Law Clerks' Review

By Barry W. Kwasniewski - Carters Professional Corporation

http://www.carters.ca/

A. INTRODUCTION

Ever since COVID-19 was declared as a pandemic by the World Health Organization (“WHO”) on March 11, 2020, there has been a great deal of uncertainty about, among other things, an employer’s obligations towards its employees. In this unprecedented time, employers need to take into account their obligations and the rights of employees in making operational decisions, and to ensure that they are complying with the most up-to-date legislative requirements and government directives. This Bulletin provides an overview of some of the legal requirements and considerations that, as employers, charities and not-for- profits should be aware of, including the recently announced legislative changes by the federal government, as well as the Ontario government.

Given the fast pace at which changes are being announced by the various governments, in addition to the unprecedented situation that employers are placed in due to this pandemic, this Bulletin is limited to the proposed and implemented legislative changes made by the federal and Ontario governments at the time of writing, and does not cover all of the relevant legal requirements for a particular charity or not-for- profit. It is the responsibility of an employer to make informed decisions based on the most recent information available and seek legal advice as necessary.

B. PROVIDING A SAFE WORKPLACE ENVIRONMENT

Under the Occupational Health and Safety Act (Ontario) (“OHSA”),employers have the duty to take all reasonable precautions to protect the health and safety of their employees, in addition to providing them with the information and training them to protect against hazards. Conversely, employees have the right to refuse work if they have “reason to believe” that the workplace is unsafe to work in (with exceptions for workplaces where risk is inherent as part of the job), and an employer may not discipline or retaliate against the employee. Violations of the OHSA can lead to an employer being penalized.

In the current pandemic situation, the following are especially relevant considerations:

• Staying informed with the recommendations and guidance provided by the WHO, Public Health Agency of Canada, and the provincial health agencies, such as Ontario Ministry of Health and Long- term Care.
• In Ontario, Premier Doug Ford announced on March 23, 2020 that all non-essential businesses must be closed for a period of 14 days, commencing at 11:59 p.m. on March 24, 2020.The Ontario Government has published a list of essential businesses that may remain open.

• Prior to yesterday’s important announcement, it had been recommended that employers implement social distancing measures, which include encouraging all employees to work remotely, making use of telephones or videoconferencing, and if that is not possible, to avoid close contact if physically present at the workplace.

• Employers should discourage business or personal travel of their employees, which has already been restricted with the federal government’s imposition of travel bans on non-essential travel. In this regard, the Government of Canada travel directives should be reviewed and followed.
• All employees should be required to disclose any COVID-19 associated symptoms and be sent home for self-isolation. Further, if an employee discloses that they or a family member has been in contact with someone who was exposed to or tested positive for COVID-19, they should be sent home and required to self-isolate for 14 days.
• If the employee is working from home while quarantined, they should be paid. If unable to work from home, other options, such as temporary lay-offs, need to be considered. To assist affected employees, new initiatives by the governments have been introduced (as discussed under heading D, below).
• In collecting any personal information or precautionary screening for COVID-19, privacy implications should be taken into consideration. In a time like this, public health implications may supersede privacy obligations to a certain extent.
• Be mindful of human rights considerations when making operational decisions, such as accommodating employees that need to stay home, work remotely or work at modified hours, to take care of or supervise children due to school or daycare closures, which would be protected under the Human Rights Code (Ontario).
• The OHSA imposes a duty to report “occupational illnesses” of employees to the Ministry of Labour, Training and Skills Development and the union, if present, within 4 days. The definition of occupational illness is broad enough that it would include COVID-19 if the employee contracted the illness while at work. There is also a duty in Ontario on the employer to report occupational illnesses to the Workers’ Compensation Board, if covered by it, within 3 days. A record must also be kept regarding the same.

C. TEMPORARY LAY-OFFS

In light of the Government of Ontario’s announcement on March 23, 2020 requiring all non-essential businesses to close for at least 14 days, charities and not-for-profits may be faced with the prospect of having to temporarily lay-off some or all of its employees. The Ontario Employment Standards Act, 2000 (the “ESA”) does provide for temporary lay-off of employees. Such lay-offs can be for up to 13 weeks in any 20 week period, or up to 35 weeks in any 52 week period if certain obligations, such as benefits continuance, are met by the employer. Temporary lay-offs that meet these criteria are deemed to not constitute a termination of employment pursuant to the ESA.

However, in some judicial decisions, Ontario courts have ruled that even a temporary lay-off may constitute a form of wrongful dismissal at common law, unless the employee has agreed in advance to the lay-off. It remains an issue as to whether or not a temporary lay-off in the context of a declared pandemic and provincial emergency will also be viewed in the same light by the courts as other business related lay- offs as reviewed in the previous case law, so employers should be cautious with temporary lay-offs.

However, in order to mitigate the legal risks of temporary lay-offs, employers should limit the period of lay-off to as short a time as possible, while complying with all emergency measures imposed by governments, as well as the lay-off time limits in the ESA. Employers should also continue benefits coverage for the period of the lay-off, and make it known to employees that they will be recalled as soon as possible. Employers may also consider asking their employees for their written consent to a temporary lay-off to avoid allegations of wrongful dismissal. However, if consent is not received from the employee, financial circumstances may dictate that the temporary lay-off still proceed, despite the potential risks.

D. GOVERNMENT ASSISTANCE MEASURES

Both the Ontario and the federal government have introduced measures to provide help to employees affected by COVID-19 related job losses, which are in addition to the pre-existing legislative provisions. Different provinces may provide for similar provisions, but only the Ontario and federal governments’ initiatives are discussed below.

