Business in Vancouver Issue 1586

news Coronavirus exposes weak links in supply chains 1 BUSINESSVANCOUVER

March 23–29, 2020

•Globalization as we know it is about to undergo radical overhaul in the COVID-19 economy •B.C. port container cargo terminals brace for virus fallout | Pages 4–5

Digital healthcare crunch Experts call demand for virtual delivery of health care unprecedented as COVID-19 outbreak puts digital health care to the test | Page 3

Daily business news K biv.com

March 23–29, 2020 | Issue 1586 | $4.00

COVID-19 closing time economy | Federal

government’s multibilliondollar aid package seen as just the first lifeline for business in a stark economic landscape unfolding for B.C. and the rest of Canada

BY Hayley Woodin hwoodin@biv.com

U

nprecedented, extraordinary and wholly unpredictable: B.C. and Canada are in a marathon into uncharted territory, and if one thing is certain, it’s that it is far too early to know where the finish line is and in what condition our economies will be when we get there.

“We will survive in some form, but it’s going to be rough,” said Kevin Milligan, professor of economics at the University of British Columbia’s Vancouver School of Economics.

“If I saw 20% unemployment in May, it wouldn’t surprise me. We’re talking – and I mean this seriously – Great Depression-level unemployment rates. Now, my God, I hope that’s only temporary. But that’s where we’re going to be for a few weeks, a few months.”

•Online and in-print business news initiatives

for BIV readers in COVID-19 crisis | 3 •Coronavirus measures rattle B.C.’s tourism and hospitality sectors | 5 •Canada’s COVID-19 unification factor | 13 •How long will and how long can this go on? | 13

continued on page 6

Giardino owner Umberto Menghi, one of the first Vancouver restaurant owners to close his business as the COVID-19 threat escalated: “it’s like wartime” |

first nations

real estate First Nations that resolve governance issues and are willing to negotiate are getting deals done in B.C. | Page 7

Rob Kruyt

technology A major shift in B.C. property markets has begun, and the outcome in the COVID-19 era is uncertain | Page 8

B.C. software companies see pandemic changing the way business is done as remote working becomes the new normal | Page 11

12

Return undeliverable Canadian addresses to Circulation Department: 303 W 5th aveNUe, Vancouver, B.C. V5Y 1J6.

7

PM40069240

71114 78312

R8876

6

“Come to me, all you who are weary and burdened, and I will give you rest.”

Jesus

Matthew 11:28 The Bible

love

joy

peace

hope

truth

purpose

text 604.263.2314 to learn more

2

BUSINESSVANCOUVER March 23–29, 2020

BIV | Beyond the print

inside Real Estate

8

Top stories at BIV.com

Pandemic tremors

Business in Vancouver’s most-seen online stories for the week ended March 19:

Peter Mitham on uncertainty beginning to rattle B.C. property markets

•COVID-19: There’s an app for that – thanks to Coquitlam man biv.com/article/2020/03/covid19-theres-app-thanks-coquitlamman

FINANCE 9 Data Points

Bryan Yu on a thaw in new home construction in British Columbia

List 10

Business in Vancouver on Global: Hayley Woodin on how COVID-19 is hitting the Canadian economy, and Ottawa’s measures to invervene

Top software companies in B.C.

•More Metro Vancouver retail space is going dark biv.com/article/2020/03/moremetro-vancouver-retail-spacegoing-dark •B.C. urges residents not to leave Canada, and to self-isolate on return if they do biv.com/article/2020/03/bc-urgesresidents-not-leave-canada-andself-isolate-return-if-they-do

BIV’s exclusive list, ranked by number of employees in the province

Insights 13

•Can B.C. fix its condo insurance crisis? biv.com/article/2020/03/can-bcfix-its-condo-insurance-crisis •Singaporean tycoon sues Concord Pacific president for $245 million biv.com/article/2020/03/singaporean-tycoon-sues-concord-pacificpresident-245-million •COVID-19 compensation: What B.C. workers and employers need to know biv.com/article/2020/03/covid19-compensation-what-bc-workersand-employers-need-know

For the duration Kirk LaPointe on questions about how long the COVID-19 pandemic will last

Courts 15 Lawsuit of the week

Stream, download or subscribe to the BIV Podcast at biv.com for in-depth analysis of this week’s biggest business stories

BIV events •BC CTO Awards: Nominate now for BIV’s salute to the province’s top chief technology officers in private-sector, public-sector and non-profit organizations. For more information, go to biv.com/bc-cto-awards

Find it in brief

6

insights 13-14

real estate

8

for the record

finance 9

15

Contact

Construction company sues City of Richmond over delays to firehall project Publisher; editor-in-chief; vice-president, editorial, Glacier Media | Kirk LaPointe 604-608-5183 Managing editor | Timothy Renshaw 604-608-5131 Deputy managing editor | Mark Falkenberg 604-608-5174 Online editor | Emma Crawford Hampel 604-608-5138 604-688-2398 Staff writers 604-688-2398 | ads@biv.com ADVERTISING SALES Reader sales & service Customer service 604-608-5147 Subscription sales/renewals 604-608-5192 EVENTS 604-608-5160

Business in Vancouver is published by BIV Media Limited Partnership at 303 West 5th Avenue, Vancouver, BC, V5Y 1J6. Telephone 604-688-2398; fax 604-688-1963. New subscriptions: visit biv. com/subscribe. Copyright 2020. Articles may not be reprinted without permission from the publisher. Publications Mail Agreement No. 40069240. Registration No. 8876. Return undeliverable Canadian addresses to Circulation Department: 303 West 5th Avenue, Vancouver, BC, V5Y 1J6. Email: subscribe@biv.com.

BC MIDDLE MARKET GROWTH CONFERENCE New Date September 29 & 30, 2020 Fairmont Waterfront Vancouver What can you expect at BCMMGC2020?

The market is complex. Let’s break it down together. We’ll discuss uncertainty, share insight, and connect with others on the front lines of change.

DIAMOND SPONSORS:

PLATINUM SPONSORS:

Canadian Business Growth Fund Dentons Fort Capital Partners Fulcrum Capital Partners Mogan Daniels Slager LLP Norton Rose Fulbright The Toronto Dominion Bank TriWest Capital Partners

2020 Highlights: • Economic updates from Jean-François Perrault, Scotiabank, Senior Vice-President & Chief Economist • Fresh sell-side insight to help you make decisions with confidence • Top guidance on transitionary leadership in a fast-moving market

GOLD SPONSORS:

• Best practices for redefining BC’s competitive advantage • New perspectives on the growth capital gap, and helping entrepreneurs to think big, with keynote George Rossolatos, CEO, Canadian Business Growth Fund

MEDIA SPONSOR:

Seats are limited! Register today at acgbcevents.com Become a sponsor, while opportunties remain!

Contact us at vancouver@acg.org, 1.778.835.8692 or visit www.acgbcevents.com

Capital West Partners Deloitte Fiera Private Debt Miller Titerle + Co. MNP Corporate Finance Raymond James Ltd. Reliance Insurance

news

BUSINESSVANCOUVER

March 23–29, 2020

3

COVID-19 pandemic puts digital health care to test technology | Experts

BY TYLER ORTON TORTON@BIV.COM

W

h i le prov i nci a l a nd federal health authorities are prescribing Canadians a dose of “stay home” amid the COVID-19 pandemic, long-gestating forays into virtual delivery of health care look poised to pay off.

“T he si lver l i n i ng on t h i s sombre cloud is we have so ma ny more opt ions tod ay than we had even 18 months ago,” said physician Alexandra Greenhill, CEO of Vancouverbased Careteam Technologies Inc. “Networks are even more robust in terms of sustaining traffic volume and the cloud services are more elastic.”

Careteam’s platform helps care providers working across different organizations collaborate digitally on care plans for patients with complex chronic cases.

Greenh ill said government pleas to keep visits to hospitals and clinics for urgent matters only are creating capacity for doctors to attend to cases online.

M e a nw h i l e, j u r i s d i c t io n s throughout North America are now trying to facilitate telehealth billing amid the pandemic, “which is something that easily could have happened long ago but is now being introduced as an emergency measure,” she said.

The pandemic is having other k n o c k- o n e f f e c t s , s u c h a s prompting both the Canadian Medical Association and American Medical Association to put together guidelines to further enable telehealth options.

“In an ideal-case scenario, people should be able to do a self-assessment, and a clinician can supervise how they do the swab [via video],” Greenhill said. “This way no one’s exposed either during the clinical visit but also travelling to a location to get tested.”

She said most jurisdictions are

call level of demand for virtual delivery of medical services ‘unprecedented’

More and more people are reaching out to find the right and validated resources for self-care and to manage distress related to the COVID-19 crisis

[] Navya Singh research scientist, Columbia University

Telus vice-president of consumer health Juggy Sihota says demand for her company’s virtual healthcare services has reached “unprecedented levels” amid the COVID-19 crisis | Submitted

not equipped to do that just yet but there’s no reason such measures could not be implemented in a matter of days.

Telus Corp.’s (TSX:T) ow n health-care app, Babylon by Telus Health, began offering primary care services to British Columbians in March 2019.

It has since handled more than 40,000 patient consultations and has just become available in Alberta and Ontario.

I n add ition to offeri ng access to health records and enabling video calls with doctors,

Digital delivery of health care is increasingly becoming a necessity, not just a convenience, as the coronavirus pandemic accelerates | Submitted

the app features an artificial-­ intelligence-powered symptomchecker, which was just updated for COVID-19 screening.

If the symptom-checker determines a user needs to see a doctor, he or she will be directed to book an appointment through the app.

“No one could have predicted where we are now with COVID and this quickly growing crisis,” said Juggy Sihota, Telus’ vicepresident of consumer health.

“Certainly in this last couple of weeks, demand for this service is at unprecedented levels and we are actively looking at bringing on more doctors to manage the demand that we’re getting

from patients.”

Telus is tapping into its own network of doctors who ca n help with online consultations as more people self-quarantine.

In addition to recruiting more doctors, Telus is reallocating some of its own employees to provide additional support for the app.

“From a tech nolog ica l a nd infrastructure standpoint, there are no issues,” Sihota said. “It can handle all of the volume that what we want to give it.”

Navya Singh, a psychologist and research scientist at Columbia University’s department of psychiatry, said she expects demand to swell for virtual health

and mental health care as the pandemic unfolds.

“More and more people are reaching out to find the right and validated resources for selfcare and to manage distress related to the COVID-19 crisis,” she said. “Not being able to access in-person therapy will lead more people to reach out for digital care.”

Singh, the founder of the wayForward (PsyInnovations Inc.) menta l hea lth support platform, said that while the digital health industry is experiencing unprecedented demand for services, barriers remain getting patients and providers to jump on board with new tools. •

Online and in-print business news initiatives for BIV readers in COVID-19 crisis To our readers and advertisers: Business in Vancouver has proudly served British Columbia as its leading source of business journalism for more than three decades. We can agree: nothing like COVID-19 has hit us before.

The pandemic has devastated elements of our economy as it takes globally what we know locally will be a significant human toll. We are indebted to the compassion of our health-care workers and front-line responders.

