Employment Standards Appeals Are Lengthy and Difficult, Yet Meant to Protect the Vulnerable: Case Comment on 639299 Alberta Ltd v Meganathan

This post comments on a recent Employment Standards Umpire decision, 639299 Alberta Ltd v Meganathan, 2013 CanLII 87001 [Bistro India], which was unusual in that it required seven days of hearing. The employer, a numbered company which operated a restaurant, appealed an Order of Officer requiring them to pay $10,000+ to a temporary foreign worker they had employed as an “ethnic cook.” The resultant thorough and well-reasoned decision confirms that an appeal to an umpire is a true de novo hearing,[1] and awards the employee in excess of $20,000 in unpaid wages.[2] The decision comments on the vulnerability of workers—temporary foreign workers in particular—and exposes the difficult position those workers are in on appeal, where the Director of Employment Standards usually takes a neutral position, requiring the employee to prove his or her entitlements on a balance of probabilities. The case also confirms the suitability of adverse inferences where employers fail to keep accurate records of hours worked by their employees, disclose all relevant records, or call all relevant witnesses.[3]

Appeals to the Umpire – Setting Hearing Dates

In my experience, appeals to an umpire are usually heard and decided in a somewhat cursory fashion: the Provincial Court sets aside one courtroom for one day per month for use by the Registrar of Appeals, and the Registrar usually schedules several appeals per day. The fact that so many appeals are scheduled for one day puts significant time pressure on all parties (and umpires). In Bistro India, I requested multiple days of court time, but was advised that further court time was unavailable. This appeal, though, is a perfect example of why further time needs to be made available—it took seven days, and the limited time available could have been put to better use if the appeal had been scheduled for multiple, consecutive days at the outset rather than being adjourned (twice) because of the insufficiency of the allocated time, and ultimately being heard on court dates spread out over the course of almost a full year.

Bistro India’s unusual length can largely be attributed to the fact that both employee and employer were represented by counsel, who ensured that all relevant evidence was heard. In every case, as will be discussed below, an employee has a legal responsibility to prove all of her or his entitlements, and as such, must be afforded the opportunity to present all relevant and material evidence. I cannot imagine how that could be done in an hour or two, and would suggest that further court time should be set aside for Employment Standards [“ES”] appeals.

A True de novo Hearing?

In my experience, ES appeals can look more like appeals on the record, where appellants must demonstrate some error or deficiency, than hearings de novo.  For example, ES Officers’ findings are often taken by umpires as starting points for investigations of whether or not the previous Orders should be varied on appeal. Further, umpires are provided, in advance of appeals, copies of the relevant Officer’s Work Sheet, Order of Officer, Notice of Appeal, and Notice of Hearing, but nothing else. This makes it appear that an officer’s work product and appellant’s arguments are the only documents of import for the appeal, which could be the case in an appeal on the record but not in a hearing de novo.

Indeed, on first reading, the Employment Standards Code [the “Code”] might appear to allow umpires to conduct appeals in any way they wish, including as appeals on the record:

  • an “umpire may determine the procedure to be followed in the appeal” (s. 98(4)); and
  • “may determine the manner in which evidence is to be admitted” (s. 100(2));
  • is “not bound by the rules of evidence or any other law applicable to judicial proceedings” (s. 100(1)); further,
  • while he or she “may conduct an appeal without requiring oral representations” (s. 98(3));
  • he or she may also compel the attendance of witnesses (s. 101(2)(a));
  • punish witnesses who refuse to give evidence (s. 101(2)(b)); and
  • award costs as he or she sees fit (s. 107(1)).

While umpires have a lot of freedom to determine the process of appeals, they do not in fact have the freedom to begin from the findings of an ES officer. The Court of Queen’s Bench in Alberta has considered the relevant sections of the Code in detail and concluded that appeals to umpires are truly de novo, and umpires must “proceed without any assessment of, regard for or deference to the work product”[4] of the ES Officer. Although Osteria De Medici is a binding decision from several years ago, it may be that, in some cases, umpires have nonetheless continued to begin appeals from the Orders of Officer being appealed.

