Friday, 4 August 2017

Ottawa Judge Rules that Severance Offers Should Not be Pleaded

(c) istock/BernardaSv

If I reject a severance offer, will the judge think I am being too greedy in asking for more? That question is a common concern among employees who find themselves suddenly unemployed. Conversely, employers are often hesitant to offer enhanced severance packages, lest the employee sue for wrongful dismissal and claim the offer as evidence of the employer’s willingness to at least pay such amount.

In a decision released July 19, 2017, Ramos v Hewlett-Packard (Canada) Co., 2017 ONSC 4413 (CanLII), the Honourable Madam Justice Robyn M. Ryan Bell may have done a great deal to mitigate such concerns for both sides.

Wednesday, 19 July 2017

“Retiring Allowances” and the Taxation of Wrongful Dismissal Damages

(c) istock/MattZ90

Lawyers are often loathe to guarantee anything. However, it is said that two things in life are guaranteed: death and taxes.

This “guarantee” raises an important issue for the settlement of any wrongful dismissal case, the taxation of wrongful dismissal damages. While employers and employees can and often will agree to a favourable characterization of such damages, as the case of Ferhman v Goodlife Fitness Centres, Inc., 2017 ONSC 4348 (CanLII) demonstrates, sometimes that is not done and employees can end up receiving a lot less money – net of taxation – than they anticipated.

Saturday, 15 July 2017

Beware the Innocuous Termination Provision

(c) istock/miluxian

It is often said that, “a magician never reveals his secrets.” If that is true, then it is a good thing that I am not a magician.

There is a phrase employed in countless employment agreements, which, on its face, appears innocuous. As will be explained below, notwithstanding the fact that this one simple, seemingly benign phrase can cost workers literally thousands, if not tens or even hundreds of thousands of dollars, few employees will ever give a second thought to accepting such a contractual provision.

While I suspect that many employment lawyers know exactly to what I refer, I would suspect that few outside this union of magicians would have any clue to what I am making reference.

Wednesday, 28 June 2017

Wrongful Dismissal Cases are Appropriate for Resolution by way of Application: ONSC

(c) istock/Jrcasas

A frequent criticism of the Canadian judicial system is that it moves too slowly. Indeed, as the Supreme Court of Canada recently observed in its now infamous decision in R. v. Jordan, [2016] 1 SCR 631, 2016 SCC 27 there has been a “culture of complacency towards delays” in the justice system for years. And while the Supreme Court’s comments were directed towards the criminal system in that case, most would tend to agree that things are no better in the civil bar.

And so what is one to do when he finds himself with a simple, straight-forward wrongful dismissal case, where the only points in issue are: (1) Is this employment contract dispositive of my entitlements to reasonable notice, and (2) If the answer to that question is no, then what is the notice period?

Prevailing wisdom over the past seven or so years has been that the dismissed party should start an action, and then bring a motion for summary judgment. (See the comments of Justice Hackland in Beatty v. Best Theratronics Ltd., 2014 ONSC 3376 (CanLII): I agree with Perell J.’s observation in Adjemian v. Brook Crompton North America, [2008] O.J. No. 2238 (Ont. S.C.J.) that summary judgment may be an appropriate and optimal way to proceed in cases involving the determination of reasonable notice periods.)

But, as will be considered below, motions for summary judgment, especially in cases where the amount claimed is less than $100,000, can have their drawbacks and limitations.

Is there a better way yet still?

I believe there is. And, in the case of Farah v EODC Inc., 2017 ONSC 3948 (CanLII), the Ontario Superior Court of Justice endorsed such an approach as appropriate.

Friday, 23 June 2017

Can Employers Opt-In to the Common Law to Opt-Out of the Canada Labour Code?

(c) istock/kieferpix

Given the considerable effort that has been expended as of late in trying to have employees opt out of the common-law regime of reasonable notice, see e.g. my discussion of termination clauses in my post Will Wood Finally Answer the Question of Benefits? There’s Hope., it is almost unfathomable that employers would even consider attempting to contract in to such a regime. However, when one considers the remedies to which employees employed pursuant to the provisions of Canada Labour Code can have access, a payment in lieu of reasonable notice would be the lesser of two evils.

It now settled law that the employment of non-managerial employees, employed for more than 12 consecutive months, who are employed pursuant to the provisions of Canada Labour Code cannot be terminated absent the employer showing just cause for termination: Wilson v. Atomic Energy of Canada Ltd., 2016 SCC 29 (CanLII), about which I wrote in my post No Cause? Then No Dismissal for Non-Unionized Federal Employees – The Supreme Court of Canada Shakes Up Canadian Employment Law. Moreover, as the more recent case of Randhawa v Bank of Nova Scotia, 2017 CanLII 4774 (ON LA) demonstrates, where a complaint of unjust dismissal under the Canada Labour Code is upheld, the default remedy must be reinstatement. Reinstatement is much more intimidating than a severance payment.

And so the question is begged: Can employees contractually - and preemptively - opt out of the unjust dismissal regime established by the Canada Labour Code in favour of the common-law regime of reasonable notice and wrongful dismissal?

Saturday, 27 May 2017

Mo Money Mo Problems (A Review of Termination Pay Obligations for Large Payrolls)

On May 27, 2017, I presented a paper to the County of Carleton Law Association’s annual solicitor’s conference titled “Mo Money Mo Problems (A Review of Termination Pay Obligations for Large Payrolls).” What follows is a copy of that paper.

I can think of no better way to introduce the subject of termination pay obligations for large payrolls than the lyrical hook to the song Mo Money Mo Problems by artist The Notorious B.I.G.:

I don't know what, they want from me

It's like the more money we come across

The more problems we see

The purpose of this paper is to canvass the subject of the obligation to pay statutory severance pay. As will be explained more fully below, pursuant to the provisions of section 64 of the Ontario Employment Standards Act, 2000, it is patently obvious that, notwithstanding anything Ol’ Dirty Bastard may have said about the subject, [“Look here, more money, more problems, my ass / You'se a naive cat, if you still believe that …”] the more money that employers come across, the more problems they’ll see.

Tuesday, 23 May 2017

Court of Appeal Rules that Modest Earnings Earned during Notice Period Not to be Deducted from Wrongful Dismissal Damages

(c) istock/OlafSpeier

What happens when an employee takes a new job not so much to mitigate her damages, but rather to survive? More to the point, what if that new position is so much beneath the wrongfully dismissed employee’s previous position that to deduct such earnings would work a disservice to the employee?

In the case of Brake v PJ-M2R Restaurant Inc., 2016 ONSC 1795 (CanLII), the Honourable Justice Kevin B. Phillips of the Ontario Superior Court of Justice held that a wrongfully dismissed employee’s ability to find employment did not take away from the loss she suffered from being dismissed without cause. Moreover, her new position, that of a cashier, was so substantially inferior to the managerial position she held with the defendant that, “the former does not diminish the loss of the latter.” As a result no deduction was applied on account of the mitigatory earnings.

I blogged about the trial decision in my post Trial Judge Finds Mitigatory Earnings too Insignificant to be Deducted from Wrongful Dismissal Award .

On May 23, 2017, the Court of Appeal for Ontario released its reasons for decision in respect of the appeal of that case: Brake v. PJ-M2R Restaurant Inc., 2017 ONCA 402.