Saturday, 3 March 2018

Twenty-Six Months’ Notice Awarded to Employees Who Rejected Offer of Continued Employment

Is an employee who is slated to lose his or her employment as a result of the sale of part of his or her company required to accept an offer of employment from the purchaser, if that offer of employment is on substantially less favourable terms?

If the employee reasonably rejects that offer, then what is the maximum amount of ‘severance’ to which a wrongfully dismissed employee can be entitled? While many will tell you that 24 months is the most a court will ever award for reasonable notice, as this blog has noted on more than one occasion, see e.g. What is the Maximum Amount of Reasonable Notice Under Ontario Law? and Is Twenty-Six the new Twenty-Four? Taking the 'Cap' off the Limit on Reasonable Notice, and as the Honourable Justice Lois Roberts (now of the Court of Appeal for Ontario) said in the case of Hussain v. Suzuki (2011), 209 A.C.W.S. (3d) 101 (ON SC):

There is no cap on the amount of reasonable notice of employment termination to which an employee may be entitled.

On February 20, 2018, the Ontario Superior Court of Justice in its decision in Dussault v. Imperial Oil Limited, 2018 ONSC 1168, once again confirmed that there is no such thing as a “hard cap” at 24 months and took a good, hard look at the obligations of an employee to mitigate his or her damages by accepting a substantially less lucrative offer of employment from the purchaser in an asset sale arrangement.

Facts

The case concerned two former employees of Imperial Oil, Mr. Dussault and Ms. Pugliese.

Plaintiffs’ Terms of Employment

Mr. Dussault was employed by Imperial for over 39 years. He was 63 years old when his employment was terminated in 2016. He began working for Imperial in 1976 while attending university, and became a full time employee in 1978. He held a number of different positions between 1978 and 1990, including Business Analyst, Service Station Automation Manager and Eastern Canada Merchandising Coordinator. Starting in 1990, he worked as Manager, real Estate Development Ontario, which is the position he held until his termination.

As Manager, Real Estate Development Ontario, Mr. Dussault was involved in the development and re-development of service station sites across Ontario. While he did not directly manage any other employees, he had significant responsibilities, including identifying potential retail sites, purchasing or leasing land for new service stations, obtaining government approvals for new service stations and managing Ontario Municipal Board hearings on behalf of Imperial. During the course of his employment in this position, Mr. Dussault was involved in the acquisition of approximately 80 services stations.

At the time of his termination, Mr. Dussault's compensation included the following:

  1. A base salary of $190,200;
  2. Employer contributions to a savings plan, including a portion in the form of Imperial shares;
  3. Reimbursement of business related 407 tolls and parking costs;
  4. Reimbursement of car costs related to business use and full reimbursement of business vehicle insurance costs;
  5. Reimbursement of home office expenses, including internet, mobile phone, office furniture and supplies;
  6. A defined benefit pension plan;
  7. Six weeks paid vacation, five floater days, and twelve earned days off per year; and
  8. Employment benefits.

Ms. Pugliese was employed by Imperial for 36 years. She was 57 years old when her employment was terminated in 2016. She began working for Imperial following her graduation from college in 1980. Between 1980 and 1999, she held a number of technical positions at Imperial. In 1999, she moved to the retail side of Imperial’s business, working in a number of management positions, including National Car Wash Manager and National Category Manager.

At the time her employment was terminated. Ms. Pugliese was Territory Manager. In that position, she oversaw twenty-four of Imperial's retail sites. She too did not directly manage other employees, but this position involved significant responsibilities, including participation in the selection of retailers, training new retailers, leading a number of special projects, ensuring the retail sites' compliance with safety procedures and regulations, and monitoring and reporting on various aspects of the retail sites' financial performances.

At the time of her termination, Ms. Pugliese's compensation was as follows:

  1. A base salary of $156,700;
  2. Employer contributions to a savings plan, including a portion in the form of Imperial shares;
  3. Direct reimbursement of all out of pocket expenses, such as meals and 407 toll charges;
  4. Reimbursement of car costs related to business use;
  5. Reimbursement of home office expenses, including mobile and land phone lines, office furniture and supplies;
  6. A defined benefit pension plan;
  7. Six weeks paid vacation, five floater days, and twelve earned days off per year; and
  8. Employment benefits.