The well-being of our employees is uppermost as we cope with the challenges in front of us. Most of us

are working from home, and the rest of us will be quite soon. We are no different than you are in your lines of business: gripped with uncertainty but resolved to use our creativity and resilience to address foreseen and unforeseen consequences of coronavirus.

I want to thank the many readers and advertisers who reached out this week to extend their support. We want to be understanding in this difficult time for you, too.

Never in memory has evidencebased, factual journalism and support for it been more necessary to our lives. I ask you to make us one of your prime sources of information

each day and to tell me how to make it most relevant at this most urgent of times. I’m at klapointe@biv.com.

We have started a daily online newsletter devoted to news on COVID-19 and the economy. Please subscribe to it atbiv.com/newsletters.

We have added features. Each afternoon we are recording (virtually, for social distancing) a video podcast for our website, Coping With COVID-19, featuring experts on the economy and the virus. We are grateful for the generosity of their time to help the community understand what it faces. We are profiling a local business daily and its efforts to manage. Across our platforms we

are featuring our business journalism and the great community work of other Glacier Media publications related to the evolving crisis. Much more is coming.

We will continue to print our weekly newspaper and our portfolio of magazines and to create daily journalism online. We know we have an important public service to provide, and we will not let you down.

We have shifted some of our “For the Record” newspaper feature online Mondays for the time being as we adapt to remote production. The BC Supreme Court has closed, denying us access to our “Who’s Getting Sued” and “Lawsuit of the Week”

features; the last ones for now are in this week’s edition.

Given that many of you are working remotely, if you want your personally addressed office newspaper delivered to your home for the time being, email us at subscribe@biv.com and we will redirect it. If you want to suspend print delivery of your office paper but wish to continue with a digital edition, sign on to your account at biv. com/user/login and follow the steps.

Stay well and safe, and stay connected with us to stay informed.

– Kirk LaPointe, publisher and editor-in-chief

4

news

BUSINESSVANCOUVER March 23–29, 2020

Spread of coronavirus puts

By Chuck Chiang cchiang@biv.com

C

ould the current COVID-19 pandemic spell the end to globalization?

Not likely, experts say.

But, most analysts agree that – when the world does return to a new normal after COVID-19 subsides – globalization will look substantially different from the current model, because the pandemic exposed several weak links in global supply chains that will need to be mitigated or resolved outright.

“I think there will be a rethinking on another level,” said Werner Antweiler, associate professor at the University of British Columbia’s (UBC) Sauder School

of Business. “Globalization has been hugely beneficial to all of us, simply because of specialization and the comparative advantages of individual locations across the world. That force remains strong and true in the future. However, there is a broader question about the resilience of supply chains; how can we make sure that supply disruptions don’t make us vulnerable to the entire chain falling apart?”

Antweiler, who is also the director of the school’s Prediction Markets program, said the key word is “resilience”: companies emerging from the outbreak will have to consider their ability to weather massive global disruptions, whether through inventory management or establishing

trade | COVID-19 multiple manufacturing locations for every component in the production chain.

“That is a dimension that we haven’t dealt with in the past,” he said. “We’ve had local disruptions – maybe a localized epidemic or political disruptions – but we haven’t seen something that disrupts on a global scale like what we see today, where there are multiple supply locations shut down because people can’t come to work.

“For example, if you don’t get the chips from one location or the screens from another location, then you don’t have a cellphone.

Every component is, in essence, critical. So you have to make sure that … we no longer depend on just one production location. For

supply chain hiccups spark

an individual company, it means having multiple locations and having redundancy built into the system.”

Yves T ibergh ien, d i re c tor emeritus of U BC’s Institute of Asian Research, noted that there has been a slow shift toward regional supply chains – a trend that may pick up after the COVID-19 pandemic subsides.

He added that the new economic globalization will also depend on the political wills of the major global players individually – specifically, that of the world’s largest economy. “ We h ave seen t hese connections being made between countries like Canada and those in Europe and Asia. What we don’t know is what the United

Every crisis is an opportunity to recalibrate the system, and this one is no different

[] Andreas Schotter associate professor of International Business, Ivey Business School, University of Western Ontario

States will do…. Mistrust between countries right now makes it hard for co-ordinated action.

It’s hard right now to bring people together at the table.”

Observers such as South China Morning Post columnist Cary Huang have a rg ued that the

Container terminal operators brace for virus impact transportation | No major cargo flow disruptions thus far, despite bleak outlooks and slowing trade

By Timothy Renshaw trenshaw@biv.com

C

OVID-19’s rapid erosion of world travel and trade has yet to significantly disrupt operations at B.C.’s largest container cargo terminals.

But increased border closures and travel restrictions and global economic stagnation will inevitably slow goods demand and freight flow around the world.

In its most recent briefing on the global container terminal sector, U.K.-based shipping consultancy Drewry noted that the share price of major publicly traded container terminal operators was down an average of 14% compared with the same time a year ago.

Eleanor Hadland, Drewry’s senior ports and terminals analyst, said that drop would have been closer to 17% if not for DP World’s (Nasdaq Dubai:DPW) decision in February to delist from the Nasdaq. As Business in Vancouver previously reported, under DP World’s Nasdaq-delisting plan, its Port and Free Zone World corporate parent will acquire 19.55% of DP World’s shares at a 29% premium over the price announced in mid-February.

DP World operates the Fairview container terminal in Prince Rupert and the Centerm container terminal in Vancouver.

Hadland said Drewry’s basecase scenario for COVID-19’s impact on container traffic, based on containment of the coronavirus in China, projects a slowdown in global GDP growth and even a contraction, but a potential contraction of GDP “will depend wholly on the size of the

The EBITDA of shipping companies globally could decline by between 25% and 30%

[] Moody’s investors service March 2020 outlook

consumption areas affected and how quickly and effectively each location controls the outbreak.”

She added that, under the basecase scenario, global economic recovery would be pushed back to 2021 and bounce-back would be far more limited than Drewry’s more optimistic scenario.

T he first wave of the virus outbreak resulted in a spike in cancelled container ship sailings between Asia and Europe.

Conta i ner a na ly tics fi rm Alphaliner noted that in the eightweek period following 2020’s Chinese New Year, 40 container ship sailings were cancelled on the Asia-Europe trade loop compared with 15 during the same period in 2019. Alphaliner has estimated that 2020’s extended Chinese New Year holiday, instituted in an effort to reduce the spread of COVID-19, will cut container cargo volumes at Chinese ports by six million 20-footequivalent units in 2020’s first quarter.

Si nce then, w ith the v i r us rapidly spreading into consumer markets elsewhere around the world, Hadland said, significant softening in demand will reduce more sailings and port volumes.

Under Drewry’s pessimistic scenario, the pandemic tracks

through into a global recession “as both consumption and production economies are badly impacted and results in a large-scale contraction in container demand across 2020 and increasingly uncertain prospects for 2021.”

Citing the coronavirus outbreak’s spread and the deteriorating global economic prospects, Moody’s Investors Service has downgraded its outlook for global shipping to negative from stable.

In a report released last week, the U.S. credit rating agency said it expected earnings before interest, tax, depreciation and amortization (EBITDA) of rated shipping companies to drop by between 6% and 10% in 2020 compared with EBITDA growth of almost 40% in 2019. The report added that there is a downside risk that “the EBITDA of shipping companies globally could decline by between 25% and 30%, similar to levels last seen in 2016 when Hanjin Shipping Co. Ltd. went bankrupt in one of the largest recent failures in the sector.”

Meanwhile, a Global Port Tracker report released in early March by the U.S. National Retail Federation and Hackett Associates warned that “the coronavirus outbreak is expected to have a longer and larger impact on imports at major U.S. retail container ports than previously believed as factory shutdowns and travel restrictions in China continue to affect production.”

Februa ry conta i ner tra ffic through the Port of Long Beach, one of North America’s busiest container ports, was down 9.8% compared with the same month in 2019, as imports fell 17.9% and exports dropped 19.3%.

However, B.C. container terminals servicing the transpacific trade loop have thus far been spared any significant disruption from COVID-19.

Marko Dekovic, vice-president of public affairs for GCT Global Container Terminals Inc., said in an email that “there are currently no impacts, and operations at our terminals remain fluid. We are in close communication with appropriate government authorities and supply chain partners to ensure goods continue to move.”

GCT operates GCT Deltaport at Roberts Bank and Vanterm in Burrard Inlet.

Dekovic added that the company has implemented several measures aimed at limiting the spread of the coronavirus at its terminals. They include travel restrictions, increased cleaning regimens on terminals and in offices and providing work-fromhome options for employees not required on site.

Angela Kirkham, DP World (Canada) Inc.’s manager of marketing and communications, said the company is following the guidance of the World Health Organization and local health authorities at its operations around the world to prevent the spread of COVID-19.

“We are closely monitoring any impacts on trade flows, although it is too early to give an assessment.”

T he BC Maritime Employers Association (BCMEA) and the International Longshore and Warehouse Union Canada (ILWU) are also working together on a plan to address COVID-19’s potential impact on B.C. port operations.

BCMEA president and CEO Mike Leonard said interim mitigation strategies include a shift to digital dispatching for ILWU casual workers in Vancouver, increased cleaning of port facilities, providing work-from-home options and limiting travel.

He added that there has been a “material slowdown” in cargo volumes through B.C. ports “due to a number of events, including the effects of COVID-19 on imports from Asia.”

But he added that “at this time, it would be premature to assess the specific impacts of COVID-19 on cargo throughput and demand of labour.”

B.C.’s other gateway port, Prince Rupert, employs about 1,500 people in a city of about 13,000.

As such, said port authority CEO Shaun Stevenson, operations where face-to-face interaction is not needed have been suspended, as have open houses on proposed developments.

“The port’s ongoing operation is vital to Canada, and North America’s response to COVID-19, and as safety is integral to our sustainability as a gateway, we are working to ensure that trade is conducted as carefully as possible in this situation.”

Stevenson said the port is working closely with tenants and partners to implement practices to mitigate COVID-19’s spread.

Those partners include Transport Canada, the Canadian Border Services Agency, the Public Health Agency of Canada, shipping lines, masters and crews, port authorities and terminal operators. • – W i t h a f i l e f ro m Je re m y Hainsworth

news

BUSINESSVANCOUVER

March 23–29, 2020

5

squeeze on flow of freight inventory concerns across multiple sectors COVI D-19 outbrea k may be “fatal” to globalization because it exposes “the downside of overreliance on Chinese supplies,” as the virus originated in the central Chinese city of Wuhan.

About 32% of global manufacturing is currently done in China, the world’s second-largest economy. Huang said businesses have benefited from the economic efficiency of cost-competitiveness optimization but are now also seeing its risks.

Andreas Schotter, associate professor of international business at the University of Western Ontario’s Ivey Business School, said such a dramatic result is unlikely because of the powerful nature of economic logic and the technological possibilities enabled by

globalization.

