Employees For Keeps: Some Best Practice Suggestions for Employee Retention in Small and Family-Run Businesses

Both economic and cultural factors strongly suggest it is better to hire employees, to the greatest extent possible, “for keeps”.  This is particularly challenging with today’s low unemployment rates. Employee turnover is expensive, imposing monetary costs (as much as $100,000 for a single employee) as well as leading to a “downward spiral” in  worker morale and negatively impacting workplace culture, “fracturing” work teams and preventing them from optimizing their potential. In consequence, employee retention is crucial for the success of small and family-run businesses.

Bankrupt spelled in scrabble tiles.

When Insolvency Meets Arbitration: The Supreme Court’s Ruling in Peace River v Petrowest

A natural tension exists where a company that is subject to insolvency proceedings (such as bankruptcy) is also a party to an arbitration agreement. In such cases, there may be conflicting decisions issued by the arbitrator and the insolvency court, or there may be disagreement about which forum has the authority to hear the dispute. The modern view has tended to be that agreements to arbitrate should be honored, consistent with the principles of party autonomy and freedom of contract. Insolvency procedures, however, favour a centralized judicial process and can override certain pre-insolvency agreements in order to achieve objectives in the best interests of creditors. In a much-anticipated decision, the Supreme Court of Canada (SCC) recently weighed in on these conflicting principles in Peace River Hydro Partners v. Petrowest Corp.,[1] and, in doing so, addressed a key intersection of insolvency and arbitration law.

Two brothers fighting

Certainty and Partnership Arrangements – Key Components to Consider

When embarking on a business venture, it is crucial to set out clear definitions of roles and relationships of all interested parties involved. This can be especially important when seeking to create a formal business partnership, since such an arrangement gives rise to special legal obligations between the partners (as well as legal implications in the partners’ dealings with others). As illustrated by the cases discussed in this blog, sometimes this can be a challenge. Perhaps individuals will be so busy in the whirlwind of starting up a business that they neglect to provide sufficiently certain terms in their agreements, or maybe the alleged partners were never of one mind to even become partners to begin with. Since such errors can have legal consequences; persons should ensure that, if they actually intend to operate as a partnership, they draft an agreement that unequivocally shows that this is how they want their business to be defined.

Typos and Contracts

This is a cautionary tale about attention to clerical detail! Can a typo in a contract prevent a deal from being reached? Apparently, yes, at least insofar as essential terms of the contract are concerned. In 1132080 B.C. Ltd. v 1055616 B.C. Ltd.,[1] one mistake in the party’s name invalidated a contract related to the land and its subsequent assignments.