Midterm Flashcards
Questions of business strategy
What is risk?
What is legal risk?
Identification evaluation and response
How identify?
How evaluate?
How to create response
OR
Rules
Process
Strategy
When starting a business
- Rules? What rules? Why?- find out what laws need to be abided by
- Process? What process? Are you following the rules? Are their any ambiguity? What are concequences for not following?
- Strategy? What strategy? Should I comply? What should I do?
What is getting ahead of the regulatory curve?
Fixing processes to fix laws that will be there in the future
What is the law
Definition: Law is a body of rules that can be enforced by the courts or by other government agencies in order to resolve disputes
Key component: must be able to be enforced
Varies from place to place
What is a rule vs a law
No chewing gum in class vs no speeding
Laws vary from place to place
Laws can be punishable in a variety of ways including fines jail time etc
What is the goal of the law
Law is a balancing act of competing interests guided by a purpose or rationale and that purpose includes predictability AND fairness
There to resolve disputes
Explain the balancing act between predictability and fairness
- Predictability AND Fairness: If you always apply law the same to everyone regardless of circumstances it may be predictable but NOT fair so the facts and circumstances are very important (Examples: Small business and disabled employees. Speeding.)
Fairness is Subjective and Has Limits: What is fair in a perfect world is often not feasible and affordable (Example: A consumer dies from a bad product such as a medicine/drug. Rules? What is fair? How much is a life worth? What is feasible?)
Laws and Interpretation and Enforcement: Politicians make the laws and judges (and other adjudicators such as administrative tribunals, arbitrators etc.) have to decide how to enforce those laws predictably, fairly, and feasibly (so people will use the legal system and follow its rules)
Why do laws exist
solve a problem (but what types of problems)
protect consumers, workers, employees, from harmful acts
protect business from other businesses (cheating, fraud)
predictability and enforcement
international rules so all business must play by same rules
rules can create setting for innovation (see below)
What is the law about and what is the method to the madness
law is about trying to come up with a good way to solve a problem
sometimes rules have unintended consequences, or cannot be enforced, or are too easy to avoid, or are perceived as being unfair
but there is a rule for almost any type of action, including business activity, and there is a rationale behind the rule
Examples: What is the rationale for ?: employment laws, torts and negligence laws, contract laws, property and intellectual property laws, environmental laws, competition laws, international trade law
So, you not only need to know what rules exist, but also why they exist, since this will inform your Strategy of how to respond to the rules ( comply with the rules, or ignore the rules, or get around the rules, use the rules for innovation and disruption)
Why businesses want rules
Where no laws exist, there is a void and the business area can be subject to abuse, then reputational decline, get free riders, business wants even playing field, including internationally
What would the business world be like without laws (no employee rights, no rule about contracts, no protection of ideas such as IP, no property, no bankruptcy, no corporations and limited liability)
Explain rules process and strategy
In order to understand how business law works, and to make good decisions as a businessperson or employee, you need to think about 3 related things:
Rules: You need to understand what the rules say AND also what they don’t say (Rules are ideas or principles rather than answers and must be interpreted through some Process focusing on the facts and circumstances and balancing both predictability and fairness)
Process: You need to understand how the legal system works with and applies these Rules using a balancing act (see previous slides) alongside procedural rules for how to use the court and legal system
Strategy (Risk Management): You need to understand how to consider the Rules as well as the Process to decide on a Strategy that is most likely to give you what you need (money and compensation, deter others from doing the same thing, justice no matter what it costs, revenge)
Risk management as a business strategy
Steps: Identification, Evaluation and Response
Strategies: Avoidance, Reduction, Shifting, Acceptance
Techniques: Insurance, Exclusion and Limitation Clauses, Incorporation
Examples: Purdue Pharma and painkiller drugs, Juul and vaping, Uber and rideshare
Problem: Latisha has worked for a bank for over 5 years but one day she gets into a car accident and cannot work for several months. When she is ready to return to work, she asks to be transferred to a job where she does not have to stand so much. Her employer (NazTea Inc.) tells Latisha that is not possible and that she will have to quit her job?
Rules? What do you think the rules are? How find out?
Process? What do I do next? How do I use the rules?
Strategy? What strategies and options should I consider? Why do I want and how do I get it? Either for NazTea Inc or Latisha? Latisha?
How does NazTea create a Strategy? Risk management?
Steps: Risk Identification, Evaluation, Response
Strategies: Avoidance, Reduction, Shifting, Acceptance
Techniques: Insurance, Exclusion and Limitation Clauses, Incorporation
How is criminal and civil law different
business law is civil law which means a plaintiff is suing a defendant usually for money or compensation whereas in criminal law the government is taking someone to court to punish them including incarceration/jail
criminal law and civil law sometimes overlap (example: cruise ship accident, Vancouver hockey riots, OJ Simpson murder trial)
How are rules created
There are different levels of government and jurisdiction (city/municipal, provincial, national and international)
Influencers: Lobbying attempts to use the political process to influence law creation or modification (using lobbyists or Governmental Relations Departments at large businesses)
Judges and case law
what are the main categories of rules
Main categories of rules: statutes and common law
What is a statute? It is a law or rule or regulation created by the government (federal, provincial or municipal)
Examples: Criminal Code, Canadian Business Corporations Act, Constitutions Act and Charter of Rights, and provincial laws (BC Employment Standards Act, BC Corporations Act), Vancouver building codes or zoning laws or housing rules
What is common law? Decisions or cases decided by the courts (either provincial courts, federal courts including the Supreme Court of Canada, and administrative tribunals)
What if rules differ
Sometimes rules in different provinces may vary, or conflict with federal/national law, or may conflict with a court decision, or different courts may disagree. So what happens then?
