Employment Contract Deemed Void Ab Initio for Failing to Account for Hypothetical Severance

If an employment contract makes no mention of the payment of statutory severance in the event of a termination without cause, is the contract legally unenforceable regardless of whether the employee is actually entitled to severance at the time of dismissal? That is to say, must an employment agreement account for all future hypothetical scenarios in order to be legally binding?

In the case of Garreton v Complete Innovations Inc., 2016 ONSC 1178 the Honourable Mr. Justice Laurence A. Pattillo endorsed the words of Justice Low in Wunderman, “It is not that difficult to draft a clause that complies completely with the Act, no matter the circumstance” and held that, unless an employment contract would always be valid, no matter what the reality at the time of termination, it is void from the start.

Trial Judge Finds Mitigatory Earnings too Insignificant to be Deducted from Wrongful Dismissal Award

The application of the duty to mitigate to the post-termination earnings of wrongfully dismissed employees is probably the most reviled subject that an Ontario employment lawyer will have to discuss with his employee clients. (By contrast, it is a favourite subject of employers.) In short, the doctrine essentially provides that an employer is entitled to the set-off of any post-termination dollars earned by the dismissed employee during the reasonable notice period. As the case of Davidson v. Tahtsa Timber Ltd., 2010 BCCA 528 demonstrates, sometimes by virtue of an employee’s success in finding new employment, an employee can be completely shut out from being awarded anything notwithstanding being wrongfully dismissed.

But 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, the Honourable Justice Kevin B. Phillips of the Ontario Superior Court of Justice sitting at Ottawa 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.

Deletion of Browser History in Failed Attempt to Protect Privacy Not Spoliation of Evidence

Is deleting your browser history, so as to attempt to conceal the fact that you had visited "adult" websites, in the face of a court order to "preserve all records relevant to a lawsuit" “spoliation” of evidence?

That was one of the questions that the Honourable Mr. Justice Frank J. C. Newbould of the Ontario Superior Court of Justice was asked to resolve in the case of Catalyst Capital Group Inc. v Moyse, 2016 ONSC 5271.

Judge Orders Costs of Injunction against Solicitation “In the Cause”

The dirty secret of contract law is that a contract is only as good as a party’s ability to enforce it. Typically, this blog focuses on the legal ability of an employer to enforce certain elements of an employment contract; whether that element be termination provisions, about which I write frequently, or restrictive covenants, such as non-solicitation or non-competition agreements, about which I write much less frequently.

Putting legal considerations aside for a moment, there are also practical considerations in attempting to enforce contractual provisions, not the least of which is the element of cost.

In his reasons for decision in Accreditation Canada International v Guerra, 2016 ONSC 6184, the Honourable Justice Patrick Smith of the Ontario Superior Court of Justice sitting at Ottawa, highlights one of the main practical impediments to an employer attempting to enforce restrictive covenants: the cost.

Being "Reckless With the Truth" Not Just Cause for Termination

Is “being reckless with the truth” as to whether a client has insurance coverage “just cause” for the termination of an insurance broker’s employment?

That was one of the questions that the Honourable Mr. Justice Ronald M. Laliberte Jr. was asked to resolve in the case of Cassell v. Irving H. Miller Limited, 2016 ONSC 5570.

Although the employer felt very strongly about having just cause for termination, Mr. Justice Laliberte saw things differently.

Will Wood Finally Answer the Question of Benefits? There’s Hope.

This post will break from tradition. Rather than be a post about something that has happened, it will be an anticipatory post about something that is expected to happen.

On September 6, 2016, the Court of Appeal for Ontario heard the appeal of the decision reached by Mr. Justice Grant Dow of the Ontario Superior Court of Justice in Wood v Fred Deeley Imports Ltd., 2016 ONSC 1412 (CanLII). Should the court choose to answer all of the questions put to it by the appellant, then I have no doubt that the decision will fundamentally alter the landscape of Ontario employment law.

UPDATE: On February 23, 2017, the Court of Appeal for Ontario released its much anticipated decision in Wood v. Fred Deeley Imports Ltd., 2017 ONCA 158 (CanLII). For analysis of that decision, see my post: Court of Appeal Finally Brings Much Needed Clarity to Issue of Benefits in Contractual Termination Provisions.

Emotional Upset Not Enough for Award of General Damages: ONCA

If being accused of breaking the law “takes a serious toll” on you, causing you “emotional upset”, can you successfully sue the person that caused that harm?

It is trite to observe that being accused of something that you did not do is likely to cause feelings of serious upset. In employment law, this scenario arises most frequently when an employer alleges “just cause” for the termination of an employee’s employment. But what do the courts have to say about this issue? Can someone sue for emotional upset?

In the case of 495793 Ontario Ltd. (Central Auto Parts) v. Barclay, 2016 ONCA 656, the Court of Appeal for Ontario confirmed that a plaintiff’s testimony of emotional upset, being unsupported by medical evidence, was insufficient to ground the substantial award of non-pecuniary damages made by the trial judge, the Honourable Regional Senior Justice Helen M. Pierce. (See reasons for decision reported at 2014 ONSC 3517.)