Showing posts with label employment law. Show all posts
Showing posts with label employment law. Show all posts

Friday, August 31, 2012

Ontario Employment Law: Mitigating Damages By Staying With The Same Employer

In Ghanny v. 498326 Ontario Limited, the Ontario Superior Court of Justice was faced with a question that has become all too common in these difficult market conditions.

Must an employee whose job is being eliminated by its employer accept the same kind of position at a related company with the same pay in mitigation of his losses arising from a wrongful termination?

In the case, the Plaintiff, an 18 year employee was terminated with less than one month's notice. By any measure, this was highly inadequate and wrongful. The Plaintiff's job as Service Manager at Downtown Toyota had been eliminated by the company. But as it happened, his employer offered him immediate re-employment at the same job at the same salary at Downtown Suzuki, a recently obtained and related dealership, just a few blocks away.  The Defendant made the same offer again months later, after receiving a letter from the Plaintiff's lawyer stating that the Plaintiff had been wrongfully dismissed and was seeking compensation for same.

The Plaintiff turned down both offers of re-employment for two reasons:
  1. He thought that his 18 years of service at Downtown Toyota would not be recognized if he joined Downtown Suzuki; and
  2. He was concerned that the future of this dealership in spite of having received assurances to the contrary from his employer.  
The Plaintiff argued that he was under no obligation to accept the offer of employment; the Defendant argued the contrary. In the end, the Plaintiff obtained a job in mitigation of his losses. However, it had taken him several months to secure and his salary at the new job was considerably lower than at his old job.

The Court, in deciding that the Plaintiff should have accepted the offer that had been advanced by his employer, considered the leading Supreme Court case on the subject Evans v. Teamsers Local 31, [2008] 1 S.C.R. 661, wherein it is stated:
[I]n some circumstances it will be necessary for a dismissed employee to mitigate his or her damages by returning to work for the same employer ... requiring an employee to mitigate by taking temporary work with the dismissing employer is consistent with the notion that damages are meant to compensate for lack of notice, and not to penalize the employer for the dismissal itself. The notice period is meant to provide employees with sufficient opportunity to seek new employment and arrange their personal affairs, and employers who provide sufficient working notice are not required to pay an employee just because they have chosen to terminate the contract. Where notice is not given, the employer is required to pay damages in lieu of notice, but that requirement is subject to the employee making a reasonable effort to mitigate the damages by seeking an alternate source of income.

The Court held that a reasonable person, in the position of the Plaintiff, would have accepted the offer that had been advanced. The salary offered was the same; there were no changes in working conditions; and the personal relationships involved had not become acrimonious.

In so holding the Court had regard for the following statement of law from Evans:
The critical element is that an employee not [be] obliged to mitigate by working in an atmosphere of hostility, embarrassment or humiliation … and it is that factor which must be at the forefront of the inquiry into what is reasonable. Thus, although an objective standard must be used to evaluate whether a reasonable person in the employee's position would have accepted the employer's offer … it is extremely important that the non-tangible elements of the situation -- including work atmosphere, stigma and loss of dignity, as well as nature and conditions of employment, the tangible elements -- be included in the evaluation.
The Court found that the Plaintiff, despite his statements to the contrary, had received assurances of job security from the Defendant  that his belief, that his 18 years of service would not be recognized, was not reasonable in all the circumstances. In any event, not enough reason him to refuse the position like he did.

This decision illustrates that  in certain circumstances, a wrongfully terminated employee may have to accept an offer of re-employment from its terminating employer.
- Robert Tanha, Toronto

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Monday, July 30, 2012

Workers’ Compensation Benefits Curtailed for Injured Antiques Aficionado

An October, 2011, decision by the Nova Scotia Workers’ Compensation Appeals Tribunal should signal to those of us who not only collect, but also repair, show or deal in antiques, that our hobby activities may be scrutinized by adjudicators determining entitlement to benefits arising out of a workplace injury.

The names of the injured worker and his employer are not disclosed in the reported decision. However the details of the injury, treatment, ongoing physical and emotional difficulties, and expert opinions are each enumerated in detail. The worker had been employed since 1988 as a Division Crewman, performing general labour duties; but he worked primarily as part of an asphalt crew doing brush cleaning and traffic control. He was injured in October, 2005, when he lifted a steel ramp on the back of a truck. He stated that since his injury he has had pain in his low back and numbness in his left leg, and could not work at his job.

