::this post ID is 14656::::in categories of ..Legal Corner..::

Franchisor groups oppose changes to employment laws proposed in new report

Employment process information concept on blackboard with a hand pointing on it.Ontario employers and employees may face significant changes to workplace laws after the provincial government released its “Changing Workplaces Review: Special Advisors’ Interim Report.”

The review’s focus is on issues faced by ‘vulnerable workers in precarious jobs,’ but many of the potential changes would affect all provincially regulated employers and employees. The report deals with the Employment Standards Act, 2000 (ESA) and Labour Relations Act, 1995 (LRA) and identifies approximately 50 issues with more than 225 proposals for change, mainly from unions or other employee advocate groups.

Jason Hanson, Allison Di Cesare and Josh Fineblit of Osler, Hoskin and Harcourt LLP recently addressed one of the proposals for a complete overhaul of the relationship between franchisors, franchisees and the employees of franchisees. They found the review proposes amending LRA and ESA to force additional employment-related duties on franchisors by introducing a new joint employer provision in LRA. This means franchisors and franchisees could be declared joint employers for all of a franchisee’s staff. The lawyers say this change could thrust franchisors into collective bargaining negotiations with respect to workers over whom they have no day-to-day oversight. It could also place obligations contained in a collective agreement, such as potential joint liability for a franchisee’s failure to pay his/her workers, onto franchisors.

Adopting a new model for unionizing franchises would allow employees at one franchise site to unionize, negotiate an initial collective agreement and then allow the other franchise sites of the same franchisor to be brought under the terms of that initial agreement. The lawyers say amending ESA to make franchisors liable for their franchisees’ employment standards violations could make them exercise additional control over the operations of their franchises, which in turn would enhance the risk of franchisors being defined as the true employers of their franchises’ staff. The review points out employer/franchisor groups strongly oppose these changes, as they could threaten the entire franchising business model.

To read more from the lawyers on the “Changing Workplaces Review: Special Advisors’ Interim Report,” click here. 

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