January 27, 2025

Jurisdictional Issues for Employers with Remote/Hybrid Workers

Remote and hybrid work offers employers many advantages, including lower overhead, the ability to recruit highly qualified candidates from other jurisdictions, and improved employee-morale.  However, it can also have many pitfalls if not carefully considered and planned, particularly at the time the relationship is formed.

As we approach five years from the onset of the COVID-19 pandemic, remote and hybrid work arrangements have led to an increase in the number of employees working remotely. And despite the recent efforts of some employers to require employees to return to the office, there is little doubt that these arrangements are here to stay in one way or another.

Employees who perform services remotely sometimes do so from home in the same geographical region as their employer, but in an increasing number of circumstances, they work remotely from afar, whether in other provinces, or other parts of the world.

With the increase of employees now working either remotely or on a hybrid basis, often in a different Province from the Employer, jurisdictional issues have become more common in all facets of employment law. This article provides a brief overview of some of the relevant jurisdictional considerations for employers with employees who work outside of British Columbia.

Employment Standards

Each jurisdiction in Canada has its own unique employment standards legislation which may provide employees with different rights and entitlements depending on which provincial legislation applies.  This, in turn, may create significant consequences for an employer in terms of things like maximum hours of work, pay for overtime, and vacation entitlement.  British Columbia employers should therefore carefully consider which legislation will apply to a remote and/or hybrid employee outside of British Columbia to ensure that they are compliant with the applicable legislation. 

Whether or not the British Columbia Employment Standards Act will apply to a remote and/or hybrid employee working outside of British Columbia will depend on the circumstances.  The Employment Standards Tribunal will examine whether there is a “sufficient connection” between the employment and British Columbia, based on factors such as the residence and “usual place of employment” for the employee, and the extent to which other jurisdictions may legitimately claim jurisdiction over their employment.[1]  The issue can therefore be unclear.

We expect to see more determinations forthcoming from the Tribunal on this issue, as disputes related to remote/hybrid work arrangements make their way to decision-makers. 

Workers’ Compensation and Occupational Health and Safety

As with employment standards, each jurisdiction in Canada has its own unique workers’ compensation and occupational health and safety legislation.  In most jurisdictions, employers in British Columbia who have no corporate presence in another Province must comply with that Province’s workers compensation and occupational health requirements if they have even one employee working in the jurisdiction.  In addition, in some jurisdictions, employers are required to pay insurance premiums and could find themselves footing the cost of compensation for an injured worker if they are not registered and up to date on those premiums.   

This legislation in British Columbia imposes obligations upon employers to ensure that employees work safely while working remotely.  For example, an employer has an obligation to ensure employees working remotely have a safe environment in which to work, which may include ergonomic and/or risk assessments of the employee’s workspace and work environment.  In addition, if a remote worker is alone throughout the work day, the employer may be required to comply with WorkSafeBC’s Working Alone or in Isolation Guidelines

Given that these requirements vary from province to province, employers in British Columbia with employees working outside of the Province should make the necessary enquiries with the relevant workers’ compensation and/or occupational health and safety authorities to determine registration and compliance requirements.  Failure to do so could potentially lead to significant consequences if an employee is injured at work in other jurisdictions. 

Civil Litigation

Employers based in British Columbia with employees working outside of the Province may find themselves in the difficult situation of being sued by former employees in a different jurisdiction.  This may lead to disputes about which jurisdiction is more appropriate for the litigation, along with which common law and statutory employment laws apply, in addition to the substance of the dispute.  In almost every case, it will lead to increased costs for the employer.

Risk may be mitigated significantly though enforceable employment contracts which contain clauses to address these issues such as choice of laws and forum selection clauses for employment-related disputes. However, with the unprecedented shift in remote and hybrid work that we have seen since the onset of the pandemic, many employers do not have clauses in their employment agreements addressing these issues.  For new employees, these clauses can be included in their employment agreement at the outset.  For existing employees who have transitioned to remote work, employers should consider negotiating a new employment agreement containing such terms with the employee, in exchange for fresh consideration. 

Conclusion

Remote and hybrid work are here to stay. While remote work is beneficial in many respects, it can also have significant and sometimes unanticipated consequences for employers.   The good news is, however, most if not all these issues can be addressed with a bit of planning. 

We recommend that employers inform themselves about which provincial legislation applies to their remote workers and ensure that their policies and practices are in alignment with that legislation.  In addition, employers should turn their minds to which jurisdiction will apply in the event of a dispute, and review existing employment agreements for remote workers to ensure that jurisdiction is addressed in those agreements. 


[1] Re Can-Achieve Consultants Ltd, 1997 CanLII 25711 (BC EST #D453/97); Re Dayton Boots Company Ltd, 2022 BCEST 29

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