For 14 years, Leon Brick was employed as a commissioned sales agent for La-Z-Boy Canada Ltd, a
Question:
For 14 years, Leon Brick was employed as a commissioned sales agent for La-Z-Boy Canada Ltd, a furniture manufacturer. In an effort to avoid contributing to the Employer Health Tax and Workplace Safety and Insurance Board schemes, however, the company informed Brick that, if he wished to continue working for La-Z-Boy, he would be required to sign a document in which he expressly declared that he was an independent contractor and not an employee. That document further stated that La-Z-Boy was entitled to terminate Brick's services, at any time and for any reason, as long as it provided two months' notice. The new arrangement also brought a few other changes. The company encouraged Brick to create a corporation and to provide his services through that corporation. It also required him to register for the goods and services tax (GST), and it encouraged him to share office space with other individuals in the same position. In most respects, however, the parties' relationship was unchanged. Brick's responsibilities and compensation remained the same as in the past. The company continued to provide training and promotional materials, it continued to control the products being sold, and it continued to restrict Brick's sales efforts to a certain territory. Nine years after that new arrangement had been created, the parties' relationship suddenly came to an end. The precise reasons are unclear. Brick suspects that the company decided to sever ties after it learned that a prospective customer had filed a statement of claim alleging that Brick had committed a harmful tort. If successful, that tort claim will trigger damages in excess of $500 000. A second source of tension involves the circumstances surrounding Brick's termination. La-Z-Boy insists that, under the terms of the signed contract, Brick was entitled to only two months' notice. In contrast, Brick believes that, after 23 years with the company, he deserves a much more generous severance package. And, in fact, the evidence indicates that an employee in Brick's position normally would be entitled to a severance payment equal to 18 months' income. Discuss the legal issues raised in this case.
CorporationA Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...
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Managing the Law The Legal Aspects of Doing Business
ISBN: 978-0133847154
5th edition
Authors: Mitchell McInnes, Ian R. Kerr, J. Anthony VanDuzer