Example: One province says legal drinking age is 18 and another province says it is 21. Or vaping age ? COVID rules?
Why is there overlap?: The Canadian Constitution Act outlines whether the federal government or province has authority or “jurisdiction” to create law about a particular activity or issue
Example: One province says you have to be 18 to start a business but the federal government says you must be 21 (Overlapping jurisdiction) OR Kinder Morgan Transmountain oil
What happens when there is a conflict? Courts decide
these types of conflicts give the impression that law is very complex and unpredictable but there are rules for dealing with a conflict in rules
How do canadas laws impact the world
Canada (national, provincial and cities) must make laws on many issues
these laws exist in a global context (want to have some consistency and common approaches to important such as contracts, IP, trade and tariffs etc.)
there will also be many differences (eg employment, tax, environmental)
all laws come under political pressure (eg Huawei and China) and this impacts business operations
What are international rules and how are they relevant for businesses
international rules are not only international laws (treaties like Paris Convention on Climate Change) but also the law in other countries
national laws in other countries can be very different and if you do business in these countries, you may need to follow (eg environmental law, tax laws, employment laws)
Examples: Paris Convention and Climate Change, international rules on IP protection for patents, international human rights laws
Explain the charter of rights and freedoms
The Charter of Rights and Freedoms outlines important principles that governments must guarantee to citizens
Examples: freedom of speech (including what businesses can say and advertise), freedom of association (includes unions and collective bargaining), freedom against discrimination (useful in employment situations)
There are other important human rights statutes: Canadian Bill of Rights, provincial human rights acts and these can apply to businesses dealing with individuals and NOT only government
What are court procedures/rules about going to court
You need to know the Process in order to strategically assess the risks of a legal dispute and going to court compared with other options:
the rules about going to court are procedural law
Procedural law: the rules you need to follow to initiate and pursue a legal claim including the filing of documents, timelines or deadlines, trials and evidence, and appeals (when you don’t win the first time)
Statement of claim: a document you file that states what you are claiming and how the law supports your claim (Example: What would you say in an employment/workplace discrimination statement of claim)
Statement of defence and counterclaim: a document stating your defence and maybe, counterclaim (Example?)
Examination for discovery: pre-trial process for reviewing and scrutinizing the evidence and reliability of plaintiff and defendant
Limitation period: deadlines for when you must begin your legal claim and process
What does knowing the court system help you manage
Knowing the court system helps you manage risk (cost, timelines, remedies) and identify the best way of achieving your objective
Which court do I go to? It depends on your type of legal problem since there are specific courts for specific issues
Types of court: federal, provincial including small claims court, trial court and appeal court (federal & provincial) and Supreme Court of Canada (highest court of appeal)
Small claims court: where the claimed amount is less than some amount (less than $35k for BC)(or motor vehicle claims up to $50k)
Alternatives to court: tribunals, ADR (see upcoming slides)
Example: You have a dispute with your landlord over getting back a security deposit? What do you do? Where do you go? Factors to consider? Strategy?
Explain court trial
Knowing the court system helps you manage risk (cost, timelines, remedies) and identify the best way of achieving your objective
Which court do I go to? It depends on your type of legal problem since there are specific courts for specific issues
Types of court: federal, provincial including small claims court, trial court and appeal court (federal & provincial) and Supreme Court of Canada (highest court of appeal)
Small claims court: where the claimed amount is less than some amount (less than $35k for BC)(or motor vehicle claims up to $50k)
Alternatives to court: tribunals, ADR (see upcoming slides)
Example: You have a dispute with your landlord over getting back a security deposit? What do you do? Where do you go? Factors to consider? Strategy?
Precedent: means that the judge must apply the rules that apply to the dispute including previous court decisions. Why? This promotes consistency and fairness. Judges can’t go “rogue”
Remedies and Outcomes: if you win, the judge typically awards money (damages) to compensate you for your loss, or sometimes to deter others from doing the same thing (punitive damages) but can’t give you certain things (eg things that have been destroyed or given to someone else)
Disputes and Appeals: if you don’t agree with the decision, you can sometimes ask a higher court (appeal court) to review the decision (plaintiff becomes appellant, defendant becomes respondent)
Empty Judgement: even if you win your case and the judge awards damages (money or something else) you may still not get what you were awarded by the judge since if the defendant does not have money, or lives outside Canada, you may not be able to enforce the court’s decision
All of these things are important strategic considerations and part of risk management
Costs and remedies of court
What are the risks and the rewards? What is at stake?
Risk and Costs: if you lose, you will pay damages for harm you have caused, court and lawyer costs, pay for other business/person’s costs, your time, damage to your business reputation, or damage for the harm even when it was caused by others (vicarious liability)
Vicarious liability: not only responsible for harm you caused but also the harm caused by those you are responsible for (eg employees)
Rewards and Remedies: if I win, put me back to condition I was in before I was harmed (if possible?) or compensate me for the harm I suffered (financial, physical, emotional), give me the thing I wanted (contract), stop doing harmful things (injunction)
Remedies: there are limits on what you can get, what a judge can give you (remedy for loss of life?), cannot give you back something destroyed (?), and sometimes the loser cannot or won’t pay
Evidence and proof
The Process requires convincing evidence to prove your case so your Strategy must assess whether you have adequate evidence (including evidence to support arguments of fairness eg speeding to hospital)
Burden of Proof: The plaintiff has the burden of proof in court and must provide enough evidence to meet the standard of proof
Standard of proof: this is how much evidence is needed to win the case and that standard is a “balance of probabilities”
Balance of probability (BOP): you must convince the judge that it is more likely than not that you are right
Criminal law: is different from civil law since the government has the burden of proof and the standard of proof is “beyond a reasonable doubt” (BARD)
What evidence?: physical evidence such as photos, testimonial evidence such as witnesses (2 main types of evidence)
Example: You are claiming workplace harassment? The employer disputes your claim and even claims you were to blame? What evidence do you put together? How? Who has burden of proof? How would you apply the standard of proof? BOP or BARD? What is the difference?