1. FEDERAL – Employment Insurance (“EI”)
   • EI Regular Benefits: Available to employees losing their jobs through no fault of their own, which would include shortage of work or temporary/mass layoffs. Unless an employer provides for paid leave entitlements, this is particularly helpful for employees that meet the EI insurable hours requirement and other eligibility criteria.
   • Supplemental Unemployment Benefit (“SUB”) Program: This is a plan to enable an employer to top up employees’ EI benefits during a period of unemployment due to a temporary or indefinite layoff for, among other things, illness, quarantine, or temporary stoppage of work. SUB plans should be registered with Service Canada, otherwise any top-up amounts paid by the employer would be considered insurable earnings and be deducted from the employee’s EI benefits.
   • EI Sickness Benefits: The federal government now provides up to 15 weeks of income replacement to individuals that qualify for EI Benefits and are unable to work due to being ill or in quarantine. Applications need to be made to Service Canada, and the one-week waiting period that normally applies to EI sickness benefits has been waived. There is also no requirement for a medical certificate.
   • Emergency Care Benefit: This has been newly introduced by the federal government (awaiting Royal Assent), providing $900 bi-weekly, for up to 15 weeks in income support to: (i) employees (including self-employed) that are sick or quarantined due to COVID-19, but do not qualify for EI sickness benefits; (ii) employees (including self-employed) taking care of a family member who is sick with COVID-19; and (iii) parents with children requiring supervision or care due to school closures, and are unable to earn employment income. Applications will be available starting April 2020, and require attestation of meeting eligibility requirements, with re-attestation being required every two weeks. This will be done through the Canada Revenue Agency’s (“CRA”) MyAccount portal.
   • Emergency Support Benefit: Another new income support benefit delivered through the CRA that provides up to $5 billion in support for employees that are ineligible for EI and are facing unemployment. On March 22, 2020, Prime Minister Trudeau announced that the House of Commons is expected to meet on Tuesday, March 24, 2020 to pass emergency legislation to put the Federal Government’s economic support plans in place.
   • Work-Sharing Program: This Federal program involves implementing temporary special measures to support both employers and employees affected by a downturn in business to avoid layoffs. The new temporary special measures are available to employers facing business downturns that may directly or indirectly be due to COVID-19 and extends the Work-Sharing agreements from 38 weeks to 76 weeks, waves the mandatory waiting period between agreements, in addition to easing the recovery plan requirements.
2. ONTARIO – ESA and Employment Standards Amendment Act (Infectious Disease Emergencies), 2020

• Employees have the right to take unpaid leaves of absence pursuant to various statutory leave provisions in Ontario, as governed by the ESA, which include sick leave, critical illness leave, personal leave, family caregiver leave, and bereavement leave, among others.

• On March 19, 2020, during an emergency sitting of the Ontario legislature, the Employment Standards Amendment Act (Infectious Disease Emergencies), 2020 was passed to provide employees with job-protected leaves for employees who are quarantined, in self-isolation or directly affected by travel restrictions due to COVID-19, unable to work because of school or daycare closures, or due to their need to care for “specified individuals.” The list of “specified individuals”, which previously included close family members, such as the employee’s parent, foster grandparent, foster child, spouse, spouse of a child, sibling, or a relative of employee dependent on the employee for care or assistance, has now been broadened to even include extended family members including, for example, a person who considers the employee to be like a family member (provided any prescribed conditions are met), or any individual prescribed as a family member.

• Previously, the ESA had provisions for an emergency leave, which was limited to declared emergencies, but now has been amended to include infectious disease leaves.
  
  
• These leaves last so long as the employee requires, or either the emergency declaration pursuant to the Emergency Management and Civil Protection Act  remains in place or the government prescribes an infectious disease for the purposes of the leave, whichever ends earlier. A state of emergency has been declared in Ontario until March 31, 2020, allowing employees to apply for the declared emergency leave. In addition, COVID-19 has been designated as an infectious disease, giving entitlement to employees to seek an unpaid leave of absence under the infectious disease provision because of a reason related to COVID-19, which is deemed to have started on January 25, 2020.

• Employers are not permitted to ask for medical notes from employees but may require an employee “to provide evidence reasonable in the circumstances, at a time that is reasonable in the circumstances, that the employee is entitled to the leave.

E. OTHER THINGS TO KNOW

On March 19, 2020, the Federal Government proposed to provide eligible small employers, including charities and not-for-profits, a temporary wage subsidy for a period of three months, which will equal “10% of remuneration paid during that period, up to a maximum subsidy of $1,375 per employee and

$25,000 per employer. This proposal seeks to support businesses facing revenue losses and help prevent layoffs. This is to be implemented immediately and supporting legislation is to follow.

F. CONCLUSION

As the various governments’ responses to the COVID-19 pandemic are being announced on a daily basis, it is important for charities and not-for-profits to keep updated, so that the appropriate and informed decisions can be made on a timely basis.

(Reprinted with permission)

http://www.carters.ca/pub/bulletin/charity/2020/chylb465.pdf

By Tanya Kuzman - Mills & Mills LLP

With the Ontario government issuing a new emergency order prohibiting gatherings of more than five (5) people[1] and the federal government recently launching a $30-million national ad campaign compelling Canadians to #StayHome, many not-for-profit and charitable organizations (“NFPs and Charities”) are reconsidering when and how to hold their upcoming Annual General Meetings (“AGMs”). This article will provide federal NFPs and Charities incorporated under the Canada Not-For-Profit Corporations Act (the “CNCA”)[2] with a step by step guide to determine whether they can proceed with a virtual AGM during the Coronavirus (COVID-19) Pandemic. For the options available to NFPs and Charities incorporated in Ontario under the Corporations Act,[3] see Ontario Provides Emergency COVID-19 Relief for Not For Profit Governance.

