Category: Wrongful Dismissal/Termination

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Employment Law Wrongful Dismissal/Termination

Termination: Employer Duties and Employee Rights

photo of several empty work stations representing employers duties upon termination of an employee

Employees have certain legal rights when it comes to their employment relationship. The availability of these rights may exist either at common law or they may be provided for in an employment contract between the employee and the employer. This blog post will focus on providing a high-level review of some of these rights, which apply upon termination of the employment relationship.

The Employment Contract and Notice of Termination

An employment contract is the governing document that outlines the terms of the relationship between an employer and an employee. It can be documented in writing, or it may be oral or implied. Typically, an employment contract sets out details related to job responsibilities, employment duration, work schedule, compensation, and benefits. The employment contract also defines the roles, responsibilities, compensation, and benefits available to the employee. It can also include the obligations of both parties when it comes to terminating the relationship.

Generally, the employee or employer can terminate the relationship at any time without giving cause or notice. Where there is a valid employment contract in place, it may include language that requires the terminating party to provide notice, in which case this obligation is binding. However, the notice required by the employer is subject to the rules of the Employment Standards Act (also referred to as the “ESA”).

The Employment Standards Act

Under the Employment Standards Act, in the event of a dismissal without cause, the employer must give “reasonable” notice or pay in lieu of notice. The amount of notice considered “reasonable” increases with the duration of the employee’s employment, as summarized below:

  • Less than one year – one week before termination,
  • One year or more and fewer than three years – two weeks before termination,
  • Three years or more and fewer than four years – three weeks before termination,
  • Four years or more and fewer than five years – four weeks before termination,
  • Five years or more and fewer than six years – five weeks before termination,
  • Six years or more and fewer than seven years – six weeks before termination,
  • Seven years or more and fewer than eight years – seven weeks before termination, or
  • Eight years or more – at least eight weeks before termination.

What may be considered “reasonable” is also subject to the common law. In the event of termination (and generally, a termination of employment that has lasted more than eight years), the courts will consider factors such as the “character” of the employment, the length of the employment, the age of the terminated employee, and additional circumstances, as the statutory minimum notice requirement may not be sufficient in every case.

However, it is essential to note that employers who have a just cause for dismissal are not required to give notice to the terminating employee. Employees are under no similar obligation unless explicitly required under the employment contract.

Payment in Lieu of Notice

The Employment Standards Act permits the employer to either provide the employee with notice in accordance with the above-outlined timeline or provide payment in lieu of notice. In the latter, the employer will be required to compensate the terminated employee pay and benefits equal to the amount the employee would have earned during the applicable notice period. As previously noted, notice in addition to the minimum notice requirements may also apply if the court finds it appropriate. Nonetheless, whether the employer provides an employee with notice or pay, if the employee seeks to argue that such notice or payment is insufficient, they bear the burden of establishing such.

Probationary and Fixed Term Notices

The notice period differs for employees in a probation period or on a fixed-term contract.

Generally, a probationary employee (i.e., an employee who has been employed for less than three months) is not entitled to notice or pay in lieu of same. However, an employer is not free from legal responsibility when terminating an employee within the probation period. The common law has imposed a duty on the employer to satisfy a three-prong test, showing that:

  1. The probationary employee was given a reasonable opportunity to demonstrate suitability for the job;
  2. The employee was found not suitable for the job; and
  3. The employer’s dismissal decision was based on an honest, fair, and reasonable assessment.

A fixed-term employee is also not entitled to notice or pay due to the nature of the fixed-term contract. Under such employment contracts, the employee is aware that the employment relationship has an end date and neither party has a duty to renew the contract. The caveat here is that, if the employer chooses to terminate the employee during the contract, the employee would be entitled to the compensation they would have earned unless the contract stipulates differently.

“Just Cause” Termination

An employer has the right to terminate the employment relationship for “just cause” which means they are not required to provide notice or pay. However, the conduct necessary to meet this standard is governed by the common law. An example of conduct resulting in “just cause” can include severe misconduct and incompetence. In such an assessment, the employer will be responsible for demonstrating that it provided reasonable, objective standards for the employee to meet, the employee failed to meet these standards, the employer had previously warned the employee of their failure, and the employee was provided with the opportunity to correct their incompetence.

Contact the Employment Lawyers at Bader Law to Help Resolve Employment Contract Disputes

The trusted employment lawyers at Bader Law help demystify employment laws for employees and empower them with the necessary knowledge to enforce their rights at various stages throughout the employment relationship. Our team helps simplify the law in order to provide clients with a comprehensive understanding of their options in order to help them make informed decisions in the event of a dispute. Our lawyers regularly advise employees on discrimination matters, accommodation of disability and illness, harassment in the workplace, wrongful dismissal, and severance packages. Call us at 289-652-9092 or contact us online to schedule a consultation with our experienced employment law team member.

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Employment Law Wrongful Dismissal/Termination

Court Finds Employee was Constructively Dismissed

When terminating employees who hold a long tenure of employment, the consequences of wrongful or constructive dismissal can be significant. Therefore, employers must be careful when altering the employment contracts or, or terminating, long-term employees.

In a recent case before the Ontario Superior Court of Justice, the Court was tasked with weighing in on a dispute where an employee and employer were unable to agree on whether the employee had actually been terminated.

Employee’s hours drastically reduced after nearly three decades of full-time employment

In Miranda v. Respiratory Services Limited, the plaintiff employee commenced a wrongful dismissal claim against the defendant employer. The employee had been employed by the employer for 35 years between 1982 to 2018 as an office administrator. Her duties involved standard reception and administrative tasks at her employer’s offer, who provided respirology medical services. However, the employment relationship was not codified in a written employment contract.

Eventually, the employer’s shareholders entered into a Share Purchase Agreement, after which a new doctor, Dr. Sharma, was hired. Dr. Sharma subsequently hired his own staff who took over some of the employee’s duties. At the same time, the doctor who the employed worked for, Dr. Lilker, reduced his hours, reducing the employee’s working hours from five days per week to three days per week. Over the next five years, the employee’s hours started to vary and she experienced fluctuations in her income. Dr. Lilker paid portions of the employee’s salary which became a source of tension with Dr. Sharma.

Direct employer passed away and new employer sought to alter the employment arrangement

In February 2018, after a period of vacation, Dr. Lilker passed away. The employee was originally supposed to return to work after Dr. Lilker’s vacation concluded, however, she was suddenly informed of Dr. Lilker’s passing by his family. In March 2018, Dr. Sharma requested to meet with the employee.

