The common employer doctrine allows the Court to treat separate
legal entities as a single employer for liabilities such as
outstanding wages, termination pay or severance pay, in appropriate
cases. However, the fact that corporations are related and
coordinate their activities does not, in and of itself, mean they
have common liability.
The recent decision of
O'Reilly v. ClearMRI Solutions Ltd. confirmed
that a Court cannot hold a parent or shareholder corporation
liable as a common employer unless there is a clear intention to
create an employer-employee relationship.
Background
The employee was owed a substantial amount of money when his
employment ended. He brought an action seeking recovery of all
outstanding amounts from his employer as well as his
employer's corporate majority shareholder (the “Parent
Co.”). He claimed that although he did not have a position or
written agreement with the majority shareholder, the Parent Co. and
his employer were common