“Globalization has enabled and pushed us to shift resources towards true knowledge and R&D collaboration, accelerating innovation,” said Schotter, who was in Hong Kong more than a decade ago as an expatriate business executive during the SARS outbreak. “The best example is the current global R&D alliance in the hunt for a COVID-19 vaccine. This effort is truly globalized. Imagine if everybody keeps everything to themselves, then there’s no way we would be able to have the kind of breakthroughs that we are already experiencing and will experience in the very near future.”

But he noted that isn’t to say globalization won’t change.

Schotter has been advocating for multinational executives to identify supply chain choke points and develop contingencies for potential disruptions since the 2013 Sendai tsunami and Fukushima nuclear disaster.

He said executives need to have a vigilant leadership mindset to survive in the next phase of evolution for the globalization model.

“I see this crisis as a potential inflection point for a new type of human work paradigm – the future of where, what, how much and for what I work – a real shift in wealth distribution, potentially globally. Every crisis is an opportunity to recalibrate the system, and this one is no different.”

He added that only about 30% of trade currently crosses national

borders, and multinational corporations operating within their own operational structures account for 30% of that total.

“There is simply no way and no economic reason for sourcing entirely domestic,” Schotter said.

Antweiler agreed.

“Lower cost is still a key factor. If I say I have a supply chain that’s more local and more resilient, and you have one that’s more global and less resilient, the global one will still be less costly in the end because it has productions in places with the lowest cost. The high-resiliency local supply chain would only have an advantage during times of major global disruption, so, ultimately, the logic of international trade … is still going

to be very powerful and will not go away.”

Tiberghien added that consumers are a powerful force for keeping current globalization trends.

“People have gotten used to modern travel and technology.

Young people grew up in this world, and they are not willing to give it up. There’s resilience and mutual interest from many countries to continue, but it will be a hybrid system. There will be some partial downscaling … maybe some regionalization here or there, but a lot will be determined by how we come out of the coronavirus outbreak – and if the governments can work together, we can perhaps come out of this in three months reasonably well.” •

COVID-19 measures rattle tourism, hospitality sectors ECONOMY | Shutdown

By Glen Korstrom gkorstrom@biv.com

U

mberto Menghi was one of the first Vancouver restaurant owners to close his business as the threat rose from COVID-19.

The longtime restaurateur, and Giardino owner, cut short his vacation in Hawaii when cases related to the pandemic started to spread in North America.

“I was thinking about Giardino, my staff, the customers and all this that we’re talking about – confusion,” he said. “So I said, ‘Why don’t I go back and shut it down?’”

His March 14 closure was originally intended to be for a month but the rapid spread of the virus and government actions in the week that followed left him unsure when he would be able to reopen.

He told employees t hat he would cover two weeks’ worth of pay before the federal government changed employment insurance eligibility. Exactly how much those workers will be compensated remains unclear.

The business buys many ingredients daily and others frequently to ensure that they are fresh, so he did not have a lot of food that would go to waste.

Suppliers took back some of the food and Menghi said that he took some home to make meals for himself and his wife.

He spent many days during last week’s sunny weather gardening at home and reflecting on the state of the world.

“It’s like wartime,” he said.

“This is a problem for everyone – rich, poor, whatever religion.

wreaks havoc on financial and emotional well-being of entrepreneurs

$14b

Estimated annual sales generated

by Canada’s restaurant industry in 2018

7.3%

Percentage of B.C.’s workforce employed by the restaurant sector

20%

Percentage of restaurant spending generated by tourists to the province

$18.4b

Annual revenue generated by B.C.’s tourism sector

This is the first time in my life that I’ve lost the feeling of a sense of belonging where I am. I’m like a fish out of water.”

Fortunately for Menghi, he owns the property under his restaurant so he does not have a l a nd lord a sk i n g for le a se payments.

Many restaurant owners are not as fortunate, with some telling Business in Vancouver that most peers could go under within a few months without a bailout by government.

Restaurants Canada data from 2018 showed that the restaurant industry generated $14 billion in annual sales and was worth 5% of the province’s GDP. The sector’s 180,100 employees represent 7.3% of the province’s workforce.

Tourists are estimated to account for 20% of restaurant spend i ng, a nd t hei r i mpact

on the economy is even more substantial.

According to Destination British Columbia data, 137,800 people are employed in the tourism sector, which generates $18.4 billion in annual revenue.

Canada’s unprecedented ban on tourist visits therefore carries an enormous economic price tag and causes uncertainty for many even as it slows the progression of COVID-19.

“Destination British Columbia has ceased all marketing, including to the U.S. and Canada, and is focused on supporting industry and keeping them informed on the latest developments,” the province’s destination marketing organization told BIV in a statement.

It created a COVID-19 resource page that includes federal and provincial information on infection prevention, travel advisories and other information.

U.S. Treasury Secretary Steven Mnuchin called the COVID-19 crisis “worse than 9/11 for the airline industry – they’re almost ground to a halt.”

Vancouver Airport Authority CEO Craig Richmond concurred, calling the COVID-19 economic impact “more broad and deep than 9-11” because planes were back in the sky within five days of the attacks. “ We’re i n u n p re c e d e n te d times,” he said. “I have been through a lot – 9/11, SARS, all kinds of airline bankruptcies, and near bankruptcies, and consolidations – and nothing has ever been like this.”

Restaurant blogger and analyst Richard Wolak said what makes the current situation different

Giardino owner Umberto Menghi: “It’s like wartime. This is a problem for everyone – rich, poor, whatever religion. This is the first time in my life that I’ve lost the feeling of a sense of belonging where I am. I’m like a fish out of water” | Rob Kruyt

from 9/11, and even the global financial crisis of 2009, is that socia l med ia has become so prevalent. While that avenue of communication can be helpful, he said, it can also provoke anxiety because misinformation is rife.

W h e n Va n c o uve r C o a s t a l Health ordered a l l ba rs a nd restaurants to close on March 17 except for takeout or delivery orders, several restaurant owners who spoke with Wolak had incorrectly heard that all the restaurants in Canada were

supposed to close indefinitely.

A Conference Board of Canada report in May 2003 found that Canada’s tourism sector was walloped hard by fear of the SARS virus.

It suggested that Toronto suffered a $950 million (0.5%) hit to real gross domestic product and that $570 million of that decline was concentrated in the travel and tourism sector.

With COVID-19 long surpassi ng SA RS i n terms of cases, deaths and panic, the economic impact is so far incalculable. •

6

news

BUSINESSVANCOUVER March 23–29, 2020

Breaking down billions in economic aid Timeline: Federal fiscal measures to combat COVID-19 crisis $10 billion federal credit line for businesses announced

Bank of Canada cuts its policy interest rate by 50 basis points to 1.25%

MARCH

MARCH

04

11

Initial $1 billion federal economic and health response package

Canada’s big six banks offer mortgage payment deferrals up to six months

MARCH

13

MARCH

MARCH

16

MARCH

17

18

Up to $82 billion addition to federal economic response plan

Bank of Canada cuts its policy interest rate by 50 basis points to 0.75%

COVID-19 Continued from page 1

T he ma ny govern ment a nnouncements Canadians heard last week are among the first meaningful emergency measures Canadians can expect to see as the outbreak of COVID-19 persists.

Canada’s economic response plan is set to deliver up to $27 billion in direct support to workers and businesses. Some $15 billion of that is earmarked for the enhancement and expansion of employment insurance. Another $55 billion in tax referrals will bring some temporary cash flow relief to businesses and families. Canada’s Big Six banks are also offering mortgage payment deferrals for up to six months.

“I think our national government is responding [in] a pretty meaningful way to this unprecedented shock,” Jock Finlayson,

chief economist at the Business Council of British Columbia, told BIV. “Whether it’s going to be enough in the circumstances, I think, is more debatable.”

T h o s e c i rc u m s t a n c e s a re changing hourly, and measures critical to addressing what B.C. has now declared a public health emergency will bring further economic impact. Businesses with primary liquor licences have been ordered closed throughout the province. Restaurants in Vancouver must close or offer takeout only. Events are cancelled, theatres are dark, recreational facilities are closed and non-essential travel postponed.

“We are in an absolute free fall. I’ve never seen anything like this,” said Ian Tostenson, president and CEO of the BC Restaurant and Food Services Association. The industry comprises some 13,000 businesses that employ 180,000 workers.

“Business owners are crying. It’s just so sad.”

The federal government has promised it will do what is necessary to see the country through a health crisis that is creating an economic one. The multibilliondollar question: what will be necessary?

The answer depends on the spread of the virus. It depends on the number of layoffs, closures and bankruptcies the country sees in the weeks ahead. It depends on Canadians’ ability to cover their basic needs, let alone record-high levels of consumer debt.

A recession remains inevitable, according to CIBC Economics, which expects the Bank of Canada to cut its overnight rate to its last recession low of 0.25% in the coming month. Many economists agree.

Parliamentary Budget Officer Yves Giroux expects data in

We’re talking – and I mean this seriously – Great Depression-level unemployment rates

[] Kevin Milligan professor of economics, University of British Columbia

March and April will likely reveal sharp drops in growth in employment and gross domestic product.

“The economic impacts of the pandemic will be brutal,” he tweeted.

Last week, Canada saw governments and financial institutions step up to backstop an economy in crisis. While it depends on a broad range of unpredictable factors, it

Tomas Knopp /Shutterstock

is widely considered that what has been announced is just the start of an economic response plan that may very well include additional funding commitments and new measures from the federal government in the weeks and months ahead.

As an additional lifeline to businesses, Milligan believes there might be room for government to expand the employment subsidy it extends to small companies struggling to meet payroll.

The priority now is to bridge the coronavirus-induced slowdown and mitigate the economic damage. The other side – wherever it is and whenever we get there – will bring its own set of economic and fiscal challenges.

“This is like nothing we have ever seen,” said Milligan. “I think the best we can do is to bend the curve on this crisis and preserve what we can to the other side and rebuild from what we have.”•

briefs HEALTH CARE

COVID-19 test device sales expedited in Canada as WHO stresses ‘test, test, test’ The Canadian government has signed an interim order to expedite access to foreigncountry-approved COVID-19 testing devices as the World Health Organization (WHO) amplifies the need for more aggressive testing to fight the pandemic.

“We have not seen an urgent enough

escalation in testing, isolation and contact tracing – which is the backbone of the response,” said World Health Organization director general Tedros Adhanom Ghebreyesus on March 16.

“We have a simple message for all countries: test, test, test. Test every suspected

case.”

But in B.C., tests have been backlogged so far, and capacity is limited despite the province and country being ahead of the vast majority of affected countries on a per capita testing basis. Still, B.C. Provincial Health Officer Bonnie Henry has stated

health authorities are still not testing people presenting with “mild symptoms.”

In contrast, WHO stated, “The most effective way to prevent infections and save lives is breaking the chains of transmission.

And to do that, you must test and isolate.

You cannot fight a fire blindfolded.”

Transportation

Child Care

Two more ride-hailing services approved for B.C. roads

Surrey shuts down city-run daycares, seeks hospital space

A pandemic hasn’t stopped the B.C. regulator responsible for ride-hailing applications from giving the nod to two more companies.

The Passenger Transportation Board has approved applications from MDD Transport Network Inc. and Safe Ride

Sharing Ltd. as of March 19.

