Can an employer refuse to pay out a severance package after it offers it to an employee and the employee agrees to accept it? That was essentially the question that the Ontario Superior Court of Justice was asked to resolve in the case of Dennis v. Ontario Lottery and Gaming Corporation, 2014 ONSC 3882 (CanLII).
According to the Honourable Justice Brian P. O’Marra, a deal is a deal.
“Can my employer…” those three little words are the most common start to any question asked of an employment lawyer by a worker. “Can we” is the most common start to questions asked of an employment lawyer by management. The purpose of this post is to address the issue of what employers can do and what am employee’s rights and response can be.
Does the Human Rights Tribunal of Ontario (“HRTO”) have the legal ability (“jurisdiction”) to award severance pay? According to a recent decision from the Divisional Court (a branch of the Ontario Superior Court of Justice, and a type of court of appeal), Campbell v. Revera Retirement LP, 2014 ONSC 3233 (CanLII), the answer is that it is probably best to look elsewhere.
The case is an important reminder to potential plaintiffs to pick the proper venue for advancing one’s case.
The reasons for decision in the recently released case of Paquette c. Quadraspec Inc., 2014 ONCS 2431 (CanLII) are a necessary read for any Ontario employment lawyer.
In his reasons for decision, the Honourable Justice Paul Kane of the Ontario Superior Court of Justice sitting in Ottawa, challenges recent decisions from the Ontario courts on the issues of both contractual termination provisions and statutory severance.
The only catch? The decision is en français.
How much weight are judges to give other wrongful dismissal decisions? According to a recent decision from the Court of Appeal for Ontario, while other decisions from the same level of court can be persuasive, they are not binding. The principle of stare decisis requires that courts render decisions that are consistent with the previous decisions of higher courts.
In order to receive an award of wrongful dismissal damages, a dismissed employee must prove that he or she suffered damages as a result of his or her dismissal from employment. While that statement of law may seem simple and straightforward, it was the primary reason the Ontario Divisional Court set aside a $21,475 Small Claims judgment in a recent decision: Garcia v. 1162540 Ontario Inc., 2013 ONSC 6574 (CanLII)
Are defined benefit pension benefits deductible from wrongful dismissal damages? According to a majority of the Supreme Court of Canada, the answer is no, they are not.
In its decision in IBM Canada Limited v. Waterman, 2013 SCC 70 (CanLII) seven of this county’s nine Supreme Court Justices (LeBel, Fish, Abella, Cromwell, Moldaver, Karakatsanis and Wagner JJ.) agreed that pension benefits are not properly deductible from wrongful dismissal damages. Justice Rothstein and Chief Justice McLachlin disagreed.
The employment contract between the appellant and the respondent was clear in providing for 15 days’ notice in order to terminate. The appellant was given pay in lieu of notice with accordance with the agreement, as found by Morgan J. We see no error in Morgan J.’s conclusions. The appeal is therefore dismissed with costs fixed at $3,500 inclusive of disbursements and HST.The above was the entirety of the Court of Appeal's decision. Such a short decision left this author wondering what more could be gleaned from the trial decision. A review of that decision left this author upset that the plaintiff employee had not sought (or followed) professional legal advice.
(c) istock/Bicho_raro
In a case sure to surprise some working parents, an Ontario Deputy Judge has ruled that the failure of a nanny to supervise a two-year-old child and a four-and-one-half year old child was not just cause for dismissal.
The case was argued in the Ontario Small Claims Court, with the threshold issue being whether the employer parents had just cause for dismissal. In finding that the parents did not have just cause, Deputy Judge Z. Jack C. Prattas held that there was conflicting evidence on the critical point of whether the children were being properly supervised. Deputy Judge Prattas's reasons for decision can be found on CanLII at: Pascua v Khul-Schachter, 2013 CanLII 47860.
There is no shortage of ways to structure a severance package. A common way for employers to attempt to terminate an employee's employment, while keeping cash flow in check, is to provide the dismissed employee with "salary continuance," i.e. payment of salary over a period of time, rather than paying the employee a lump sum. A question that I am often asked is, can the employer legally require the employee to accept salary continuance?
Like most of the answers in our series Answers to Common Questions, the answer is "it depends"
How much time do you have to consider a severance package under Ontario law? The answer can both simple and complex.
The simple answers are that you have as long as your employer gives you and that there is no time limit imposed by the Ontario Employment Standards Act, 2000. So, on the one hand, if your employer gives you a week, you arguably have a week. But, you can also have more time than what the employer says.
Where the issue arises for most employees who find themselves suddenly unemployed is when employers only give the employee a very short period to consider the offer, say one or two days. The offer usually comes with a time limit and a threat that if the offer is not accepted by the deadline, then the employer will only pay the employee the minimum amount required by law.
Two questions come emerge: What is the reasonable time limit? And can an employer arbitrarily impose any time limits?
A recent decision of Arbitrator Randy Levinson found that the Employment Standards Act, 2000 (“ESA”) does not require an employer to pay termination pay to disabled employees if the employer wishes to provide written notice of termination instead. In Quality Meat Packers Limited and the United Food and Commercial Workers Canada, Local 175 (as yet unreported), Arbitrator Levinson based his decision on the fact that the disabled employees did not provide any services to the employer and were therefore not entitled to any compensation.
In a decision released in October 2011, Stevens v. Sifton Properties Ltd., 2012 ONSC 5508 (CanLII), the Honourable Justice Ian F. Leach held that where an employment contract failed to provide for the continuation of benefits throughout the applicable notice period - even though the employer actually maintained the benefits throughout the notice period - the contractual provision was of no force or effect.
There are exceptions to every rule. For example, not all workers in Ontario are covered by all aspects of Ontario’s employment laws. Some workers’ rights, for example bank employees and those who work for airlines, are governed by the Canada Labour Code. In other cases, even those who are generally covered by the Ontario Employment Standards Act, 2000 are not covered for all aspects.
One such exemption is with respect to “construction employees.” However, sometimes determining whether a worker is a “construction employee” is more complicated than it may initially appear.
What is the maximum amount of reasonable notice, also referred to as severance, to which an employee dismissed in Ontario can be entitled under Ontario employment law? As at least one observer has asked, is the sky now the limit? See: Reasonable notice: The sky’s the limit?
The question was asked following the 2012 decision of the Ontario Superior Court in Abrahim et al v. Sliwin et al, 2012 ONSC 6295 (CanLII), in which the Honourable Justice Douglas Gray held, on an undefended default motion that, “I fail to see how a cap of 24 months, or indeed any maximum, is appropriate.”
It is Justice Gray’s decision that perhaps no maximum is appropriate that has led some to question that perhaps the sky is indeed now the limit.
If a termination provision in an employment agreement does not technically violate the provisions of the Employment Standards Act at the time of termination, but has the potential to do so at other times, is it still enforceable? “No” says the Ontario Superior Court of Justice.
