2007
 
IMPLICATIONS OF ENDING MANDATORY RETIREMENT FOR COLLEGES AND UNIVERSITIES 
On December 1, 2006 the Premier’s Council on Aging & Seniors’ Issues made a number of recommendations including that the Province introduce legislation to amend the Human Rights Code (“Code”) to prohibit mandatory retirement. In response to the report, the Premier has indicated that the Government will introduce legislation to end mandatory retirement in the Spring 2007 session. Currently in BC, employers are permitted to require retirement at age 65 because, while the Code prohibits discrimination on the basis of age, “age” is defined as between 19 and 65. At first glance, employers with problems recruiting new employees may not see any problems with the elimination of mandatory retirement, or they may already have eliminated mandatory retirement from their workplaces. There are however, some significant human resources implications and costs associated with the elimination of an employer’s right to require employees to retire at age 65, or to have different eligibility rules for benefits for employees age 65 or older. Increased Costs It is expected that with the change in the legislation, not only will employers no longer be able to require retirement at age 65, but age-based restrictions to health insurance, sick leave, and disability benefit programs, retirement plans and the like will also be prohibited. Employers will either have to pay for increased costs to extend coverage for these programs for over 65 employees, or will be faced with reducing benefit levels (equally) for all employees. Mandatory workers compensation premiums will also increase if work related accident and disability claims increase. Besides out of pocket benefit cost increases, employers can expect to have increased costs associated with illness, disability and duty to accommodate those events. Additional employees required to cover increased part time workers will also result in additional benefit and equipment/space costs. As the average age of employees increases, so too will overall salary costs increase to the extent that salaries and salary increases are based on years of service. Management of Employee Performance It is common for employers faced with under performing employees to simply put up with the performance problems if the employer knows that employee will be retiring soon. Without the ability to require retirement, employers will have to actively manage performance levels. This issue is even more acute with Universities and Colleges who have tenured faculty. Even if Universities and Colleges have performance review language in their collective agreements with their faculty, and established performance review processes, effective performance management is difficult for a number of reasons. First, the academic culture is one of collegial decision making. The people tasked with responsibility for performance reviews one year (Deans, Department Heads), have the right to return to the faculty once their terms are over. This in turn places these individuals in a conflict between their duties as ‘managers’ and self interest. Second, universities and colleges have found it very difficult to enforce decisions adverse to faculty; these decisions are invariably grieved by faculty associations, and arbitrators have generally sided with faculty. Employers should always be alert to the possibility that some performance problems may be based on a disability or illness (which triggers legal obligations on the employer to accommodate the employee). This will be even more important when dealing with older employees who have performance problems. Finally, it should go without saying that employers will not be able to institute performance management measures or criteria only on employees age 65 or older, and will be expected to “accommodate” reasonable age based limitations on performance (e.g. adapting to new technologies), provided employers can do so without undue hardship. Human Resources Planning In today’s economy where some employers are having difficulty recruiting employees, the elimination of mandatory retirement can be of benefit to human resources managers. The elimination of mandatory retirement will also result in significant uncertainty for those same people tasked with resource planning. No longer will employers know for certain when employees will retire, nor can then compel decisions on retirement dates. Strategies to Manage Human Resources after Mandatory Retirement Abolished It is not known if the Province will delay the implementation of amendments to the Human Rights Code to abolish mandatory retirement, or if any delays in implementation will be applied equally across all employer sectors. Delays will allow employers more time to consider and implement strategies to deal with the consequences of the end of mandatory retirement, noted above. Examples of such strategies may include:
COMPASSIONATE CARE LEAVE NOW IN EFFECT
On October 20, 2006, the new Compassionate Care Leave regulations came into effect under the Employment Standards Act (British Columbia). These regulations provide employees with a guaranteed right to an unpaid leave of absence from work in order to provide care or support to a family member with a serious medical condition. Compassionate Care leave is the 5th form of leave protected by the Employment Standards Act (in addition to pregnancy, parental, family responsibility and bereavement leave). Employees are entitled to up to 8 weeks of unpaid leave to care for a family member who has a serious medical condition and at risk of dying within 26 weeks. Employers are entitled to require that a medical doctor certify that these conditions exist, and employees are required to provide that medical certificate to the employer as soon as practicable. Employees are required to take the leave in units of 1 or more weeks. Besides the employee’s spouse, grandparents, parents, siblings or children, “Family member” also includes the following:
Employees are also entitled to further unpaid leave if the family member does not pass away within the original 26 week period, as long as a new medical certificate is obtained and provided to the employer. If you require additional information on these first two articles, you are welcome to contact Nicole Byres at nmb@cwilson.com.
