The qualification of the contractual relationship between the syndicate and the condo manager is of paramount importance since the rules of termination are not the same, whether it is a contract for services or a contract of employment. In most cases, a person working on a regular basis for the co-ownership is deemed to be an employee governed by a "contract of employment", and not an independent contractor. Article 2085 of the Civil Code of Québec defines the "contract of employment" as a contract, verbal or written, by which a person, the employee, undertakes, for a limited time and for remuneration, to do work under the direction or control of another person, the employer.
Differences between a contract for services and a contract of employment
The manager bound to the syndicate by a contract of employment does not have the same relationship with the latter as a manager bound by a contract for services. Throughout the duration of his services, the salaried manager is subject to the management and control exercised by the syndicate over him, which is not the case of the service provider manager, under a contract for services because in principle the latter has «the free choice of the means of execution of the contract ".
The bond of subordination is one of the conditions of existence of a contract of employment. It characterizes the legal relationship between an employee manager and the syndicate. The latter may without limitation give instructions to his employee, define his duties and work schedule, supervise the execution of the mandate for which he is responsible, sanction his faults, his shortcomings or his failures in the duties incumbent upon him. Another difference is that the contract of employment necessarily involves a natural person, whereas the service provider in a contract for services may be a natural or legal person.
Verbal or written contract
The contract of employment may be oral or written, depending on the will of the parties. It is nevertheless recommended to set down its terms and conditions in writing, more particularly to be able to prove its provisions. The parties may provide therein the nature of the work and its terms and conditions, such as the salary, vacations, holidays and other benefits (if any). Both parties may also determine the term of the contract.
In addition, article 2086 of the Civil Code of Québec stipulates that a contract of employment is for a fixed term or an indeterminate term, although in both cases their term is "limited". Article 2085 of the Civil Code of Québec provides univocally for the temporary nature of the contract of employment. The legislator thus wanted to avoid any form of "slavery" imposed on an employee.
Fixed term contract
A fixed-term contract has a clearly identifiable term, such as a date, although its termination could also be associated with a predictable and certain event. This type of contract logically ends at the scheduled time. It may, however, be tacitly renewed for an indefinite period, when the employee is still at work five days after the expiry of the initial contract, and the employer has not opposed such tacit renewal.
A fixed-term contract of employment binds the parties until its expiry. Theoretically, the employer who terminates it prematurely, without serious reasons, would give the employee the right to be paid his salary until the expiry of the contract. In return, in the event that the employee leaves his employment before the expiry of the contract, the employer would theoretically have the right to claim damages.However, if the departure is justified by a "serious reason", either party may unilaterally terminate the contract of employment (article 2094 of the Civil Code of Quebec) without prior notice.
Contract for an indeterminate term
In the case of a contract for an indeterminate term, either party may terminate it at any time, provided that a reasonable period of notice is granted. Reasonableness is assessed, without limitation, by the nature of the employment and the duration of the period of work, as well as according to the specific circumstances in which it is carried on (article 2091 of the Civil Code of Québec).
Keep in mind that the obligation to provide reasonable prior notice is subject to an exception, if a "serious reason" justifies terminating the contractual relationship. In such cases the dismissal will not be accompanied by a prior notice period or severance in lieu of notice (article 2094 of the Civil Code of Québec).
The breach of the manager’s obligations
The manager employed by the syndicate must provide services in accordance with the rules and methods required by the syndicate. He must also act with prudence, diligence, loyalty and honesty toward the syndicate and the board of directors (article 2088 of the Civil Code of Québec).
Incompetence, dishonesty, inability to satisfy requirements, as well as the failure to act with prudence, diligence and loyalty could constitute serious grounds for terminating the manager's contract of employment without prior notice or severance in lieu of notice.
It should be noted, however, that an employed manager credited with two years of uninterrupted service for the same syndicate could complain to the Commission des normes, de l’équité, de la santé et de la sécurité du travail (CNESST) and argue having been dismissed without a good and sufficient cause. Therefore, the syndicate must act with caution when terminating an employee.
WHAT YOU SHOULD KNOW ! The syndicate and its salaried manager may terminate a contract of employment of an indeterminate term, by giving the other party a reasonable period of notice.
WHAT TO KEEP IN MIND : The syndicate and the salaried manager must honor their respective rights and obligations undertaken in virtue of their contractual relationship. They must do so in good faith and in a reasonable manner.
WARNING ! A syndicate of co-owners cannot dismiss or replace a salaried manager on the ground that, being a co-owner, he neglects to pay his contribution to the common expenses, the contingency fund or the self-insurance fund except in the case of a specific provision in the contract of employment providing that it constitutes a "serious reason".Such right of replacement applies only in respect of the divided co-ownership manager (Gérant) appointed under the provisions of article 1086 of the Civil Code of Québec.