The approvals come even as Uber Technologies Inc. (NYSE:UBER) and Lyft Inc. (Nasdaq:LYFT) suspend carpooling services amid the COVID-19 clampdown. Regular services remain available in B.C.

Day camps and daycares operated by the City of Surrey will close March 23 to prevent the spread of COVID-19, Mayor Doug McCallum announced at a brief announcement at city hall March 19.

McCallum said the city is looking for empty industrial and warehouse space

K biv.com Go online to read these stories in full, along with much more business news updated daily at biv.com.

for pandemic responses, including warehousing medical equipment and possible temporary hospitals.

He previously said spring break camps and daycare facilities run by the city would continue based on the most current guidelines provided by the province.

news

BUSINESSVANCOUVER

March 23–29, 2020

7

Carrier Sekani deal proves reconciliation can work RESOURCES | First Nations that resolve governance issues and are willing to negotiate are inking deals

By Nelson Bennett nbennett@biv.com

E

ven as Indigenous activists supporting a handful of Wet’suwet’en hereditary chiefs opposed to the Coastal GasLink pipeline were chanting “Reconciliation is dead,” government and industry in B.C. were busy signing deals with First Nations that suggest it isn’t.

It may be dead for those who define reconciliation as a fight for a zero-sum outcome. But those First Nations who view it as an ongoing process of negotiation, and who have done the hard work of sorting out governance issues, have found a provincial government very much willing to address issues of rights, title and economic reconciliation.

With the troubles in Wet’suwet’en country hogging all the headlines, it was easy to miss a $200 million reconciliation agreement signed between the B.C. government and the Carrier Sekani Tribal Council at the end of January.

More recently, the Huu-ay-aht First Nations has inked a deal that makes it business partners with Western Forest Products (TSX:WFP), with a majority stake in a tree farm licence (TFL 44) and a 7% stake in the company’s Port Alberni sawmill.

Interestingly, one of the seven bands that are part of the deal with the Carrier Sekani Tribal Council is Burns Lake – also k now n a s t he Wet’suwet’en First Nation, a m i x of b ot h Wet’suwet’en and Carrier First Nations.

The Pathway Forward agreement with the Carrier Sekani includes seven bands with a total population of about 7,000.

It is not a treaty, per se, though it could be described as the cornerstone of one. It commits to an ongoing process to recognize and implement rights of title and self-government.

It is very much an economic reconciliation agreement, however – an acknowledgment that things like title and selfgovernance don’t mean much if First Nations don’t have the economic means to govern themselves and manage their lands and economies.

“W hen you have money i n the ba n k, you a re able to do more things the way you want to,” said Carrier Sekani Tribal Council Chief Mina Holmes. “So our community can comfortably deliver language programs. Before, we had to apply for language funds. They were often limited.

Now leadership can do language and culture in the community with its members.”

The $200 million in funding flows through four categories: economic development, culture, governance, and capacity

When you have money in the bank, you are able to do more things the way you want to

[] Mina Holmes Chief, Carrier Sekani Tribal Council

building. It provides $70 million for economic development, including $15 million to seed a new sovereign wealth fund.

“This idea came from what we saw [with] the Navajo Nation,” Holmes said. “They started with $10 million and they have $200 million now.”

There is also a provision to provide revenue from activity like forestry to the Carrier Sekani.

“There are issues there that are so long overdue to be addressed, and we feel that this government has attempted to start addressing that with tackling those big issues and working with First Nations to address what the future of forestry might be,” Holmes said.

The Carrier Sekani is still officially listed as involved in the B.C. treaty process, but it abandoned that process years ago, Holmes said, opting to work d i rectly w ith the prov i ncia l government.

The Pathway Forward agreement signed at the end of January started under the Liberal government, but Holmes credited the NDP government for getting the deal signed, sealed and delivered.

“We have been making steady progress, particularly with this gover n ment,” Hol mes sa id.

“Progress has definitely been made.”

Coinciding with the economic reconciliation agreement is the Omineca Demonstration Project, which deals with land stewardship and habitat issues.

Over on Vancouver Island, meanwhile, the B.C. government has also helped facilitate an agreement between the Huuay-aht First Nations and Western Forest Products that will see the Huu-ay-aht become WFP’s business partner.

The Huu-ay-aht have taken a 51% controlling interest in TFL 44 (Port Alberni) for $35 million.

WFP has the long-term lease on that TFL, which is Crown land held under a renewable 25-year lease. They will also take a $1 million, 7% stake in WFP’s Port Alberni sawmill.

The money is coming from the Huu-ay-aht’s own funds – a combination of cash provided through the Maa-nulth treaty agreement (signed in 2011), bank

Carrier Sekani Chief Mina Holmes with Premier John Horgan, Indigenous Relations Minister Scott Fraser and Forestry Minister Doug Donaldson | Carrier Sekani Tribal Council

loans and revenue from the Huuay-aht’s forestry business.

Huu-ay-aht Chief Councillor Robert Dennis said the deal would never have been possible without a treaty – which gave the Huu-ayaht ownership of 9,000 hectares of timberlands – and without a governance structure that involves both hereditary and elected leaders working co-operatively.

“Progress is being made where the First Nation communities

– hereditary leaders and elected leaders – are working together,” Dennis said.

“Our financial position is now 45 times greater than when we entered treaty,” he added. “We have a very healthy investment bank account from our forestry operations and our government operations.”

Western Forest Products CEO Don Demens said the deal benefits his company because it provides

greater certainty over timber supply, some of which comes from Huu-ay-aht timberlands that are outside of TFL 44.

“I think this is a template where First Nations can invest, with business, to support a stronger business, and it’s a way business can contribute to reconciliation,” Demens said. “It creates greater certainty of access to fibre for our business, which supports business in B.C.” •

8

BUSINESSVANCOUVER March 23–29, 2020

realestate A shift in markets has begun, and the outcome is uncertain

Real estate roundup Peter Mitham

The market shifts The World Health Organization’s declaration on March 11 that the novel coronavirus COVID-19 was a pandemic triggered a wave of public health and fiscal policy measures abundantly covered in this publication and others. What was recommended in the interests of public health one day became a requirement the next.

Over the course of a week, B.C. provincial health officer Dr. Bonnie Henry went from suggesting people gather in groups of less than 250 to shutting down bars and urging a separation of two metres between shoppers in retail premises. “Go outside and play with your family. Go up

to our ski hills. Go up to Whistler,” she urged on March 13; the following day, Vail Resorts Inc. announced that its North American resorts, including Whistler Blackcomb, would close beginning March 15.

The restrictions will deliver a significant hit to the cash flow of local hotels – which until last year had been setting new performance benchmarks – and other properties rooted in tourism and socializing.

The Canadian Tourism Commission estimated that severe acute respiratory syndrome (SARS), also caused by a coronavirus, cost hoteliers 662,000 room nights in April 2003. Room revenues in B.C. fell 5.5% that month versus the previous year.

According to the commission, the total impact on Canada’s economy from SARS that year was $519 million.

Meanwhile, governments around the world have unleashed economic remedies like it’s 2008. Policies rolled out in response to the financial crisis have been redeployed even before the full impact of the

The timing and magnitude of the rebound are highly uncertain at this point

[]

RBC Economics

pandemic on businesses and personal finances is known or can even be assessed. The Office of the Superintendent of Financial Institutions postponed changes to the stress test applied to mortgage applicants – the comment period ended March 17, and a decision was expected

by April 1 – while the Bank of Canada cut its benchmark lending rate to 0.75%, a percentage point lower than the rate in January. The two moves suggest concerns about overheated housing markets and unaffordable home prices in Canada are a thing of the past.

Reduced availability But if the financial measures are in place, are the buyers?

Travel restrictions have largely removed foreign nationals from

the market for the foreseeable future (the province’s health minister has even advised U.S. residents to stay home), but everyone now faces restricted access to presentation centres and added hurdles in closing deals. Brokers contacted last week indicated that clauses to accommodate longer closure times were being written into contracts to account for the delays. And, of course, many buyers were staying away altogether, prioritizing the health and needs of themselves and their families.

There’s also a smaller selection of projects on offer. Project launches in Metro Vancouver have declined steadily over the past three years, from a peak of 199 in 2017 to 105 last year. To quote the Canada Mortgage and Housing Corp.’s summary of its latest assessment of the Vancouver housing market, “There continues to be low evidence of overbuilding.”

Michael Ferreira, managing principal of market research firm Urban Analytics Inc., expects COVID-19 will “definitely

delay the launch of any significant new projects,” further exacerbating the region’s shortage of available housing.

But the issue circles back to the economic fallout of the pandemic.

“Will there be a bump in activity resulting from pent-up demand, or will the market slow as a result of the loss of income many are incurring from not being able to work?” Ferreira asked.

The answer to that question will surely lie in the duration of the public health emergency, the amount of spending that’s curtailed and how many jobs are lost temporarily or permanently as a result.

RBC Economics says the tight market conditions mean a price collapse is unlikely, but “the timing and magnitude of the rebound are highly uncertain at this point.” Scotiabank, for its part, is optimistic, forecasting “a strong rebound beyond Q3” as interest rates remain near record lows. • pmitham@telus.net

This content was produced by Business in Vancouver’s advertising department. BIV’s editorial department was not involved in its creation.

BCIT BUSINESS

Corporate Training Helps Organizations Unleash The True Potential of Their Human Capital Connecting work to purpose increases employee engagement and productivity.

B

ritish Columbia Institute of Technology’s (BCIT) School of Business and Media offers corporate and industry training services to corporate clients wanting to enhance their employees’ skills and knowledge, provide professional development, and engage employees in pursuit of organizational goals.

people and your purpose,” Fell says. “The intersection of all circles is the potential you have as an organization. If you get all these things right, productivity is the byproduct.”

BCIT Business and Media has an extraordinary team of professional facilitators who bring the topics to life by using practical examples.

Facilitators are industry experts and leading practitioners in their fields.

In addition, BCIT’s Corporate and Industry Training Services will customize offerings to ensure they address an organization’s unique needs, the intended audience and the specific objectives identified.

Whether during the day, evening, or weekends, BCIT’s facilitation teams are available to provide training at a company’s workplace. A statement of completion can also be issued to employees for successful workshop completion.

“We can help you realize your organization’s true potential through engaging your people and igniting your purpose to realize your productivity goals,” says Amy Fell, BCIT’s Industry and Corporate Training Coordinator.

BCIT is one of the largest business schools in Western Canada with a wide array of corporate and executive education offerings to serve professional development and career advancement.

For over two decades, BCIT has worked with businesses, municipalities, and organizations to realize the true potential of their human capital.

“We want to help you figure out how training dollars can be invested wisely to improve employee skills and connect their work to the pursuits of the organization,” Fell says. “A person will always do more when they feel that someone believes in them. We get inspired, we strive, and we contribute beyond what we believe we are able. Employees start to realize

BCIT offers the largest selection of accredited business programs in the province, with 98% of degree graduates finding employment within two years of leaving BCIT. BCIT’s facilitation teams are available to provide training at a company’s workplace.