According to the employee, she was told that since Dr. Lilker’s passing, there was no more work available to her, however Dr. Sharma offered to reduce her working hours to one or two days per week. Additionally, her wages would be reduced from $34.00 per hour to $23.00 an hour. Dr. Sharma allegedly urged the employee to apply for employment insurance benefits to help offset the difference in her income.

Dr. Sharma claimed that the employee did not offer to return to work after Dr. Lilker’s passing, and allegedly requested a record of employment so that she could apply for employment insurance benefits. Dr. Sharma instructed another employee to prepare the record of employment referencing a “shortage of work” as the reason.

The employee struggled to find new employment

Dr. Sharma, along with other employees, maintained that there was some work available for the employee on odd days but she simply refused to work. The employee wrote to Dr. Sharma that “[o]ffering work on random days does not amount to honouring my prior terms and conditions of employment.” Dr. Sharma replied stating that “We can only call you if there is a doctor or the patients. If there are no patients what are you going to do?”

After her termination, the employee began to seek new employment for the first time in over 35 years. At 58 years old, with only one employer on her resume and limited computer skills, this proved to be difficult. The employee documented her job search efforts to find new employment over two years which spanned over 163 pages. She was only able to secure three interviews, but at the time of the hearing, had not yet been successful in finding new employment.

The employee’s statement of claim alleged that she had been constructively dismissed

The employee took the position that she had been constructively dismissed. This belief was prompted by the employer “unilaterally placing her on a layoff and telling her that [it] no longer had any work for her.” The employer claimed that the employee had never been terminated.

The Court confirmed that constructive dismissal occurred when “an employer decides unilaterally to make substantial changes to the essential terms of an employee’s contract of employment and the employee does not agree to the changes and leaves their job.” The employee is not considered to have resigned because the employer is no longer meeting its obligations. In these circumstances, the employee will be compensated in lieu of notice.

There are two types of constructive dismissal. The first type occurs when a single act breaches or alters an essential employment contract term. Alternatively, it may occur when there have been a series of actions taken by the employer which demonstrate that the employer no longer seeks to be bound by the contract.

Court found that the employer had breached essential terms of the employment contract

In reviewing the facts, the Court preferred the employee’s evidence over that of the employer. Although the employer maintained that the employee had not been terminated even after attempting to call the employee back to work in late March 2018, the emails sent from the employer to the employee contradicted this assertion. For example, the employer told the employee the following:

a.      “We can only call you if there is a doctor or the patients.  If there are no patients what are you going to do?”

b.      “There is work again next week on Wednesday and for 7th time we will ask you to come to work.”

There was no indication by the employer that the employee would have an ongoing position with consistent hours after being laid off in early March 2020. Previously, when the employee had taken unpaid leave, there was an understanding of what day she would return to work and these times were not considered formal layoffs. Moreover, on her return, there were no changes to usual employment.

As such, the Court found that the breach by the employer constituted a substantial breach of the employment contract. In the Court’s view, “a reasonable person in the same situation as [the employee] would have felt that the essential terms of her employment contract were being substantially changed.” As such, the Court held that the employee was constructively dismissed.

The employee was owed compensation in lieu notice

Given the employee’s age, length of service with the employer, and the fact that she had only one job on her resume, the Court held that the appropriate notice period was 22 months. The Court therefore calculated that the damages owed to the employee amounted to $67,271.38.

Contact the Employment Lawyers at Bader Law in Managing Terminated Employees

The trusted employment lawyers at Bader Law help demystify employment and human rights laws for businesses and employers. Our team helps simplify the law in an effort to help clients understand their options and make informed decisions with respect to employee terminations. Our employment lawyers regularly advise clients on discrimination, accommodation of disability and illness, harassment, wrongful dismissal, severance packages, and more. To schedule a consultation with a member of our experienced employment law team, call us at 289-652-9092 or contact us online.

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Wrongful Dismissal/Termination

Employer to Pay Additional Damages in Wrongful Dismissal

It is always essential for employers to ensure they are terminating employees within the requirements set out by law. It is worth it to carry out a termination in good faith because it can cost the company later on.

The employee was terminated after a lifelong career with the employer

Pohl v. Hudson’s Bay Company involves an employee, Mr. Pohl, who had been employed at the Hudson’s Bay Company for 28 years. For his final eight years with the company, he worked as a Sales Manager of eight different departments.

In September 2020, his employment was terminated without cause. In the aftermath of his termination, his supervisor escorted him out the door of the establishment. Mr. Pohl sued Hudson’s Bay Company for wrongful dismissal.

The employer did not provide the employee with appropriate notice

In response to the allegation of wrongful termination, Hudson’s Bay Company stated that it had offered Mr. Pohl a “voluntary separation package”. Even though Mr. Pohl did not accept this package, the company argued that it had done its duty to provide notice by offering it. The voluntary separation package included 40 weeks’ pay in lieu of notice and offered Mr. Pohl the minimum entitlements under the Employment Standards Act.

While the employer maintained that the severance package complied with the minimum standards in the province, the Ontario Superior Court of Justice found that it had not. In its legal arguments, Hudson’s Bay Company had not produced any precedent where 40 weeks was deemed reasonable. In its own factum, it asserted that 14 to 18 months was reasonable – far more than what was offered to Mr. Pohl in the voluntary separation package.

“Bardal factors” applied to determine the amount of reasonable notice

The Court assessed the factors set out in the leading case of Bardal v. Globe & Mail Ltd. to determine the proper amount of notice to which Mr. Pohl should have been entitled. These factors are:

  1. length of employment;
  2. character of employment;
  3. age of the employee; and
  4. availability of similar employment having regard to the experience, training and qualifications of the employee.

The employee should have received 24 months’ pay in lieu of notice

Because Mr. Pohl had worked for Hudson’s Bay Company for his entire life, the first factor weighed in favour of a longer notice period. He was also in a senior supervisory position and had significant responsibilities. The Court noted Mr. Pohl’s age, 53 years old, which was not at the end of his working career but was approaching it.

Finally, while Mr. Pohl did not perform a specialized role, he did obtain all of his experience from Hudson’s Bay Company. Although there were similar employment opportunities in his region, he was unsuccessful in all 136 job openings to which he had applied. The Court noted the impact of the COVID-19 pandemic on his efforts due to the economic downturn. As these facts also weighed in favour of a longer notice period, the Court determined that the reasonable notice period Mr. Pohl was entitled to was 24 months.

The employer provided evidence in attempt to reduce the reasonable notice period

Hudson’s Bay Company alleged that Mr. Pohl failed to mitigate his damages after termination. Generally, employees should try to find new employment as soon as possible after being wrongfully dismissed. If they have not done so, it can result in a reduction in the reasonable notice period. This is because employees cannot obtain relief for losses they could have avoided.

