In the recent case of Waraich v. Manitoba, 2021 MBCA 82 the Manitoba Court of Appeal (MBCA) affirmed that, in the interests of ensuring finality in legal proceedings, the doctrine of issue estoppel (res judicata) can apply to bar an attempt to relitigate an issue already decided by an administrative decisionmaker.
The claimant ran a small cleaning business and was ordered by the Director of Employment Standards to pay three claims for unpaid wages under The Employment Standards Code, CCSM c E110. These orders went unheeded, which led to the Director garnishing the unpaid wages from the claimant’s personal bank account.
In Small Claims Court, the claimant successfully argued that she was not personally responsible for the unpaid wages since the employees in question were employed by a corporation rather than her directly. On appeal, the MBCA established that the claimant should have been prohibited from raising the issue in a different forum instead of appealing the matter to the Labour Board as permitted by the Code.
This case illustrates the fact that the corporate veil is not completely impenetrable, and that when it comes to employment standards and the payment of wages, employers must comply with the decisions of employment standards officers or the Director of Employment Standards, or appeal to the Labour Board as allowed by the Code.
By Ty Schmidt – Supervised by Professor Maharaj