Class action lawsuits
Class actions?: when many individuals who have suffered the same harm or damages from one person or business (defendant) bring their case together to a court
Why useful? Reduces costs, can hire one lawyer, provides more evidence or weight to your claims of damage ( 3 main reasons)
Risks? Some individual cases may be different, courts may be more reluctant to award damages to large groups claiming significant damages, class action not always possible (3 main risks)
Process? You must get certified or recognised as a class (this joins cases together), and if settle with defendant you must have court approval
Strategy: in order to know whether a class action is a good Strategy you need to know the Process so you can assess the risks as well as the benefits
Example: Walmart and wage discrimination (female employees)
Administrative tribunals
Administrative Tribunals: government agencies (eg Canada or BC) created to act as a court and judge on specific technical issues (employment and labour issues, human rights, tax, environmental, securities law)
Why do they exist? alternative to court system, less expensive, less time consuming, and more specific expertise in certain areas of law (eg employment disputes) (4 reasons)
Strategy: in order to identify your best Strategy, you need to know the Process of using Administrative Tribunals and why they may be the best way of getting what you want
Example: Ravi believes that he has been fired from his job due to discrimination but he cannot afford to go to court and get a lawyer. Is there another strategy? What should he consider as part of his Strategy?
ADR
Alternate dispute resolution (ADR) are options for how to deal with a dispute instead of going to court (or before deciding about going to court)
3 Main forms: Negotiation (including Settlement), Mediation, Arbitration
Negotiation: informal way to try to get a resolution
Settlement: can negotiate and agree on a compromise, and can do so even during court trial
Mediation: requires an agreed upon mediator, and you are not bound to the decision
Arbitration: is more formal, with professional arbitrator, and decision is binding, and very common in business world, particularly in international deals
Benefits and risks of ADR
What are the Benefits of ADR?: costs less than courts or even nothing, you have more control over the Process and Rules, more expertise of the “judge” or decision maker on complicated or technical issues, less adversarial and more informal, you can address international disputes where local courts cannot (5 benefits)
What are the Risks? you don’t get everything you want (compromise), other person ignores the decision (mediation, negotiation), you want to make your argument to a judge or jury (more sympathetic?) (3 main risks)
Example: Ravi believes that he has been fired from his job due to discrimination but he cannot afford to go to court and get a lawyer. Is there another strategy? What should he consider as part of his Strategy?
Identification
Always ask what are the rules that apply to my problem?
How? criminal or civil, statutes or court cases or tribunals, which place or jurisdiction (federal or provincial or overlap, international)?
If I am doing business in different provinces or different countries then maybe many rules apply to my problem, so find out
Example: You run a small tech business in Vancouver but you have one employee based in Calgary, one in London UK, and a small office of 2 employees in Shanghai. If you need to hire and fire these employees, which legal rules apply?
Example: Uber? Airbnb? Different rules? How do they manage the Rules and the risks? (see also below)
Evaluation
You need to evaluate the Rules and how to use them
What do the Rules say and what do they mean (how interpreted) which is more than Identification?
How do the rules apply to your situation?
Understand how the legal system and legal process works
Know the legal Process and consider your options (courts, types of court, negotiation and ADR)
Obtain opinions and advice ( eg lawyers) in order to create a Response and Strategy
Response and strategy options to laws
there are different strategies in responding to rules about business, including your business
You can:
try to prevent rules or change them (political lobbying)
anticipate the rules and innovate (stay ahead of the rules and regulations)
react to the regulations and manage risks (legal risk management) so that your business is better prepared if there are problems
Strategy: goals
Your overall objective is to be a sophisticated businessperson knowledgeable and strategic about how the legal system works so you can manage risks AND identify opportunities (always remember Rules create both obligations and opportunities)
Risk Management steps: identification, evaluation, response
Risk Management strategies: avoidance, reduction, shifting, acceptance
Risk Management techniques: insurance, exclusion clauses, incorporation
Strategy: Lawyers
Why consider a lawyer?: Lawyers help you with all these issues from Rules to Process to Strategy including how to manage your risk
Rules: What do the Rules say? How are the Rules interpreted by courts and judges? How do the Rules apply in my situation? Do I have a good case?
Process: What is the Process? Should I negotiate including ADR? Who can I sue? Who is responsible for the harm (sometimes more than one person eg opioid crisis)? What can I get either through negotiation or court (remedies)? Do I have good enough evidence and witnesses? Can I afford going to court, or getting a lawyer?