Employers must have evidence to support an allegation that an employee failed to mitigate their damages. Based on its evidence, Hudson’s Bay Company sought a reduction of Mr. Pohl’s notice period of six to 10 months.

The employer offered alternative employment

The employer claimed it had offered Mr. Pohl an associate lead position when he was terminated. Because he did not take that offer, Hudson’s Bay Company claimed Mr. Pohl “completely failed to mitigate his losses.”

However, the Court rejected this position. It found that Mr. Pohl had essentially been asked to resign his position to one that paid him significantly less, including fewer benefits and no guaranteed hours of work per week. Additionally, the associate lead position allowed the employer to terminate him anytime without cause. The Court found that no reasonable person would have accepted the employer’s offer, so this evidence did not meet the burden to prove Mr. Pohl failed to mitigate his damages.

The employee did not apply to a specific job suggested by the employer

Hudson’s Bay Company’s second piece of evidence was that he should have applied to his previous role before he was terminated. The Court noted that Mr. Pohl had not worked in this alternate position suggested by the employer. It was entirely different than any job Mr. Pohl had held previously. He was also not qualified for the job. Therefore, this piece of evidence was also not accepted by the Court.

The employee did not make enough effort to get another job

The employer was dissatisfied with the number of positions for which Mr. Pohl had applied. It claimed he had applied to only 23% of the job positions it had sent to him, even though many of the ones it listed were duplicates or were incomparable positions. It was also critical that of the job postings he had applied to, he had only been able to secure nine interviews.

The Court pointed out that the matter of securing interviews was outside of Mr. Pohl’s control. It also acknowledged that Mr. Pohl had been struggling with depression, anxiety, feelings of humiliation and diminished self-worth after his termination. This delayed his ability to apply for jobs until February 2021, six months later. He took steps to improve his mental health, seeing a doctor and completing online counselling.

In light of how his mental health affected his ability to job search and the fact that Mr. Pohl remained unemployed at the time of this summary judgment, the Court found that Mr. Pohl did not fail to mitigate his losses in the period after his termination.

The employer had to pay additional moral and punitive damages for its conduct in terminating the employee

The Court ruled that Mr. Pohl was entitled to 24 months’ salary in lieu of reasonable notice for the termination of his employment. It also found that Hudson’s Bay Company had breached its employment contract with Mr. Pohl between April to June 2020 by unilaterally reducing his wages by 25% with no change to his hours of work. However, because Mr. Pohl continued to work for the employer throughout the period of reduced wages and thereafter, he effectively condoned it and was not entitled to compensation for this reduction.

The Court found that the manner in which Hudson’s Bay Company treated Mr. Pohl in the aftermath of his termination warranted the award of additional damages. Not only had Mr. Pohl been escorted off of the property, but the company had also offered him a position that would allow him to be fired without cause in the future. It also failed to pay Mr. Pohl wages owed within the time period prescribed by the Employment Standards Act. Further, Hudson’s Bay Company did not provide Mr. Pohl with his Record of Employment within the required time, and the copies that were sent contained errors.

The Court found that the employer’s conduct had been “untruthful, misleading, and unduly insensitive”. As Hudson’s Bay Company had not terminated Mr. Pohl’s employment in good faith, their actions could reasonably be contemplated to have caused Mr. Pohl’s mental distress. For this reason, the Court awarded Mr. Pohl an additional $45,000 in moral damages and $10,000 in punitive damages.

Consult with the Employment Lawyers at Bader Law for Your Wrongful Dismissal Dispute

The trusted employment lawyers at Bader Law help demystify employment and human rights laws for businesses and employers. Our team helps simplify the law to help clients understand their options and make informed decisions. Our lawyers regularly advise clients on discrimination, accommodation of disability and illness, harassment, wrongful dismissal, severance packages, and more. Call us at 289-652-9092 or contact us online to schedule a consultation with a member of our experienced employment law team.

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Employment Law Wrongful Dismissal/Termination

Court Reminds Employers They Can’t Contract Out of Employment Standards Act

Employers must remember that any employment contract must comply with statutory standards and those set out in court decisions. When a clause of an employment agreement does not comply with these required standards, the agreement can be deemed invalid in its entirety. If that is the case, an employee dismissed within the terms of the employment contract may be found to have been wrongfully dismissed.

Employers’ retirement plan was to sell off their practice

In a recent case before the Ontario Superior Court of Justice, Henderson v. Slavkin et al, the employers hired the employee as the receptionist of their oral surgery dental offices. The employers were two oral surgeons who opened the practice together in the 1970s. The employee was hired in April 1990 and was terminated in April 2020. At the time of termination, the employers provided the employee with a reference letter.

As oral surgeons, the employers were reliant on referrals to generate business. Most clients of oral surgeons do not require regular checkups or appointments. Often, their clients would see them once or a few times before the relationship was effectively complete. Because of the reliance on referrals to generate business, selling an oral surgeon’s practice is generally more challenging than a family dentistry practice, where clients can be passed on with the business.

In 2015, the employers began to think about retirement. They hoped to sell the oral surgery dental offices to another oral surgeon. In anticipation of this, the employers prepared employment contracts to help their employees better understand what could happen with their upcoming retirements.

New employment agreement allowed for termination without cause

Accompanying the new employment contract was a letter explaining the new employment policies. The employees were offered $500.00 to sign the agreement. If they chose not to sign it, they would be terminated. Clause 13 of the new employment agreement provided:

13. Your employment may be terminated without cause for any reason upon the provision of notice equal to the minimum notice or pay in lieu of notice and any other benefits required to be paid under the terms of the Employment Standards Act, if any. By signing below, you agree that upon receipt of your entitlement under the Employment Standards Act, no further amount shall be due and payable to you, whether under the Employment Standards Act, any other statute or common law.

After two days, the employee signed the agreement and continued to work for the employers. In January 2019, the employers closed their office in the Greater Toronto Area. By February 2019, the hours of operation at their Bolton location were reduced to two and a half days per week.

Was the employee wrongfully dismissed?

One of the employer surgeons was set to retire in August 2019. In need of a plan, they had a meeting in which they determined that it was not possible to sell off the practice. In November 2019, all employees were brought together and informed that their employment would be terminated with the final employer’s retirement in April 2020. The employee at issue in this litigation was terminated just after the start of the COVID-19 pandemic.

