played the role in the sequel to The Chronicles of Narnia: Prince Caspian (2008), as well as in the third part of The Chronicles of Narnia: The Voyage of the Dawn Treader, which premiered in 2010. Following the release of The Chronicles of Narnia: The Lion, the Witch and the Wardrobe, Georgie also acted in her theater group’s production of Babes in the Wood, which ran from January 27 to February 4, 2006.
She also played the role of young Jane Eyre in the BBC adaptation of the film of the same name.
Georgie currently lives in Ilkley and studies at Bradford Grammar School, where she also attends the Ilkley Upstagers.
In her early childhood, she appeared in commercials. Georgie later played in a local theater group called the Ilkley Upstagers, where she was discovered by casting director Pippa Hall while casting for the film. Georgie landed the role after beating over 2,000 other applicants. Georgie on filming The Chronicles of Narnia: “I was amazed at the scale of the shooting, at first it was scary even to believe what was happening. But everyone helped me a lot, for which many thanks to our wonderful film crew!”. The film grossed over $700 million at the box office and earned Georgie two awards, the Phoenix Film Critics Society Award and the Young Artist Award.
Lucy Georgie also played the role in the sequel to The Chronicles of Narnia: Prince Caspian (2008), as well as in the third part of The Chronicles of Narnia: The Voyage of the Dawn Treader, which premiered in 2010.