Imperial’s Sale of its Retail Business

Prior to 2016, Imperial operated approximately 497 retail sites across Canada under the “Esso” brand. All of the retail sites included convenience stores.

On January 28, 2015, Imperial held a meeting with all its employees working in the retail branch of the business, including the plaintiffs, and advised them that it was assessing the possibility of selling off its retail sites. Imperial held another meeting with its retail employees on January 29, 2015, again including the plaintiffs, at which it informed the employees that it would take eight to twelve months to complete the assessment, and that the employees would be kept informed as more information became available and a final decision was made. Between February 2015 and February 2016, Imperial held a number of meetings and sent out some written communications about the status of Imperial's assessment of the potential sale of its retail operations.

On March 8, 2016, Imperial held a meeting with the plaintiffs and other retail employees at which Imperial advised the attendees that it had reached a conditional agreement to sell its retail business in Ontario to Mac's. Imperial also informed the employees at the meeting that many of them would be offered employment with Mac's.

The following day, on March 9, 2016, the plaintiffs attended meetings with their respective supervisors at which they were both told that they would be offered employment with Mac's. They were also told that Mac's would hold an information meeting in the coming weeks with employees who were to be offered employment with Mac's.

On March 9, 2016, Imperial held another group information session at which the retail employees were told that Imperial would offer employees who accepted offers from Mac's a "gratuitous lump sum payment" meant to offset for a period of 18 months the difference between the benefit plan offered by Mac's and the benefit plan they had been receiving from Imperial. Employees were also advised that if they did not accept Mac's employment offers, Imperial would meet its obligations under the employment standards legislation, but that their entitlement to severance pay would be substantially reduced or eliminated to reflect the fact that they "passed up an opportunity for continued employment with Mac's".

The parties disputed the extent to which Imperial provided further information to the plaintiffs about their options. What was undisputed was that, despite requests made by the plaintiffs, Imperial would not disclose the amount of the gratuitous lump sum it would pay the plaintiffs until after they accepted employment from Mac's. Imperial took the position that the exact amount of the lump sum could not be calculated without ascertaining some of the information required for the calculation, such as each employee's specific date of termination and whether employees would choose to join Mac's pension plan. In the context of the litigation, Imperial disclosed that the lump sum payment that would have been made to Mr. Dussault is $81,800 and to Ms. Pugliese is $67,400.

Offers from Mac’s

Both plaintiffs received offers of employment from Mac's in mid-June 2016. The offers they received were conditional on the sale from Imperial to Mac's taking place and made clear that the plaintiffs would be expected to sign releases in Imperial’s favour in order to receive the gratuitous lump sum payment.

Mac's offer to Ms. Pugliese was made on June 15, 2016. She was offered the position of Market Manager and given three weeks to accept the offer. The offer included the following terms:

  1. Her base salary would remain at $156,700 per year for eighteen months;
  2. She would participate in a defined contribution pension plan;
  3. She would receive a benefit plan that she describes as "less favourable" than Imperial's benefit plan;
  4. She would receive five weeks of paid vacation per year;
  5. She would be required to participate in a vehicle lease program at a rate of $70.00 bi-weekly; and
  6. She would have to purchase a cell phone for company use.

On June 17, 2016, Mac's offered Mr. Dussault the position of Real Estate Development Manager. He too was given three weeks to consider the offer. The offer made to Mr. Dussault contained the following terms, which are similar to those offered to Ms. Pugliese:

  1. His base salary would remain at $190,200 for eighteen months;
  2. He would participate in a defined contribution pension plan;
  3. He would receive a benefit plan that he too describes as "less favourable" than Imperial's benefit plan;
  4. He would receive five weeks of paid vacation per year;
  5. He would be required to participate in a vehicle lease program at a rate of $70.00 bi-weekly; and
  6. He would have to purchase a cell phone for company use.

