Ex-restaurant employees take pay fight to the courts
Former Mr. Greenjeans workers seeking almost $100,000 after ruling from Ministry of Labour
Employees of a once popular Toronto restaurant are hoping the courts can help them get nearly $100,000 in severance and termination pay the Ministry of Labour says they are owed.
A group of 12 former cooks, servers and managers of the Eaton Centre’s now shuttered Mr. Greenjeans have gone to small claims court to file individual lawsuits in a last-ditch effort to get their former workplace to pay.
“Once the (Ministry of Labour) ruled in our favour, I thought, maybe I’ll get the money,” said 22-year Mr. Greenjeans veteran Seanan McGee, who is owed more than $16,000, according to the labour ministry.
“Now I don’t think we’re ever going to get it. How is it that (employers) just don’t pay? . . . There must be some kind of loophole.”
Known for its Buffalo chips, big burgers and indoor greenery, Mr. Greenjeans had long been the place to chat and dine while visiting the Eaton Centre. It abruptly closed its doors on Labour Day 2014.
In Ontario, only corporate entities are on the hook for severance and termination pay, whereas company directors — the actual people behind the corporation — are not. Directors are responsible for wages, overtime, vacation and holiday pay.
Minister of Labour Kevin Flynn acknowledges that’s an issue. If employees are entitled to something, such as severance pay, but there is no way for them to “exercise that right,” then that’s “counterproductive,” he told the Star.
“If the ability to enforce a right isn’t within the means of the average employee in Ontario, then, I think, it’s incumbent upon the government to take a close look at this,” Flynn said, adding that his ministry will look into this issue as part of its efforts to modernize the 20-year-old Employment Standards Act, a project dubbed the “Changing Workplaces Review.”
Last month, the Star reported on restaurants that ignore Ministry of Labour orders to pay. The investigation revealed that in the past five years the labour ministry made 2,592 such orders against food sector employers, but the government would not say how many were actually paid out.
When the Ministry of Labour is unable to force restaurants to pay up, it refers unpaid orders to the Ministry of Finance, which takes on the role of collection agency. But the Star investigation found that the Ministry of Finance fails to collect on labour ministry orders more than 70 per cent of the time across all industries.
In the case of Mr. Greenjeans, the Ministry of Labour ordered the restaurant to pay severance and termination pay to its former employees. Almost two years after the restaurant was shut down, the numbered company behind it was cancelled by the Ministry of Government and Consumer Services for “failure to maintain an adequate number of directors.”
None of that is stopping the former Mr. Greenjeans workers, who submitted their individual small claims lawsuits together in late May. They are each suing the numbered company operating as Mr. Greenjeans along with Maury Kalen, a man who had been a “director” of the company and who told the Star he had a “majority interest in the company through another corporation.”
Under the Employment Standards Act, Kalen is not personally liable for severance or termination pay.
In a telephone interview with the Star, Kalen said he feels “terrible” by the loss of the business and is “devastated” that former employees lost their jobs. He said that as a former director of the restaurant, he made good on his obligations and paid every employee their wages and vacation pay. He said he removed himself as a director of the company after October 2014 because “that’s what my lawyer advised me to do.”
After Kalen spoke to the Star, a letter from his lawyer said it would be a “substantive error to refer to Mr. Kalen as the former owner of Mr. Greenjeans.”
Kalen has been referred to as the owner of Mr. Greenjeans in media reports over many years.
When it comes to the severance and termination pay they are owed, Kalen said that has “nothing to do with me.”
“It’s not my personal obligation,” he said. “There is no personal liability for severance and termination pay. That is black letter law . . . What do you want me to do? Pay them? From where? I’m unemployed.”
Kalen, who drives a black Mercedes Benz wagon with red accents, sold his Forest Hill home in 2014 for $6.8 million and now lives in a large house in the Annex. He told the Star that the small claims lawsuits launched by former employees of Mr. Greenjeans will be “thrown out” because there is no basis to go after him personally.
Mr. Greenjeans first opened on Adelaide St. at Jarvis St. in 1975. In 1980, it opened a location on the fourth floor of the Eaton Centre and became a popular Toronto landmark.
Kalen told the Star that Mr. Greenjeans had to shut down because rent in the Eaton Centre was too high and relocating the restaurant was too expensive. A two-storey Zara clothing store now occupies the space.
The 12 former employees, some who worked at Mr. Greenjeans for more than 20 years, all filed claims to the Ministry of Labour shortly after the restaurant closed down.
Although employees say they were given their last paycheques, many did not receive severance and termination pay, according to Duane Feeley, a former manager. Feeley, who filed a claim with the labour ministry after the mass termination, said Kalen paid him about $1,000 for holiday wages he was owed after the labour ministry got involved.
But the company still owes him $10,000, according to a Ministry of Labour order. That same order notes that Feeley is actually owed more than $14,500 in severance and termination pay, but employment standards officers are not allowed to make orders for more than $10,000 for one employee. Feeley said some money is “better than nothing” — if he can get it.
Similarly, McGee, another former manager, is owed more than $16,000 severance and termination pay, according to a Ministry of Labour order. But in his case, too, the order is made for $10,000.
McGee said he could have gone to small claims court right away to get the money, but didn’t have the time or know-how to navigate Ontario’s court system by himself, and he believed that the ministry had “rules” and means to get employers to pay.
“I felt . . . the easiest way is the labour board,” he said. “It’s the law . . . How are they getting away with it? How is it that some companies have to pay and others opt not to pay? Who is responsible?”
Meanwhile, opposition MPPs are calling on the government to beef up provincial enforcement in the wake of the Star’s investigation. Cheri Di-Novo, NDP MPP for Parkdale-High Park, says the government should consider making the act of not paying workers a criminal offence, as it is in New York state.
“You’re stealing from them,” she said. “Really what you’re doing is committing a crime. It’s theft.”