Lecture One (Professor Doorey): Introduction

1. We introduced the ‘three regimes’ of employment law: common law; employment regulation; and collective bargaining regulation.

In this course, we deal with only the Common Law and Employment Regulation (mostly the Employment Standards Act and the Human Rights Code). HRM 3420 (Industrial Relations) considers the Collective Bargaining regime.

2. The Common Law of Employment

This is the body of rules created over centuries by judges in cases dealing with employment contracts. They guide the interpretation of employment contracts. These rules are not written in a ‘statute’. To find the rules, you need to read the judges’ decisions or employment law books describing the rules. The common law of employment developed over time as judges read other judges’ decisions from earlier cases, and either applied the same reasoning to their cases, or ‘distinguished’ earlier cases by finding that the earlier cases involved different facts, different issues, or were just wrongly decided.

3. The Common Law is Historically Tied to the Free Market Model of Employment

If we imagine a world in which there is no employment regulation (no minimum wage, no anti-discrimination legislation, etc), how are conditions of work determined?

The answer is through ‘bargaining’ between employers and employees against a backdrop of ‘market conditions’ -- supply and demand, ‘freedom of contract’. Under this system, parties are free to agree to whatever they like.

The Er would be expected to offer conditions sufficient to attract enough workers, but not more than that, since paying more than necessary cuts into profits. The employer will offer enough to workers in order to attract the number of workers it needs.

We discussed how in most cases, employees do not “bargain” at the point of hiring: the employer tells the employee what the conditions for new hirers are and the employee either accepts or doesn’t. This is because worker usually needs job more than Er needs any particular worker. In other words, employees usually have less bargaining power and can’t (or don’t try) to bargain better terms.

As a result, Ers usually set the terms of employment. This conclusion was bolstered by a poll of the class: almost every student had accepted a job without bargaining over conditions of work.

4. Common Law Judges Saw Their Role as Only Enforcing Contract

Historically, common law judges saw their role as simply to interpret the contract, not to pass judgment on whether it was ‘fair” or ‘unfair’. If employee didn’t like the terms, she could quit or try to bargain better terms. [In some ways, this approach has changed, as we will see, as judges today do sometimes interpret contracts in creative ways to protect employee interests. ]

The combination of: (1) the market model that permitted the more powerful party (the employer) to usually set the terms of employment; and (2) the judges’ insistence that their only job was to enforce those terms, often led to very harsh conditions of work.

5. Government Intervenes in “Free’ Labour Market Through Protective Employment Regulation

To address the fact that the common law model of employment permitted wages that were ‘too low’, or hours that were ‘too long’, or conditions that were ‘too unsafe’, etc., governments over time passed legislation, like employment standards, workers’ compensation, human rights codes, occupational health and safety, etc..

These laws represent an admission by the state that the common law, free market system of employment produces outcomes that are inconsistent with public policy objectives.

But what are those public policy objectives? When should the state intervene, and is the form of intervention actually achieving the desired outcomes.

We discussed, for example, what the objective of a minimum wage is, and then whether we believe it achieves those objectives.

6. We watched several short videos.

We watched 3 short videos of the Virtual Professor Doorey doing interviews. He declined employment to a woman because of her red hair, a second applicant declined his terms and left, and the third simply accepted what was offered and was hired.

We discussed whether “I” had done anything wrong. Many students thought denying employment on the basis of hair colour was unfair and unlawful. We noted that an Er can hire whomever it likes, unless some statute regulates the decision. We will learn later when we look at human rights law whether an employer can discriminate on basis of hair colour.

But most people did not see any problem in my refusal to agree to more money when the second applicant demanded it. The employer is permitted to use its superior bargaining power to propose a ‘take it or leave it’ offer.

In a 4^th video segment, the virtual Doorey fired the employee in order to make room for a relative to have a job. Since the employer had included a term in the contract allowing dismissals for any reason at all, this was not a violation of the employment contract. Many of you thought it was wrong or ‘unfair’ nonetheless. We will learn later whether it is unlawful for me to have dismissed her on this basis.

7. We discussed the Pay Gap Between Men and Women

We noted news stories that showed how women now work more than men in Canada, but are still lumped in many of the lowest paid jobs, and still earn 71 cents on the dollar compared to men (see links on course blog).

We discussed possible explanations for this persistent gap. Is it due to sexism and discrimination, to the fact that women ‘chose’ jobs that pay less? Does the fact that women tend to be primarily responsible for childcare, and therefore are less able to meet time demands of many high paying jobs, a social problem that the state should address through regulation?

If so, what sort of regulation could address that problem? The point of the discussion was that governments need to ask whether:

(1) there is a social problem related to work that needs a legislative response; and

(2) if so, what sort of regulation would achieve the government’s policy objective

Finally, I noted that as we work through the materials, we will keep returning to these themes.