Beware the Innocuous Termination Provision

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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.

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

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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.

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.

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

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 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.

Divisional Court Rules that Employees May Sometimes be Required to Attend Medical Examination by Doctor of Employer’s Choosing

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Is an employee required to submit to an independent medical examination, an “IME”, by a doctor of his employer’s choosing as part of the employee’s duty to participate in the human rights accommodation process? In a decision released May 19, 2017, by the Ontario Divisional Court, Bottiglia v Ottawa Catholic School Board, 2017 ONSC 2517, the answer was “sometimes.”

What Happens in a Buy/Sell Deal if One of the Vendor’s Employees Refuses to Accept the Purchaser’s Offer of Employment?

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A typical term of any significant asset purchase agreement, which sees the employees of the vendor continue in employment with the purchaser, is that the purchaser will make offers of employment on substantially similar terms to the vendor’s employees. As is more fully explained in my post Continuity of Employment Following the Sale of a Business, pursuant to the provisions of Part IV of the Ontario Employment Standards Act, 2000:

If an employer sells a business or a part of a business and the purchaser employs an employee of the seller, the employment of the employee shall be deemed not to have been terminated or severed for the purposes of this Act and his or her employment with the seller shall be deemed to have been employment with the purchaser for the purpose of any subsequent calculation of the employee’s length or period of employment.

But what if one (or more) of the employees (unreasonably) refuses the purchaser’s offer? Is that employee still entitled to ‘severance’ pay? The answer will surprise most employers.

Judge Finds Poor Reference is Not Defamation

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Can an employee sue his former employer in defamation for a poor reference? In a to-the-point decision authored by the Honourable Justice Gisele M. Miller of the Ontario Superior Court of Justice, Papp v. Stokes et al, 2017 ONSC 2357, the answer was not if what was is said is truthful and/or free of malice.

In the result, Justice Miller found that Mr. Papp had not been smeared as a result of an honest, but less than flattering reference.