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Tim Hortons clawbacks raise the question: who’s the boss?

January 14, 2018

In its latest report on the Tim Horton’s clawback controversy, the Toronto Star looked at the question of who is actually the employer of Tims’ employees – the parent company or the individual franchises.

The Star spoke to Josh Mandryk, who had this to say:

“I think generally the law ought to move toward a recognition of shared responsibility for these employees,” said Josh Mandryk, a lawyer with Toronto-based labour law firm Goldblatt Partners.

What exactly would shared responsibility mean? In the case of Tim Hortons, it could potentially mean joint liability between parent company and franchisees for employment standards claims made by workers for Workplace violations.

In 2017, there were at least 183 such claims made at Timmies franchises, statistics requested by the Star show. Of these, the Ministry of Labour has investigated 90. Thirteen have resulted in settlements or compliance, while the majority of the claims have either been denied or withdrawn by the employee. The ministry says it cannot provide information on the remaining 93 claims they are still investigating.

Worker advocates wanted the Ontario government to recognize this principle, in part, through something called broader based bargaining, which essentially allows employees with the same overarching employer to come together as part of the same union — even if they are not in the same location. In sectors like precarious retail and food services where unionizing is a huge challenge, labour groups say they want workers to have a collective voice and strength in numbers when negotiating contracts.

Bill 148 enacted a narrower mechanism, but one the Ministry of Labour says shares the same goal. Here’s a hypothetical example of how the new measure works: a large corporation owns 10 coffee shops in the GTA. Each unionizes separately. The labour board now has the power to consolidate those 10 units so they can bargain a contract together, rather than each shop doing it separately.

While this will apply across the board to multi-location corporations, it will only apply to franchises when one of its franchisees owns multiple outlets. Mandryk notes this falls short of the special advisers’ own recommendations, which suggest employees of the same parent company should be able to make an application to negotiate union contracts together, regardless of who owns the individual outlets.

Compliance might be greater, Mandryk argues, in a franchise world where shared responsibility for workplaces rights was law.

“It would certainly change the behaviour of many franchise businesses. The parent companies would have to work harder to ensure fair and decent working conditions for the employees of their franchises,” he said.

“You wouldn’t see situations where they wash their hands of that responsibility.”

Read the entire article here.


Joshua Mandryk

Practice Areas

Employment Law