Before the Ontario Superior Court of Justice, one of the main issues was whether the employee’s termination constituted a wrongful dismissal. Specifically, the Court examined if the termination clause (clause 13) was unenforceable and unconscionable. The Court also considered Clauses 18 and 19, which named conflicts of interest and confidential information as the bases for dismissal for cause. 

Principles for the enforceability of a termination clause

In commencing its analysis, the Court considered the principles set out in Wood v. Fred Deeley Imports Ltd. The Ontario Court of Appeal in Wood described the principles to consider when determining the enforceability of a termination clause:

  1. Employees have less bargaining power than employers when employment agreements are made;
  2. Employees are likely unfamiliar with employment standards in the Employment Standards Act and thus are unlikely to challenge termination clauses;
  3. The Employment Standards Act is remedial legislation. As such, courts should favour interpretations of the Act that encourage employers to comply with the minimum requirements of the Act and extend its protection to employees;
  4. The Employment Standards Act should be interpreted in a way that encourages employers to draft agreements which comply with the Act;
  5. A termination clause will rebut the presumption of reasonable notice only if its wording is clear. Employees are entitled to know at the beginning of an employment relationship what they are entitled to at the end of their employment; and
  6. Courts should prefer an interpretation of the termination clause that benefits the employee more.

Additionally, the Court acknowledged that any employment agreement that does not comply with the Employment Standards Act is invalid.

The termination clause complied with employment standards in Ontario

In the trial of the Henderson case before the Ontario Superior Court, the employee argued that Clause 13 of her contract, in particular, was unclear. She submitted that the clause did not provide for the payment of severance pay as required by the Employment Standards Act. It also did not explain the payment of vacation pay within the notice period set out in the Act.

Additionally, the employee stated that Clause 13 was unenforceable because employees cannot contract out of the protected standards in the Employment Standards Act. 

However, the Court disagreed with the employee that there was any inconsistency between the termination clause (Clause 13) and the Employment Standards Act. It found no ambiguity in the clause concerning severance or vacation pay during the notice period. On the contrary, the wording of the clause demonstrated compliance with the employment standards, so it was therefore ruled to comply with the Employment Standards Act.

Other clauses in the contract were unduly broad and vague

Although the termination clause was valid and compliant with the Employment Standards Act, further clauses were not. Clause 18 of the employment contract pertained to conflicts of interest. It held that a failure to comply with the terms constituted a breach of the agreement and cause for termination without notice or compensation in lieu of notice.

However, on analyzing the text of that clause, the Court found it to be overly broad and ambiguous. It appeared certain words were missing from a term within the clause, which the employee could not reasonably imply on her own.

Similarly, Clause 19 of the employment contract about confidential information was invalid. This clause also provided that a breach would justify termination without notice or compensation in lieu of notice. This clause was also found to lack clarity. There was no specific guidance provided for which circumstances of disclosure of confidential information would not be a breach of the term. The clause also did not leave room for inadvertent disclosures or where there was a trivial breach.

Non-compliant causes rendered the entire contract void

The Court ruled that the employee was wrongfully dismissed. Although Clause 13 was compliant with the Employment Standards Act, Clauses 18 and 19 were not. Therefore, the employment contract, as a whole, was invalid.

Bader Law Advises Mississauga Employers on Employment Contracts & Termination

The knowledgeable employment lawyers at Bader Law provide robust, pragmatic advice to employers in Mississauga and the surrounding areas. We help draft effective employment contracts and review existing agreements to ensure our client’s risk is reduced. To schedule a consultation with a member of our employment law team, please call 289-652-9092 or reach out online.

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Wrongful Dismissal/Termination

Court of Appeal Rules in Favour of Employee Wrongfully Dismissed Over Blog

In a recent British Columbia Court of Appeal decision, the court upheld a finding that an articling student had been wrongfully dismissed over the contents of a blog and increased her general damages award to $100,000. 

Law School Graduate Hired by Employer Law Firm

The employee was hired as an articling student at the employer’s law firm after she completed law school in 2016. In order to qualify to become a lawyer, law school graduates must complete their “articles”, which is a form of internship, with an accredited lawyer or law firm. In British Columbia, articling students must complete an articling period of 12 months, only interrupted by a ten-week Professional Legal Training Course (“PLTC”).

The employee commenced her articling with the employer on May 24, 2016. The law firm specialized in “driving law,” which included defending criminal and regulatory offences while driving, reviewing driving prohibitions, conducting judicial review applications arising from decisions of the superintendent of motor vehicles, and defending traffic tickets.

On August 2, 2016, the founding lawyer of the law firm texted the employee and a fellow articled student, advising them of his desire to employ them both following completion of their articles.

Employee Fired Over Blog Posts

However, soon after, the founding lawyer found a website called “B.C. Driving Prohibitions Blog”, that had been started in 2016. It offered information of interest to persons facing a driving prohibition and included similar information from the law firm’s own website, which was intended for marketing purposes. The lawyer believed the blog threatened his law firm’s competitive position and that the employee was behind it.

On September 16, the employee was fired from her articling job, even though she denied writing the blog herself. She admitted that it was her husband’s blog, but denied giving him permission to create it. She claimed she had asked him to take down the website, but he had refused.

Trial Judge Finds the Employee Was Wrongfully Dismissed

The employer subsequently filed a civil claim against the employee for breach of contract, theft, trespass, and wrongful use of materials. 

In turn, the employee commenced a claim for wrongful dismissal.

At trial, the judge ultimately dismissed the employer’s claims, finding that, while the articles posted on the blog were similar to articles posted by the employer, they were not identical. He further found that the blog did not infringe on copyright, nor did it disclose private information that the employer had not made public. Finally, he held that the blog did not disclose client confidences and could have been written by anyone making use of information in the public domain. Regarding the allegation that the employee was attempting to compete with the employer, the judge observed that the employee had not completed PLTC, obtained alternate articles, or worked for a law firm since, and was hardly in a position to compete with the firm.

The judge did allow the employee’s wrongful dismissal claim, awarding $18,934 in general damages and $50,000 in aggravated damages, finding the employer’s actions unfair and undertaken in bad faith. 

Both parties appealed to the Court of Appeal. The employer challenged the trial judge’s conclusion that the employee was wrongfully dismissed. The employee cross-appealed, seeking damages in the amount of $161,650 for breach of contract and $110,000 in punitive damages for the loss of opportunity to become a lawyer.

Court of Appeal Increases Employee’s Damages 

At the outset, the court found no error with the trial judge’s determination that the employee had been wrongfully dismissed and rejected the employer’s appeal.