Costs of a lawyer? legal fees (but sometimes lawyer will take cases on “contingency”)
How to reduce costs? specific tasks like demand letters, lawyers for strategy and insights and advice even if do not go to court
Can I be my own lawyer?: You can represent yourself in small claims court but not in other types of cases since self-representation wastes time for the legal system
Example: When you were not given a raise at work, you posted some nasty things about your boss on various social media sites. Not only were you fired, your boss is now suing you for defamation. How do you decide whether to get a lawyer? How do you find one? What conversation do you have with the lawyer? Let’s have a discussion with a lawyer!
what is the purpose of employment law
Employment law is a balancing act between the rights of employers to hire the type of employee they want and to pay the wages they want AND the rights of employees to be treated fairly, to make a fair wage, to be safe, and to have their human rights respected, including right not to be discriminated against or harassed
Employment law is a response to a long history of labour problems and abuses which led to unions and the process of collective bargaining
what are the four main sources of employment law
contract law about your employment contract
laws (statutes) on employment standards, human rights and labour that vary by province, AND federal laws on labour, human rights and discrimination such as the Charter of Rights and Freedoms and these federal law apply across Canada
court decisions (common law) dealing with issues such as termination (severance) and collective bargaining
decisions of tribunals/administrative agencies such as human rights tribunals, labour boards, employment standards boards
Example: If you show up at work one day and your boss tells you that you are fired, which of these 4 sources of employment laws may apply to your situation? (Risk Identification)
What is an employee
The legal meaning of employee is more precise than how the word is used generally
There are many types of employee but the main distinction is whether you work for others or work for yourself
(1) Independent contractor: works for him/herself (eg plumbers, lawyers, accountants, real estate agents, Uber drivers?)
(2) Employee: committed to only one employer
How do lines between employee and independent contractor get blurred? Lots of employment arrangements that blend elements of both
Dependent contractor: operates a separate business but ongoing and “dependent” relationship with one employer
what are the 5 main reasons to know whether you are an employee or not
Only employees are entitled to legal benefits and protections of employment law (not independent contractors)
Independent contractors and some management jobs get very few employment law protections (still have some rights such as right to a contract, IP ownership)
Today’s workforce blends the typical employee environment with contractor to make things more confusing about who is employee and who is not (working at home, COVID19, personal computer, short work week, remote meetings etc.)
Dependent contractors: law tries to put these workers into an existing category (usually employees)
Liability of employer for employees determined by whether you’re an employee or not (employers not liable for independent contractors)
what are the two types of rules that makes you an employee
statutory definitions (eg BC Employment Standards Act)(but there is NO one definition of employee)
common law or court decisions and definitions that use the concept of “degree of control exercised” and application of 2 tests or questions: (1) control test and (2) organization test
How do you apply the rules to see if someone is an employee
Contract: If I have a contract then am I an employee? Not necessarily. Even if you have a contract, you may be employee or self-employed/independent contractor depending on your particular employment arrangement
So how do you determine who is employee? Apply the rules or tests:
Control test?: Who owns equipment or “tools of production”? Do you get an hourly wage or salary (payment scheme)? Who hires extra workers (who selects workers)? Who disciplines workers? Does worker or employer assume risks or profit or loss? (Facts and evidence important)
Organisation test?: Is the employee “integrated” into the organisation? (eg small business with one accountant)
Example: Uber: Are Uber drivers employees or independent contractors? (see Casebook)
what are the two main types of employment contract
Two main contract types: personal contract between you and employer OR collective agreement (for all employees and not just you)
what are contract terms
Restrictive covenants such as “non-competition” and “non-solicitation clauses”: restrict where and with whom an employee (who leaves) can work and with what clients
what are rules and types of protection against discrimination
Rules: Employees have protections under the Charter of Rights and Freedoms (sections 2, 15 but also see limits under section 1) AND Canadian Human Rights Act AND provincial human rights acts (see Module One slides)
Types of Protections: cannot discriminate against people when hiring (race, pregnant, age, sexual orientation), and cannot discriminate in the workplace (such as paying women or minorities lower wages (See Casebook: Johnstone and Walmart)
what does the law say about hiring and discrimination
Employers need to be careful that they do not discriminate in the hiring process (pre-employment)
Employers cannot discriminate based on a characteristic listed in the Charter or provincial human rights acts (eg gender or age etc.) UNLESS the discrimination can be “justified” (a bona fide occupational requirement)
What is a bona fide occupational requirement (BFOR)? Particular skills? Languages? Strength? Gender?
Example: A business needs to hire someone to answer the phones and take walk-in orders. The job post reads: “Rooters Pub is now hiring in Vancouver. Good wages ($9/hour), flexible hours. Uniform requirements. Female applicants only please.”
what is harassement
Rule: Harassment is unwelcome physical or verbal conduct that a reasonable person would consider objectionable or unreasonable (BC Human Rights Code)
Facts and Evidence: harassment depends on the facts and circumstances
Employer is legally responsible if other employees harassing an employee if that employer has not taken steps to protect all employees (this is law about vicarious liability)
what are some examples of harassment
Material that is displayed publicly or put in someone’s workspace that is racist, sexist, sexually explicit, anti-gay or lesbian, or insulting due to any of the group characteristics in the BC Human Rights Act;
Verbal abuse or comments that belittle people because of sex, pregnancy, race, sexual orientation, disability, or any other ground previously listed;
Unwelcome and hurtful jokes based on gender, race, marital status, sexual orientation, disability, or any other ground previously listed;
Sexually or racially offensive gestures;
Ignoring, isolating or segregating a person because of sex, race, or any other ground previously listed;
Staring or leering in a sexual nature;
Physical contact of a sexual nature;
Aggressive physical conduct;
Repeated behaviour which a person has objected to and, therefore, is known to offend.
what are the harassment strategies
Rules: the application of the Rule (what a reasonable person would find objectionable) depends on the specific facts, evidence and interpretation (i.e. what is sexual, what is offensive or a joke etc.)
