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Wrongful Dismissal 101

By Employment Law

In Manitoba a non-unionized employee can be terminated or fired at any time for any reason.  There are a few exceptions to this, but that is, for the most part, the system that we have.  One important caveat is that the employer is required to give notice of termination.

This can be done in one of two different ways.

One option is for the employer to give ‘working notice’, which means that the employee is told that their employment will terminate on a date that is far enough into the future that the employee’s legal right to notice is respected.

The other option is for the employee to be given a severance package.  This means the employee is effectively not given any prior notice of their termination, but they are provided with enough money to adequately compensate for this.

How much notice?

Whether the employee is given working notice or a severance package, the quantum of the notice period is determined by several factors.  At a bare minimum, all employees—subject to very few exceptions—must receive the notice period required by the Employment Standards Code.  An employee may also be entitled to a further amount of severance pay by the terms of their employment contract.  Most employees do not have a written employment contract, but that does not mean there is no contract.  As a matter of law certain terms can be implied.  The most important of these is the implied term that an employment contract will not be terminated by the employer without providing the employee with ‘reasonable’ notice.

Reasonable notice can be a fuzzy concept that ultimately amounts to whatever a judge would think is fair.  The age of the employee, the length of service, the availability of suitable replacement employment, and the custom in the industry can all be factors to consider.

What is a severance package?

Sometimes the compensation that is provided to an employee on their termination is called a severance package.  A severance package should be designed to adequately compensate the employee for the loss of their employment.  Although the loss of base salary in the notice period is usually the most important element, a severance package can also compensate for the loss of pension credit accrual, the loss of benefits, and can sometimes also provide access to retraining services or career counselling.

Employment Contracts

It is increasingly common for Employers to seek employment contracts from their employees that will limit severance entitlements at termination.  This can help provide certainty for employers but there are pitfalls.  Employees, and their lawyers, frequently have found ways to void termination clauses that limited severance entitlements.  When a termination clause turns out to be void, the cost for the employer is significant.  An employer should consult legal advice before seeking a termination clause in its employment contracts.  Conversely, employees who have been terminated and told that they are limited in their severance claims because of a termination clause may wish to consult legal advise as the clause may turn out to be void.

What about Cause?

In cases where an employee is guilty of serious misconduct, the law permits an employer to terminate an employee summarily and without any advance notice.  Unsurprisingly, employers and employees often disagree on whether certain facts justify summary dismissal.  Canadian courts have considered many scenarios and then ruled on whether summary dismissal was justified.  Many employers have jumped the gun and moved too quickly to dismiss when a less punishment was appropriate.

An employer considering whether to summarily terminate an employee for cause should consider obtaining legal advice prior to proceeding.

The Termination Process

Terminating an employee is a difficult and stressful moment.  Although both sides will have an interest in determining the cost of the employee’s entitlements, there is often some negotiation and back and forth.  Employees are often upset, shocked, and filled with anxiety about their future.  There are strategies in this process that can be used by both employees and employers to protect their interests in this process.  It is usually a good idea for either side to engage the services of experienced legal counsel.

How much does it cost?

Employees are often anxious about legal fees because the last time someone wants to hire a lawyer is when they have just lost their income.  Although there can sometimes be risks to negotiations, those are discussed at the outset.  In some cases, it can be possible for the lawyer to work on a contingency arrangement where the fee is taken out of the final settlement and is contingent upon the lawyer generating additional value for the client.  Legal fees can be tax deductible.

Every situation is a little bit different and it’s usually very important to not delay reaching out to legal counsel.

 

Daniel Hildebrand is a lawyer at Wolseley Law LLP focusing on civil litigation and employment law in particular

Top 5 Tips for Homebuyers

By Real Estate

There are several steps you can take to save time and money when purchasing a home in Winnipeg. Here are five things you need to know when buying a home:

 

  1. Understand closing costs.

In most cases, your lawyer will collect the balance of the purchase price, fees, and disbursements up front, directly from you.  If you are buying and selling at the same time, you may need to arrange bridge loan financing with your lender.

Closing costs are explained in more detail in this article.

 

  1. Secure your home insurance.

An insurance binder is a one-page document that proves that you have placed insurance on the property. Your lender will require you to have an insurance policy in place prior to possession. Ensure that your insurer has sent your “insurance binder” to your lawyer at least three days before possession. The “loss payable” must be your mortgage lender.

 

  1. Arrange financing two weeks prior to your possession date.

Once loan documents have been signed with your mortgage specialist, your lender will send mortgage instructions to your lawyer. Your lawyer can only move forward with your deal after they have mortgage instructions. A delay in mortgage instructions could result in additional rush fees. If your lawyer receives mortgage instructions early, it will be much easier for you to schedule an appointment at a convenient time, and you will save money on legal fees.