Turning to the employee’s claim for higher general damages, the court stated: 

“[T]he judge failed to award her damages based on the loss of opportunity to become a lawyer at the end of the articling period. He did so on the basis that there was no evidence that would enable him to value the potential increase in [the employee]’s income-earning capacity as a lawyer. He found such an award to be speculative. 

With respect, I do not agree. The trial judge’s failure to award damages for loss of opportunity was an error in principle. The law has long recognized that the fact that damages cannot be assessed with certainty does not relieve the wrongdoer of the necessity of paying damages for a breach of contract….

What [the employee] lost as a result of her wrongful termination was the opportunity to become a lawyer at the end of the articling period.”

As such, the court increased the employee’s award for general damages to $100,000.

The court also awarded the employee $25,000 in punitive damages, finding the employer’s conduct to have been “high-handed, malicious, arbitrary or highly reprehensible misconduct that departs to a marked degree from ordinary standards of decent behaviour.” 

Get Help

At Bader Law, we are proud of the relationships we build with the clients we help. Our goal is to demystify the law, provide clarity about what you can expect, and always be available to answer questions as the matter moves forward.

We seek to resolve disputes between employees and their employers quickly, efficiently, and without the need to resort to lengthy litigation. We will negotiate with your employer and attempt a resolution outside of court or another adjudicative body.

However, where needed, we do successfully represent clients in litigation at all levels of court and before various tribunals, including the Human Rights Tribunal of Ontario, the Canadian Human Rights Tribunal, and the Workplace Safety and Insurance Appeals Tribunal.

At Bader Law, our knowledgeable employment lawyers can counsel you on your rights, advise you on your options, and help you create a plan for moving forward. We represent employees in Mississauga and areas west of Toronto. Contact us online or at (289) 652-9092 to learn how we can help.

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Court Considers COVID-19 Pandemic and CERB Benefits in Determining Reasonable Notice in Wrongful Dismissal Case

Earlier this year, we wrote about a case in which a terminated employee argued that he should be entitled to the maximum allowable notice period, based in part on the difficulties he faced in finding new employment due to the COVID-19 pandemic. On the issue, the court stated:

“It seems clear terminations which occurred before the COVID pandemic and its effect on employment opportunities should not attract the same consideration as termination after the beginning of the COVID pandemic and its negative effect on finding comparable employment.”

More recently, in another Ontario case, the court ruled that a terminated employee was entitled to a longer notice period as a result of the COVID-19 pandemic. 

Employee Terminated During COVID-19 Pandemic

The employee started working for the employer, a human resources company, in November 2017 as a business development manager. His position was in sales and involved working largely from home or on the road selling the various human resources and health and safety compliance services offered by the employer to clients.  

As a sales position, the employee’s compensation was commission-based. He received a base salary of $60,000 per year, but his compensation for the last full year of his employment in 2019 was $145,186. 

The employee was terminated without cause on March 25, 2020. He was then 56 years of age. He was thus employed for a few days shy of 28 months in total. 

Upon his termination, the employee was paid four weeks of base salary plus all benefits accruing during that four-week period, but did not receive any amount in respect of commissions following his termination. The employer claimed that he had neither earned nor become entitled to any commissions following the termination of his employment.  

The employee secured alternative employment starting October 19, 2020, approximately seven months following his termination with the employer. 

The employee brought a motion for summary judgment for wrongful dismissal against the employer.

The court was tasked with making determinations on the following two main issues:

  • The period of reasonable notice to be applied to the termination of the employee’s employment; and
  • The commissions to which the employee was entitled following termination.

Court Rules in Favour of Employee

On the first issue, the employee submitted that he was entitled to receive at least six months notice of the termination of his employment, while the employer submitted that reasonable notice should be in the range of two to three months. 

In its evaluation, the court stated:

“I was asked to make findings about the job market and the possible impact of Covid-19 on [the employee]. I have little doubt that the pandemic has had some influence upon [the employee’s] job search and would have been reasonably expected to do so at the time his employment was terminated in late March 2020. However, it must also be borne in mind that the impact of the pandemic on the economy in general and on the job market, in particular, was highly speculative and uncertain both as to degree and to duration at the time [the employee’s] employment was terminated. The principle of reasonable notice is not a guaranteed bridge to alternative employment in all cases however long it may take even if an assessment of the time reasonably anticipated to be necessary to secure alternative employment is a significant factor in its determination. I must be alert to the dangers of applying hindsight to the measuring of reasonable notice at the time when the decision was made to part ways with the [employee].”

The court then considered the issue of mitigation, by which an employee who has lost their job has an obligation to take reasonable steps to find new, comparable employment to replace their lost job. The court further explained that while reasonable notice is assessed at the time the decision is made, mitigation is assessed in light of the actual efforts of the employee in the actual circumstances he then faced. 

In the present case, the employer asked the court to take into account the Canada Emergency Response Benefit (“CERB”) payments received by the employee during the applicable notice period.  

The court stated: 

“I agree with the [employer] that CERB cannot be considered in precisely the same light as Employment Insurance benefits when it comes to calculating damages for wrongful dismissal. CERB was an ad hoc programme and neither employer nor employee can be said to have paid into the program or “earned” an entitlement over time beyond their general status as taxpayers of Canada. The level of benefit paid (approximately $2,000 per month) was considerably below the base salary previously earned by the [employee] to say nothing of his lost commission income. On balance and on these facts, I am of the view that it would not be equitable to reduce [the employee’s] entitlements to damages from his former employer by the amount of CERB given his limited entitlements from the employer post-termination relative to his actual pre-termination earnings. I decline to do so.” 

The court also took into consideration the employee’s age and the uncertainties in the job market at the time of his termination. 

Having regard to all of the relevant factors, the court held that three months notice represented a reasonable balancing of the relative brevity of the employee’s service, a consideration of his age and a consideration of his prospects. 

As a result, the court concluded that the employee was entitled to receive payment equivalent to the earnings and the value of the benefits that he would have earned had he been given the three month’s working notice, without offset or deduction for CERB payments received. 

Finally, on the second issue, the court held that the employee was entitled to receive damages in the amount equal to the commissions on prior sales that would have accrued in respect of prior sales during the three months of working notice that he was entitled to. 

Get Help

If you have been terminated, you may be tempted to simply sign the severance package you have been provided with so that you can sever ties with your former employer and begin to move forward. While this may seem enticing, it is not the best course of action. Most employees do not realize how much they are entitled to upon termination and, without obtaining knowledgeable advice, often end up accepting significantly less than they should receive.