As many companies head into the new fiscal year, they may want to consider some of the trends in corporate training.

the connection they have with the organization, which creates lasting loyalty and reduces the drain of turnover.”

Managing Millennials in the workforce is something Fell has seen an increase in demand for from organizations and managers.

When Fell works with clients to determine their needs, she draws a model of interlocking circles that demonstrate the interconnected nature of people, productivity, and purpose.

Where the circles overlap are opportunities for training and growth.

“There’s been a shift. It’s been an employers’ market for a long time, where employers could say, ‘I want you to do more for less’,” Fell says. “Now it’s shifted to an employees’ market, where employees consider, ‘is this job good for me, good for us, and good for the world?’”

“We’ve learned that moving the dial on productivity relies on a connection between your

Millennials are different from their Gen X and Boomer counterparts in that they want to feel

To learn more, visit bcit.ca/business/industry/training

like they are integral to the work of an organization and tend to seek mentorship.

“This is where clarity is critical. Connecting employees to an organizations purpose drives personal motivation and helps employees see their contribution toward achieving an organization’s purpose,” Fell says.

Another new trend she has seen recently is a move toward employee-directed learning.

“This is a new trend in employee development. Employers need to spend time asking employees how they want to develop as an individual and what training they need to get there. Enabling employees to take responsibility for their learning demonstrates a commitment to their success and with that…an organizations success,” Fell says.

Investing in individuals inspires loyalty and reduces turnover.

“You want them to realize they can fulfil their potential by staying at your organization,” Fell says.

To learn more about BCIT’s variety of customizable workshops and workshop series for corporate clients, visit: bcit.ca/business/industry/training/

9

BUSINESSVANCOUVER

March 23–29, 2020

finance

H

ousing starts bounced higher in February following a weatherinduced January drop.

Urban B.C. housing starts came in at an annualized rate of 38,286 units, up 55% from the 24,561 units the previous month. In comparison, national housing starts edged lower by 2%. As is often the case, the large monthly swing owed to an increase in multi-family starts, although the number of singledetached starts also rebounded.

Nevertheless, single-family starts declined through 2019, while multi-family starts have eased after robust gains in the first half of the year.

Despite February’s gains, starts over the first two months fell 18% from same-period 2019. Metro Vancouver-area starts fell 35%, while Victoria construction declined 8%. In contrast, starts in Kelowna (up 29%) and Abbotsford-Mission (up 165%) were well ahead of a year ago. Detached starts fell 12% to 784 units and multifamily starts declined 20% to 4,113 units through the first two months.

The outlook for new-home construction remains mixed. A tightening resale market, lower interest rate environment and population growth will support demand for new ownership housing. High rent, low

Large monthly swings occur in part because most housing starts are multi-family Seasonally adjusted annual rate and trend

Bryan Yu

Starts bounced higher in February following a sluggish January 60,000 50,000 40,000 30,000 20,000 10,000 2010

2012

2014

2016

Single-detached

Trend

2018

Multi-family

2020

Trend

Sources: CMHC, Central 1 Credit Union. Latest: February 2020

Rising number of homes under construction buoy sector But COVID-19 outbreak may stall work on many projects 60,000 Units under construction

Data Points

vacancy rates and government support contribute to new rental supply. That said, condominium starts are expected to slow this year following weaker presale activity in 2018 and 2019, which is expected to dampen the pace of starts. Current economic fears stemming from the spread of COVID-19 are also a threat. Housing starts, inclusive of rural B.C., are forecast to decline more than 15% to 37,000 units this year.

While housing starts decline, B.C. construction will remain elevated. Record housing starts in 2019, extended construction times and labour market constraints have maintained a near-record level of units under construction. Units under construction in B.C.’s four largest metro areas reached 54,974 in February. While completions whittled it down from yearend highs, the number was 6% above year-ago levels. Work will continue through 2020, although lower starts and project completions will contribute to a downward trend.

In a sign of ongoing retail softness in 2020, new-vehicle sales remained in an earlyyear slump. Sales in the B.C. and territories region came in at 12,681 vehicles in January, down 14% year-over-year.

While sales managed to rebound slightly from December by 2% on a seasonally adjusted basis, a negative trend extending back to mid-2017 continued. Sales are trending at the lowest level since mid-2014 despite a period of stronger employment and population growth. •

housing starts rebound, trend down

50,000 40,000 30,000 20,000 10,000

1990

1994

1998

2002

2006

2010

2014

2018

Sources: CMHC, Central 1 Credit Union. Latest: February 2020

new-vehicle sales slowdown continues Early-year slump is a sign of ongoing retail-sector softness Sales are trending at the lowest level since mid-2014 25,000 20,000 Units

Home construction heats up after winter freeze

15,000 10,000 5,000 2010

2012

2014

2016

Seasonally adjusted

Bryan Yu is deputy chief economist at Central 1 Credit Union.

2018

2020

Actual

SourceS: Statistics Canada, Central 1 Credit Union. Latest: January 2020

INSIDERTRADING The following is a list of stock trades made by corporate executives, directors and other company insiders of B.C.’s public companies filed in the week ended March 18, 2020. The information comes from a compilation of required reports filed with the BC Securities Commission obtained from DisclosureNet.com.

Company: Ivanhoe Mines Ltd. (TSX:IVN) Shares owned: 460,986 Trade date: March 15 Trade total: $554,016 Trade: Acquisition of 237,000 shares at prices ranging between $2.29 and $2.40 per share

Insider: James A. Pattison, 10% owner Company: West Fraser Timber Co. Ltd. (TSX:WFT) Shares owned: 175,000 Trade date: March 11 Trade total: $2,806,500 Trade: Acquisition of 75,000 shares at a price of $37.42 per share

Insider: John Lee, director Company: Silver Elephant Mining Corp. (TSX:PCY) Shares owned: 10,448,901 Trade date: March 12, 15, 17 Trade total: $309,400 Trade: Sale of 2,745,000 shares at prices ranging between $0.11 and $0.12 per share

Insider: Tadeu Carneiro, director

Insider: Brian Alexander

Paes-Braga, 10% owner Company: Thunderbird Entertainment Group Inc. (TSXV:TBRD) Shares owned: 3,423,310 Trade date: March 13 Trade total: $273,750 Trade: Acquisition of 375,000 shares at a price of $0.73 per share Insider: Scott Thomson, officer Company: Finning International Inc. (TSX:FTT) Shares owned: 197,108 Trade date: March 11 Trade total: $234,300 Trade: Acquisition of 16,500 shares at a price of $14.20 per share Insider: Todd Olson Anthony,

officer Company: First Majestic Silver Corp.

(TSX:FR) Shares owned: 15,000 Trade date: March 16 Trade total: $216,750 Trade: Sale of 25,000 shares at a price of $8.67 per share

(TSX:MMX) Shares owned: 3,180,517 Trade date: March 11, 12 Trade total: $187,899 Trade: Acquisition of 47,100 shares at prices ranging between $3.51 and $4.15 per share

Insider: Harold N. Kvisle, director Company: Finning International Inc. (TSX:FTT) Shares owned: 35,000 Trade date: March 12 Trade total: $197,100 Trade: Acquisition of 15,000 shares at a price of $13.14 per share

Insider: Andrew William Bowering, officer Company: Prime Mining Corp. (TSXV:PRYM) Shares owned: 3,883,668 Trade date: March 11, 15 Trade total: $180,625 Trade: Acquisition of 552,500 shares at prices ranging between $0.25 and $0.34 per share •

Insider: Daniel O’Flaherty, officer Company: Maverix Metals Inc.

10

BIVLIST

BUSINESSVANCOUVER March 23–29, 2020

companiesin inB.C. B.C. Biggest software companies Ranked Totalnumber numberof ofemployees employeesin inB.C. B.C. RANKED BY | BY | Total Rank Company '20

1 2 3 4 4 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

Product line

SAP Canada Inc 910 Mainland St, Vancouver V6B 1A9 P: 604-647-8888 F: 604-681-2934 sap.com MDA 13800 Commerce Pky, Richmond V6V 2J3 P: 604-278-3411 F: NP mdacorporation.com Traction on Demand 2700 Production Way Suite 500, Burnaby V5A 0C2 P: 604-620-6040 F: NP tractionondemand.com Change Healthcare Imaging, Workflow & Care Solutions1 10711 Cambie Rd Suite 130, Richmond V6X 3G5 P: 604-279-5422 F: 604-279-0572 changehealthcare.com Hootsuite 5 8th Ave E, Vancouver V5T 1R6 P: 604-681-4668 F: NP hootsuite.com Global Relay 220 Cambie St 2nd floor, Vancouver V6B 2M9 P: 604-484-6630 F: 604-608-2941 globalrelay.com Clio (Themis Solutions Inc) 4611 Canada Way Suite 300, Burnaby V5G 4X3 P: 888-858-2546 F: NP clio.com Bench 545 Robson St Suite 200, Vancouver V6B 2B7 P: NP F: NP bench.co Galvanize3 980 Howe St Suite 1500, Vancouver V6Z 0C8 P: 604-669-4225 F: 604-669-3557 wegalvanize.com Sage 13888 Wireless Way, Richmond V6V 0A3 P: 604-207-9480 F: NP sage.com/ca Boeing Vancouver 13575 Commerce Pky Suite 200, Richmond V6V 2L1 P: 604-232-4200 F: 604-232-4201 boeingvancouver.com Absolute 1055 Dunsmuir St Suite 1400, Vancouver V7X 1K8 P: 604-730-9851 F: 604-730-2621 absolute.com PNI Digital Media 425 Carrall St Suite 100, Vancouver V6B 6E3 P: 604-893-8955 F: 604-893-8966 pnimedia.com Vision Critical 200 Granville St, Vancouver V6C 1S4 P: 604-647-1980 F: 604-647-1005 visioncritical.com Realtor.com 10271 Shellbridge Way Suite 300, Richmond V6X 2W8 P: 800-444-8570 F: NP careers.realtor.com Copperleaf 2920 Virtual Way Suite 140, Vancouver V5M 0C4 P: 604-639-9700 F: 604-639-9699 copperleaf.com Sophos Inc 777 Dunsmuir St Suite 1400, Vancouver V7Y 1K4 P: 604-484-6400 F: NP sophos.com ZE PowerGroup Inc 5920 No 2 Rd Suite 130, Richmond V7C 4R9 P: 604-244-1469 F: 604-244-1675 ze.com Thoughtexchange 1990 Columbia Ave Suite E, Rossland V0G 1Y0 P: 250-551-2492 F: NP thoughtexchange.com Clevest 13700 International Pl, Richmond V6V 2X8 P: 604-214-9700 F: NP clevest.com

Top local executive(s)

Business management software, enterprise resource management solutions, analytics, mobile, Kirsten Sutton, vice-president and managing director, SAP Labs Canada collaboration in the cloud Space robotics and sensors, satellite antennas, electronics and subsystems, surveillance and intelligence systems, defence and maritime systems and geospatial radar imagery