Strategy and Risk Management: 5 Ideas: (1)create and enforce policies on harassment, (2) create environment where employees can bring forward issues in confidential manner, (3) negotiate, (4) consider reputational impact, (5) possibly go to court
what are the rules on firing
Employer must give notice to terminate (unless just cause) and notice must be “reasonable” (eg employer cannot terminate someone the day they show up for work since that is not reasonable notice) OR must give pay instead of notice
What is reasonable notice? Minimum standards in employment legislation (statute) but also common law (see next slide for BC rules)
Common law looks at 5 things: employee’s age, position, type of job, nature of job market, bad faith by employer (fairness)
What if contract does include notice terms? If you have agreed in contract to shorter notice terms than the common law offers, the contract prevails (but still must be at least the same as statutory rules)
Collective agreement?: If it is a unionized workplace, then the collective agreement functions as a contract and outlines the required notice
what is reasonable notice in BC
Statutory rules: 3 months work entitles employee to one week notice, 12 months gives 2 weeks, after three years employee gets one week notice for every year employment up to a maximum of 8 weeks
Common law remedies may provide more than statutory rules because the employee is claiming a breach of contract (generally one month per year up to around two years maximum)
Some types of employees are NOT covered by statute for termination benefits (professionals such as lawyers, doctors, accountants, dentists) but ARE covered under the common law rules
what is just cause and what are the strategies for employers if claiming just cause
includes incompetence, absenteeism, disobedience, habitual negligence, harassment, drinking, immoral conduct that reflects poorly on employer, fraud, theft, lying on CV (but NOT economic downturn/lack of work)
Strategy for employer if claiming just cause (6 Ideas): (1) employer must substantiate just cause with evidence, (2) pay attention to mitigating factors and proportionality, (3) consider suspension or progressive discipline before termination, (4) try to accommodate illness or disability, (5) review terms of the collective agreement and requirements for arbitration, (6) otherwise damages may be awarded against the employer
what is constructive dismissal and what is the rule around it
Employers try to make an employee so uncomfortable that he or she will quit as a result of demotion, transfer or change of employment conditions
Rule: If the employer is trying to get the employee to quit so the employer does not have to give notice or pay, then it is constructive dismissal?
what is wrongful dismissal
Employer fires an employee claiming just cause but there is not just cause (dismissal for just cause is permitted)
Employer fires an employee but without adequate notice or pay instead of notice and does not claim just cause
Discrimination
Harassment
Constructive dismissal
explain dismissal remedies
Types of Remedies? Employee has remedies including damages and sometimes punitive damages
What are Damages? The amount of money owed by the employer to employee based on notice period i.e. if an employee should have received 8 weeks notice, he is entitled to 8 weeks pay (minus any money earned if find new job within this period)
Aggravating factors: employer lies, damages employee reputation such as defamation, or other forms of bad faith can lead to punitive damages
Can I get my job back as remedy? Only in unionized workplaces and rare cases of discrimination
Strategy: Knowing what you can get impacts your Strategy as business and employee
what is the reputational risk of dismissal
law versus perception: as a business you may be entitled to dismiss someone, but it still may not be the best Strategy:
Example: employee complains on social media about a holiday gift from his employer and the employer fires him
what happens when an employee quits
When an employee decides to quit (and not due to constructive dismissal) he or she has to follow some Rules:
What does the contract say including about notice?
employee can quit immediately if illness, unsafe working conditions, unpaid wages and where contract not followed
otherwise employee must give reasonable notice but less than employer requirements (usually 2 weeks, after 3 months of work)
employees must respect restrictive covenants in contract such as non-competition, non-solicitation and confidentiality obligations (eg cannot take customer lists, business secrets but only IF these covenants follow the rules (reasonable, geography, time)
explain collective bargaining
Collective bargaining: purpose is to organize as a union to improve bargaining power of workers when dealing with the employer
Have YOU worked in a unionized workplace? With a union? Do unions serve a good purpose or just more red tape and administration?
Rules for collective bargaining?: statutes (federal and provincial) such as Canada Labour Code, also constitutional right under s.2(d) of Charter of Rights and Freedoms
variation between provinces
what do you have to do to become unionized and create a collective bargaining agreement
Overview: certification of union in order to identify bargaining agent for employees, then negotiate a collective agreement for employees in the bargaining unit (labour relations board oversees and mediates this process)
Certification: must find a bargaining agent for the bargaining unit, and apply to labour relations board if you have 45% of workers (in BC) then vote
Bargaining agent: once certified, then bargaining unit has exclusive right to represent employees and to create collective agreement
Employers cannot engage in unfair labour practices (firing employees for union activities, blacklists etc) but can make comments and express opinions
Collective agreement: the contract that applies for all workers (not individual contracts) but management not part of union and management employees negotiate separate contracts outside of the collective agreement
explain bargaining in collective bargaining agreements
Collective Agreement: only union can negotiate for employees once union certified, usually within 10 to 20 days of certification, good faith bargaining (union and employer must meet with willingness to explore compromises, or every reasonable effort to reach agreement)
Ratification: goes to vote of union members, if passes then binding on both sides, if parties cannot reach agreement the Labour Relations Board can impose a first contract (rare)
Mediation (Conciliation): if disagreement between employer and bargaining agent for employees, can apply for mediator/conciliator, during mediation cannot strike, and mediation can be imposed in cases even if neither side applies for arbitration
Arbitration: can be ordered, particularly for government services and essential services, and the decision is binding
what are job action strategies and rules
Strategies: work stoppages, employer lockouts, work to rule (workers do no more than minimum), employees strike, wildcat strikes (without union authorization)
Strike action: occurs when there has been no resolution of a dispute over a collective agreement, since strikes are a way for employees to exert pressure on employer
Rules: no right to strike (eg essential services), cannot strike when collective agreement in force, must grieve and negotiate before striking, must negotiate in good faith and give notice
Public Sector and Essential services: special legislation, often compulsory arbitration, government can impose settlement (examples: hospitals, teachers, firefighters etc.