If you have been fired, one of the first phone calls you should make is to a wrongful dismissal lawyer. The highly experienced Mississauga employment lawyers at Bader Law have been advising employees on termination, severance packages, and wrongful dismissal for several years. We can review any termination letter or package you have been provided with, negotiate with your employer on your behalf, and file a wrongful dismissal claim where necessary. With our lawyers on your side, you can ensure you are getting the maximum amount that you are entitled to.

Contact a knowledgeable employment lawyer as soon as possible. At Bader Law, our lawyers will counsel you on your rights, advise you on your options, help you create a plan for moving forward, and secure fair compensation for the wrongful termination of your employment. Contact us online or at (289) 652-9092 to learn how we can help.

Categories
Employment Law Severance Package Reviews Wrongful Dismissal/Termination

SCC Awards Bonus Payment to Employee After Constructive Dismissal

In a recent Supreme Court of Canada decision, the court awarded a constructively dismissed employee a $1.1 million bonus he would have been entitled to during his reasonable notice period.

Constructively Dismissed Employee Claims Bonus

Beginning in 1997, the employee occupied several senior management positions with the employer, a nutritional supplement company. As a senior executive, the employee was part of the employer’s long term incentive plan (“LTIP”), a contractual arrangement designed to reward employees for their previous contributions and to provide an incentive to continue contributing to the company’s success. 

Under the LTIP, a “Realization Event”, such as the sale of the company, would trigger payments to employees who qualified under the plan.

In 2007, the employer hired a new Chief Operating Officer, who began a campaign to marginalize the employee within the company, limiting his responsibilities and lying to him about his status and prospects with the employer. Despite the employee’s problems with senior management, he stayed with the employer, anticipating that it would soon be sold at which point he would receive the LTIP payout. However, the employee eventually left the employer in June 2011, taking another job.

About 13 months after the employee’s departure, the company was sold for $540 million. The sale constituted a Realization Event for the purposes of the LTIP. 

However, because the employee was no longer actively employed on that date, the employer took the position that he did not satisfy the terms of the LTIP, and refused to issue payment to the employee.

Consequently, the employee brought a claim against the employer alleging that he had been constructively dismissed, and that the constructive dismissal was carried out in bad faith and in breach of the employer’s duty of good faith.

At trial, the judge concluded that the employer had constructively dismissed the employee and that he was owed a reasonable notice period of 15 months. The trial judge also held that the employee would have been a full‑time employee when the Realization Event occurred had he not been constructively dismissed, and that, because the terms of the LTIP did not unambiguously limit or remove his common law right to damages, the employee was entitled to damages equivalent to what he would have received under the LTIP. 

As a result, the trial judge found that the employee was entitled to receive approximately $1.1 million under the LTIP. The employer appealed the decision.

On appeal, the Nova Scotia Court of Appeal unanimously upheld the decision that the employee had been constructively dismissed and that the appropriate reasonable notice period was 15 months. However, a majority of the court found that the employee was not entitled to damages on account of the lost LTIP payment and should therefore not receive the $1.1 million bonus. The employee appealed the decision to the Supreme Court of Canada.

Supreme Court of Canada Identifies Two-Step Test

The court began by explaining that, at common law, an employer has the right to prompt an employee to choose to leave their job in circumstances that amount to a dismissal subject to the duty to provide reasonable notice. Where the employer does not provide reasonable notice, the employee becomes entitled to an award of damages in lieu thereof. The court further explained that when an employee sues for damages for constructive dismissal, they are claiming for damages as compensation for the income, benefits, and bonuses they would have received had the employer not breached the implied term to provide reasonable notice. Damages for wrongful dismissal are designed to compensate the employee for the breach by the employer of the implied term in the employment contract to provide reasonable notice of termination.

It then stated that a court must ask two questions when assessing whether the appropriate quantum of damages for breach of an implied term to provide reasonable notice includes bonus payments:

  1. Pursuant to the employee’s common law rights, would the employee have been entitled to the bonus or benefit as part of their compensation during the reasonable notice period but for the termination? and
  2.  If the answer to the first question is yes, did the terms of the employment contract or bonus plan unambiguously take away or limit that common law right?

On the first step, the court found that, since the Realization Event was triggered within the 15-month reasonable notice period, the employee was prima facie entitled to damages for the lost LTIP payment as part of his common law damages.

On the second step, the court found that the LTIP did not unambiguously limit or remove the employee’s common law right to the bonus payment.

The court therefore concluded that, had the employee been given proper notice, he would have been full‑time or actively employed throughout the reasonable notice period.

As a result, the court found that the employee should be awarded the amount of the LTIP as part of his common law damages for breach of the implied term to provide reasonable notice and allowed the appeal to restore the trial judge’s determination. The employee was therefore entitled to the $1.1 million bonus.

Get Advice on Employment Contract Terms and Payouts Upon Dismissal

The business and employment law lawyers at Bader Law have several years of experience advising employees and employers on employment law matters, including contracts and termination pay. We are thorough, efficient, and focused on delivering the best possible outcome for every single client. Contact us online or at (289) 652-9092 to discuss your matter with a member of our team. 

Categories
Wrongful Dismissal/Termination

Court Rules Termination Provision Unenforceable for Potential Violation of Employment Standards

In a recent Ontario decision, the court found that a termination provision in an employment contract was unenforceable for its potential violation of employment standards legislation. 

What Happened?

The employee was a construction employee working in the construction industry. He was first employed by the employer in 2012, and was laid off from time to time. 

On November 10, 2015, he signed an employment agreement with the employer. 

The employee was later placed on temporary layoff on October 10, 2017. The employee was not recalled to work and, in December 2017, he found alternate employment. No notice of this lay-off was given, nor did he receive any pay in lieu of notice from the employer. 

In June 2018, the employee commenced an action in the Small Claims Court seeking damages for wrongful dismissal. 

The employer claimed that the employment contract absolved it from any requirement to give any notice of the lay-off, or pay in lieu of notice. It also relied on the fact that as a construction employee, the employer had no obligation under the Employment Standards Act (“ESA”) to give notice or termination pay in lieu thereof. 

The Employment Contract

The relevant provision at issue under the employment contract stated:

Termination of Employment

…..

The Employee may be terminated at any time without cause upon being given the minimum periods of notice as set out in the Employment Standards Act, or by being paid salary in lieu of such notice or as may otherwise be required by applicable legislation. The Employee acknowledges that pursuant to the Employment Standards Act they are not entitled to any notice or time in lieu thereof due to the nature of their job and as such they are entitle[d] to absolutely no notice or pay and benefits in lieu thereof upon termination. 

The termination provisions set for[th] above, represent all severance pay entitlement, notice of termination or termination in lieu thereof, salary, bonuses, vacation pay and other remuneration and benefits payable or otherwise provided to the Employee in relation to the termination of the Employee regardless of cause or circumstances. 