 

  1. Choose your lender carefully.

From credit unions, to banks, to broker-channel lenders, there are a wide array of institutions who will lend you funds to buy your home. Shop around, not just for your interest rate, but also for less obvious but equally important terms such as pre-payment privileges and penalties, renewal fees, and front-end servicing fees. You may want to specifically ask if additional documentation will need to be signed with your lawyer. Law firms will often charge additional fees on home purchases where significant additional paperwork is required. Remember that you will be dealing with your lender for the full term of your loan, and early experiences may be a telling sign.

 

  1. Be available to pick up keys.

Depending on the specifics of your transaction, you may need to pick up the keys to your new home on the business day before the possession date. Make sure you are available to swing by your lawyer’s office during regular office hours, or that you have made alternate arrangements for key pick up.

 

Being well-prepared and well-informed on all aspects of your purchase is key. Make sure you have a trusted team of professionals to guide you through the process.

If you have any questions, or wish to inquire about our real estate services, please do not hesitate to contact our office at 204-977-1706 ext. 8, and we would be more than happy to help you.

 

Davis Johnson is a legal assistant at Wolseley Law LLP who works primarily in the area of real estate.

Closing Costs Demystified

By Real Estate

When buying a home, you will need to bring money to your lawyer before the possession date to close the deal. This money is commonly called “closing costs.” The funds will need to be provided to your lawyer by certified cheque or bank draft.

Your lawyer will send you a detailed Estimate of Closing Costs after they receive mortgage instructions from your bank or credit union. However, understanding closing costs in advance will help avoid last-minute surprises.

Closing costs are made up of 3 parts, the balance of the purchase price, legal fees, and disbursements.

 

  1. Balance of Purchase Price

 

The balance of the purchase price is calculated using the following formula.

Purchase Price MINUS Initial Deposit on House MINUS Mortgage Funds being provided by the bank or credit union PLUS OR MINUS Adjustments

Example:


Purchase Price: $250,000.00

MINUS Initial Deposit: $10,000.00

MINUS Mortgage Funds: $200,000.00

PLUS Adjustments – Annual Property Taxes ($3,650.00) paid in full for year and prorated to possession date of September 22 (100 days): $1,000.00


Balance of purchase price: $41,000.00

 

Mortgage Funds – If there are additional fees (for example: mortgage insurance premiums such as CMHC, appraisal fees, or servicing fees), these fees will be taken off at the bank or credit union, before your lawyer receives the funds.

Adjustments – No matter what date taxes are due, they are adjusted for the entire calendar year, as of the possession date. Depending on whether the vendor has paid the taxes, you will either give or receive a credit. Additional adjustments beyond taxes may apply if you are purchasing a condo, rental property, or new build home.

 

  1. Legal Fees

Fees represent the amount charged for legal work and they will vary based on the particulars of your transaction.

 

  1. Disbursements

Disbursements are out-of-pocket costs that your lawyer will pay as part of the transaction.

 

  • Registration Costs are paid to the Government of Manitoba. As of 2021, it costs $109 to register the Transfer and $109 to register the Mortgage.

 

  • Title Insurance protects both you and your mortgage lender. It is usually required by the bank or credit union when you are getting a mortgage. The cost is mostly determined by the purchase price of your home and the amount of your mortgage.

 

  • Searches are required to investigate the title at Land Titles and the tax account. You are only charged for the actual number of searches conducted.

 

  • Couriers are used to deliver documents and cheques. Again, you are only charged for the actual number of courier deliveries called.

 

  • Administrative costs such as photocopying, software transaction charges, file storage, and postage are charged differently by each firm. When choosing a lawyer, be sure to inquire about these types of costs, as they can quickly add up.

 

Taxes are applicable to fees and some disbursements.

 

Being well-prepared and well-informed on all aspects of your purchase is key. Make sure you have a trusted team of professionals to guide you through the process.

If you have any questions, or wish to inquire about our real estate services, please do not hesitate to contact our office at 204-977-1706 ext. 8, and we would be more than happy to help you.

 

Davis Johnson is a legal assistant at Wolseley Law LLP who works primarily in the area of real estate.

Power of Attorney or a Committeeship

By Committeeship, Power of Attorney

People often ask the question: “Do I need to get a power of attorney or a committeeship for my loved one?” While the two documents, and powers that they grant, look similar, there are many important differences, and often the situation that you are in will be what determines which one is needed.

 

A Power of Attorney is a document signed by a person that gives authority to another person to manage some or all of that person’s affairs (although it is important to note that it does not remove the ability of the person signing it to manage their own affairs – it just appoints a “helper”). They are often, but not always, used to guard against later-in-life inability to manage one’s affairs whether due to dementia, physical incapability, or simply because it’s easier to have a loved one take care of day-to-day tasks. They need to be made while a person is still competent to make decisions, and are typically drawn up by a lawyer because, unlike a will, powers of attorney can only be witnessed by people in certain professions, with “lawyer” being the most common one. They are often made at the same time as a Will, but unlike a Will, a power of attorney is only valid while the person who made it is still alive, where a Will is only in effect after a person dies.

