IDI CONFERENCE - VENICE MAY 18, 2012 EMPLOYEE AND STAFFING IN CONCESSIONS & CORNERS The Critical Issues

Main Staffing Considerations Consignor Ability/Desire to Help Consignee Locally Existing Infrastructure Easy Consignee No Country Presence No/Limited Knowledge of Local Laws

Consignor Employees Consignee Employees Staffing Agency Independent Contractors Combination of any/all of the above Staffing Options

Risks Deemed Employer Co-Employer Common/Affiliated Employer

Deemed/Co-Employer Examination of the Fact & Circumstances of the Relationship Integration of the Relationship

Examination of the Facts Look Beyond the Form of the Relationship and into its Substance Who recruits, hires, disciplines and terminates? Who remits withholdings to proper government authority? Who maintains payroll and personnel files? Who provides benefits? Who provides workers’ compensation insurance coverage? Who provides training, uniforms and ID?

Microsoft Case Independent Contractors Recognized as “common law employees” Individuals Provided by Temp Staffing Agency Court Applied 5 factor test: 1.Recruitment 2.Training 3.Duration of Employment 4.Right to assign additional work 5.Control over relationship between worker and agency

Risks Associated with Deemed/Co- Employment Inadvertent Assumption/Sharing of Employer Responsibilities including liability for: Severance payments Human rights Disability

Employer Liabilities Canada Payment of Legislated and Common Law Severance Quebec: Reinstatement of Employment Liability for Human Rights Complaints, Employee Injuries and Workplace Safety United States “At will” Employment 3 Exceptions:  Public Policy  Implied Contract  Implied Covenant of Good Faith Liability for Civil Rights Violations and Damages for Breach of Contract

How to Reduce the Risk? Clear Contract Terms  Who is employer and what are their responsibilities  Avoid sharing employer responsibilities  Include provisions that exclude participation in your employee benefits and have your plans specifically exclude non-employees  Require employees to sign waivers to benefits in employment agreements  Minimize communications and involvement in dispute resolution process  Indemnities Reflect Contract Terms in Day to day Operations

Common/Single Employer Doctrine Created by Statute and Common Law Allows the Court to treat 2 different legal entities as 1 employer for purposes of attribution of liability for employees where a sufficient degree of relationship exists between the entities

United States 4 Elements of the Rule:  Interrelation of the corporations  Common management  Centralized control of labor relations; and  Common ownership or financial control

Canada Common Law Doctrine Also in Employment Standards Legislation Test: “A sufficient degree of relationship” Determined on a case by case basis Consider individual shareholdings, corporate shareholdings and interlocking directorship