Lower Court Decision

The Deputy Judge granted judgment in favour of the employee, awarding him damages equivalent to 9.5 weeks’ salary, which was equal to $9,530.

The Deputy Judge agreed with the employee’s submissions that the termination clause of the employment contract was void because it purported to contract out of the obligation under s. 60(1)(c) of the ESA to pay benefits during the statutory notice period and the presumption of reasonable notice was not rebutted by the employment contract. 

The employer appealed. 

Issues on Appeal

The employer claimed that the Deputy Judge erred by determining that it had purported to contract out of the obligations under s. 60(1) the ESA to pay benefits during the statutory notice period despite the fact that the employee was a statutory “construction employee” and not entitled to statutory notice under the ESA.  

Appeal Decision

The court began by explaining that the common law principle of termination of employment on reasonable notice is a presumption, rebuttable only if a contract of employment clearly specifies some other period of notice. Additionally, a contract of employment is only enforceable if it complies with the minimum employment standards in the ESA. As a result, if it does not do so, then the presumption is not rebutted, and the employee is entitled to reasonable notice of termination.

However, the court also noted that some types of employees are not protected by the ESA, including those “prescribed individuals” under s. 3(5)12 of the ESA.  Nonetheless, if an employee has two or more roles in their employment, and only one of these roles is not protected by the ESA, they will continue to be protected with respect to that other role as per s. 3(6) ESA. The court acknowledged that the employee fell within the definition of a prescribed individual as a construction employee under s. 2(1)9 of the ESA’s Regulation 288/01.However, the court then explained that the Regulation does not disentitle prescribed individuals to the protection of the entire ESA; rather, the inapplicability of the ESA to the employee is limited to those employment standards set out in s. 55 – being notice of termination and termination pay. 

The court found that the error in the employment contract was twofold. 

First, an employee cannot contract out of a protected employment standard under the ESA, even if that particular standard does not yet apply under s. 5(1). The court stated:

“It is sufficient if a provision of an employment contract potentially violates the ESA at any date after hiring […]. Accordingly, on the chance that [the employee]’s position at [the employer] changed to something other than a construction employee, the effect of the Employment Contract is that it denies [the employee] his right to benefits during his notice period, which is protected by the ESA. While the Employment Contract does refer to [the employee] being employed as an apprentice and that he will be working in the construction industry, it does not explicitly state that this applies only to him while occupied as a construction employee and that it would be of no force or effect if his position changed.” 

Secondly, the court found that the termination provision of the employment contract also violated the ESA in a way that was not so remote, because as “prescribed” employees, construction employees may not be entitled to the employment standards governing the termination of employment or notice thereof, but they are still entitled to the employment standards guaranteed in the event of their severance. The court opined that if the employer grew in size, employing more than 50 employees and then discontinued its business, or else had a payroll more than $2.5 million, the employee would have been entitled to severance pay, irrespective of his job description. The court stated:

“The Employment Contract clearly disentitles [the employee] to these employment standards. Again, the potential violation of the ESA renders these provisions unenforceable. 

Accordingly, […] even a potential violation of the ESA, no matter how remote, should be unenforceable.”

As a result, the court found that the termination provisions, read as a whole, clearly showed that the employment contract purported to contract out of the ESA in at least two ways and dismissed the appeal.   

Get Advice

Social distancing is here to stay for the medium term, and in response, we have moved our full business online. Our service model may look a little different, but we are continuing to meet all of our clients’ legal needs using online technology that is readily available and user-friendly. We would be happy to help you get set up as needed. In most cases, we will send a single link to clients, allowing them to join a meeting with just a click. We can still be reached by leaving a voicemail at (289) 652-9092; however our reception is not staffed for safety reasons, so there will be a delay in replies. For faster access, please email your lawyer directly; lawyer contact information is available here. For new inquiries, or if you are unsure who to contact, please email our office at info@baderlaw.ca.

At Bader Law, our Mississauga employment lawyers have been representing non-unionized employees in workplace disputes since 1999. We know that such disputes can be very stressful and can get emotional quickly. We seek to simplify the law so that you understand your options and make informed decisions. We leverage our extensive experience advising employers to provide insightful guidance to employees who are facing challenging circumstances at work. We work hard to protect you.

If you have questions about unfair practices in the workplace, wrongful dismissal, or any other employment matter, contact the Mississauga employment lawyers at Bader Law. Our knowledgeable employment lawyers can counsel you on your rights, advise you on your options, and help you create a plan for moving forward. We represent employees in Mississauga and areas west of Toronto. Contact us online or at (289) 652-9092 to learn how we can help.

Categories
Wrongful Dismissal/Termination

Court of Appeal Rules That One Illegal Part of a Termination Clause Renders Its Entirety Unenforceable

In a recent case, the Ontario Court of Appeal found that the fact that one part of a termination provision violated employment standards legislation meant that all parts of the termination provision were unenforceable.

What Happened?

The employee began working for the employer on January 8, 2018 as its director of sales. His base salary was $135,000 per year plus expenses and the possibility of an annual bonus, which brought his overall annual salary close to $200,000. 

The employee was terminated without cause on October 18, 2018 and the employer paid the employee two weeks’ pay in lieu of notice.

The employee sued the employer for damages for wrongful dismissal, claiming six months’ pay in lieu of notice for his eight months of employment with the employer. 

The Employment Agreement

The employment agreement between the parties contained a termination without cause clause, which entitled the employee to one week notice or pay in lieu of such notice in addition to the minimum notice or pay in lieu of such notice and statutory severance pay as may be required under the Employment Standards Act, 2000 (the “ESA”). 

The employment agreement also contained a termination for cause provision. 

The employee submitted that the termination for cause provision breached the terms of the ESA and was therefore void and unenforceable. 

The employer conceded that the termination for cause provision violated the ESA and was unenforceable, but argued that it was irrelevant because the employee was not terminated for cause.

Finally, the agreement contained a severability clause, which stated that if any provision was found to be invalid or illegal, all remaining terms in the agreement would remain in full force and effect. 

Parties’ Positions

The employee argued that the unenforceability of the termination for cause provision impacted the agreement beyond that one clause. The employee submitted that the defective clause rendered the entire agreement – or, at the very least, both termination provisions in the agreement – void and unenforceable. 

The employer submitted that where there were two discrete termination provisions that applied to different situations, the court must consider whether one provision impacted upon the other and whether the provisions were “entangled” in any way. If they were not, then there was no reason why the invalidity of one should impact on the enforceability of the other. 