Chris Pogue, president, MDA government programs

Salesforce platform consulting, implementation and software development services, marketing Greg Malpass, founder and CEO, Mike Epner, president, Chris Peacock, automation, data management and software-as-a-service technology chief marketing officer, Errol Olsen, chief financial officer, Tanya Jarrett, chief people officer Departmental diagnostic imaging solutions, enterprise workflow and infrastructure solutions, NP extended care and change management solutions

Year founded

No. B.C. staff '20/'19

1989

1,381 1,460

1969

602 666

2006

560 426

1988

5002 595

Social relationship platform management from one integrated dashboard with more than 16 million users

Ryan Holmes, CEO

2008

5002 551

Cloud archiving and information governance solutions for the global financial sector and other highly regulated industries

Shannon Rogers, president and general counsel, Warren Roy, CEO and founder

1999

461 393

Cloud-based legal technology

Jack Newton, co-founder and CEO, George Psiharis, chief operating officer

2008

375 300

Financial technology company that automates accounting tasks to organize the financials of small businesses

Ian Crosby, co-founder and CEO

2012

350 300

Cloud-based audit and risk management software with data analysis for finance, governance, risk, IT and compliance professionals

Laurie Schultz, president and CEO

1987

308 277

Business management software, solutions and services for small and mid-sized businesses

Paul Struthers, executive vice-president and managing director, Sage Canada

1981

305 241

Data science and software development services for Boeing's global customers

Bob Cantwell, president

1996

302 288

Embedded, persistent end-point security and management solutions for computers, laptops, tablets and smartphones

Christy Wyatt, president and CEO

1993

2902 275

Software platform for retailers that offers on-demand personalized products for sale online, from in-store kiosks and from mobile devices

Simon Cairns, general manager

1995

285 265

Cloud-based customer relationship intelligence software

Ross Wainwright, CEO

2000

2702 257

Real estate sales and marketing solutions

Klaus Salchner, vice-president, software engineering, Ryan Green, vicepresident, product

1982

260 293

Develops and sells decision analytics software to utilities and other companies managing critical infrastructure to improve investment planning

Judi Hess, CEO, Boudewijn Neijens, chief marketing officer

2000

230 186

Encryption, end-point security, web, email, mobile and network security solutions backed by SophosLabs

Chris Kraft, vice-president, product management

1985

200 200

Software development and consulting firm that provides products and services for energy, commodities, industrial, agriculture and financial markets

Zak El-Ramly, president and CEO, Aiman El-Ramly, chief strategy officer

1995

181 215

A software-as-a-service community intelligence platform that helps leaders crowdsource the answers to questions in real time

Dave MacLeod, founder and CEO, Jim Firstbrook, founder and president

2009

1384 138

Innovative software for mobile workforce management exclusively for utility field operations

Thomas Ligocki, president and CEO

2002

132 130

Sources: Interviews with above companies and BIV research. Others may have ranked but did not respond to information requests by deadline. NP Not provided 1 - Business unit of McKesson Medical Imaging 2 - BIV estimate 3 - Previously ACL; name changed May 13, 2019 4 - 2019 figure

Business in Vancouver makes every attempt to publish accurate information in the List, but accuracy cannot be guaranteed. Researched by Anna Liczmanska, lists@biv.com.

Next week’s list – Top real estate deals of 2019

COVID-19 Roundup Daily Newsletter

New daily newsletter focusing on COVID-19 and our economy, delivered to your inbox each weekday afternoon.

Plus, a daily video podcast on how business is dealing with the emergence and spread of coronavirus in our region.

For more information, visit: biv.com/newsletter

BIVLIST

BUSINESSVANCOUVER

March 23–29, 2020

11

COVID-19 drives home new normal of remote working human resources | B.C.

BY TYLER ORTON TORTON@BIV.COM

T

he economic fallout of COVID-19 poses something of a paradox for a tech company like T hought­ exchange, according to CEO and co-founder Dave MacLeod.

The 140-person firm, formally known as Fulcrum Management Solutions Ltd., is headquartered in the B.C. Interior and depends significantly on a remote workforce to support its commercial platform for crowdsourcing.

While throngs of businesses across the province are now adjusti ng to send i ng workers home to work remotely, Thought­exchange has been set up to accommodate that since its founding.

Working from one of th ree small offices making up its headquarters in Rossland has always been optional, as is attendance at its WeWork Cos. Inc. office in Vancouver.

“We’re privileged that we’re built for this,” MacLeod said, referring to government calls for workers to stay home amid the pandemic. “It’s just business as usual for us because it’s how we’ve always operated.”

Although Thoughtexchange is poised to weather the storm in what he describes as a “wild” business atmosphere, many clients are not.

“It’s a bit of a paradox in that clients will be facing revenue cha l lenges,” sa id MacL eod, whose clients include American Airlines Inc. (Nasdaq:AAL).

“A n d a t t h e s a m e t i m e … we’re seeing an unprecedented amount of interest in what we do to make leaders’ crowdsourcing proficient.”

T h o u g h te x c h a n ge’s p l a tform can crowdsource ideas from groups ranging from 10 to 100,000 people.

It closed a Series B financing round in December 2019 amounting to $20 million, leaving the B.C. tech company well prepared

software companies see pandemic changing the way business is done

for difficult economic times.

With that in mind, Thoughtexchange will be giving away its platform for free to any organization that needs crowdsourcing help related to COVID-19.

“It may or may not have an economic benefit but we’re going to do it anyways,” MacLeod said.

“If there’s an organization out there that needs to hear back from people and it could actually help them, and make them more safe, and make their business more successful in a really hard time, then it’s kind of our corporate duty.”

Thoughtexchange typically charges between $2,000 and $10,000 per month for entrylevel packages.

While the company is already set up to work remotely through a m i x of tools such as Slack Technologies Inc.’s messaging services and Zoom Video Communications’ video conferencing services, other companies are now in the trial-by-fire phase.

“A lot of people have been reluctant to use video conferencing tools in the past; there’s always the thinking that it’s better to do it in person. But many businesses will now realize they can do much more online than they realize – because, right now, they have to,” said Werner Antweiler, an associate professor at the University of British Columbia’s Sauder School of Business.

“There’s a massive exploration going on right now, seeking out what can be done virtually. So there may be a permanent effect on in-person meetings in the business world, and frankly, it’s a whole lot cheaper.”

Antweiler sits on the board of directors for a Toronto-based company that used to f ly its d i rectors to meeti ngs at its headquarters.

“Well, that costs us $30,000 to $40,000 a pop, so why are we spending this money?” he said. “I suggested as treasurer three years ago to switch to a digital platform, and it’s working just fine. People

Most of Rossland, B.C.-based Thoughtexchange’s 140 workers are already set up to work remotely, allowing the company to adapt to the new realities of COVID-19 | Submitted

like it, and it’s a whole lot cheaper. Yes, we don’t personally get together for the meeting anymore, but for a small corporation like ours, it makes all kinds of sense.”

Meanwhile, companies that have been sending employees home to work are now facing new concerns about cybersecurity, according to Christy Wyatt.

“Now you have people remote [working], they’ve taken systems [and] in some cases these are systems that have never been out of the office,” said the CEO of Vancouver tech-security firm Absolute Software Corp. (TSX:ABT).

“Even when devices are in the office, there’s a certain amount of vulnerability … so you’re going to see what I think of as ‘cyber looting.’”

Wyatt said her company expects to see an uptick in cases in which bad actors try to exploit the COVID-19 pandemic through phishing attacks or other means as more companies struggle to figure out best practices for employees working from home.

“They’re looking at new ways to compromise both individuals and

Coping with COVID-19 PODCAST

industries because then they’re catching us while we’re all off guard,” she said.

Wyatt said now is not the time for more companies to deploy massive new initiatives depending on technology.

In the meantime, Absolute Software is offering to help fix applications for clients remotely for

free regardless of whether that was part of the package they’ve licensed.

“I don’t think people will take this as an opportunity for companies to take advantage of the situation. I do think that there’s an opportunity for security companies and technology companies to step up,” Wyatt said. •

Is your offshore supply chain for custom parts disrupted?

Why not buy locally??

Laser Cutting | CNC Machining | Sheet Metal | Metal Stamping Tool & Die | Welding | Water Jet Cutting info@hanind.com | www.hanind.com 604.278.2223 | Fax: 604.278.7733 2871 Olafsen Avenue, Richmond, BC, Canada, V6X 2R4

| your daily source of business intelligence.

Download the latest BIV podcast daily for insights on the issues that effect B.C. business.

BIV has introduced a new podcast, Coping With COVID-19, that each day discusses with experts in business, the economy, health and public life the impact the coronavirus is having, how people and businesses are dealing with social distancing and the public health crisis, and what we need to understand about the challenging circumstances we face as a community. Join hosts Hayley Woodin, Tyler Orton and Kirk LaPointe for daily interviews at biv.com/audio, or subscribe to our daily COVID-19 newsletter that features it and other related news on the coronavirus, at biv.com/newsletters.

Listen at BIV.com/audio. For sponsorship opportunities, contact ads@biv.com.

12

BUSINESSVANCOUVER March 23–29, 2020

bivlist

Software companies accelerate employment growth

By Albert Van Santvoort avansantvoort@biv.com

B

ritish Columbia’s biggest software companies are growing faster than they did five years ago, according to data collected on Business in Vancouver’s list of B.C.’s biggest software companies (page 10).

In 2020, the median one-year growth rate for those companies increased to 5%, nearly five times the 1.2% median one-year growth rate they posted in 2016.

However, the average one-year growth of 5.5% in 2020 was only fractionally higher than that of 2016. This suggests that in 2020 the growth momentum of smaller software companies lower on the list has outpaced that of larger companies higher on the list when compared with their 2016 counterparts.

It also suggests that, unlike in 2016, software companies on the list in 2020 are in general growing at roughly the same rate, regardless of their size.

The lacklustre performance of the larger players is evidenced by the mixed performance of the list’s top five software companies. Over the past five years, employment at two of the top five has decreased while it increased

one-year growth of B.C.’s biggest software firms increases by nearly 500% at the other three. Traction on Demand (No. 3) has grown the most: 197.9% to 560 B.C. employees in 2020, up from 188 in 2016. However, MDA (No. 2) had the largest decline in staff in the top five, falling 10.3% to 602 employees in 2020 from 671 in 2016.

This broad-brush growth has unsurprisingly resulted in more employees across the spectrum of companies on the list.

The No. 1-ranked company on the list, SAP Canada Inc., employed 1,381 people in 2020 versus 1,100 people in 2016. Clevest, the company holding the No. 20 spot on the list, had 132 employees in 2020 versus 100 in 2016.

Talent is a tech and software company’s most important asset.

Not only are British Columbian software companies hiring more people, but, according to a recent CBRE Group report, those employees are increasingly more talented.

In 2017, Vancouver ranked 16th on CBRE’s tech talent scoring ranking. By 2019, it had surpassed Chicago, Baltimore and Orange County to claim 12th place. According to the report, this jump was in part the result of Metro Vancouver’s strong techcentric universities.

From 2012 to 2018, Vancouver

In 2017, Vancouver ranked 16th on CBRE’s tech talent scoring ranking. By 2019, it had surpassed Chicago, Baltimore and Orange County to claim 12th place.