UNDERSTANDING CONSTRUCTION MANAGEMENT
In recent years, higher learning institutions have moved away from the traditional fixed price (or stipulated price) design-bid-build project delivery system in favour of construction management for large or complicated capital projects. An experienced construction manager can add value in design and assist in the development of construction schedules and provide constructability assessments and cost estimates. Trade contracts can be entered into sequentially, with the construction contract divided into smaller packages in order to shorten the overall project time. This “fast tracking” can take advantage of procurement opportunities and goes some way to address availability problems in the marketplace, such as are currently experienced in Western Canada. However, construction management has also led to misunderstandings, particularly in relation to the standard form construction management agreement most often used in Canada, being the “Canadian Standard Construction Management Contract Form between Owner and Construction Manager CCA No. 5 – 1988” published by the Canadian Construction Association (the “CCA 5”). The Canadian Construction Association also publishes a companion form of contract entitled “Stipulated Price Contract for Trade Contractors on Construction Management Projects CCA No. 17 – 1996” which is intended for use by the owner and trade contractors when entering into separate trade contracts. Construction management differs from traditional project delivery in that another party is added to the historical three-pronged model (owner-consultant-contractor). In its basic form, construction management is a process by which a an additional party (the construction manager) is retained by the owner to provide leadership throughout various stages of the project (e.g. pre-construction, construction and post-construction). The construction manager represents the interests of the owner by administering the construction contract and by managing the work, including cost, time and quality aspects of the project. Construction management generally takes one of two forms, each with its own scope of responsibilities and risks. The two models are (a) the construction manager as agent of the owner and (b) the construction manager “at risk”. In its basic form, construction management is performed by an independent party as a separate professional service, on a fee-for-service basis. The construction manager will manage separate trade contractors on behalf of the owner and will perform the management and the coordination functions typically carried out by the general contractor. In this model, the construction manager is merely an agent of the owner and does not design or construct the project. Instead, the agency construction manager administers the construction contract through the various phases of the project and the owner contracts separately with each of the construction manager, design professional and trade contractors. The agency construction manager is generally not responsible for the means or methods of construction and does not guarantee construction cost, time or quality aspects of the work. On the other hand, the construction manager “at risk” provides advice and construction leadership on a project during the planning and design phases and provides construction leadership, contract management, direction, supervision, coordination and control of the work during the construction and post-construction phases. The owner contracts separately with the design professional and it is the construction manager (rather than the owner) who contracts with the trade contractors. Under this model, the construction manager has control (and takes the risk) over the means and methods of construction, the management of the contractors and the delivery of the project within the owner’s time and budget requirements. The contract between the owner and the construction manager will differ significantly, depending on whether you the construction manager is the owner’s agent or is a construction manager “at risk”. The CCA 5 is specifically written for the construction manager as agent and is not really suitable for use under the construction manager “at risk” model. Unfortunately, at present, there is no Canadian standard form of contract available for the construction management “at risk” model. Owners who use construction management on multiple projects usually develop their own custom form of contract which is specifically designed for this form of construction management. Some owners attempt to modify the CCA 5 to suit this “at risk” construction management, but the modifications required are extensive and caution is advised. Owners should seek legal advise when they take this approach. Allowing the construction manager to propose and prepare the form of contract is not advised, as this often puts the owner at a significant disadvantage. Some of most misunderstood aspects of the CCA 5 relate to the promises which the construction manager makes to the owner (or stated otherwise, the risks the construction manager assumes), particularly with respect to the project schedule and budget. Article A-2(a) of the CCA 5 provides that the construction manager, along with the owner and the consultant shall “strive” to achieve substantial performance of the project by a given date. Unlike a general contractor or a construction manager “at risk” the construction manager as agent, does not actually take the risk that the project may not be within time or within budget. One of the other common misunderstandings relates to the compensation payable to the construction manager. Under the CCA 5, the fee payable to the construction manager is just one of several components of compensation to which the construction manager may be entitled. Articles A-5 (contract fee), A-6 (reimbursable expenses) and A-7 (own forces work) all deal with the compensation payable to the construction manager. Appendix A to the CCA 5 lists reimbursable expenses which the construction manager is entitled to recover in addition to the contract fee. Some of these items often come as an unwelcome surprise to owners. It is essential that the owner have a clear understanding of the services covered under the contract fee and which items will be additional, reimbursable expenses. Whatever form of construction management contract is used, it is essential that the contract be finalized and executed by both parties before the construction manager provides any services or before trade contracts are awarded. If you require additional information on construction management, you are welcome to contact Hannelie Stockenstrom at hgs@cwilson.com.