what are some other rules on employment
Employment Standards: minimum wages ($14.60 in BC as of June 1 2020 but note general versus liquor service minimum wage), notice and pay for termination, maximum work hours, overtime (after 8 hours per day or 40 hours per week), holidays and vacations (after 12 months you get 2 weeks vacation), specified leaves such as pregnancy (17 weeks of unpaid leave) (disputes referred to Employment Standards tribunal)
Workers Compensation: compulsory insurance for injury or illness from job available even if workers careless or negligent on job, administrative board hears cases, like no-fault insurance, worker gives up right to any other compensation, unless caused by someone other than employer or another employee
Health and Safety: purpose is to improve workplace safety (eg fencing, hard hats), statute creates board that hears complaints
Employment Insurance: both employers and employees contribute, does not apply to those who leave work voluntarily, or on strike, or if got severance package, and also benefits for illness, pregnancy, adoption, disability (see Employment Insurance Act)
what is vicarious liability
Case: Samuel works as a delivery person for Ly & Able Tea Company. One day he goes for lunch with the company delivery truck.
an employer is always directly liable for its own negligence (carelessness) in hiring, training or supervising employees
an employer is always vicariously liable for the wrongful acts of an employee within the scope or course of the employee’s employment (Why? What is the rationale?)
an employer may be (rarely) vicariously liable for the wrongful acts of an employee outside the scope of the employee’s employment
What is within the scope or course of an employee’s job and what is not? The facts are critical
what is employer liability
an employer hiring an independent contractor is not vicariously liable for their wrongful acts (eg Uber driver)
an employer is always vicariously liable for wrongs committed by an agent in the scope of the agent’s actual, apparent or usual authority
the most effective Strategy for employer to manage the risk of liability is to take proactive preventative measure (policies, supervision etc.)
what are the 6 main things you should do when you are supervising employees
Screening: Pre-screen employees for issues e.g. harassment, workplace theft, violence, drinking on the job
Create Policies: harassment, theft, computer misuse, privacy, use of surveillance etc. and performance reviews for employees
Contract: Ensure that these policies are included in employment contract and employees are aware
Enforce: Ensure that these policies are enforced and violations documented
Training: invest in training sessions for employees & managers
Communication: If there are violations, must inform employee (Performance Review) and give opportunity to respond (cannot just terminate) and then use progressive discipline (warning, suspension, with pay or without)
what are the rules and processes to respond to workplace problems
Rules and Process: In order to respond to workplace problems, you need to know the laws, review the laws and the Process (courts, tribunals, collective agreement process, ADR) and then consider your best Strategy (negotiation including settlement, mediation and other ADR, courts and tribunals such as human rights tribunals or employment standards board, class actions, do nothing)
Strategy & Risk Management (5 Key Strategies): in order to prevent workplace disputes: Negotiate the employment contract, include risk management techniques such as restrictive covenants, spend time hiring and training, have a good HR team, and create and enforce workplace policies that don’t leave things to chance including vicarious liability for your employees
Explain torts when it comes to car tech and tesla
A customer purchases a Tesla car with new “driver assistance” technology and has an accident when using the “driver assistance” technology software and suffers severe injuries when the car runs into a truck that turned in front of the customer’s Tesla car
there was also another passenger in the car who suffered injuries
customer was sending an email when the accident happened but customer claims the “driver assistance” technology was turned on
Tesla instructs drivers to keep hands on the wheel and to take control of driving whenever needed
Other drivers/customers have been killed or injured in recent accidents involving self-driving technologies (eg United States, China, The Netherlands) but it is unclear whether the cause of those accidents was driver error or Tesla technology
The government (Ministry of Transportation) has approved Tesla’s “driver assistance” technology
What is a tort
A tort is an act that causes harm such as physical harm, harm to property or reputation, and gives the right to sue and to seek remedies including damages to compensate the victim for the loss
Torts are “private” or civil wrongs not criminal wrongs (though remember there is potential for overlap)
When is a tort a crime? Car accident, causing death, even environmental damage
What is the balancing act of tort law and negligence
Discourage anyone including businesses from causing other people harm, but do not discourage all risky activity by imposing unrealistic standards of conduct and costs of compliance
What are the rules on torts
The rules are mostly common law (judicial decisions) but some rules have been added or clarified in statutes (eg Occupier’s Liability Act dealing with landlords, or BC Motor Vehicle Act dealing with driving and rules of the road)
Rules and Facts and Evidence: the most important thing about the Rules is how they are applied to a specific situation taking into account all the facts and evidence (since you cannot create rules or statutes to anticipate every situation or set of facts and circumstances)
If the rule is that businesses that provide products and services are liable or responsible for those products and services when they cause harm, the question is whether they did, in fact, and based on all the evidence, actually cause harm, or did something else cause the harm, or is the business only partly responsible?
What are the types of tort and intent
Intentional: Did the person/business who caused the harm intend the harm (or did they at least intend the act that caused the harm)?
Strict liability: Did the person/business do something that was inherently dangerous and cause harm, regardless of whether they intended the harm?
Negligence: Did the person who caused the harm act carelessly?
