In a significant victory for temporary workers, the Ontario Labour Relations Board has ruled against FDM Group, a multinational temporary work agency, declaring their $30,000 training fee for early contract termination illegal. This landmark decision, partly championed by Downtown Legal Services, protects vulnerable workers from unjust financial penalties.
The case involved four former FDM Group temporary workers who faced a hefty $30,000 charge for leaving their assignments before completing a mandatory two-year commitment. FDM Group’s employment agreement stipulated this fee as compensation for alleged job-training costs. However, Parkdale Community Legal Services and Downtown Legal Services challenged this clause, arguing it violated the Ontario Employment Standards Act, which prohibits temporary work agencies from charging fees related to employment or work assignments.
John No, staff lawyer at Parkdale Community Legal Services, stated, “In addition to being an unconscionable provision in an employment agreement, FDM’s enforcement of the $30,000 charge is in clear violation of the Employment Standards Act.” He further emphasized that agencies seeking employee retention should focus on improving working conditions rather than resorting to punitive financial measures. Downtown Legal Services echoed this sentiment, advocating for fair treatment and the elimination of exploitative practices within the temporary work sector.
The Ontario Labour Relations Board sided with the workers, agreeing that FDM’s $30,000 charge was indeed a prohibited fee under the Employment Standards Act. The Board’s decision unequivocally deemed the charge illegal and mandated FDM to remove these clauses from all employment agreements. This ruling marks a crucial step forward for temporary agency workers across Ontario, many of whom are low-wage earners, recent graduates, and newcomers to Canada, often relying on agencies like FDM for employment opportunities. Downtown Legal Services played a vital role in this victory, representing one of the workers and contributing significantly to the legal arguments presented before the Board.
Eduardo Guzman-Diaz, one of the workers involved, expressed immense relief and excitement about the outcome. He highlighted the widespread impact of the decision, stating that many FDM workers had been living in fear of these contract termination fees. The collaborative effort between Parkdale Community Legal Services and Downtown Legal Services in this case underscores the critical role legal aid organizations play in safeguarding workers’ rights and ensuring fair labor practices.
Despite the Board’s clear decision, FDM’s public response has raised concerns about their willingness to fully comply and abandon these illegal fee practices. Parkdale Community Legal Services and Downtown Legal Services are now urging the Ministry of Labour to actively ensure FDM removes all iterations of the illegal damages clause from their employment agreements and adheres to the Board’s decision moving forward. This case serves as a powerful reminder of the importance of accessible legal services, like Downtown Legal Services, in protecting vulnerable workers and upholding employment standards.
For further details, the full decision is available here.
For further information, please contact:
John No
Staff Lawyer, Workers’ Rights Division
Parkdale Community Legal Services
[email protected], (416) 531-2411, ext. 227
Jennifer Fehr
Supervising Lawyer, Employment Law Division
Downtown Legal Services
[email protected], (416)934-4535