OFF-CAMPUS WORK PROGRAM EXTENDED TO MORE INTERNATIONAL STUDENTS
In December, 2006, the Minister of Citizenship and Immigration announced that the Government will begin discussions with interested provinces and territories to expand the Off-Campus Work Permit program to include private institutions on a pilot basis. As a result of the pilot project, foreign students studying at approximately 75 additional institutions could be eligible to apply for off-campus work permits. The program, which allows international students at post-secondary institutions to work off-campus, is currently available only to students at publicly funded universities and colleges. In order to ensure appropriate controls, the pilot project will apply only to programs and institutions recognized or authorized by the provinces and territories to confer degrees. Provinces and territories interested in participating in the pilot will need to negotiate memoranda of understanding with the private schools in theirjurisdictions and monitor the implementation of the program. The Minister launched the Off-Campus Work Permit program nationally on April 27, 2006. Over 8,300 international students have already benefited from the initiative. Prior to the introduction of this program, these students were restricted to holding jobs on the campus of the educational institution at which they were studying. If you require additional information on the above, or other immigration matters, you are welcome to contact Ken Ing at kki@cwilson.com.
BRITISH COLUMBIA SUPREME COURT UPDATE
The British Columbia Supreme Court has made two significant changes over the last few months that post secondary institutions involved in litigation will want to keep in mind. Most importantly, January 1, 2007 saw the introduction of a new Costs Tariff. In British Columbia, as in other Canadian jurisdiction, a successful litigant is usually awarded costs against the unsuccessful party. These costs, are based on the Costs Tariff and as a rule do not indemnify the successful party completely. There are substantial revisions to the Tariff, including an increase from $80 to $110 in the unit value for the scale of costs most often awarded, now called Scale B. Whereas successful litigants previously received approximately only one-third of their actual costs it is estimated that they will now receive in the range of 70%. Second, on July 1, 2006 the Court issued a Practice Direction regarding electronic evidence which sets out a framework for managing both hard copy and electronic documents in a technology environment. More and more of the relevant documents that must be produced in a court proceeding are electronic documents, such as e-mails. The Court is also encouraging parties to produce Lists of Documents and the documents themselves in an electronic format, particularly when the total number of discoverable documents exceeds 1,000. The Practice Direction will apply where the Court so orderswhen the parties agree it applies. Finally, it is also worth noting that the Expedited Litigation Project under Rule 68 remains in place at least until September 11, 2007. Rule 68 applies in the pilot registries (namely, Vancouver, Victoria, Prince George and Nelson) and is intended to streamline procedures for cases under $100,000. If you require additional information on the above, or other litigation matters, you are welcome to contact Larry Munn at lm@cwilson.com.
ANNOUNCEMENT OF NEW CHILLIWACK CAMPUS FOR UCFV
On January 16, 2007, Premier Gordon Campbell announced the completion of the acquisition of a 34 hectare parcel by UCFV from Chilliwack Economic Partners Corporation. This transaction, which relates to a large part of the former Department of National Defence base in Chilliwack has been underway since 2004. In addition to UCFV and CEPCO, it also involved Canada Lands Corporation and close cooperation with the City of Chilliwack as well as with the Province of British Columbia, which is contributing $7.6 million to land acquisition costs and $21.6 million for a major building renovation. The new UCFV campus will be the largest parcel within Canada Education Park, which is also the home for the World Trade University and RCMP training facilities. UCFV’s new state-of-the-art Trades & Technology Centre is scheduled to be open on the new campus by the fall of 2007 and by 2010, UCFV expects 1,800 students call the new Chilliwack campus home. This is double the number now studying at UCFV’s current downtown campus. Future plans include classrooms, residences, a learning commons, indigenous learning centre and other student support facilities as well as access paths through to the popular Rotary Vedder River Trail, preservation of heritage elements of the site and the possibility of commercial development along Vedder Road. The new campus will be a centrepiece in the expansion of advanced education programs by UCFV in the burgeoning Fraser Valley, the population of which has doubled since 1974, the year when UCFV was founded. As quoted in UCFV’s announcement of the new campus, UCFV’s President, Dr. H.A. (Skip) Bassford stated: “We’re really looking forward to creating this vibrant centre of learning for a student body and community truly in need of it. The space UCFV will gain on this new campus is enough for us to grow comfortably in the eastern end of our valley for the foreseeable future.” For additional information on the new Chilliwack campus of UCFV, go to: www.ucfv.ca/MarCom/Newsroom/CanadaEducationPark.htm. Clark Wilson LLP congratulates UCFV on the new Chilliwack campus site, and Brock Johnston is grateful to have had the opportunity to assist UCFV with the acquisition and related concerns.
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