Canadian Jurisprudence and the Employment Contract

Douglas Brodie

doi:10.1093/indlaw/dwab017

Abstract

Abstract The jurisprudence of the Canadian Supreme Court has been at the forefront of a judicial conversion to a more progressive view of the employment relationship, which is attuned to key realities such as inequality of bargaining power. The Court’s influence can be seen in the decisions of courts in other jurisdictions such as the UK. The change in outlook has had a discernable impact on doctrinal development. In recent years, the Canadian Supreme Court has elevated the importance of good faith in contract law as a whole. In 2020, in a series of key decisions, the Court explored some of the implications for the law of employment contract. This article seeks to explore whether those developments will be of relevance to the development of the employment contract here.

Highlights

The Canadian Supreme Court, in their recent decision in Matthews v Ocean Nutrition (Matthews),[1] referred to their earlier 1987 decision in Reference Re Public Service Employee Relations and reiterated that ‘A person’s employment is an essential component of his or her sense of identity, self-worth and emotional well-being’.2 worded dicta can be found here and elsewhere, but Matthews reminds us that the Canadian judiciary were early proponents of the contemporary common law view that the employee’s interest in the employment relationship is not purely pecuniary.[3]
The jurisprudence of the Canadian Supreme Court has been at the forefront of a judicial conversion to a more progressive view of the employment relationship, which is attuned to key realities such as inequality of bargaining power
In the UK, good faith is more evident in the law of contract but it does not seem likely that a general principle in the Bhasin fashion will emerge in the foreseeable future

Summary

INTRODUCTION

The Canadian Supreme Court, in their recent decision in Matthews v Ocean Nutrition (Matthews),[1] referred to their earlier 1987 decision in Reference Re Public Service Employee Relations and reiterated that ‘A person’s employment is an essential component of his or her sense of identity, self-worth and emotional well-being’.2 worded dicta can be found here and elsewhere, but Matthews reminds us that the Canadian judiciary were early proponents of the contemporary common law view that the employee’s interest in the employment relationship is not purely pecuniary.[3]. Awareness of the perils of inequality of bargaining power prompted the UK Supreme Court, for instance, to reform the law of sham contracts to render it more applicable in the employment context.[9] There are currently a number of areas where the law is in something of a state of flux and where comparative jurisprudence might be found helpful. Might be one; the extent of control is somewhat uncertain and difficult questions arise including the utterly fundamental one of stipulating when a decision is discretionary in nature. Another area, which is not fully settled, is the impact of mutual trust and confidence, or good faith more widely, on the substantive terms of the bargain. The courts have demonstrated that they are vigilant in requiring adherence to the agreement struck but will the law on unconscionability be expanded to allow the fairness of the terms to be reviewed? This latter point is admittedly more in the realm of an emerging issue but comparative experience may inform how evolution of the law in the UK will play out

REGULATINGTHE EMPLOYER’S DISCRETION

FAIR DEALING AND DISCRETION

THE FAIRNESS OFTHE BARGAIN

CHANGE IN CIRCUMSTANCES

HONOURINGTHE BARGAIN STRUCK

CONCLUSION