The offers provided that the plaintiffs' base salaries would remain the same as their base salaries with Imperial only for a period of eighteen months. While they were not told what their salaries would be after eighteen months, they were given the salary range for comparable employment at Mac's. In Ms. Pugliese's case she was told that the salary range for similar employment at Mac's was from a midpoint of $56,500 to a highpoint of $69,952, and in Mr. Dussault's case he was told that it ranged from a midpoint of $85,000 to a highpoint of $102,000.

In addition, both offers of employment included an explicit term that Mac's would not recognize their years of service with Imperial:

Both plaintiffs declined Mac's offers of employment because they viewed the terms of employment with Mac’s as less favourable than their terms of employment with Imperial.

Termination of Employment

On August 12, 2016, Imperial notified Ms. Pugliese that it was terminating her employment. She was required to work until October 7, 2016. She was provided with a severance payment of $78,100, which represented her statutory entitlement pursuant to the Employment Standards Act, 2000.

On September 2, 2016, Imperial gave Mr. Dussault's notice of termination of his employment. He was required to work until October 31, 2016, and received $94,800 as severance pay which also represented his entitlement pursuant to the Employment Standards Act, 2000.

Following the end of their employment with Imperial, the plaintiffs chose to retire from Imperial, which means that, in addition to their severance pay, they both began receiving monthly unreduced pension benefits, monthly Registered Pension Plan Bridge payments payable to age 65, and health, dental, life insurance and other benefits. In addition, Mr. Dussault received a lump sum payment from Imperial's Supplemental Pension Arrangement.

Issues

The case was resolved by way of summary judgment. The issues that the court was asked to consider were, in addition to whether the case was appropriate for disposition by way of summary judgment:

  1. What length of notice were the plaintiffs entitled to?
  2. Did the plaintiffs fail to mitigate their damages, and specifically by not accepting the offer from Mac's?
  3. What are the plaintiffs' damages? [Not considered in this post]

Decision

Writing her reasons for decision on behalf of the court, the Honourable Justice Lise G. Favreau reasoned as follows with respect to each issue.

Notice Period

The first thing that Justice Favreau had to address was Imperial’s argument that the notice period in this case should be reduced to reflect the fact that the plaintiffs had known for some time that their employment was coming to an end.

Imperial had relied on the decision in Ahmad v. Procter & Gamble Inc., 1991 CanLII 7225 (ON CA), where the Court of Appeal upheld a four month notice period for an employee who had been working for sixteen years in circumstances in which he had been notified for eighteen months that his employment would likely be coming to an end in the near future.

In Justice Favreau’s opinion, in this case, there was no basis for shortening the notice period on the basis of the information Imperial shared with the plaintiffs about the likely sale of the retail division to Mac's. Her Honour went on to write as follows:

[44] In Prinzo v. Baycrest Centre for Geriatric Care, 2002 CanLII 45005 (ON CA), at para. 17, the Court of Appeal stated that "notice must be clear and unambiguous".

[45] Up until the plaintiffs received notices of termination, the information they had received from Imperial and from Mac's was that there were still steps required to complete the transaction. Even the letter from Mac's offering the plaintiffs employment stated that the "offer of employment is conditional upon the purchase of certain assets of Imperial Oil Limited … by Alimentation Couche-Tard Inc…"

[46] More importantly, the rationale for shortening the notice period in cases where employees have been forewarned about the likelihood that their employment would soon be coming to an end is that employees in these circumstances should know to start looking for new employment before the formal termination. However, in this case, the message from Imperial to the plaintiffs was not that their employment would be terminated and they should look for new work, but rather that they would be given an opportunity for similar employment with Mac's. Under those circumstances, it would not be reasonable to expect the plaintiffs to start looking for alternative employment until they had a chance to consider the offer of employment from Mac's.