In Bistro India, Umpire Sharek expressly references Osteria De Medici and confirms he must proceed without deference to the Order of Officer and the Officer’s worksheets which had been placed before him by the Registrar of Appeals.[5]

While the Umpire gave no deference to the findings of the ES Officer, he did rely in part on viva voce evidence[6] given by the ES Officer as to what in her experience constituted a normal length of workday for a cook in Alberta.[7]  Essentially, the ES Officer functioned as an expert witness at the appeal, given her lengthy tenure as an Investigator working particularly with temporary foreign workers. Interestingly, the Officer was called, not by the Director, but by the employee, and the Director later suggested that the employee should therefore bear the cost of the Officer’s salary for the duration of her attendance at the appeal.

The Role of the Director and the Hardship Created for Employees

It is worth considering at this point the role of the Director at an appeal to the umpire. In my experience, which is consistent with the experience reported by Justice Jeffrey in Osteria De Medici, although the Code makes the Director a party to every appeal, [8]  the Director frequently takes “no position before the Umpire.”[9] This refusal to take an adversarial position accords with judicial authorities, which demand that statutory tribunals restrict themselves on appeal therefrom to arguing their own jurisdiction and explaining the record, and which prevent them from arguing the merits.[10]

Given that umpires can give no deference to Orders of Officer, the Director’s decision not to take an adversarial position (while seemingly correct in law) puts an employee responding to an employer’s appeal in an extremely difficult position: he or she must prove, on a balance of probabilities,[11] his or her entitlement to remedies under the Code. It is unlikely that employees making ES complaints anticipate that even if they prove their entitlement to unpaid wages to the satisfaction of the investigating Officer, they may end up having to prove that entitlement again, to a Judge, without any government assistance and in the face of, potentially, multiple days of evidence and argument from their employer’s counsel.

The difficulty of that position, for employees, cannot be overstated.

In this case, the Umpire commented on the vulnerability of workers and in particular temporary foreign workers like Mr. Meganathan, who may speak limited or no English and be unfamiliar with Canadian laws.[12] See, for example:

  • “The inequity in the bargaining position between employer and employee, particularly a temporary foreign worker, is exemplified by the unilateral change by Bistro India in, they allege, altering the Employment Cont[r]act from $13.00 per hour plus overtime to a monthly salary of $2,300.00.”[13]
  • “To suggest, as the Employer does, that Meganathan ‘volunteered’ for these 2 events is untenable, and once again, points to the inequity in the bargaining position between the employer and the employee . . . It is not credible to suggest that Meganathan agreed to do this work for free. . .  In any event, it would be unfair and inequitable for Meganathan not to be paid for the work he did.”[14]

The Code, Adverse Inferences, and Protecting Employees

The Code was created in recognition of employee vulnerability, and is meant to protect workers from poor treatment. Consider, for example, this statement from our Court of Queen’s Bench:

“The social policy underlying [the Code] is the desire to make employment conditions reasonable and to prevent employment abuses. It was recognized as early as the Industrial Revolution that employees who are in an unequal bargaining position can be abused by overzealous employers.”[15]

Given the particular vulnerability of temporary foreign workers to abuse, and the very purpose of the Code, I find it disappointing that employers who appeal Orders of Officers requiring them to pay earnings to their employees can so easily put those employees into the position of being required to prove their entitlements before a judicial decision-maker, without assistance. Without counsel or other representation, the difficulty may become insurmountable.

Thankfully, the Code has been interpreted in such a way as to prevent, through the use of adverse inferences, employers from avoiding their payment obligations by merely failing to properly track and report employee hours, or produce relevant evidence on appeal. See, for example, Beiseker Battery Barn Inc. v Sibernagel, where the Umpire concludes that “in the absence of any records maintained and produced by the employer, the employee’s word is to be accepted.”[16] In Bistro India, Umpire Sharek summarizes the caselaw on this point as being “consistent that an employer who fails to keep and provide time records as required by the legislation does so ‘at its peril,’” and concludes that while the employee bears the burden of proof on appeal, the onus shifts where an employer fails to provide accurate time records.[17] The umpire goes on to draw an adverse inference against the employer with respect to the hours worked by Mr. Meganathan, and a further adverse inference was drawn against the employer because it failed to produce a material witness for cross-examination.[18] This use of adverse inferences to compel employers to fully disclose material evidence provides some limited protection to vulnerable workers.

