Nova Scotia

Sydney call centre troubles lead to extended worker protections

The federal government is changing regulations under the Wage Earner Protection Program to include workers whose employer is based in another country, as a direct result of troubles experienced two years ago by ServiCom call centre employees in Sydney, N.S.

Workers whose employer goes bankrupt outside of Canada soon to be added to Wage Earner Protection Program

Chris Feltrin, a longtime employee of what is now the Sydney Call Centre, said in April 2019 he was happy to be getting back pay owed after ServiCom went into receivership. (Tom Ayers/CBC)

The federal government is extending financial protection to workers whose employer goes bankrupt in a foreign country as a direct result of problems experienced two years ago by call centre workers in Sydney, N.S.

In 2018, about 600 employees of ServiCom were thrown out of work three weeks before Christmas after the call centre's American owner, JNET Communications, filed for bankruptcy in a U.S. court.

That meant the workers had no way to recover the pay they were owed and would otherwise receive under the federal Wage Earner Protection Program.

The employees faced a bleak holiday season, owed about $1 million in pay and bonuses with little hope of recovery.

By the new year, another U.S. call centre company — MCI Canada — bought ServiCom's assets and restarted the Sydney operation.

Employees said they hunkered down and made it through Christmas with the help of friends and family.

Three months later, the Nova Scotia Department of Labour tried something it had never done before.

The province filed a court action on behalf of the employees. It sought a declaration of bankruptcy in Canada to allow the workers to access the wage protection program.

That was granted and, in June 2019, the workers started getting back pay.

According to a regulatory impact analysis published in the Canada Gazette, Ottawa is changing the regulations as a direct result of the ServiCom decision to protect Canadian workers by including them under the program, even if their employer is based in another country.

The wage protection program allows workers to access up to $2,000 in back pay and gives employees "super-priority" status, which means wages and vacation pay rank ahead of secured creditors in a bankruptcy case.

Going to court to help workers access the program was "complicated and time consuming," the analysis said, and changing the regulations is expected to result in only a small number of additional claims and little extra cost.

The new regulations are expected to take effect this spring.

MORE TOP STORIES

ABOUT THE AUTHOR

Tom Ayers

Reporter/Editor

Tom Ayers has been a reporter and editor for 36 years. He has spent half of them covering Cape Breton and Nova Scotia stories. You can reach him at tom.ayers@cbc.ca.

Comments

To encourage thoughtful and respectful conversations, first and last names will appear with each submission to CBC/Radio-Canada's online communities (except in children and youth-oriented communities). Pseudonyms will no longer be permitted.

By submitting a comment, you accept that CBC has the right to reproduce and publish that comment in whole or in part, in any manner CBC chooses. Please note that CBC does not endorse the opinions expressed in comments. Comments on this story are moderated according to our Submission Guidelines. Comments are welcome while open. We reserve the right to close comments at any time.

Become a CBC Member

Join the conversation  Create account

Already have an account?

now