STEP ONE: Confirm Your Governing Legislation

The first step for any organization attempting to navigate these unprecedented challenges is to confirm under which legislation it is governed. The governing legislation of any organization can always be determined by consulting its constating documents (i.e., articles of incorporation or letters patent, etc.) and will guide NPFs and Charities as to the available options and permitted practices when charting a pathway forward.

STEP TWO: Consider Your Organization’s By-Laws

The second step is to review your organization’s by-laws for any requirements or restrictions in connection with holding an AGM— including as it relates to how your members will vote. It’s important to understand the intersection between your organization’s by-laws and the CNCA because this will determine the degree to which your organization may benefit from provisions in the legislationpermitting virtual AGMs.

(a) Virtual Members’ Meetings

Under the CNCA, members’ meetings may be held entirely by means of a telephonic, electronic or other communication facility where that facility permits all participants to communicate adequately with each other during the meeting (a “Virtual Meeting”). However, this option is only available to federally incorporated NFPs and Charities whose by-laws explicitly permit holding Virtual Meetings. Without explicit wording to that effect in the by-laws, an NFP or charity incorporated under the CNCA would likely not be able to take advantage of these provisions.

Where an NFP or Charity’s by-laws do permit a Virtual Meeting, participants can vote digitally so long as:

• voting digitally is not prohibited by the corporation’s by-laws; and
• the digital voting method allows the corporation to gather votes in a way that allows them to be verified, tallied and presented while maintaining vote anonymity.

(b) How to Handle The “Show of Hands” Language

Many organizations’ by-laws provide that voting shall be carried out by a “show of hands.” This language has created another obstacle for corporations attempting to convene Virtual Meetings. Fortunately, however, organizations may be able to rely on technology to successfully navigate this challenge.

There are Virtual Meeting and video conferencing applications which contain a “Raise Hand” feature allowing meeting participants to virtually raise and lower their hands during the meeting. By implementing these applications, and subject to the specific wording of the corporation’s by-laws, NFPs and Charities may be able to take the position that this technology allows for compliance with the “Show of Hands” language while holding a Virtual Meeting. Corporations should ensure that any applications utilized for this purpose don’t inadvertently give non-voting members or guests attending the Virtual Meeting the ability to vote.

(c) Absentee Voting

Ideally, a corporation’s by-laws would provide for voting procedures for those not in attendance in-person (or electronically). This is called absentee voting. Unfortunately, under the CNCA, absentee voting is only permitted where the corporation’s by-laws explicitly provide for absentee voting. However, a corporation may apply to Corporations Canada to permit members to vote as absentees. Another potential mechanism to address this issue is to conduct a Hybrid AGM, which is discussed in more detail below.

STEP THREE: Consider Holding a Hybrid AGM

Under step three, and in line with a set of options released by Corporations Canada for NFPs and Charities to remain compliant during the COVID-19 Pandemic (the “Corporations Canada Options”),[4] organizations may consider holding a hybrid AGM. Such a meeting would mean that some participants (but no more than five if you’re meeting in Ontario and while maintaining a distance of at least 2 metres from others during this period of physical distancing) attend the AGM in person at a physical location, while the other members participate through a digital channel that allows participants to communicate with one another during the meeting. A hybrid AGM may be a viable alternative for NFPs and Charities whose by-laws do not permit a Virtual Meeting and a solution to accessibility obstacles for members who cannot participate due to, among other things, lack of internet connectivity. However, as all levels of government in Canada continue to impose increasingly restrictive physical distancing measures to stop the spread of COVID-19—holding a hybrid meeting at this time may not be in the best interest of the corporation or its members. NFPs and Charities should be sure to consult counsel before implementing such an option.

STEP FOUR: Consider Amending Your Organization’s By-laws

Under step four, and also in line with the Corporations Canada Options, directors of organizations with by-laws that are silent on electronic members’ meetings or prohibit them entirely may consider amending the organization’s by-laws to permit Virtual Meetings. Any changes to the by-laws would remain in effect until the next members’ meeting where they would either be accepted or rejected. For greater clarity, step four is not an option for corporations with by-laws providing that member approval is required before any changes to the by-laws are effective.

STEP FIVE: Consider Applying to Delay the AGM

Under the CNCA, federal organizations can apply to Corporations Canada for an extension to hold an AGM at a later date. In order to pursue this option, NFPs and Charities must apply by e-mail to IC.corporationscanada.IC@Canada.ca at least 30 business days prior to sending the notice calling the meeting. For greater clarity, the purpose of the extension application is to delay an AGM not to exempt a federal corporation from the obligation of calling an annual meeting of members entirely. Applications are reviewed on a case by case basis to ensure, among other things, that members will not be prejudiced by the extension.

(Reprinted with permission)

https://www.millsandmills.ca/blog/not-for-profit/step-by-step-how-to-know-if-your-federal-not-for-profit-or-charity-can-hold-a-virtual-annual-general-meeting-during-the-covid-19-pandemic/

By Serena Wolfond - Mills & Mills LLP

On April 7^th, the Government of Ontario passed an emergency order permitting wills and powers of attorney to be witnessed using video conferencing technology, a welcome concession during the Coronavirus (COVID-19) pandemic.

