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.

Employer Ordered to Provide Particulars of Reasons for Termination Without Cause

Is a provincially regulated employer required to provide the reason that it terminated an employee’s employment if that employer does not allege that it had “just cause” to terminate the employment?

Conventional wisdom would be that the employer would not have to provide a reason. It is settled law that employers in Ontario may terminate the employment of any of its employees without cause subject only to two restraints: (1) the employer must provide the employee with reasonable notice of the termination; and (2) the reason for termination cannot be prohibited by law.

It was the second criterion, the reason for termination cannot be prohibited by law, that brought the issue of whether an employer had to provide its reason for the termination of employment into focus. According to a decision of Master Donald E. Short, Mezin v. HMQ, 2016 ONSC 5171, if an employee alleges that his employment was terminated in contravention of the provisions of the Human Rights Code, then the employer must provide particulars of its denial of such allegations.

Do Federally Regulated Employers Require Just Cause to Dismiss Non-Unionized Employees Employed for Less Than Twelve Consecutive Months?

Do federally regulated employers require legal “just cause” to terminate the employment of non-unionized employees employed for less than twelve consecutive months, e.g. those employees “on probation”? The question is not an academic one, but rather one certain to have a very real impact on the lives of those employed in the federally regulated sphere and the financial bottom lines of those who employ them.

The Supreme Court of Canada’s decision in Wilson v. Atomic Energy of Canada Ltd., 2016 SCC 29 (CanLII), which was released July 14, 2016, finally resolved the debate concerning whether federally regulated employers require legal just cause to terminate the employment of non-unionized employees employed for more than twelve consecutive months: yes they do. However, that decision left unanswered the question of whether such employers also require just cause to terminate the employment of employees employed for a shorter period of time.

Although I must confess to having not researched this issue fully, such that this post may generate a definitive answer from someone who has looked at the issue, for the reasons that follow, it is my sense that federally regulated employers do require legal “just cause” to terminate the employment of non-unionized employees employed for less than twelve consecutive months.

No Cause? Then No Dismissal for Non-Unionized Federal Employees – The Supreme Court of Canada Shakes Up Canadian Employment Law

At the end of 2015, I proclaimed the Supreme Court of Canada’s decision to grant leave to appeal from a decision of the Federal Court of Appeal the most important decision to Canadian employment law of that year. (See Top Five Cases of Importance to Ontario Employment Law - 2015.) My reason for doing so was simple:

The Federal Court of Appeal’s decision in Wilson v. Atomic Energy of Canada Limited, 2015 FCA 17 was unanimous: A federally regulated employer can dismiss an employee without cause. While that statement may sound obvious, given the provisions of section 240 of the Canada Labour Code the same was far from a given. Indeed, given the Supreme Court’s decision to hear the appeal I would suggest that it still is not.

It is the fact that the Supremes are willing to hear the appeal, which was unanimous, and which upheld a previous decision of the Federal Court suggests to me that the Supreme Court of Canada is not entirely certain that the Federal Court got it right.

Although I somewhat reserved my prediction on matters, it would turn out I was right: The Supremes did grant leave because they doubted the correctness of the Federal Court of Appeal's decision.

On July 14, 2016, the Supreme Court of Canada (“SCC”) laid down its decision in the case of Wilson v. Atomic Energy of Canada Ltd., 2016 SCC 29.

In doing so, the Supreme Court has finally settled years of debate among Canada’s employment lawyers as to whether non-unionized federally regulated employees can be let go without cause, with a resounding “No!”.

Doubling Down Damages – The Ontario Court of Appeal Sends Strong Message to Discriminatory Employers

What is the penalty for embarking on a “campaign of abuse”, intentionally designed to force a disabled employee to quit her job? In a June 2016 decision from the Court of Appeal for Ontario, Strudwick v. Applied Consumer & Clinical Evaluations Inc., 2016 ONCA 520, Ontario’s highest court awarded nearly a quarter million dollars plus costs following the wrongful dismissal of a long-term employee who has harassed and belittled by her employer after losing her hearing.

The ONCA’s Decision in Oudin v. CFT Leaves One 'Wundering' – Is Wunderman Dead?

Must the termination provision in an employment contract expressly employ the words “benefits” in order to be legally binding? Before the Court of Appeal for Ontario’s decision in Oudin v. Centre Francophone de Toronto, 2016 ONCA 514 (released June 28, 2016), I would have said “yes.” In fact, I said so rather emphatically in my earlier blog post “Benefits”: The Most Important Word in Ontario Employment Law. I mean, I declared the word “benefits” as “the most important word in Ontario employment law.” Perhaps I was mistaken.

Want to Wrongfully Dismiss an Employee? There’s an App for That!

Can I interest you in an app that will almost invariably get you sued? I doubt it.

It has been my experience as a litigator that few people want to be involved in a lawsuit. It has also been my experience that most people do not want to break the law. Most employers are not interested in either wrongfully dismissing one of their employees or dealing with the fallout once they do. So why would anyone be interested in an app that almost invariably ensures both a wrongful dismissal and a letter from someone like me?

