Administrative law – Decisions of administrative tribunals – Employment Standards Tribunal – Employment law – Remuneration – Judicial review – Compliance with legislation – Privative clauses – Standard of review – Patent unreasonableness
Brandt Tractor Ltd. v. Claypool,  B.C.J. No. 941, 2015 BCSC 759, British Columbia Supreme Court, May 11, 2015, P.W. Walker J.
Mr. Claypool (the “employee”) worked as a worksite product specialist with Brandt Tractor Ltd (“Brandt”). He signed multiple one year contracts that governed his employment from March 2006 to June 2010. In addition to an annual salary base, the employee’s compensation package included commission payments. Whereas the employee took no issue with Brandt’s treatment of statutory vacation and holiday pay on his base salary, he took issue in the manner in which statutory vacation and holiday pay on earned commissions (“Vacation Pay”) was treated in his employment contract. Section 58 of the Employment Standards Act, R.S.B.C. 1996, c.113 (the “Act”) requires all employers to pay vacation and holiday pay. The minimum amount payable for vacation pay for employees with less than five years employment with their employer is 4% of their wages; thereafter it is 6%. Brandt agreed to pay the employee the maximum amount up to 6% at the outset of his employment.
The employee filed an unpaid wage complaint in September 2010 under s. 74 of the Act. His complaint was determined in favour by a member of the Employment Standards Tribunal in January 2013; the employment contract was determined not to comply with the Act in respect to its treatment of Vacation Pay on earned commissions. Brandt was found to owe the employee $10,039.91. Brandt appealed but was unsuccessful (“Appeal Decision”). Brandt requested reconsideration which was denied as well (“Reconsideration Decision”).
The primary ground of Brandt’s claim on judicial review was that the determination in the Reconsideration Decision (that s. 58 was contravened) was patently unreasonable. Alternative grounds were also advanced. The respondents opposed the petition on three main grounds: (i) the Court must give considerable deference to the tribunal member who issued the Reconsideration Decision, (ii) the petitioner failed to demonstrate the decision was patently unreasonable and (iii) the result was correct.
The parties, and Court, agreed that as a result of the combination of the privative clause contained in the Act and s. 58 of the Administrative Tribunals Act, the governing test for the judicial review application was patent unreasonableness. The Court determined the Reconsideration Decision was patently unreasonable.
The tribunal member found that the employee’s employment contract contravened the Act because he found it reduced the employee’s earned and payable commissions that he and Brandt agreed to. The Court noted that according to a plain reading of the Employment Standards Act, the contract did not contravene the Act. The Court observed that the tribunal member did not refer to the actual words in the employment contract which provided that the employees global commission payments included statutory vacation and holiday pay and set out the actual amounts of 6% and 4% respectfully.
The Court also determined that the Reconsideration Decision was patently unreasonable because the tribunal member did not apply the facts in reaching his determination. More particularly, the tribunal member determined that the treatment of Vacation Pay in the employment contract did not comply with the Act because it did not meet the employee’s reasonable expectation. The Court found that this was inconsistent with the facts as set out in the previous decisions. The Court found that there was no lack of transparency noting that the employee signed successive employment contracts with identical language insofar as treatment of Vacation Pay payable on earned commissions was concerned. Also the Court noted that the employee was provided with a regular, monthly itemized written breakdown of the specific amounts of all global commission payments, statutory vacation and holiday pay earned and paid on all earned commissions and the commission amounts net of Vacation Pay.
For the above reasons, the Court quashed the Reconsideration Decision and referred the complaint back to the Employment Standards Tribunal for reconsideration.
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