Accordingly, whether you are in the midst of the estate process with us, or considering whether you should prepare or update your wills and powers of attorney, you can take comfort in knowing that you can complete this process without compromising the rules of social distancing, in six simple steps or less.

Here’s how it works:

1. Your lawyer would send you your documents by email to print, or by mail, if you don’t have a printer at home.
2. Your lawyer would set up a virtual meeting using audio-visual communication technology (such as Zoom, Skype, FaceTime or Microsoft Teams) among you, your lawyer (note that one of the witnesses must be a lawyer or licenced paralegal), and a second independent witness, being another member of our firm, or the spouse or other eligible adult in the lawyer’s household. During the virtual meeting, you would angle your webcam to enable both witnesses to see you sign your will(s) and powers of attorney.
3. You would place your executed documents into an envelope and send it to your lawyer by courier, mail or hand delivery.
4. Once received by your lawyer, he or she would set up a second virtual meeting among the three parties. During this virtual meeting, your lawyer would angle their webcam to enable you and the second witness (if not in the lawyer’s physical presence) to see him or her sign your will(s) and powers of attorney as witness. If the second witness is in the physical presence of your lawyer, he or she would also sign as witness during this virtual meeting.
5. If the second witness is not in the physical presence of your lawyer, then steps 3 and 4 would be repeated to enable the second witness to receive the original documents and sign them as witness in the presence of you and your lawyer.
6. The second witness (or your lawyer, if he or she resides with the second witness) would place the executed and fully witnessed documents in an envelope and send it by courier or hand delivery to our offices, where they would be deposited into our vault for safekeeping.

(Reprinted with permission)

https://www.millsandmills.ca/blog/wills-estates-trusts/signing-your-will-and-powers-of-attorney-during-covid-19-social-distancing-part-2/

May 13, 2020

by Stikeman Elliott

This post was originally published April 27, 2020 and has been updated on May 13, 2020 to reflect the Government of Ontario’s adoption of Bill 190, COVID-19 Response and Reforms to Modernize Ontario Act, 2020.

The Government of Ontario has added a new Part XIX to the Business Corporations Act (Ontario) (OBCA) to provide, among other things, the suspension and replacement of provisions of the OBCA in respect of virtual meetings, requirements to re-issue notices of meetings and to present financial statements at annual meetings within a specified period.

Pursuant to Bill 190, COVID-19 Response and Reforms to Modernize Ontario Act, 2020 (the Bill), the Government of Ontario has revoked its April 24, 2020 order under the Emergency Management and Civil Protection Act (Ontario) (the Order) and adopts provisions to temporarily extend the deadline for annual shareholder meetings and allow issuers to hold virtual-only board and shareholder meetings, regardless of their articles and bylaws, as we had previously discussed. As was the case under the Order, the Bill provides greater certainty for OBCA-corporations with regard to the timing, format and procedures of annual shareholders meetings in 2020, in response to the COVID-19 pandemic. Similar provisions have also been adopted under the Bill for corporations under the Corporations Act (Ontario), the Co-Operative Corporations Act (Ontario) and the Condominium Act (Ontario).

Annual Financial Statements

The OBCA requires that financial statements, any related auditor’s reports, and, where applicable, further financial information be laid before shareholders at each annual meeting. Such financial statements and other information must pertain to the period commencing either on the day the corporation came into existence or immediately following the end of its last completed financial year and ending not more than six months before the annual meeting. As a result, the directors of an OBCA-corporation are generally required to call an annual meeting for a date not later than six months after the end of the immediately preceding financial year, as well as satisfy the general requirement to call a meeting no later than 15 months after the corporation’s last annual meeting. While the Ontario Government had extended the meeting deadline under an emergency order on March 31, 2020, such order failed to address the financial statement requirement and left some ambiguity as to how corporations could both comply with the financial statement requirements and delay their meeting in 2020. The Bill addresses this issue by temporarily suspending the requirement that the financial information placed before an annual meeting pertain to a period ending not more than six months before such meeting.

Notice of Meeting

The Bill clarifies that an OBCA-corporation is not required to send a new or amended notice of meeting if it is changing the date, time or place of its meeting of shareholders to permit a virtual meeting, provided that the persons entitled to receive the notice are informed of the change in a manner and within a time that is reasonable in the circumstances. This requirement is consistent with the Canadian Securities Administrators’ recent guidance with regard to virtual shareholder meetings, which requires issuers changing the date, time, location or format of their shareholder meetings in the 2020 proxy season to issue a news release announcing the change and taking all reasonable steps to inform the parties involved in the proxy voting infrastructure.

Virtual Meetings

The Bill temporarily amends the provisions of the OBCA in respect of shareholder meetings to provide additional flexibility for corporations looking to hold virtual meetings by permitting shareholder meetings to be held by telephonic or electronic means, regardless of any provision in the corporation’s articles or bylaws. However, the Bill further clarifies how voting should be conducted at a virtual meeting, by providing that the chair of a virtual meeting must conduct the vote by a show of hands or by a ballot, if feasible, and otherwise the chair may direct voting by alternate means, for example, in the case of an audio only meeting.

Meeting Deadline

As previously discussed, in light of the state of emergency declared in Ontario, the deadline to hold an annual meeting of shareholders has temporarily been extended for OBCA-corporations as follows (the extended meeting deadlines):

• If the last day on which the annual meeting is required to be held falls during the time that the current declaration of emergency applies, the corporation may hold the meeting any time before the 90^th day after the day the declaration of emergency is terminated.