 

A Committeeship has some similarities and some differences. Like a power of attorney, a committeeship gives another person the ability to manage some of a person’s affairs while that person is still alive. The main difference is that a committeeship is a judge-made court order and they are only issued after someone has lost the ability to manage their own affairs. Because of this, they require sworn affidavits from physicians that the person can’t manage their own affairs, as well as a court appearance before a judge (although typically there is no need for witnesses to be called). This makes committeeships significantly more expensive to obtain than making a power of attorney in the first place – often thousands of dollars – although if the person no longer has the mental capacity to make a power of attorney then it may be the only option for a family member to take control of the affairs of someone.

 

There are some other differences as well: Most often, when we draft a power of attorney, we give as many powers as possible to the person who will be taking on the powers. With a committeeship the powers that are granted are more limited, and sometimes additional orders are required. For example, most powers of attorney are drafted with the option to allow the family member to sell the house if the person can’t live in it anymore. Under a committeeship, the house can only be sold after review of the sale by a judge, resulting in a delay on the sale and increased costs for seeking that review. A power of attorney can also name anyone (over 18, mentally competent themselves, and no an undischarged bankrupt) whereas a committeeship can only be granted to a person who is a Manitoba resident.

 

In the end, it is often far easier on everyone involved to have a power of attorney in place before it is needed. With that said, if there isn’t one in place, it’s important to know that not all is lost and that a committeeship may be an option. Please feel free to talk to us if you have any questions, and let us know if there is any way that we can help with your committeeship or power of attorney questions.

Workplace Investigation: 5 Reasons to Hire an External Investigator

By Workplace Investigations

Fair and equitable work environments in which all employees can participate and do their best work should be the goal of all employers. As part of that goal, there is a need for accountability by both employees and employers when issues arise in the workplace. That’s where a workplace investigation may be appropriate.

Some allegations of misconduct can be investigated and addressed internally, but there are many situations where employers should consider hiring an external workplace investigator. It is valuable for employers to be aware of when they are unable to handle an investigation. There is no specific list of circumstances to determine when an external investigator should be retained because every situation is unique. Below are some factors and scenarios to consider:

  1. The Allegations Are Serious

When serious allegations, such as sexual harassment or criminal conduct, are made, it is advisable to have an investigator with the necessary legal knowledge, training and expertise handle the matter.

Also, if an employee’s job is at risk, the employer should take the necessary precautions to ensure that a fair and proper investigation is undertaken and the rights of all parties are respected. An external investigator with a background in employment law has the necessary skills to make sure this is done.

  1. Impartiality in the workplace investigation

It is vital that workplace investigations be conducted by an impartial investigator with the necessary knowledge, training and expertise. You want all parties to accept and abide by the recommendations of the investigator. A necessary part of this is for the investigator to appear neutral and unbiased. Hiring an external investigator can shield the employer from claims of bias.

  1. Lack of Time and/or Resources

Conducting a proper investigation takes significant time and resources, which otherwise would be devoted to regular workplace activities. An external investigator will be able to conduct their investigation with only minimal disruptions to the day-to-day operation of the workplace.

  1. Helps to Re-build Morale

Allegations can cause a serious rift in employee relations and workplace dynamics. Employees often feel more comfortable reporting incidents when they feel that their employer takes such allegations seriously. Hiring an external investigator is a way for employers to elevate the trust and confidence their employees have in them.

  1. Prepares for and Simplifies Litigation

Similar to avoiding the spectre of bias, hiring an external investigator can safeguard the investigation against allegations of procedural unfairness. A report by an external investigator can be used as a shield against potential litigation and can be relied on by adjudicators in human rights or employment disputes. This will save all parties time and money in the long run.

For more information, please see our workplace investigations page here.

Katie Brownell is an associate at Wolseley Law LLP where she assists businesses with workplace investigations and other human resources disputes. The information presented in this article is not to be considered legal advice nor fit for any particular purpose. You should consult a lawyer with any questions specific to your situation.

Unbundled Services – A New Approach to an Old Problem

By Family law, Unbundled

Unbundled Legal Services – A New Approach to an Old Problem

By Katie Brownell

 

Over the last decade, more and more Manitobans have started representing themselves in their legal disputes. While this has typically been the case for small claims matters, self-representation is now approaching the 50% mark for family law matters, according to statistics collected by the Department of Justice and legal unbundled services is something that people are turning to for help.

You might choose to represent yourself for a number of reasons: you feel that you cannot afford a lawyer or you do not qualify for legal aid; you cannot find a lawyer; you have been unhappy with previous experiences; you do not trust the legal system or you believe that you can do the work yourself.