Issue

The issue was whether the illegality of the termination for cause provision rendered the termination of employment without cause provision unenforceable.

Lower Court Decision

The motion judge dismissed the employee’s action, and awarded the employer $16,000 for costs. He concluded that the termination of employment without cause provision was a stand-alone, unambiguous, and enforceable clause.

Court of Appeal Decision

The court explained that an employment agreement must be interpreted as a whole and that the correct analytical approach was to determine whether the termination provisions in an employment agreement read as a whole violated the ESA. The court then stated: 

“In conducting this analysis, it is irrelevant whether the termination provisions are found in one place in the agreement or separated, or whether the provisions are by their terms otherwise linked.”

As a result, the court found that the motion judge had erred because he failed to read the termination provisions as a whole and instead applied a piecemeal approach without regard to their combined effect.

Additionally, the court rejected the employer’s argument that it did not rely on the illegal termination for cause clause because a court must determine the enforceability of the termination provisions at the time the agreement was executed; therefore, non-reliance on the illegal provision was irrelevant. The court explained this is because where an employer does not rely on an illegal termination clause, it may nonetheless gain the benefit of the illegal clause. 

Finally, the court declined to apply the severability clause to the termination provisions, explaining that a severability clause cannot have any effect on clauses of a contract that have been made void by statute. Because the court had already concluded that the two termination provisions must be read together, the severability clause could not apply to sever the offending portion of the termination provisions.  

As a result, the court set aside themotion judge’s order.

Because the only defence the employer had to the action was its reliance on the termination without cause provision, the court ordered that the matter be remitted to the motion judge to determine the quantum of the employee’s damages and the costs of the action. 

Get Advice

At Bader Law, our Mississauga employment lawyers have been representing non-unionized employees in workplace disputes since 1999. We know that such disputes can be very stressful and can get emotional quickly. We seek to simplify the law so that you understand your options and make informed decisions. We leverage our extensive experience advising employers to provide insightful guidance to employees who are facing challenging circumstances at work. We work hard to protect you.

If you have questions about unfair practices in the workplace, wrongful dismissal, or any other employment matter, contact the Mississauga employment lawyers at Bader Law. Our knowledgeable employment lawyers can counsel you on your rights, advise you on your options, and help you create a plan for moving forward. We represent employees in Mississauga and areas west of Toronto. Contact us online or at (289) 652-9092 to learn how we can help.

Categories
Wrongful Dismissal/Termination

Supreme Court of Canada to Decide Whether a Terminated Employee Was Entitled to a $1.1M Bonus

The Supreme Court of Canada is expected to issue a decision in the coming months that will clarify whether a constructively dismissed employee was entitled to the bonus he would have received during his reasonable notice period.

The lower court decision on appeal awarded the employee almost $1.1 million as part of the employer’s incentive plan.

What Happened?

The employee was a chemist who has worked in the omega-3 fish oil industry for decades. He worked for the employer (or its predecessors) from January 1997 to June 2011.

In 1997, the employee started in the position of operations manager. He became a senior manager in 2001; and became vice-president of various departments from 2006 to 2009.

In early 2007, the employer created a long-term incentive plan. Under the plan, 2% of the employer’s value created on the sale or public offering of the company in excess of $100 million would be distributed among the executives who were party to the incentive plan. The plan was intended to be an incentive and a retention tool. During his employment, the employee was entitled to the plan.

Under the terms of the plan, if the employer company was sold during the period of time that the employee was employed by it, he was entitled to receive a portion of the sale proceeds based on the formula contained in the plan.  

The plan also provided that if the employee was not employed by the company at the time of the sale he would not be entitled to share in the proceeds, whether he resigned or was wrongfully dismissed. 

After a change in management and a significant change and reduction of his duties, the employee resigned on June 24, 2011.

On May 18, 2012, the employer announced it had been purchased by another company. On July 19, 2012, the completion of the acquisition was announced. Thetotal enterprise value of the sale was $540 million.

The employee sued the employer for wrongful dismissal seeking damages for breach of his employment contract, including the loss of the long term incentive plan.

Lower Court Decision

The hearing judge found that the employee had been constructively dismissed and was entitled to 15 months’ notice. The sale of the employer took place during that 15-month period. 

The hearing judge found that despite the employee not being employed with the company at the time of the sale, he was still entitled to recover under the long term incentive plan because the notice period overlapped with the sale of the company.

As a result, the hearing judge found that had the employee been employed with the company at the time of the sale he would have been entitled to receive approximately $1.1 million under the plan and so ordered.

The employer appealed the decision.

Court of Appeal Decision

The Court of Appeal found that the hearing judge did not err in finding that the employee had been constructively dismissed, nor did he err in finding that the reasonable notice period was 15 months. However, the majority of the court found that he erred in awarding damages pursuant to the long term incentive plan. 

The majority of the court found that the clause stating that the employee was not entitled to the share of the proceeds if he was not employed by the company at the time of the sale, whether through resignation or was wrongful dismissal, precluded any such payment.  

As a result, the court allowed the appeal in part. It upheld the finding of constructive dismissal and 15 months reasonable notice, but set aside the $1.1 million awarded under the long term incentive plan. 

However, the judge in dissent would have confirmed the amount awarded by the trial judge related to the plan. The dissenting judge stated that though the plan itself prevented recovery under that agreement, the employment contract had an implied duty of honesty and good faith and it was the employer’s dishonesty which had resulted in the employee’s constructive dismissal. 

The dissenting judge would have dismissed the appeal on the issue of the long term incentive plan, finding that it was within the reasonable contemplation of the parties that if the employee was constructively dismissed he would be entitled to the payment under the plan.

The employee appealed the decision.

Supreme Court of Canada Decision

The Supreme Court of Canada granted the employee leave to appeal and heard arguments for the appeal in October 2019. The decision is expected in 2020.

Get Advice

At Bader LLP, our Mississauga employment lawyers have been representing non-unionized employees in workplace disputes since 1999. We know that such disputes can be very stressful and can get emotional quickly. We seek to simplify the law so that you understand your options and make informed decisions. We leverage our extensive experience advising employers to provide insightful guidance to employees who are facing challenging circumstances at work. We work hard to protect you.

If you have questions about unfair practices in the workplace, wrongful dismissal, or any other employment matter, contact the Mississauga employment lawyers at Bader Law. Our knowledgeable employment lawyers can counsel you on your rights, advise you on your options, and help you create a plan for moving forward. We represent employees in Mississauga and areas west of Toronto. Contact us online or at (289) 652-9092 to learn how we can help.