   

• If the last day on which the annual meeting is required to be held falls within the 30-day period that begins on the day after the day the current declaration of emergency is terminated, the corporation may hold the meeting any time before the 120^th day after the declaration of emergency is terminated.

The Bill clarifies that the directors of an OBCA-corporation may call a meeting of shareholders to be held on a date contemplated by the extended meeting deadlines at a time that enables the corporation to comply with the extended meeting deadlines and that is reasonable in the circumstances. The Bill also clarifies that the date on which an OBCA-corporation was required to hold its annual meeting of shareholders for the purpose of determining whether the extended meeting deadlines will apply to the corporation should be based upon both the meeting deadline described in section 94 of the OBCA (i.e., within 15 months from the corporation’s last annual meeting) and the financial statements required to be placed before the meeting (i.e., within 6 months of the issuer’s year end).

Electronic Filings and Signatures

The Bill also amends the OBCA to permit for electronic signatures on certain documents, to permit for copies of certain documents to be used in place of originals and to accommodate alternative methods of filing under the Alternative Filing Methods for Business Act, 2020, which permits alternative means of filing and electronic signatures.

General

The amendments to the OBCA under the Bill are retroactive to March 17, 2020 and the Order is deemed to be revoked on the same date. The temporary suspension period under the Bill is the period of the emergency that was declared on March 17, 2020 under the Emergency Management and Civil Protection Act and a further period that ends on the 120^th day after the day the declared emergency is terminated. If provided for by regulation for a particular section, the temporary suspension period may also include a further prescribed period of time immediately following the end of the 120-day period. Similar amendments to the Corporations Act (Ontario), the Co-Operative Corporations Act (Ontario) and the Condominium Act (Ontario) are provided for in the Bill.

(Reprinted with permission)

https://www.stikeman.com/en-ca/kh/canadian-securities-law/Ontario-Bill-Clarifies-Financial-Statement-Requirements-for-Delayed-AGMs

May 14, 2020

by Stikeman Elliott

On May 12, 2020, Ontario introduced and passed Bill 190, the COVID-19 Response and Reforms to Modernize Ontario Act, 2020 (“Bill 190”) to help corporations meet their legal obligations while respecting physical distancing guidelines. In addition to re-enacting provisions allowing corporations to hold virtual meetings and defer annual meetings that were first set out in an emergency order, Bill 190 enables businesses filing documents under various business statutes to sign them electronically, file copies instead of original documents, and file by email or fax instead of in-person or by mail.

A true omnibus, Bill 190 enacts a new statute, the Alternative Filing Methods for Business Act, 2020 (the “AFMA”; see Schedule 1 of Bill 190), and amends filing and signature provisions in seven business statutes: the Ontario Business Corporations Act, Business Names Act, Co-operative Corporations Act, Corporations Information Act, Corporations Act, Extra-Provincial Corporations Act, and the Limited Partnerships Act (the “Business Statutes”).

Alternative Filing Methods Under AFMA

Under the AFMA, documents normally filed under the Business Statutes in-person or by mail may be filed by an alternative method that meets specified requirements. The filing methods and requirements are set out Notice MR-001 “Notice – Filing Methods and Requirements” (the “Notice”): documents and search requests may be filed electronically by email (companiesfilings@ontario.ca) and fax (416-314-0102) in accordance with the Notice until further notice is provided.    

Legible electronic copies must be filed using the prescribed, required or approved form together with any required accompanying documents and a cover letter that includes specified information. Documents submitted by email and fax will be handled the same way as documents submitted by mail, and subject to the same service standards. The Business Statutes continue to govern the filings in all respects, including effective dates, and filing by email or fax will not result in immediate fulfillment. See the Notice for the full requirements and payment processes.

Electronic Signatures Under AFMA

Documents that require a signature, however filed, may be signed by an electronic signature that satisfies requirements established under the Business Statutes. These requirements are also set out in the Notice. In addition to meeting the definition of an electronic signature under the applicable Business Statute^[1] an electronic signature must meet two requirements:

• The full name of the signatory must be legible and set out in the document on the signature line. If this is not possible the full name may be set out in another field together with the information required for that field.

   

• The document must indicate that it has been signed by an electronic signature. The examples in the Notice include: Jane Doe or “Jane Doe” by electronic signature/e-signature; a cursive font or computer-generated electronic signature if the full name of the signatory (Jane Doe) is also set out on the signature page; a cover letter to a document stating that the document has been signed by electronic signature if the name of the signatory is set out on the signature page. A copy of a manual signature does not require this indication.

The records related to an electronic signature (e.g. an email) are not filed, but must be kept with a copy of the properly executed version of the signed document (in paper or electronic format) at the filer’s registered or head office or, in the case of a limited partnership, at its principal place of business in Ontario or with its attorney and representative. This copy and the related records must be provided to the Director or Registrar under a Business Statute if requested.

Filing Copies of Documents

A requirement to file an original notice or document under a Business Statute can now be satisfied by filing a copy that meets the requirements established under the particular statute. These requirements are also set out in the Notice: a legible copy of any document is permitted – this includes legible copies of articles, applications (including for letters patent and supplementary letters patent and declarations) and applies whether the document is filed in-person, by mail, email, or fax. Legible and notarial copies of certified copies of court orders will also be accepted.