The most common reason motivating people to self-represent is that hiring a lawyer is too expensive. This is something that lawyers can help fix by offering services that the majority of people can afford. Instead of the traditional billable-hour model, where legal fees are charged on an hourly rate and the lawyer handles all aspects of the case, we are starting to offer unbundled, or limited scope, services. This is where you and your legal team make an agreement to limit the scope of the lawyer’s work on the file to specific, pre-agreed tasks. It is an option that falls between no representation and full representation.

According to the National Self-Represented Litigants Project, many self-represented clients find the process of handling their own legal matter to be overwhelming and uncertain. The unbundled model gives you access to a lawyer who can help alleviate your concerns without requiring you to provide a large retainer up front.

While the unbundled services don’t make sense for all matters or all people, it can be particularly helpful when you are representing yourself in a civil or family matter where there are many specific procedures and court rules that must be followed. The big challenge for most people isn’t the actual law, it is the procedure involved. Having a good argument or a worthwhile claim doesn’t mean much if you are not able to put it into a form the courts will accept.

The impact of family litigation can be lifelong; it can affect what kind of a relationship you will have with your children and how much money you will have to support them and yourself. Making a mistake at an early stage in the process can be difficult to fix later and fixing it can cost much more than doing the right thing in the first place.

In February of 2019, the court implemented a new model for family law matters that has resulted in changes to court forms and procedure. Under the new model, there is an emphasis on exchanging materials and information at an early stage so that families can attempt to negotiate or settle as many issues as possible without the involvement of the court. Given these recent changes, it is important to make sure that the initial documents you submit to the court and exchange with the other person are in the proper form and set out the issues you are hoping to have resolved.

Hiring a lawyer on an unbundled basis is a great way to set yourself up for success. Instead of providing a lawyer with a retainer and having them control the entire file, you can seek the lawyer’s advice or assistance on particular tasks such as preparing, filing and serving a Petition for Divorce or a Statement of Claim. You can also get legal advice on one specific issue or have a lawyer look over materials you receive from the opposing party. You and your lawyer can decide on a plan that best suits your case and your budget. Once you’ve gone to a lawyer for unbundled services, you can make an appointment to go back and get further advice as problems or questions arise, which can be helpful because that lawyer is already familiar with your file.

Hiring a lawyer may not always be necessary and sometimes may not be possible. Unbundled services are an affordable and accessible alternative to help you navigate the legal system during what can be a tough or confusing time.

Out of Court Family Resolution Certificates

By Family law

Manitoba Courts have recently expressed significant concern that the courts are being used to solve family law disputes involving child custody, support, and property division. As a way to encourage the resolution of family matters outside of court, Legal Aid Manitoba, also referred to as “LAM”, has created a certificate specifically for clients with out of court resolution in mind: “Out of Court Family Resolution Certificates”. To obtain one of these certificates, both parties must qualify for legal aid and they must commit to resolving their matter using a family resolution process such as collaborative law or four- way settlement meetings. Litigation is not permitted without authorization from Legal Aid Manitoba. If the parties do not work with their lawyers to achieve out of court settlements, and elect to go to court, they run the risk of having their LAM certificate cancelled. The intent of this approach is to focus on the best interests of the children and families as well as encouraging more effective ways to settle disputers.

In order to determine if one qualifies for a certificate, LAM reviews the applicant’s complete financial situation, including income, assets (including a house or RRSPs), debts, and whether or not money will be available to pay legal fees at the end of the case. The guidelines for income threshold to be eligible for legal aid are based on gross family income and family size. The typical guidelines are as follows:

Family Size Gross Family Income
1 $23,000
2 $27,000
3 $31,000
4 $34,000
5 $37,000
6 $40,000
7+ $43,000

 

Legal Aid Manitoba will also look closely at the legal matter to determine its appropriateness for this process. Whether one qualifies for assistance is solely at the discretion of LAM.

Alternatively, LAM also offers an Agreement to Pay (ATP) Program to help applicants pay for their legal services. If someone qualifies for this program, LAM requests an initial payment be made and then ongoing, interest-free monthly payments until the cost of the legal matter has been paid in full. This can often be significantly more affordable than hiring a private lawyer. [i]

Wolseley Law LLP is now accepting Out of Court Family Resolution Certificates through LAM, as we strongly support the initiative to resolve matters outside of Court when possible. If you think you qualify for legal aid and are interested in resolving your matter outside of Court or have already applied and been approved for this certificate, we may be able to assist you. If you do not know if you qualify for assistance, we would be happy to help you with your application at our office. You can contact us at al@wolseleylaw.ca, through our website www.wolseleylaw.ca or by telephone at 204-977-1706.

[i] Information taken from the Legal Aid Manitoba Website: https://www.legalaid.mb.ca/financial-rules/do-i-qualify-financially/