Explain strict liability
You can be held responsible just because you did something (particularly inherent dangerous or risky things) even though you did not intend to cause harm, AND even demonstrating that you were careful and took precautions is not enough to avoid liability
usually a non-natural use, and escape and injury (the rule in Rylands v. Fletcher)(very uncommon activities)
Example: A business operates an oil and gas pipeline and a pipeline ruptures and spills oil into a river and that contaminates water supply and causes longstanding environmental harm
Risk Management: knowing that these rules exist, businesses may chose to avoid the risk (not engage in this type of business), shift (insure if possible), reduce (manage risk through operations and training) or accept (factor in the costs when things go wrong including lawsuits)
Explain intentionality when it comes to torts
What is intent? It is not the intent to injure or harm that matters but instead whether someone deliberately intended the conduct or act that caused the injury or harm
Example: You are at a bar and a woman insults your boyfriend so you slap her in the face. Intentional or not?
Example: A person attempting suicide lands on someone passing by and both survive but both suffer serious injuries. Intentional or not? What did you intend?
Example: You walk on someone else’s property not knowing that you are on their property. Intentional?
It does not matter if you intend to harm if you cause harm as the result of your deliberate act and that caused the harm
Explain intention and damages when it comes to torts
Why does it matter if it is an intentional tort as opposed to negligence (not intentional)?
Damages are greater if you can show intent, and may include punitive damages
Example: Fennimore v. SkyService Airlines: A pilot was defamed by employer and lost his job and career so he was awarded $3 million by jury due to intentional nature of the harm, and decision of court/jury to award punitive damages
Juries and Strategy: victim often gets more damages since juries can be more sympathetic to a victim, particularly when the harm is intentional, and also when a big company is involved (“deep pockets”) and this reality impacts Process and Strategy
Explain intentional torts
Assault (threats) and Battery (physical contact): must be immediate, physically possible, unwanted even if not harmful, and without defences of self-defence (unless excessive) or consent (informed and complete) eg. doctors need consent otherwise can be battery
Invasion of Privacy: no tort but covered through other protections such as trespass, using private information (more on this later)
False Imprisonment: cannot detain someone unless you have authority (police)
Trespass: you cannot go where you are not allowed, unless you have permission, and it does not matter if you didn’t know you were not supposed to be there
Nuisance (Interference with Chattels): interfering with another’s property (chattels) such as escape of water, noise, fumes etc.
Defamation: saying false things about others that cause harm
Explain false statements when it comes to torts
Deceit: business makes false statement, which it knows to be false, and intends to mislead, and causes a loss
Injurious Falsehood: false statement about a business, even if not intended to cause a loss, and causes a loss (typically about property ownership or product quality)
Defamation: false statement that could lead a “reasonable person” to have lower opinion of someone (including a business)
Explain the 4 elements of defamation
publication (communication in some form) (verbal/slander or written/libel)
of a false, derogatory statement
that refers specifically to the plaintiff
and that harms the plaintiff (eg reputation or financially)
What are the defamation defences
Defences (3): Truth, Privilege (3 types), Fair Comment
Truth (Justification): The defendant still has to prove that the statement was true
Absolute Privilege: Types of statement or speech we want to defend even if it may harm reputation (eg Parliament and courts/trials) (Why important?)
Qualified Privilege: Want to protect employers with obligation to disclose information (eg employment reference or review) but statement must be made honestly and without malice. Why?
Public Interest Responsible Journalism: For “responsible” journalists with a story that the public should be able to hear. Why?
Fair Comment: Honestly held and informed “opinions” about public figures or matters of public importance (eg politicians, celebrities) where anyone (not just journalists) can make “responsible communication” (meaning that it is an informed opinion) even if the statement is false and derogatory but tried to find truth (responsible)
Explain negligence
Negligence: unintentional conduct causing harm to others, due to a failure to live up to a degree of skill or care required in the circumstances (carelessness)
Is this negligence? a business creates a defective product due to some error or oversight, accountant gives incorrect professional advice, a government builds road that results in an accident, someone hits you in the face at the dance club, someone slips at the dance club falling into you so that you fall and injure yourself, the dance club waxes the dance floor at the club and it is not dry enough so that people slip on the floor and injure themselves
Explain the rules on negligence
In order to prove negligence you must prove 4 things:
that there is a duty of care of the defendant (people generally have the responsibility or duty to be careful no matter what they do)
that the standard of care was not met (the difficult issue is how careful do we have to be, and whether certain people like professionals have to be even more careful, and how much more careful)
that the action of the defendant caused the plaintiff harm (even if we are not adequately careful or responsible, it may not be clear that a failure actually caused the harm, since other things may have caused the harm instead)
and that there is harm that can be shown and measured (not all harm warrants damages in the legal system, as some things cannot be proven or measured e.g. hurt feelings)
Explain duty of care
Duty of care?: Was the victim reasonably forseeable? But what is reasonable? Reasonable is different from possible (Donoghue case)
Apply the Donoghue v. Stevenson test AND the Ann’s test to determine whether the victim was reasonably forseeable and a close relationship between parties (proximity) and even if both conditions are met, still ask whether there are policy reasons to find that there was no duty of care
similar to The Charter of Rights and section1 (even if discrimination is it justifiable?)
What policy reasons may lead to finding no duty of care? Can’t create unrealistic expectations on people and businesses in all situations, or place unrealistic costs on government since government provides so many services that may go wrong (health care, roads, schools)
What is causation
Was there ANY causal link between the conduct/action and the harm OR was the link too remote? ( The “but for” test) (Refer to previous cases)
If there was a causal link, what type of link (or causal relationship)?
Was there a direct link (direct causation)? Did the defendant’s action directly cause the harm? (Example: You run into another vehicle causing the other driver injury.)