[47] The defendant's argument of foreshadowing was rejected in similar circumstances in Chan v. IBM Canada Ltd., [1996] O.J. No. 4022 (Gen. Div.), at para. 40:

The defendant's position is that the time runs from the announcement made on March 29, 1994. I disagree. The defendant made it clear that an offer of employment would be forthcoming and that the defendant was working on its terms. Such offer was not made until late June. The matter was up in the air for almost three months. Furthermore the defendant informed the employees that if they did not accept, a letter of termination would be given with the notice period being in the range "of 2 to 8 weeks with 8 weeks applying to anyone with 8 years or more of IBM service" (Exhibit 1, Tab 9). The defendant then recognized and represented to the employees that the notice period would run not from March 29, 1994 but rather from the time of the letter. Otherwise if the period was to run from March 29, there would be no need to give 8 weeks from the date of the letter as the 8 weeks would have run. In the plaintiff's case the defendant made a further offer which was turned down resulting in the letter of termination and a notice period of 3 months which was based on the perception at the time that the customer of the Sedar project would then be signing off. In my view the time runs from the date of the letter of termination. As I have stated the defendant recognized and represented to the plaintiff that the time would so run. Furthermore the plaintiff was awaiting details of the new employment which was not forthcoming until the eleventh hour, and then there were further negotiations. To paraphrase Hoyt J.A. in St. John Shipbuilding Ltd. v. Perkins (1989), 24 C.C.E.L. 106 at 110 in those circumstances it was reasonable for the plaintiff to have awaited the outcome of the offers of employment before concluding that she had been dismissed. To hold otherwise would result in the employer having it both ways. And see Alpert v. Carreaux Ramca Ltée 1992 CanLII 7748 (ON SC), 41 C.C.E.L. 276 at 286 where for the reasons therein stated the starting date of the notice was the date that "the full package became apparent to the plaintiff which he did not accept."

[48] Similarly, in this case, it was not until the plaintiffs received and rejected the Mac’s offers that it was clear that they faced potential unemployment due to Imperial’s sale of its retail business to Mac’s. This view is reinforced by the fact that the termination letters to both plaintiffs opened by stating that the letter provided them with “8 weeks of advance working notice” that their employment was to end on their respective termination dates. Accordingly, in my view, the plaintiffs only received clear and unambiguous notice that their employment with Imperial was terminated when they received Imperial’s notice letters after they rejected Mac's offers. In Ms. Pugliese's case, the notice period started to run on August 2, 2016 and, in Mr. Dussault's case, the notice period started to run on September 2, 2016.

With respect to the length of the notice period, the plaintiffs provided a number of decisions, which they argued presented similar circumstances, in which the range of notice varied between 24 and 30 months.

Justice Favreau found that, having regard to the Bardal factors, 26 months' notice was appropriate in this case.

Justice Favreau’s reasons for that decision were as follows:

[50] … The plaintiffs' circumstances are similar to those in Keenan v. Canac Kitchens Ltd., 2016 ONCA 79 (CanLII), 2016 ONCA 79 (C.A.), at para. 32, wherein the Court of Appeal accepted the trial judge’s findings that the circumstances in that case were exceptional and warranted 26 months' notice:
Lawrence Keenan and Marilyn Keenan worked for Canac for approximately 32 and 25 years respectively. Together, their average length of service was 28.5 years. They were 63 and 61 years of age at the time of termination. They held supervisory, responsible positions in which they oversaw the installation of Canac's products and met with Canac's customers as its representatives. For over a generation, they were Canac's public face to the outside world. Over a period of approximately thirty years -- the entirety of their working lives -- the Keenans' income had come from Canac and they relied on that income to support themselves and their family. […] These circumstances justify an award in excess of 24 months and I see nothing wrong in the trial judge's finding that 26 months' notice was reasonable.