According to the report, this jump was in part the result of Metro Vancouver’s strong tech-centric universities

North American tech talent quality versus cost analysis

Vancouver top Canadian city for tech talent, according to CBRE Group report

  

was one of North A merica’s most attractive destinations for tech talent with a “brain gain� of 11,160, meaning that the city had 11,160 more tech jobs than people who earned tech degrees.

The only hotter destinations were Toronto, San Francisco, Seattle and Charlotte. Vancouver also beats out nearly every other city measured in terms of having the highest-quality talent for the lowest cost, according to the report. •

Source: CBRE 2019 Scoring Tech Talent report

Change in B.C. employment at the largest software companies Traction on Demand had the largest five-year growth at 198%

B.C. employees

analysis | Median

1,600 1,400 1,200 1,000 800 600 400 200 2016 SAP Canada Inc.

2017 MDA

2018 Traction on Demand

2019

CALL FOR NOMINATIONS! NOMINATE BY: JUNE 1

BCCFO

PRESENTED BY:

SPONSORED BY:

biv.com/bc-cto-awards

NOMINATE BY: JULY 20 BIV is currently seeking BC’s outstanding CEO’s in private, public sector and non-profit organizations.

PRESENTED BY:

SPONSORED BY:

biv.com/ bc-ceo-awards

NOMINATE BY: AUGUST 17 BIV is currently seeking BC’s outstanding registered export companies and the individuals who contribute to their success.

biv.com/bc-export-awards

Global Relay

  

BIV EVENTS

BIV is currently seeking BC’s outstanding CTO’s in private, public sector and non-profit organizations.

2020

Hootsuite

PRESENTED BY:

Source: biv list

BUSINESSVANCOUVER

March 23–29, 2020

Insights

Publisher; Editor-in-chief; vice-president, editorial, Glacier Media | Kirk LaPointe, 604-608-5183 Managing editor | Timothy Renshaw, 604-608-5131 Deputy Managing editor | Mark Falkenberg, 604-608-5174 online editor | Emma Crawford Hampel, 604-608-5138 Business in Vancouver is owned by Glacier Media Inc., 303 West 5th Avenue, Vancouver, B.C. V5Y 1J6

Canada’s coronavirus unification factor

B

usiness and political leaders cannot afford to waste COVID-19’s unifying role as a common villain. Partisan divisiveness has become a major negative force in 21st-century enterprise and politics that has closed free-trade doors and increased the corrosive fallout from widening wealth gaps and inert governments.

The pandemic’s threat to everything from transportation, trade and

The COVID-19 economy has also underscored the world’s overreliance on China travel to entertainment and community events has for the first time this century galvanized communities and countries in a war against a single enemy. That singular focus has temporarily eliminated parochial walls.

And Canada needs all the singular focus it can get to allow it to tread water in what is shaping up to be a rapid downshift into global recession that will affect all sectors and social strata in the country.

13

last laugh

Civility and empathy in the House of Commons following word that the prime minister’s wife had tested positive for the coronavirus was a welcome departure from current standard operating procedure in the political arena.

But singular focus needs to be applied now to the COVID-19 economy.

It is devolving into ever-darker degrees of bleak, especially for Canada.

In a recent economic assessment, the Organization for Economic Cooperation and Development notes that COVID-19’s severe impact on the global economy has rendered growth prospects highly uncertain. What is certain is that they are not good. The assessment estimates annual GDP growth dropping to 2.4% this year, which is down from an already anemic 2.9% in 2019. It pegs Canada’s GDP growth at a slim 1.3%, down another 0.3% from 2019 and likely optimistic in light of recent events.

The COVID-19 economy has also underscored the world’s overreliance on China as the centre of its manufacturing and supply chain universe.

Diversification to domestic and regional sources is long overdue.

The COVID-19 challenge has and will inflict a lot of damage in the short term, but its role in unifying local, regional and international virus war efforts could pay long-term social and economic benefits.

Tough COVID-19 questions: how long will, how long can this go on?

Podium Kirk LaPointe

I

hear a lot of people asking: how long will this go on?

What I wonder is: how long can this go on?

First, the “will” question.

The first bout of COVID-19 social distancing and self-isolation might still feel like one part novelty, one part dislocation, but it will wear really thin, really quickly, really. We were born to socialize, and this is, after all, Beautiful British Columbia.

This is spring’s first week and our inclinations will be to hit the park, the beach, the hiking trail, the golf course, the tennis court, the bike path, the seawall, the Grind, the Drive, whatever.

Mostly, though, we can’t, which

I’m afraid to say might be different from saying we won’t.

Several weeks from now, the stir-craziness will be savage among the healthy among us.

Naturally we are wise to confine our outdoorsy moments to our front step or our backyard, to a patio at home and not the one we cherish at our favourite (but, sigh, still closed) restaurant. But: singles not dating?

Campers not pitching tents? No picnics in the park? Sure we can not do that?

The best guess – guess with a capital G – is that the coronavirus will hit its peak in B.C. in June, endures in July and August, and keeps us creeped out about gatherings. Some authorities fret about a resumption in autumn. Many predict three or four social distancing stints.

Beyond logistics, can any of us claim we will not fall prey to serious psychological problems from the stress of seclusion and solitary work? Isn’t it already happening? Wasn’t the hoarding of supplies a precursor to fear

what’s your opinion?

contagion?

But the bigger question is the “can” question. How long can this go on?

The pandemic has already clobbered our economic prospects. That the federal government earmarked last week $82 billion in emergency relief is telltale of symptoms to come.

Provinces and cities still have to weigh in with support, but Ottawa’s deeper pockets will be dug and dug and dug into. Spain, after all, disbursed nearly 20% of its gross domestic product to its calamity; Canada is around the 3% level.

So, even with the shovelling of money, at what stage can we afford to stay isolated and inactive and not engender a true meltdown?

We live in a society of instant gratification, not enduring denial of it. We are social animals with few lone wolves. Our businesses have cultivated us with access to quick delivery, abundant choice and easy refunds and exchanges.

In this environment of tempting online commerce and government underwriting, consumers cannot be quelled, but many bricks-and-mortar businesses can be. It will not take long to take large holes out of our communities, to make permanent the staff reductions in our stores and restaurants, unless there is some sort of accommodation of the seclusion – and that doesn’t seem in the cards.

Small business is acutely vulnerable. It bears ridiculous rents and taxes, excessive regulations, a shortage of labour due to unaffordability and global behemoths as competitors. Take two or three months out of their lives and you take out their lives. If governments can’t see, own and act upon their share of the problem and its foundations, they have a death wish on the sector.

Larger businesses, too, are suffering a surfeit of silly impediments to investment, layers of taxes and virtue signalling tolls – hardships in normal

circumstances. Under this new normal, this can’t continue.

As we feed and nurture those in need, action must be taken toward a reset of government’s size and seizure in the postvirus period. This won’t be the last coronavirus.

We are into a period in which the joy of living in a great city is deeply diminished. The head of our province’s restaurant association told me last week he expects one-fifth of the sector to vanish. We need businesses to survive for our post-virus identity as a community; for them to do so, governments have to stop seeing them as an ATM. Think ahead, governments: the geese will not lay the golden eggs for a long time after this ends. Private-sector growth is an oxymoron, but public-sector growth is alive and well. How long can that go on?• Kirk LaPointe is the publisher and editor-in-chief of Business in Vancouver and the vice-president, editorial, of Glacier Media.

| BIV welcomes readers’ opinions. All letters, including those sent by email, must include the author’s name, address and daytime telephone number. Business in Vancouver, 303 West 5th Avenue, Vancouver, B.C. V5Y 1J6. Email: news@biv.com. We reserve the right to edit for brevity, clarity and legality.

14

BUSINESSVANCOUVER March 23–29, 2020

insights

Most Canadians want more say in choosing senators, poll finds

Podium mario canseco

B

efore the entire country became gripped in the fight against the coronavirus, Research Co. asked Canadians about their views of the upper house. Discussions about the Senate of Canada can be extremely toxic, and there has been no shortage of ideas and proposals to make the best of existing statutes.

From 2012 to 2016, the Senate was on the minds of Canadians for the wrong reasons, after the expenses of its members were examined by the auditor general. While the level of attention and dismay from Canadians fell short of what was experienced in the United Kingdom during its parliamentary expenses scandal in 2009, the situation served to harden existing negative perceptions.

The New Democratic Party (NDP) and the Bloc Québécois have had no difficulties arguing for the Senate’s abolition.

The Conservative Party of Canada attempted to make some modifications during the tenure of Stephen Harper. The Liberal Party of Canada, following its victory in the 2015 federal election, chose to switch appointments from the prime minister’s desk to an arm’slength advisory body. Since this modification was enacted, 52 senators have joined the upper house.

Four years have passed since the first arguably non-partisan appointments to the Senate, but Canadians remain unwavering in their wish that, someday, all voters will be able to have a say in the composition of the upper house.

In the survey, only about one in 10 Canadians (9%) says that our country needs a Senate and believes the current guidelines that call for appointed senators should not be modified. Three times as many adults in Canada (27%) think that we do not need a Senate and want all legislation to be reviewed and authorized

by the House of Commons.

This leaves one in five Canadians (20%) who are undecided when asked how they feel about the upper house and the largest proportion (45%) who want Canadians to take an active role in the process to choose senators.

Across both genders and all age groups, more than two in five Canadians yearn for this approach. British Columbians and Albertans, at 52% and 51%, respectively, are more likely to support the notion of a Senate where voters have an opportunity to make a selection.

A second question puts forward different options for the Senate of Canada, and there is some consistency. Across the country, 40% of Canadians want to reform the Senate to allow Canadians to elect the members of the upper house. Just over three in 10 (31%) prefer establishing a selection committee that would appoint non-partisan senators.

Only 10% want to go back to the process we had before Justin Trudeau’s Liberals formed the government – the prime minister making all appointments at his or her discretion.

While the Reform party advanced the cause of a Triple-E Senate (equal, elected and effective) in the last decade of the 20th century, the highest level of support for electing senators is seen now with Canadians who voted for the NDP in the last federal election (52%). Those who cast ballots for the Conservative party (44%) and the Liberal party (35%) in 2019 are less likely to endorse this type of Senate reform.

Since the beginning of his tenure, Prime Minister Trudeau has named only senators who were recommended by an arm’slength advisory body and not directly appointed by himself.

More than a third of Canadians (37%) believe these changes have made the upper house “better than before.” As expected, Liberal voters are more likely to feel this way (58%) than Canadians who voted for the New Democrats (30%) and the Conservatives (20%).

Even after many instances of interrupted efforts to reform the Senate, Canadians are still hopeful for the future, with more than half (54%) expecting that, one day, voters will “definitely”

or “probably” get to elect the members of the upper house.

Longing for the chance to vote for senators at one point is highest in Ontario (57%), British Columbia (56%) and Saskatchewan and Manitoba (also 56%).

