The New Brunswick Labour and Employment Board has ruled that elected municipal councillors are not “employees” under the Employment Standards Act (ESA), affirming the decision of the Director of Employment Standards.
The dispute arose after Hanwell Rural Community Council suspended a councillor — P.S. — for breaching its Code of Conduct in late 2022, resulting in a six-month pay suspension. P.S. argued that this decision violated the ESA, as it amounted to his employer docking his pay.
However, the Director of Employment Standards determined that P.S. was not an employee under the ESA, a decision that was appealed to the Board.
In its ruling, the Board supported the Director’s findings, concluding that P.S.’s role as a municipal councillor did not meet the ESA’s definition of “employee.” The Board stated, “The evidence and applicable legislation show that Hanwell did not exert the type of control over the work of Councillors that is indicative of an employment relationship.”
Municipality can’t hire or fire councillors
Key factors cited included the independence of councillors in setting their work tasks, hours, and remuneration, as well as their inability to be hired or fired by the municipality.
“Hanwell does not have the power to appoint or dismiss its Councillors, it cannot dictate the issues they pursue on behalf of their constituents, how they interact with residents, or how they vote,” the decision stated.
The Board also noted that municipal councillors are explicitly prohibited from being employed by the local government they serve, as outlined in the Local Governance Act. This statutory provision further solidified the Board’s stance that councillors do not qualify as employees under the ESA.
Despite affirming the Director’s decision, the Board acknowledged the broader implications of the ruling. “The Board’s decision in this matter is not an endorsement of Hanwell’s actions; it is simply a finding that a complaint under the ESA was not the appropriate recourse in this case,” the ruling clarified.
Lessons from this ruling
- Clear Definitions Matter: Employers must understand and correctly apply legal definitions of “employee” and “employer” to avoid jurisdictional issues under employment standards legislation.
- Distinguish Roles and Relationships: Differentiating between elected officials and employees is crucial, particularly when it comes to remuneration, disciplinary actions, and control over work.
- Follow Statutory Guidelines: Adhering to the specific provisions of relevant statutes, such as the Local Governance Act, helps ensure compliance and mitigates legal disputes.
For more information, see Septon v Hanwell (Municipality), 2024 CanLII 47665 (NB LEB).