The unfortunate and frustratingly ironic reason that so many employers use an app almost guaranteed to get them sued is that the app is ostensibly designed to do the opposite.

So what app am I talking about? The “Severance Pay Calculator” put out by, of all people, the Ontario Ministry of Labour.

Is Twenty-Six the new Twenty-Four? Taking the 'Cap' off the Limit on Reasonable Notice

Notwithstanding the popularity of the Netflix series by the same name, it remains debatable whether orange really is the new black. Also subject to debate is whether twenty-four months remains the unofficial ‘cap’ on reasonable notice.

Ever since the Court of Appeal for Ontario’s pronouncement in Lowndes v. Summit Ford Sales Ltd., 2006 CanLII 14 (ON CA) that, “Although it is true that reasonable notice of employment termination must be determined on a case-specific basis and there is no absolute upper limit or ‘cap’ on what constitutes reasonable notice, generally only exceptional circumstances will support a base notice period in excess of 24 months”, employment lawyers have debated what those “exceptional circumstances” might be.

A more recent decision from the Court of Appeal, Keenan v. Canac Kitchens Ltd., 2016 ONCA 79 affirmed an award of 26 months to a “dependant contractor.” (For more on the issue of “dependant contractors” see The Not-So-Independent Contractor.)

Is 26 the new 24? I don’t know, what I do know is that whoever said orange was the new pink was seriously disturbed.

Employer’s Financial Circumstances Not a Relevant Consideration in Determining Reasonable Notice: ONCA

Are an employer’s financial circumstances a relevant consideration in determining the period of reasonable notice to which a wrongfully dismissed employee is entitled?

That was the issue that the Court of Appeal for Ontario had to answer in the case of Michela v. St. Thomas of Villanova Catholic School, 2015 ONCA 801.

In answering the question “no”, the court could not have been any more succinct or clear: “An employer’s financial circumstances may well be the reason for terminating a contract of employment – the event that gives rise to the employee’s right to reasonable notice. But an employer’s financial circumstances are not relevant to the determination of reasonable notice in a particular case: they justify neither a reduction in the notice period in bad times nor an increase when times are good.”

Judge's Wrongful Dismissal Decision is Itself Wrongful

From time-to-time a decision will come along that will leave me not only confused, but frustrated. Wyllie v Larche, 2015 ONSC 4747 is one of those cases.

Yesterday, I wrote about the court’s decision not to award punitive damages in that case. With respect to that issue, the court decided that the employer’s refusal to pay the statutory minimum amount of severance to a dismissed employee was excused because the employer had offered the employee an extra $546.25 (gross of tax) to waive all of his rights. See: Failure to Pay Statutory Severance ‘Okay’ because Employer Offered to Do So.

In my earlier commentary I had written the following:

I have a number of issues with Justice Price’s decisions. Principally His Honour’s decision to award Mr. Wyllie no more than his five days of statutory severance and his decision to not award punitive damages.

I have already explained my concerns with respect to the punitive damages decision, this post examines the severance issue.

"Cynical, Patronizing, Unfair, Impractical, and Expensive" - How Justice Perell described the Partial Summary Judgment Approach to Wrongful Dismissal Cases

Summary judgment, a method of resolving lawsuits without the need for a trial, has long been considered an appropriate means by which to resolve wrongful dismissal cases. The changes made in 2010 to the Rules of Civil Procedure, the rules governing lawsuits in Ontario, served only to increase the popularity of such a process.

But, as this blog has considered on more than one occasion, the speed and efficiency of summary judgment bring with them their own challenges in wrongful dismissal cases; most acutely what to do about the dismissed employee’s duty to mitigate?

In April of 2015, in the case of Markoulakis v SNC-Lavalin Inc., 2015 ONSC 1081 (CanLII) the Honourable Justice Andra Pollak held that the use of the “Trust Approach” previously approved by the Court of Appeal for Ontario in Cronk v. Canadian General Insurance Co. (1995), 25 OR (3d) 505 (CA) was no longer appropriate given the decision of the Supreme Court of Canada in Hryniak v. Mauldin, 2014 SCC 7. That case was summarized by this blog in the post Rushing to Judgment: How to Reconcile the Duty to Mitigate with Summary Judgment in Wrongful Dismissal Cases.

More recently however, on June 29, 2015, the Honourable Justice Paul Perell, also of the Ontario Superior Court of Justice, in the case of Paquette v TeraGo Networks Inc., 2015 ONSC 4189 (CanLII) described the "Partial Summary Judgment Approach", where the employee is granted a partial summary judgment and the parties return to court during and or at the end of the notice period for further payments subject to the duty to mitigate, employed by Justice Pollak as “cynical, patronizing, unfair, impractical, and expensive.” Justice Perell specifically mentioned the Markoulakis case in making such comments.

Ouch.

Employee Owed More Severance Because He was Fired in June

Does it matter in which month an employee is fired? According to decision from the Ontario Superior Court of Justice, Fraser v Canerector Inc., 2015 ONSC 2138 (CanLII), the answer is “yes.”

