Technological advancement and the growth of globalization in the 21st century have resulted in unprecedented interconnectivity and mobility. One area of law that has become increasingly prevalent concerns employment relationships that cross provincial or international boundaries. Employment relationships involving employees who live in a different jurisdiction than the one in which they are employed are becoming more and more common, and these situations present some interesting and unique legal questions on the applicable provincial jurisdiction.

It is essential for employers with employees whose work is done in different jurisdictions to understand exactly which jurisdiction’s laws will apply to the employment relationship. Fundamental components of employment, such as notice periods for termination, can vary dramatically across jurisdictions and these differences can profoundly affect the circumstances of workers employed under such contracts.

Historically, largely due to the delay in receiving contracts by regular mail, the standing rule was that a contract between parties in different jurisdictions was formed when and from where it was mailed. This “postal exception” was necessary as it would have been incredibly inefficient for the parties to be unable to rely on a contract until it finally arrived at its destination by ship, horseback, carrier pigeon, or train.

As technology evolved, the postal exception became unnecessary and eventually obsolete. Today, a contract is formed when and where acceptance is received. In the case of an employment agreement between an employee and an employer in different jurisdictions, the employment contract would be formed when and where the employer receives an electronic copy of the signed agreement from the employee. However, this is just one of the relevant factors that courts have considered when assessing the appropriate law governing an employment relationship.

Other factors that courts have relied on include where the contract is formed, whether there are contractual terms explicitly setting out which jurisdiction is to govern (which is not necessarily determinative), where the employee’s work physically takes place, and where the employer is headquartered. In Pedwell v SNC-Lavalin Inc, 2014 ABQB 309, the Master held that Alberta courts had jurisdiction over a wrongful dismissal dispute between an employer based in Montreal and an employee from Calgary who had been working out of Toronto before being transferred to China. While the employer was indeed based in Quebec, the employee had been recruited, hired, managed, and ultimately terminated at a distance. The Master found that the fact that the employee was from Calgary coupled with the fact that he had performed at least some work for the employer when in Calgary was sufficient to establish Alberta’s jurisdiction over the employee’s claim.

Key Takeaways for Employers

There are two key takeaways for any employer who hires, or considers hiring, workers who live in a different jurisdiction and who potentially carry out their employment duties in that jurisdiction or a third jurisdiction altogether. First, an employer should be aware of the fact that, while they may be based in Alberta, the law in another jurisdiction could end up governing the relationship they have with their employee. The second key takeaway is that none of the factors listed above, including a contractual jurisdiction clause, are determinative, and courts will weigh all of the circumstances in a given case to determine the applicable law and/or jurisdiction. These decisions are highly contextual and there are many examples in common law of decisions with very similar sets of facts yet completely different outcomes.