Was there an indirect link (indirect link but material connection)? Even if it is unclear whether the actions caused the harm, did they contribute to the harm (Example: You run into another vehicle and the driver seems fine after the accident but several weeks later he develops serious headaches )
Remember that the defendant’s actions may be only one of many causes of the harm
If there are many possible causes for the harm, courts may either (1) find no causation or that causation is not material or too remote, or (2) may divide up liability (contributory negligence) among different people including the plaintiff (see slides on Remedies and Defences)
What are the rules on product liability
Manufacturers are liable for their products both through contract and tort
If you have a contract, then the manufacturer may be strictly liable (which means victim just has to show they were injured and do NOT have to prove all the elements of Negligence)
But if you are using Tort rules (so you have more remedies and potential damages), you still have to prove all the elements of Negligence including:
Duty of care? Businesses have a duty of care to consumers for the manufacture and design of their products and delivery of services
Standard of care? Businesses making stuff or providing services must meet the “reasonable manufacturer” standard of creating products that are reasonably safe for their forseeable use. But what is reasonable? And what is foreseeable use?
Causation: Did the product cause the harm in some material way (evidence) either directly or indirectly? Or was the product misused contrary to warnings and instructions (eg Tesla and not following instructions)
What is the difference in causation US vs Canada
United States: Rules in US make it easier to sue for product liability since the rule is that there is a presumption of Negligence against manufacturer when there is enough evidence of injury (this is the legal rule on “strict liability”)(eg your mobile phone battery catches on fire)
United States: The more evidence you have, or the more harmed people or victims there are, the easier it is to create a presumption of liability (strict liability) and then the burden of proof shifts to manufacturer to show they met the standard of care
Strategy? Why is this information about different legal rules in the US important, for businesses and consumers even if they are in Canada? Risk Management? Avoid?
What is professional liability
Doctors: What if doctor amputates leg when patient was in hospital for appendix removal? What if doctor misdiagnoses cancer or fails to catch cancer early enough? Is this professional liability? What is the difference?
Lawyers: What if lawyer tells you incorrectly that there is no Small Claims court in BC and you rely on this information so don’t go ahead with your case? What if lawyer guesses wrong about your chances of winning your case and you lose? Professional liability?
Accountants: What if you ask your accountant about a great business opportunity and she suggests that it is not a good idea but later you discover from a friend she pursued this investment opportunity? Professional liability? Why?
Balancing act: courts always trying to find limits to avoid an unrestricted duty on professionals since this would be too onerous (too high a standard) and difficult to get insurance to protect themselves from negligence cases
What is at stake in torts
Compensatory Damages: compensation with money taking into account duty to mitigate (you must try to minimize damage) and remoteness unless harm was intentional
Punitive damages: in addition to compensate, punish and deter others
Nominal damages: recognize a tort even if no demonstrable harm (eg defamation)
Injunction: stop the action that is causing the harm (eg stop new pipelines)
What are the remedies and defences for torts
When a Judge is deciding on what Remedy to give you, they will consider 3 main things: (1) whether you contributed to the problem, (2) whether you agreed to the risk and consequences, and (3) whether the harm suffered was just too strange or remote for anyone to anticipate
Contributory negligence: When there is evidence that the plaintiff contributed to the problem or loss, the court apportions damages like 75% v. 25% (Example: Jim gets hurts in bar fight, or accepts ride with drunk friend and gets in accident, and so court will try to assess Jim’s role in the harm he has suffered)
Voluntary assumption of risk: If person accepts both physical AND legal risk then they cannot claim any damages, where the legal risk is agreeing to give up right to sue for negligence (Example: Hockey players sign contracts and agree to accept both physical AND legal risks)
Remoteness: If someone’s reaction is so strange that their injuries are too “remote” and not forseeable, then courts won’t award damages (Example: Mustapha case where he is changing water bottle and sees a fly and has very unusual reaction of nightmares and depression)
Example: You accept ride with a drunk friend in his car after a party and you are injured when your friend crashes the car . Is this contributory negligence or voluntary assumption of risk or remoteness?
What are bus risk strategies for torts
Risk Management Steps or Stages: Identification, Evaluation and Response
Identification: Important to know the rules for negligence and there is usually a duty of care, that there is a standard of care when making a product or delivering a service (rules and obligations also the result of contracts and warranties in contract or consumer protection laws) and that causation can be very difficult to determine and may take years or even decades (tobacco, drugs/medication, food etc.)
Evaluation: Even after you identify the rules, it can be difficult for businesses to determine whether they are, in fact, complying with the rules, AND how to determine whether the entire business is following the rules (supply chains, all employees, no cutting corners etc.)
Response: Some business will try to follow or comply with the rules, other businesses will try to avoid the rules, and ALL businesses will use some combination of risk management techniques in order to prevent and respond to risk and problems
What are strategies and techniques for busniess for torts
Create policies and procedures to prevent problems such as faulty products (eg product testing, supply chain management including globally)
Protect yourself from litigation and lawsuits by using warnings, limited warranties and obtaining consent or acknowledgement of danger from customers and clients (exclusion clauses and consent forms)
Use insurance policies to shift risks to others eg insurers (though there is a cost and sometimes insurance may not be available or may not cover the harm and damage that occurred)
Manage your reputation as a business (do not want a reputation either locally or nationally for creating risky products or for defending lawsuits from your customers/clients)(eg Uber, Purdue Pharma etc.)
Recognize the international variations in rules about torts including negligence (such as defamation, product liability and professional liability)
Acknowledge that some accidents will happen and cannot be prevented (including those created by employees and human error) so plan for these events as a cost of doing business