The worker was an antique car and machinery collector. He had been off work for a number of years, he had undergone extensive treatment and testing, and he was now being offered an alternate, less stressful position with the employer which he had begun pursuant to a back-to-work program. The worker claimed that the subsequent onset of migraines, and bowel and bladder problems were causally connected to the initial injury, and thus should be taken into consideration during a review of his case, and his application for additional benefits. In addition he claimed he was unable to fulfill the requirements of the newly offered job.

The appeals tribunal reviewed the prior decision of the Workers’ Compensation Board which found that these additional medical problems were not related to the injury, that the offer of an alternate position with the employer was reasonable and appropriate, and that the worker was not entitled to further treatment at a pain management clinic. The worker’s appeal of that decision was denied in its entirety by the Appeals Tribunal. The final two issues (offer of alternate employment and denial of ongoing treatment) are relevant to our discussion of the worker’s passion for antiques and should serve as a warning to those of us who are injured on one job, but carry on with another vocation, even if it’s a hobby.

Most of us have heard stories about insurance companies sending out private investigators to spy on people who have been injured in car accidents, to speak to their neighbours, and to otherwise dig up information which suggests that they are not as injured as they claim or are simply malingerers. Workers’ compensation boards have a similar right to test the veracity of the claims of injured workers by hiring investigators. And now, in the age of the internet, it’s much easier to find out how injured individuals are really spending their time while away from the workplace, ostensibly recovering.

The evidence at the appeals hearing disclosed that the antiques aficionado, while off work had been participating in events involving antique cars and machinery, including a plowing event. He stated that because of his condition he wasn’t able to participate in the festivities “to any great extent.” He said that he would still drive an antique car around, but not while taking medication.

The worker owned four antique cars and some antique trucks and tractors, and would work on their restoration. He said that his friends would help him out to some extent working on his cars, but admitted that he did spend time on his own in his home workshop. When asked about coming to work (the back-to-work program) with grease under his nails, he admitted to working at things at his shop and showing his son how to do mechanical things, such as replacing a bicycle chain. But in an effort to rehabilitate his testimony, he stated that the mechanical jobs he was doing around the house now took longer since he had difficulty concentrating since the accident. He also said that his doctors had told him to challenge the pain, and therefore that was why he’d been seen doing strenuous activities.

On cross-examination the worker admitted that he had also been spending time on eBay and Kijiji while at work. He had been conducting business on these two internet sites while at the work at the new position offered to accommodate him. He stated that he found the websites difficult to use.

The Appeals Tribunal decision noted all these activities that the worker had been engaging in while either off work entirely, or at the back-to-work program. Yet supposedly he was unable to return to his usual job duties because of ongoing medical issues and in fact new problems which, he alleged, arose as a result of the 2005 accident.

As indicated, the worker’s claims were denied in their entirety. His claim for further treatment at a pain management clinic was denied. The Tribunal determined that he was medically able to perform the duties of the alternate position that had been made available to him, and which he in fact had been working at.

The lesson to be learned is straightforward. If you’re an antiques collector or dealer and are attempting to advance claims arising out of an accident or injury, be careful. Whether it’s an insurance company, an employer, or a workers’ compensation board, each has means of delving into your day-to-day activities. A couple of decades ago those investigations were restricted to having private eyes looking into your comings and goings. While these investigations continue today, in the modern age of internet technology, sites like eBay, Facebook and other social media networks and websites make it much easier to determine if you’re in fact entitled to the benefits and entitlements you claim. Investigators can now go online rather than follow you around and speak to your neighbours.

- Alvin Starkman, Oaxaca, Mexico
Alvin Starkman received his Masters in Social Anthropology in 1978. After teaching for a few years he attended Osgoode Hall Law School, thereafter embarking upon a successful career as a litigator until 2004. Alvin, a good-standing member of the Law Society of Upper Canada, now resides with his wife Arlene in Oaxaca, Mexico, where he writes, leads small group tours to the villages, markets, ruins and other sights, is a consultant to documentary film production companies, and operates Casa Machaya Oaxaca Bed & Breakfast.
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Sunday, June 24, 2012

Ontario Employment Law: Contractual Entitlement to Notice and the Question of Mitigation

In Bowes v. Goss Power Products Ltd., decided May 25, 2012, the Court of Appeal for Ontario was faced with an interesting question of law:

Is an employee, who is terminated without cause, required to mitigate his or her loss when entitled to a fix term of notice or pay in lieu of notice?

In the case, the employee, Peter Bowes had entered into a written contract of employment with Goss Power Products Ltd, which provided that he would receive six months' notice or pay in lieu thereof if his employment was terminated without case. The contract was silent as to any duty on his part to mitigate his damages in the event of a termination without cause. As it happened, only two weeks following the date of termination, Mr. Bowes was lucky enough to secure comparable employment at the same salary he had been earning with Goss.  