[51] Twenty six months' notice in this case represents a recognition that the plaintiffs' circumstances are somewhat unusual having regard to the Bardal factors:

  1. The character of their employment: While neither Ms. Pugliese nor Mr. Dussault supervised other employees, they were both in positions with significant levels of responsibility. On its own this factor does not present unusual circumstances, but each of the other factors does.
  2. Their length of service: Mr. Dussault worked for Imperial for 39 years and Ms. Pugliese worked there for 36 years. In both cases, as in Canac Kitchens Ltd., supra, Imperial was their only employer since their respective graduations from university and college.
  3. Their ages: Mr. Dussault was 63 years old and Ms. Pugliese was 57 years old when their employment was terminated.
  4. The availability of similar employment in light of their experience training and qualifications: Imperial argues that the offers of employment from Mac's is evidence of the availability of similar employment. However, in my view the Mac's offers demonstrate the opposite view. Mac's had only agreed to pay the plaintiffs' base salaries at the same level as what they received from Imperial for 18 months. It is evident that Mac's own pay scales for similar employment were significantly lower. This is reinforced by the fact that Ms. Pugliese and Mr. Dussault were told by Mac's that they would have to keep their salary confidential so as to avoid conflict with other employees. If anything, the offers from Mac's emphasize the difficulty the plaintiffs would have in finding similar employment. In addition, given that they had only worked for Imperial for their whole working lives, it is evident that their skills and experience were geared to one particular employer, likely making it difficult to transfer those skills to a different employer.

Mitigation

Imperial had argued that the plaintiffs failed to mitigate their damages because they ought to have accepted the offers of employment from Mac's.

The plaintiffs argued that the Mac's offers were not comparable, and in any event that they had no obligation to accept the offers given that they were made prior to Imperial's termination and that they required the plaintiffs to sign a release in Imperial's favour.

In her reasons for decision, Justice Favreau wrote the following with respect to these arguments:

[55] Imperial has the burden of proving that Ms. Pugliese and Mr. Dussault failed to mitigate their damages. In Yiu v. Canada Kitchens Ltd., 2009 CanLII 9412 (ON SC), 2009 CanLII 9412 (Sup. Ct.), at para. 16, this Court emphasized that the employer's burden is not a light one …

[56] In making the argument that the plaintiffs failed to mitigate their damages by turning down the Mac's offers, the defendant argues that the case is akin to situations in which courts have held that an employee was required to return to work with an employer during the notice period in order to mitigate his or her damages. In Evans v. Teamsters, Local 31, 2008 SCC 20 (CanLII), at para. 30, the Supreme Court of Canada recognized that there are circumstances in which employees may have an obligation to mitigate their damages by returning to work for a former employee …

[57] In this case, I agree with the plaintiffs that it was not reasonable for them to be required to mitigate their damages by accepting the Mac's offer. I have made this finding for a number of reasons.

[58] First the offer from Mac's was made before the plaintiffs' employment was terminated. In Farwell v. Citair, Inc. (General Coach Canada), 2014 ONCA 177 (CanLII), 2014 ONCA 177 (C.A.), at paras. 20-21, relying on Evans, supra, the Court of Appeal confirmed that it is fatal to an employer's argument that an employee failed to mitigate his damages by working for his old employer where the offer of alternative employment was made before the termination …

[59] In this case, the Mac’s offer was presented to the plaintiffs before their employment with Imperial was terminated. Neither Mac’s nor Imperial approached the plaintiffs after they rejected the offers and after Imperial sent out the notices of termination offering the plaintiffs an opportunity to work for Mac’s while they searched for new employment.

[60] Second, given Imperial's requirement that the plaintiffs sign a release in order to get their lump sum payment, it was reasonable for the plaintiffs not to accept the Mac's offers. While the defendant argues that the plaintiffs had an obligation to accept the Mac's offers to mitigate their damages, the effect of accepting the offer as it was presented would be to renounce their right to sue Imperial for any shortfall in their entitlement to damages in lieu of notice. Again, in my view, in accordance with the Court of Appeal's decision in Filmore v. Hercules SLR Inc., 2017 ONCA 280 (CanLII), 2017 ONCA 280 (C.A.), at paras. 10-11, the requirement that the plaintiffs give up any right to sue Imperial is fatal …

[62] Third, it was not reasonable to require the plaintiffs to accept an offer that did not recognize their years of service with Imperial. The evidence on the motion confirms that Mac's purchased Imperial's retail business as a going concern. Previous cases have recognized that in circumstances where a new employer has purchased a business as a going concern, there is an implied term that the employees' years of service will be recognized, unless there is an express term to the contrary. In circumstances where there is an express term to the contrary, the employee has the choice to accept the offer of employment with the purchaser or sue the seller for wrongful dismissal and damages in lieu of notice: see Sorel v. Tomenson Saunders Whitehead Ltd., 1987 CanLII 154 (BC CA), [1987] B.C.J. No. 1332 (B.C. C.A.), at p. 3; and Carpenter v. Brains II Canada.