In his reasons for decision granting the plaintiff 50% more reasonable notice than he otherwise would have awarded, the Honourable Justice Sean F. Dunphy wrote:

I must also account for the time of year when his employment was terminated in assessing reasonable notice. Mr. Fraser’s employment was terminated in June and it was quite foreseeable that hiring decisions at his level might have needed to be delayed somewhat due to the summer months in order to account for vacation schedules of key decision-makers.

Termination from Employment While on Disability Leave

There is never a good time to be fired from one’s job. However, some times are worse than others. A particularly bad time to be fired is while absent from work on disability leave.

While there are few definitive answers when it comes to the law, this post will take a look at some of the most common questions concerning termination from employment during disability leave.

Rushing to Judgment: How to Reconcile the Duty to Mitigate with Summary Judgment in Wrongful Dismissal Cases

How should the court account for a plaintiff’s duty to mitigate his damages following termination from employment, when summary judgment can be awarded before the expiry of the reasonable notice period?

More to the point, how can an employer ensure that the dismissed employee will take all reasonable steps to mitigate his damages if that dismissed employee is already in receipt of his pay in lieu of notice?

In the case of Markoulakis v SNC-Lavalin Inc., 2015 ONSC 1081 (released April 16, 2015), the Honourable Justice Andra Pollak held that the use of the “Trust Approach” previously approved by the Court of Appeal for Ontario in Cronk v. Canadian General Insurance Co. (1995), 25 OR (3d) 505 (CA) is no longer appropriate, given the decision of the Supreme Court of Canada in Hryniak v. Mauldin, 2014 SCC 7.

Should Employers be Allowed to Fire Employees for Their Off-Duty Conduct?

Should employers be allowed to fire employees for their off-duty conduct? Although this blog has repeatedly considered the issue of whether employers can fire employees for their off-duty conduct (they can; see e.g. Comments on Facebook "Just Cause" for Dismissal), the question that this blog has not yet really considered is whether employers should be able to do so.

In posing this question I do not wish to be taken as suggesting that any particular set of actions should go without punishment. Moreover, I do not intend to suggest that perhaps an employee should never lose his or her job for off-duty conduct. Rather the questions are really these:

• Is termination from employment ever an appropriate punishment for one’s off-duty conduct?
• If termination can be an appropriate punishment, after what sort of process should such a punishment be meted out?
• How serious must the off-duty conduct be in order to warrant termination from employment?

There is More to Employment Law in Ontario than Just the Employment Standards Act

There is more to employment law in Ontario than just the Employment Standards Act, 2000. While this point should be obvious, a recent article in the Toronto Star, Ontario allowing employers to fire workers without cause begs for this point of clarification.

“Bridging” Employee to Retirement is an Inappropriate Method by which to Calculate Reasonable Notice says ONCA

How are trial judges to calculate the amount of reasonable notice to which a suddenly unemployed employee is entitled? In yet another decision to reinforce the position that the analysis set out in Bardal v Globe and Mail remains the preeminent method by which to calculate the same, Arnone v. Best Theratronics Ltd., 2015 ONCA 63 (CanLII), the Court of Appeal for Ontario disapproved one judge’s approach of calculating the amount of time it would take to ‘bridge’ the employee to an unreduced pension.

Terminations without Cause are not Automatically Unjust: Federal Court of Appeal

In a landmark decision, the Federal Court of Appeal has said that terminations without cause are not automatically “unjust” as defined by the terms of the Canada Labour Code. In “breaking the tie” between competing lines of jurisprudence, the Federal Court of Appeal in Wilson v. Atomic Energy of Canada Limited, 2015 FCA 17 (CanLII) has unequivocally said that the purpose of the “unjust dismissal” provisions of the Canada Labour Code is not to elevate non-unionized employees to the same status as those who are unionized. Put another way, there is no longer any security of employment under the Canada Labour Code. For those employees working in such industries, this is huge.

NOTE: This is a summary of a decision of the Federal Court of Appeal. This decision has since been overturned by the Supreme Court of Canada.

Hitting the “Target” with Mass Terminations

A lot has already been said about Target’s abrupt decision to close all of its Canadian stores; but one story has dominated headlines more than others: Target’s ‘decision’ to provide its employees with 16 weeks of ‘severance.’ As some employees are discovering, that ‘severance’ is really nothing more than working notice. What is more, the ‘decision’ was pretty much already made for Target as the amount is dictated by Ontario law.

Working through the mechanics of the situation, one can see that Target’s ‘decision’ is hardly as generous as it was first touted.

Requirement to Purchase Shares Signalled Employer’s Intention to Create Long-Term Employment Relationship: ONSC

How does requiring an executive to purchase shares in his employer’s company affect the employee’s reasonable notice period in the event that his employment is terminated without cause? According to the Honourable Mr. Justice G.E. Taylor of the Ontario Superior Court of Justice, the answer is that it tends to length the notice period.

In the case of Rodgers v. CEVA, 2014 ONSC 6583 (CanLII), Mr. Justice Taylor held that, “Based on the required investment in [the employer] I find there was at least an implied representation that the plaintiff was about to embark upon a long-term employment relationship with [his employer.]