The Temporary and Permanent Aspects of the Changes

Bill 190 contains a combination of temporary and permanent legislative amendments related to electronic documents. This is primarily because the Bill 190 amendments originate with changes first set out in the Cutting Unnecessary Red Tape Act, 2017 (“CURTA”) but never proclaimed in force. Certain of the Bill 190 amendments replace the equivalent provisions in CURTA immediately and will remain in force when CURTA is proclaimed (those allowing copies to be filed, for example); others operate until CURTA comes into force, at which time a CURTA provision as revised by Bill 109 will take effect. AFMA provides that it will be repealed on a date proclaimed by the Lieutenant Governor.

Together the Bill 190 amendments and the Notice (which is subject to change or revocation by further notice) provide a trial run for future electronic dealings that have been anticipated since CURTA received Royal Assent in 2017.

Commissioning Affidavits and Notarizing Documents Virtually

Aspects of Bill 190 facilitate physical distancing objectives when commissioning affidavits and notarizing documents.  Schedule 4 of Bill 190 amends the Commissioners for Taking Affidavits Act to provide for circumstances where affidavits or declarations can be administered without being in the physical presence of the person swearing the affidavit or making the declaration. Similarly, Schedule 13 of Bill 190 amends the Notaries Act to provide for circumstances in which the notary public need not be in the physical presence of the person who is having items notarized. In addition, it will not be necessary for the notary public to affix his or her seal in order to validate any oath, affidavit or declaration. The circumstances where physical presence will not be required for commissioning affidavits and notarizing documents will be set out in regulations, which are not yet available. In the meantime, various provincial Law Societies have provided guidance in the form of best practices for virtual commissioning of affidavits and notarizing of documents. 

Other Amended Statutes

Bill 190 amends a number of other statutes, including:

• The Succession Law Reform Act to permit electronic beneficiary designations.

   

• The Condominium Act to re-enact provisions first set out in Regulation 107/20 allowing condominium corporations to hold virtual meetings and defer annual meetings.

The Not-for-Profit Corporations Act, 2010 (which is not yet in force) to make changes similar to those made to the Business Statutes.

(Reprinted with permission)

https://www.stikeman.com/en-ca/kh/corporations-commercial-law/Accelerating-the-Modernization-of-Ontarios-Business--Statutes

This bulletin addresses what the boards of charities and not-for-profit organizations incorporated federally, in Ontario or in Alberta should be doing during the COVID-19 crisis.

1. Consider re-defining board objectives

The Board’s first priority should be to re-assess, in the context of COVID-19, what is critical to the success and sustainability of the organization and fulfillment of its mission. For some Boards, that may mean greater support from the Board and more frequent meetings. For others, it may mean reducing the number of meetings and finding other ways for the Board to play a meaningful, but not overly intrusive, role. Some organizations may be less active during this time while others, such as health care entities or other organizations that support those in need, may be operating with greater demands on the organization. In the latter case, management may have less time to support the regular meeting schedules of the Board and its committees.

In order to define its role as a Board at this time, some key questions the Board should be asking about the impact of COVID-19 on the organization include:

• How are the employees impacted? Have appropriate steps been taken to ensure the mental and physical wellbeing of the employees?
• How are we continuing to support those the organization serves? How are we staying in contact with key stakeholders?
• What assumptions are being used to assess the impact on the organization?
• How have organizational priorities been adjusted based on the assumptions?
• When will management re-assess the assumptions?
• What steps are planned to ensure the ongoing viability of the organization? What are the timelines for implementation of these steps and how will the impact of these steps be monitored?
• What key indicators should the Board be looking at and how often should the Board and its committees be meeting to support management and monitor the plans to address the impact of COVID-19?

Practical advice:

• Each organization is different. While there will be shared challenges during this time, there will be many different circumstances. The Board should consider the specific situation of the organization, including available resources; immediate, medium and longer-term forecasts; what type of connectivity would be helpful; and what kind of legal obligations the organization should be considering.
• Depending on the nature of the organization, the Board work may feel weighted toward “business as usual” with reports on the impact of the pandemic from management. Other organizations will be impacted very differently. For some, it may be appropriate for the Board to meet less often while; for others, the impact of COVID-19 may require the Board to become more active. There really is no “one-size-fits-all” solution.

2. Board and committee meetings

The Board and its committees may not be able to meet in person. Here are some considerations to take into account when it is not possible to get the full Board together:

• Required board meetings: While there is generally no prescribed number of Board meetings that must be held annually, confirm whether there are specific requirements for the number of Board meetings in the organization’s by-laws, articles of association, and/or applicable special legislation. The Board may therefore be able to suspend its regular meeting schedule for the duration of the emergency if there is no mission critical decision or important Board oversight role required to be performed during the anticipated length of the emergency.
• Resolutions in writing in lieu of a meeting: If a decision is required and it is not possible to call a Board meeting, a resolution in writing may substitute for a Board meeting, but it must be unanimous. If Board members are not all immediately available, this is not a practical way to get a quick decision.
• Electronic meetings: An electronic meeting may be another option for Board meetings. Note that a regulation issued on March 30, 2020 under the Emergency Management and Civil Protection Act (Ontario) has enabled electronic meetings for directors of corporations to which the Corporations Act (Ontario) applies regardless of what the by-laws of the organization may require. In Alberta, a Ministerial Order issued April 9, 2020, under the Public Health Act (Alberta) suspends all obligations to convene an in-person meeting under the Companies Act (Alberta), and provides that nothing precludes an organization from holding a remote meeting. For organizations incorporated under the Canada Not-for-profit Corporations Act, the Board may hold meetings by electronic means, subject to the by-laws and with consent of all directors.
• Executive Committee: In this time of crisis, organizations may experience difficulty in achieving a quorum for a meeting of the entire Board in a timely manner. To address this, the Board could consider delegating some (or all) of its powers to on an Executive Committee. If the organization does not currently have an Executive Committee, the Board can create one if the by-laws or articles of association, as applicable, enable one to be formed. In considering an Executive Committee:
• Consider what the appropriate terms of reference should be, including what powers should be delegated, and for what time period. It may be appropriate for the timeframe of the Executive Committee to be limited to the duration of the COVID-19 crisis.
• Consider the appropriate membership of the Executive Committee in terms of skill sets and availability. It may be necessary to get a quorum of the Executive Committee together on short notice.
• If the Corporations Act (Ontario) applies to the organization, the Board cannot establish an Executive Committee unless the by-laws authorise the Board to do so.
• Similarly, if the organization is incorporated under Part 9 of the Companies Act (Alberta), the Board may strike an Executive Committee where permitted by its articles of association.
• If the organization is incorporated under the Canada Not-for-profit Corporations Act, the limits on the authority of the Executive Committee in s. 138(2) must be taken into consideration.

Practical advice:

• Consider the need for the Board’s regular meeting schedule to continue in light of the impact of the pandemic on the organization. Determine if more or fewer meetings are required. If Board decisions are required, consider using resolutions in writing or holding electronic meetings.
• If a Board meeting is called on short notice to deal with a specific matter, consider limiting the agenda to critical business.
• When a Board decision is required on short notice and there are concerns that the Board may not be able to easily achieve quorum given other demands on directors at this time, consider if Board decisions can be made by an Executive Committee.
• Some Boards have a concern that Executive Committees lead to a “Board within a Board”. To address this concern, consider calling an electronic meeting of the full Board and notifying the Board that, if quorum is not achieved, but there is a quorum on the phone for an Executive Committee, the meeting will proceed as an Executive Committee meeting with the other directors who are on the call participating, but only Executive Committee members voting. This will give management the benefit of a wider range of Board views while allowing prompt and timely decisions.

3. Deciding what to decide

Determining what requires a Board decision is generally an art rather than a science. Boards tend to receive information for three main purposes:

• To exercise their oversight role. This information includes committee reports, management reports and performance indicators. No decision is required to receive this oversight information.
• To educate and inform the Board, often with a view to the Board making a future specific decision or setting strategic priorities. No decision is required to receive this information.
• To make a decision.

Certain matters require a Board decision. In addition to specific matters that might be set out in the by-laws, articles of association, or Board policy, the matters that would typically require a Board decision include:

• Approvals above management’s delegated authority (which are usually required for a contract or transaction above a dollar threshold).
• Matters where a third party wants evidence of the Board’s approval. For example, banks will require a Board resolution to establish signing authorities.
• Hiring the CEO, Executive Director or similar management positions.
• Appointing Board officers.
• Establishing committees, unless the by-laws or articles of association, as applicable, have permitted the Chair to establish an ad hoc committee.
• Approving the organization's by-laws or articles of association (also subject to member or shareholder approval, respectively).
• Approving the annual audited financial statements. The Board does not need to approve the quarterly statements.
• Approving the strategic plan.
• Any fundamental changes to governance such as the name of the corporation or the size of the Board (also subject to member or shareholder approval, as applicable).
• Any additional matters set out in the organization’s governing documents.

In other cases, a Board decision may not be legally required, but would be prudent. This is a harder question to answer for most Board and management teams, but would typically involve an analysis of factors such as:

• Are there any unusual risks to the organization including reputational risk?
• Does it conflict with prior decisions of the Board?
• Does it put other strategic priorities at risk?

The Board may also be asked to become involved in some COVID-19 specific issues such as human resource issues.

Practical advice:

• Annual meeting planning
• It is unlikely that in person annual meetings of more than 5 people can be legally held in Ontario during the COVID-19 emergency.
• Alberta has prohibited workplace gatherings of 15 or more people in a single space, but ordered organizations to find alternate ways to organize group meetings and observe all public health guidelines, including physical distancing, if such meetings are necessary.
• If the organization is governed by the Corporations Act (Ontario), the Emergency Order referred to above authorizes corporations to (a) hold an annual meeting through electronic means despite anything to the contrary in the organization’s by-laws or other applicable legislation; and (b) delay the annual meeting for up to 90 days or potentially 120 days after the last day of the declared emergency in Ontario. As far as we can tell, the Emergency Order does not expressly deal with the requirement in the Corporations Act (s. 97(1)) that financial statements for the fiscal year ended no more than 6 months before the annual meeting be laid before the members at such meeting. We have brought this concern to the government’s attention.
• In Alberta, the Ministerial Order referred to above suspends the requirement for not-for-profit organizations to host in-person annual general meetings. Instead, the Order permits organizations under Part 9 of the Companies Act (Alberta) to hold general meetings through electronic means regardless of any provision to the contrary in the organization's articles of association.
• No similar emergency legislation has been issued for federally incorporated organizations. Nevertheless, the Board of a federally incorporated organization may be able to revise by-laws to enable the members’ meeting to be held entirely by electronic meetings (if not already permitted) and an application may be made to Corporations Canada to allow a deferral of the annual meeting of members (this application must be made at least 30 business days before sending the notice calling the meeting).
• It is important to note the minimum requirements for an annual meeting are to place the financial statements before the members, appoint the auditors (or approve the exemption from audit if applicable), and elect directors (election of directors may be delayed in certain circumstances).
• Where the annual meeting is deferred, incumbent directors remain in office.
• Annual audit
• Consider if the annual audit can be deferred, particularly if the annual meeting is deferred, or if it can be conducted remotely. This is normally a labour intensive matter. External auditors should not be on the organization’s premises in any event.
• Some factors that may affect the deferral of the audit include: (a) for organizations incorporated under the Corporations Act (Ontario) or Companies Act (Alberta), whether there is more clarity or relief with respect to the requirement that financial statements for the fiscal year ended no more than 6 months before the annual meeting be laid before the members or shareholders at such meeting; and (b) whether there are any contractual obligations to stakeholders who rely on the audit (such as bankers) that would be breached or triggered if the audit timing changes.
• Charities
• If the organization is a registered charity, please note that the Charities Directorate has temporarily suspended its operations. It has also extended the filing deadline for all T3010 annual returns due after March 18, 2020 to December 31, 2020.
• The Ministerial Order referred to above has extended the expiry date for the registrations and fundraising licenses of all Alberta charities, to three months beyond the date of expiration. This applies only to those registrations or licenses that expire while the Order is in effect.