[65] Fourth, I accept the plaintiffs' evidence that having to hide their higher pay from other employees at Mac's would make for a potentially difficult working environment. In Evans, at para. 30, the Supreme Court made clear that the obligation of employees to mitigate their damages by accepting work with an existing employer through the notice period does not include an obligation to work in an atmosphere of hostility or embarrassment. In Farwell, at para. 20, the Court of Appeal confirmed that this is meant to be an objective assessment based on what a reasonable person would do in the circumstances. In their evidence on the motion, both plaintiffs anticipated the embarrassment and discomfort that would come from being required to hide their salaries from other employees because they would be earning a higher salary than many of their co-workers and even their supervisors. In my view, this is a reasonable reaction and it was reasonable for the plaintiffs to anticipate that the work atmosphere would be uncomfortable under the circumstances.

[66] Finally, while there are many aspects of the Mac's offer that are comparable to the plaintiffs' employment at Imperial, there are sufficient differences to make the rejection of the offer reasonable. The most notable examples are the issues of benefits and salary. With respect to benefits, Imperial recognized that there were differences in the benefits offered by both companies which is why Imperial offered to pay a "gratuitous lump sum" to make up the difference. However, Imperial's failure to disclose the amount of the lump sum payment did not allow the plaintiffs to assess whether the Mac's offer in combination with the lump sum made for comparable employment. The fact that Imperial has disclosed the amount of the lump sum in the context of the litigation is irrelevant because the issue to be decided is whether the plaintiffs acted reasonably at the time the offer was made. Another example is the base salary to be paid to the plaintiffs. While they were to receive the same base salary as they received from Imperial for eighteen months, Mac's would not tell them what their salary was to be after eighteen months and the releases to be signed in Imperial's favour would preclude them from suing Imperial from any shortfall beyond eighteen months. Based on these factors alone, the proposed employment with Mac’s was not comparable to the employment with Imperial, and it is therefore not necessary to parse the offers to determine the other respects in which the employment with both companies differed.

[67] Accordingly, in my view, the plaintiffs did not have an obligation to mitigate their damages by accepting the offers of employment from Mac's. It is evident that Imperial and Mac's negotiated terms in the agreement for the purchase and sale of Imperial's retail business that were meant to relieve Imperial from some of the financial consequences of potential claims by some of its affected employees while ensuring that Mac's did not have to provide the same compensation to those employees in the long term. This may have been a good deal between Imperial and Mac's, but the assessment of whether the plaintiffs had an obligation to accept the offer of employment from Mac's is to take place from the perspective of a reasonable person in the plaintiffs' position. For all of the reasons stated above, I find that Imperial has not discharged its burden of showing that the plaintiffs acted unreasonably.

Commentary

I will confess that my initial motivation for authoring this post was my consternation with the post on First Reference’s blog, 26 is the new 24 (Reasonable Notice). As I mentioned at the outset of this post, in January of 2016, I had authored a post titled Is Twenty-Six the new Twenty-Four? Taking the 'Cap' off the Limit on Reasonable Notice. I thought the title, and indeed much of the content, a touch… familiar.

Second, I wanted to address the commentary in that post that, “This Court of Appeal approved “no 24-month cap” on notice has just trickled down to the lower courts.” Ontario’s courts were awarding more than 24 months long before Keenan, as canvassed in those earlier posts I authored. Indeed, in the case of Markoulakis v SNC-Lavalin Inc., 2015 ONSC 1081 (CanLII), about which I blogged in my post Rushing to Judgment: How to Reconcile the Duty to Mitigate with Summary Judgment in Wrongful Dismissal Cases, the court awarded 27 months pay in lieu of reasonable notice.