Employees facing employer appeals of ES orders are therefore in extremely difficult positions: they must prove their entitlements from square one, the Director usually takes no position on the merits of appeals (and thus does not present evidence to support their orders), and the Registrar does not have enough court time available to schedule time for a full hearing, resulting in a hearing with significant time pressure. Furthermore, when employers are represented by counsel at ES appeals, employees are often so disadvantaged that they settle for a mere fraction of their earnings because they fear they will not be able to successfully prove their entitlements on their own.

I believe this process fails to adequately protect workers’ rights. In my opinion, we can and should assist employees through the appeal process: perhaps by providing free or low-cost representation to those employees who want it (through an independent government office, or perhaps through a formal pro bono or law student-led assistance program), or by tasking ES officers with calling evidence in support of Officer’s Orders (which might require a change in the legislation). In any case, given the protective intent of the Code, justice demands better than the status quo.

Note: A subsequent, ground-breaking costs decision in Bistro India will be the subject of an upcoming post.


[1] A hearing de novo is a new hearing, starting at the beginning without any pre-conceived ideas about the evidence or outcome.

[2] For those who may not be familiar with the Employment Standards process, a complaint is initially investigated by an Employment Standards Officer. If the Officer finds, after investigation, that wages are owing to an employee, he or she issues an “Order of Officer” that requires the employer to pay those wages. Either the employee or employer can appeal an Order of Officer to an umpire, who is an independent, trained decision-maker. In Alberta, provincial court judges sit as umpires.

[3] Please note that, as counsel for the employee in this appeal, my opinions are in no way neutral or unbiased.

[4] Osteria De Medici Restaurant Ltd v Yaworski, 2009 ABQB 563 (CanLII) [Osteria De Medici] at para 15.

[5] At para 49.

[6] Viva voce evidence is evidence given in person by a witness with direct knowledge of the facts in issue.

[7] At para 53.

[8] At s 96(2).

[9] At para 6.

[10] As explained in Osteria de Medici at para 6, citing Northwestern Utilities v Edmonton, 1978 CanLII 17 (SCC) aff’d Brewer v Fraser, Milner, Casgrain LLP 2008 ABCA 160.

[11] See, for example, para 68 of Bistro India.

[12] By way of background for those unfamiliar with the temporary foreign worker (“TFW”) program, TFWs are typically granted work permits allowing them to work in Canada for one specified employer, in one specified location and position. If they lose that employment, they cannot work for another employer unless and until they have a new work permit (which takes months to obtain). Because of that lack of mobility, some TFWs tolerate mistreatment in silence.

[13] At para 45.

[14] At para 47.

[15] Gartner v 520631 Alberta Ltd., 2005 ABQB 120 (CanLII) at para 56.

[16] As cited in para 50 of Bistro India.

[17] At para 50.

[18] At para 37.

About Sarah Eadie

LL.B. (U of A), M.A. (U of A), B.A. (McGill). Sarah Eadie is a staff lawyer at the Edmonton Community Legal Centre, where she is part of a team of lawyers who practice poverty law in the area of civil litigation. Prior to her work at the ECLC, Sarah worked as a criminal defence barrister. She has a strong interest in poverty law, particularly in the areas of access to justice, human rights, and employment law including the rights of migrant and temporary foreign workers.
This entry was posted in Civil Litigation, Employment Law, Public Policy and tagged , , . Bookmark the permalink.

1 Response to Employment Standards Appeals Are Lengthy and Difficult, Yet Meant to Protect the Vulnerable: Case Comment on 639299 Alberta Ltd v Meganathan

  1. Paula says:

    I’d be interested in learning more about the Bistro India case if you could post the link. thanks.

Leave a Comment

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s