The survey shows that, while Canadians are not necessarily enthralled by everything that happens in the upper house, there are still some positive feelings about where things are headed. Just over a third of Canadians think the new process of advisory body recommendations has helped, but a larger proportion wants to vote – and more than half dream of eventually holding a paper ballot bearing the names of candidates to the upper house. • Mario Canseco is the president of Research Co. Results are based on an online study conducted February 22–25, 2020, among 1,000 adults in Canada. The data has been statistically weighted according to Canadian census figures for age, gender and region.

The margin of error, which measures sample variability, is plus or minus 3.1 percentage points, 19 times out of 20.

Court clarifies legal principles in wrongful dismissal claims

n the recent Quach vs.

Mitrux Services Ltd. decision, the BC Court of Appeal clarified three important legal principles in wrongful dismissal claims related to: 1) how employers can modify employment contracts; 2) whether employees on fixed-term contracts are entitled to damages equivalent to the balance of the term if wrongfully dismissed; and 3) when aggravated damages for unfair or bad-faith conduct or emotional upset will be awarded.

Mitrux insisted.

The new month-to-month contract was terminable upon four weeks’ written notice or payment of one month’s salary in lieu of notice. On Quach’s insistence, the month-tomonth contract included a term that said that any failure to comply with the terms of the agreement or misrepresentation by Mitrux would void the entire agreement.

Prior to his start date, Mitrux terminated Quach without cause. Quach sued for damages for wrongful dismissal and sought damages for the full year of unpaid wages. Mitrux argued that the month-tomonth contract governed, and therefore one month’s pay in lieu of notice was appropriate. After losing at BC Supreme Court, Mitrux appealed the decision to the BC Court of Appeal, which made the following findings.

The facts In this case, Tri Quach and Mitrux Services Ltd. signed a one-year, fixed-term contract.

One month later, Mitrux asked Quach to sign a month-tomonth contract in place of the fixed-term contract. At this stage Quach had already left his previous job. Quach initially refused to sign the new contract but ultimately agreed after

Modification of contracts The trial judge found that the month-to-month contract failed for lack of fresh “consideration” for the changes that Mitrux tried to impose.

The Court of Appeal agreed, reaffirming the principle that a modification of a pre‑existing contract will not be enforced unless there is a further benefit to both parties. In this case,

Podium Sarah Blanco

I

Mitrux attempted to replace the first contract with one that was more favourable to Mitrux, and less favourable to Quach.

The second contract purported to provide fresh consideration because Mitrux agreed to waive the “probationary requirement” as set out in the Employment Standards Act. However, the Employment Standards Act establishes a floor of standards, not a requirement that there be a probationary period. There was therefore no consideration at all.

Mitrux also argued that its commitment to pay $1,000 to reimburse the legal fees incurred by Quach in creating the fixed‑term contract was sufficient consideration.

However, the trial judge found that the terms of the second contract had not been settled when Mitrux offered to reimburse Quach $1,000. The Court of Appeal agreed that the evidence on this point was vague.

Aggravated damages The Court of Appeal began by reiterating the test for aggravated damages, which required a finding that Mitrux engaged in conduct during the course of dismissal that was unfair or in bad faith, and a finding that the manner of dismissal caused Quach a serious and prolonged disruption that transcended

ordinary emotional upset or distress.

Mitrux argued that contrary to the finding of the trial judge, the second criteria had not been met. The Court of Appeal agreed. There was no indication that Quach’s feelings of strong dismay and anxiety for himself and his family were beyond the “normal distress and hurt feelings” of job loss that are not compensable. On the contrary, Quach appeared to recover quickly from his loss of the position. He found new employment soon after he learned he would not be starting work with Mitrux.

Are new earnings deductible from damages?

The Court of Appeal then considered the trial judge’s award of damages. The judge made no deduction for post‑dismissal earnings. After reviewing the applicable law in B.C., the court concluded that the fixed‑term nature of a contract did not entitle Quach to damages in the full amount of unpaid wages for the balance of the term without deduction of monies earned elsewhere during the term, absent a contractual provision that says otherwise.

Tips for employers Quach vs. Mitrux Services Ltd.

is a helpful decision that clarifies the law in several key areas.

Employers now have certainty that mitigation will be taken into account in cases involving wrongfully dismissed employees on fixed-term contracts unless the contract provides otherwise. The case also serves as a helpful reminder to employers to: •ensure that a modification to an employee’s contract contains a benefit for the employee; •act fairly and in good faith when dismissing employees and avoid conduct that will cause employees an unnecessary emotional upset; and •note that employees who are dismissed before their start date may still be entitled to wrongful dismissal damages. • While every effort has been made to ensure accuracy in this article, you are urged to seek specific advice on matters of concern and not to rely solely on what is contained herein.

The article is for general information purposes only and does not constitute legal advice.

Sarah Blanco is an associate at Roper Greyell, practising in employment and labour law with a focus on injunctions, wrongful dismissal claims and labour grievances in the workplace.

for the record

BUSINESSVANCOUVER

March 23–29, 2020

15

trouble WHO’S GETTING SUED

Claim US$263,627 for a default judgment in a foreign copyright infringement case.

These corporate claims were filed with the BC Supreme Court registry in Vancouver. Information is derived from notices of civil claim. Civil claims have yet to be proven in court.

Defendant Fraser Valley Parkers Inc. Plaintiff Raiwal Agro Tech Foods Ltd. Claim US$250,831 for blueberries.

Defendants Bird Design-Build Construction Inc. and Fraser Health Authority Plaintiff Shanahan’s LP Claim $2,565,421 for door supply and installation work; a builders lien.

Defendant Trevor Dyck dba Source Forest Products Plaintiff Kootenay Valley Helicopters Ltd. Claim $1,836,354 for debt.

Defendants Frontline Machinery Ltd. and DZ Grinders LLC and Caterpillar Inc. and Finning International Inc. Plaintiff GFL Environmental Inc. Claim $1,718,097 for damages arising from a fire caused by defendants’ defective grinder machine.

Defendants Priority Medical Imaging Ltd. and Syed Haider and Dawn Haider and Joe Coyle and Tarek Helou and Jeffrey Hagel and Karim Ahamed and Hardeep Singh Basi Plaintiff The Toronto-Dominion Bank Claim $1,472,275 for debt.

Defendants Camp Developments Corp. and Aquilini Investment Group Inc. Plaintiff Pitt Meadows Plumbing & Mechanical Systems (2001) Ltd. Claim $392,980 for pre-construction services; a builders lien.

Defendants Envoy Construction Services Ltd. and the Board of Education of School District No. 43 (Coquitlam) Plaintiff Pitt Meadows Plumbing & Mechanical Systems (2001) Ltd. Claim $339,833 for plumbing, heating and ventilation work; a builders lien.

Defendant Quantum Music Works Inc. Plaintiffs Universal Music MGB NA LLC and Casa Ricordi S.R.L.

Defendant Focus Equities Inc. Plaintiff Dead Horse Investments Inc. Claim $250,685 for debt.

Defendant Onni Property Management Services Ltd. Plaintiff National Credit Recovery Services Inc. Claim $190,081 for wireless communications services.

Defendants Brittania Enterprise Inc. dba Britannia Logistics and Fulfillment and Thien Duy Nguyen Plaintiff BCR Properties Ltd. Claim $184,206 for breach of lease.

Defendant MGX Minerals Inc. Plaintiff Michael Frank Claim $135,600 for debt.

Defendants Hayat Tire Ltd. and Gul Hayat Plaintiff Royal Bank of Canada Claim $76,106 for debt.

Defendant Summit Earthworks Inc. Plaintiff Sunbelt Rentals of Canada Inc. Claim $68,320 for rented equipment that defendant failed to secure from theft.

Defendant Chohan Carriers Ltd. Plaintiff Telus Communications Inc. Claim $58,287 for debt.

Defendant East Vancouver Brewing Co. Ltd. Plaintiff Factory Brewing Ltd. Claim $55,841 for debt.

Lawsuit of the week Construction company sues City of Richmond over months of delays at firehall construction project Stuart Olson Construction Ltd. is suing the City of Richmond over months of delays at a firehall construction project that allegedly cost the company more than $900,000 as it waited on design drawings that were changed “numerous” times.

Stuart Olson Construction filed a notice of civil claim in BC Supreme Court on March 6, claiming it inked a deal with the city for construction of a new firehall at 6960 Gilbert Road in March 2016. According to the claim, Hughes Condon Marler Architects (HCMA) “was the architect of record retained by the City for the Project responsible for the overall design and design coordination on behalf of the City”; however, the company is not named as a defendant in the lawsuit.

The project, the company claims, was originally set for completion in August 2017.

“Stuart Olson planned and scheduled its work and the work of its subcontractors so as to meet the original agreed upon project schedule,” the claim states. “However, because of acts, errors, omissions and negligence of the City and its consultants, including HCMA … the Projects completion was delayed to July 2018.”

Stuart Olson claims HCMA “provided a late and deficient, error-filled and incomplete Design and requested numerous changes to the Design, well beyond what was reasonable and could have been contemplated and planned for by Stuart Olson.”

The changes and “cascading delays” pushed the project back months, the construction firm claims, and “impacted the economic and efficient scheduling of the work.”

In December 2019, Stuart Olson gave the city a claims package detailing 192 days of delays, seeking damages under the contract. But the city responded in February 2020 that the company was entitled to damages for only 23 days of “compensable” delays. The company claims it suffered damages of “no less than $909,400.45, arising from Stuart Olson’s increased costs due to delay and the extended project duration.”

Meanwhile, several subcontractors have made claims against the company for increased costs and damages arising from the project changes and delays.

“To date, in breach of the Contract, the City has failed to reimburse, hold harmless and indemnify Stuart Olson for any portion of the Subcontractor Claims,” the lawsuit states.

The construction firm seeks $909,700 in damages for breach of contract and negligence. The allegations have not been tested or proven in court and the City of Richmond had not responded to the claim by press time.

Defendant Vanwest College Ltd. Plaintiff Su Young Kwon aka Cindy Kwon Claim $53,831 for management and consulting services.

Defendants Jago Developments (Westbourne) Inc. and Syncra Construction Corp.

Plaintiff Calvin Mikael Garcia dba Real Amigos Painting Claim $53,762 for painting work.

COLLECT THAT DEBT.

Defendants Kentwood Homes Ltd. and Angus Guan Yuan Fu and Pearle Pui Ying Sin Plaintiff Torque & Hammer Pile Driving Ltd. Claim $40,503 for pile driving work; a builders lien.

Most accounts can be recovered without litigation.

Defendant ITC Residential BC II Inc. Plaintiff Seneca Building Maintenance Ltd. Claim Damages for breach of contract for failure to pay for cleaning work. •

K biv.com For BIV’s People on the Move, Hats Off, Discipline, Buyer’s Alert and Datebook features,

and to view more lawsuits, go online at biv.com.

DON’T WASTE TIME IN COURT—

Trust Canada’s Business Debt Recovery Pros 1 888 797 7727 | MetCredit.com

Get ahead of the pack.

Social • Google • Websites • Programmatic

Glacier Media Digital experts help businesses succeed online.

Contact us for a FREE Digital Audit

ads @b i v.com