My petty grievance aside, the Dussault decision is actually a very informative decision with respect to the issues of notice of termination and mitigation. I therefore thank the author of the First Reference post for bringing the decision to my attention.

On the issue of mitigation, and the court’s reliance on the Farwell decision, I am reminded of what I wrote in my post ONCA: No Duty to Mitigate Unless Offer Made After Termination, “It was hard not to hear the Price is Right “losing horn” after reading the decision.”

Farwell aside, one is inclined to agree that the difference between the terms of employment between Imperial and Mac’s was quite substantial. Moreover, given the Court of Appeal’s recent decision in Krishnamoorthy v. Olympus Canada Inc., 2017 ONCA 873, about which I blogged in my post Brave New World: ONCA Says that in Asset Transaction, an Offer of Employment is Sufficient Consideration for Material Changes, there was good reason for the plaintiffs to be reticent at the idea of releasing their rights vis-à-vis Imperial in consideration of the offer of employment from Mac’s.

When I saw Brake, about which I blogged in my post Court of Appeal Rules that Modest Earnings Earned during Notice Period Not to be Deducted from Wrongful Dismissal Damages, referenced in Justice Favreau’s reasons for decision, I was sure that that decision would factor into Her Honour’s decision on mitigation. I was therefore somewhat surprised when it did not. I suppose that Her Honour did not consider Mac’s offer to be so insignificant as to be on all fours with the Brake decision.

As I said, on the whole, a really good decision and good read. I am glad that I read and considered it. Given the outcome for Imperial, I suspect that the Court of Appeal may have the opportunity to consider it as well.

Takeaways for Employees with Labour Pains

There are a few takeaways for employees with labour pains. The first is that there is no such thing as a limit on the amount of ‘severance’ to which you may be entitled. If someone tells you that you “can’t” get more than 24 months, question them. The second takeaway is that if you are offered new employment as a result of the sale of part of your company, seek legal advice before you do anything. The law on this point is technical and complicated. Sometimes you should accept the offer, and sometimes it will be reasonable to reject it. Before doing anything, speak with a lawyer.

If you are an individual looking for assistance with respect to a similar situation, contact the professional, experienced and cost-effective employment lawyers for employees at Ottawa's Kelly Santini LLP; we would be happy to be of service to you.

Takeaways for Employers with Labour Pains

There are similarly two takeaways for employers. First, be mindful of the belief that 24 months is a hard cap on the amount of severance that may be owed to a dismissed employee. In exceptional circumstances, more may be required. Second, if you are considering the sale of all or a part of your business, consider the employment consequences early and seriously. I have written about the subject more than once, including the post What Happens in a Buy/Sell Deal if One of the Vendor’s Employees Refuses to Accept the Purchaser’s Offer of Employment?. As the Dussault decision makes plain, “getting it wrong” can be very, very expensive.

If you are considering the sale of your business, and you have employees, you should be working not only with business lawyers but with an employment lawyer as well. The professional, experienced and cost-effective employment lawyers for employers at Ottawa's Kelly Santini LLP would be happy to be of service to your business or organization.

Contact Me

To reach the author of this blog, Sean Bawden, email sbawden@kellysantini.com or call 613.238.6321 x260.

Sean P. Bawden is a partner with Kelly Santini LLP, located in Ottawa, Ontario, Canada. He practices in the areas of employment law and civil litigation. He has also taught Trial Advocacy for Paralegals and Small Claims Court Practice at Algonquin College in Ottawa.

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As always, everyone’s situation is different. The above is not intended to be legal advice for any particular situation. It is always prudent to seek professional legal advice before making any decisions with respect to your own case.

Photo Credit: (c) istock/AntonioGuillem



1 comment:

  1. Good decision. Its obvious that the plaintiff's worked with a smart lawyer who gave them good advice. Imperial was obviously trying to get away from paying common law severance.

    ReplyDelete