4. Board stability and continuity

Management should have access to Board leaders when needed. Some Board members may themselves have less time available given the increased demands in their professional and personal lives. Some might need to step back from a Board leadership role and allow someone else to step in.

Practical advice:

• Board availability: The Chair should ask all Board members what their availability is to support the work of the Board when needed and consider sharing roles between Board members for continuity purposes. For example, if there is no Vice-Chair of a committee, the Chair may ask a committee member to “shadow” the Chair of the committee.
• Board Chair availability: The Chair needs to assess whether they have the time to support the Board and management and consider either greater Vice-Chair involvement or asking another Board member to be involved.
• Management succession plans: The Chair and Vice-Chair or another Board member should understand the management succession plan in the event key senior team members become ill and cannot work.
• Board leadership succession plans: Typically, by-laws provide for the Vice-Chair to perform the role of the Chair in the absence of the Chair. The Board should have a contingency plan for replacing both the Chair and Vice-Chair on short notice.
• Being available to management: Where possible, and without delaying management’s access to the Board Chair, both the Chair and Vice-Chair should be involved in key discussions with the senior team so there is continuity should one become unavailable. However, both must be able to promptly respond to management and, if both cannot be available at the same time, the meeting with management needs to go forward on management’s timetable and availability. The Chair or Vice-Chair should brief the other as required after such meeting to stay current.
• Board succession: Consider extending the terms of the current directors, decreasing the size of the Board or tolerating some vacancies. This would avoid distracting management with supporting the Board recruiting new directors and this is probably not the best time to “on board” a new director.

5. Communication and director due diligence

Is there a role for Board leaders in managing the information flow to and from management and the Board?

If the Board suspends its Board and committee meetings, directors will feel a responsibility to ensure they are exercising their own personal due diligence at this time. Directors may want more frequent reporting from management as the situation rapidly changes yet this is a time when management has less time to prepare such reports.

Consider if Board leaders can take responsibility to prepare weekly briefing notes to update the Board. Similarly, directors need to know that they can raise their questions and concerns but these could be directed through the Chair to management.

If an Executive Committee is established, there should be reports prepared by the Chair to the Board from the Executive Committee following each meeting. If the Chair and Vice-Chair are having regular sessions with management, there should also be reports from the Chair to the Board.

6. Stakeholder relations

The Board should turn its mind to key stakeholder relationships and what role the Board can do to support those relationships. For example, is there a role for the Board in staff and volunteer appreciation?

There may be a role for Board members with fundraising efforts at this time.

7. An eye to the future

COVID-19 has intervened in Board work plans and shifted priorities. In the short term, the Board needs to evaluate how to reframe its work while being mindful that individual Board members may also be personally and professionally impacted by COVID-19. Board members and Board leadership must have tolerance for the different approaches and reactions of individual Board members.

In the long term, the Board, as part of its fiduciary duties, needs to ensure organizational sustainability and adjust strategic and operational plans to reflect the new ‘normal’ that will emerge following COVID-19.

(Reprinted with permission)

https://www.blg.com/en/insights/2020/04/governance-advice-during-covid-19?utm_campaign=5bcfd23d308f87000101db82&utm_content=5e96069c30aece00011fdcc1&utm_medium=smarpshare&utm_source=linkedin

CARTERS PROFESSIONAL CORPORATION/ By Esther Shainblum:

OPC Provides Privacy Tips for using Videoconferencing Services

http://www.carters.ca/index.php?page_id=229

ENTRAC :

Ergonomics and Temporary Work From Home

https://entrac.ca/wp-content/uploads/2020/03/Practical-Guide-ergonomics-and-temporary-work-from-home-by-Entrac.pdf

SUPERIOR COURT OF JUSTICE/
Ministry of the Attorney General: 

Consolidated Notice to the Profession, Litigants, Accused Persons, Public and the Media
Re: Expanded Operations of Ontario Superior Court of Justice, effective May 19, 2020

https://www.ontariocourts.ca/scj/notices-and-orders-covid-19/consolidated-notice/

GOVERNMENT OF CANADA:

Mental Health Tips For Working From Home

https://www.canada.ca/content/dam/tbs-sct/documents/covid-19/20200320-mht-eng.pdf