The employer took the position that even though the contract was silent as to any obligation on Mr. Bowes to mitigate his damages, he had an implied obligation to do so and had effectively mitigated most of his damages by obtaining this new position. Therefore, the employer argued it did not have to pay Mr. Bowes anymore than

In answering "no" to the question set out above, the Court noted that a contractually fixed term of notice is distinguishable from common law reasonable notice where a duty to mitigate is an implied term of the employment relationship. In this regard, Winkler C.J.O. stated:
When parties contract for a specified period of notice or pay in lieu thereof they are choosing to opt out of the common law approach applied in Bardal. In doing so, the parties should not be take as simply attempting to replicate common law reasonable notice.
Winkler C.J.O. continued:
In my view, there is nothing unfair about requiring employers to be explicit if they intend to require an employee to mitigate what would otherwise be fixed or liquidated damages. In fact, what is unfair is for an employer to agree upon a fixed amount of damages, and then, at the point of dismissal, inform the employee that future earnings will be deducted from the fixed amount. 
This decision illustrates that where a contract specifies the period of notice, or pay in lieu thereof, which an employee will be entitled upon a termination on a without cause basis, courts will not presume a term requiring the dismissed employee to mitigate its damages.

If you believe that you have been wrongfully dismissed, please contact a lawyer who can advise you as to your rights and entitlements.

- Robert Tanha, Toronto
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Saturday, January 14, 2012

This Week at the Ontario Court of Appeal - January 13, 2012

Each week, Wise Blog looks at recent decisions from the Ontario Court of Appeal.

Tuerr Holdings Inc. v. Vrankovic

The appellant, Peter Vrankovic, appealed from an order granting summary judgment to the respondent, Tuerr Holdings Inc., on the appellant's guarantee of a second mortgage on a commercial property owned by Cambridge Place Commercial Corporation ("Cambridge"). The appellant was the president and director of Cambridge.

The respondent served a Notice of Intention to Enforce Security on Cambridge and a Notice to Attorn Rents on Cambridge's tenants as a consequence of Cambridge being in default on its second mortgage to the respondent. On May 14, 2010, the parties executed a Minutes of Settlement and Forbearance Agreement. The respondent agreed to suspend any further enforcement proceedings on the mortgages until September 5, 2010. This agreement was contingent on Cambridge paying the arrears owing to the respondent and keeping its first mortgage on the property, held by Meridian Credit Union (Meridian), in good standing. Moreover, the Minutes of Settlement and Forbearance Agreement were confirmed by a consent court order.

Contrary to their agreement, Cambridge failed to pay the arrears owing to the respondent and defaulted on its first mortgage to Meridian. As a consequence, Meridian obtained an order appointing a Receiver to sell the property. Furthermore, the respondent commenced an action against the appellant on his guarantee of the second mortgage and obtained summary judgment on the claim.

The Court agreed with the motion judge that Cambridge breached the terms of the Minutes of Settlement and Forbearance Agreement by failing to pay the arrears owing to the respondent and by its default under the first mortgage provided by Meridian. Further, when Vrankovic signed the Minutes of Settlement, the respondent was unaware that Cambridge was already in default in its mortgage payments to Meridian (first mortgagee), and owed over $500,000 in municipal taxes on the property. The Court reaffirmed the motion judge's conclusion that by signing the document in his personal capacity, the appellant waived his right to raise any previous deficiencies in the respondent's enforcement proceedings in response to the motion for summary judgment.

The Court dismissed the appellant's position that Meridian verbally agreed to forbear on enforcement of its first mortgage and to permit Cambridge to pay reduced rent so that it could pursue lease negotiations that would yield increased revenue from existing or potential tenants. The appellant submitted that this evidence served a viable defence to Meridian's assertion that it was entitled to enforce its mortgage security. Additionally, the Court noted that the motion judge correctly rejected the appellant's assertions of an oral forbearance agreement with Meridian, as these assertions were not supported by any documentary evidence, were inconsistent with the terms of the first mortgage and failed to adduce any convincing evidence that Cambridge lost prospective tenants as a result of the respondent's actions.

The Court added that Cambridge was hopelessly in debt, in breach of the terms of the first mortgage and could not be rescued by any extended lease arrangements that were a long ways away from completion. As a result, the Court found that the appellant failed to raise any genuine issues requiring a trial.

Warren Woods Land Corporation v. 1636891 Ontario Inc.

The primary issue on appeal was whether the appellant satisfied the three criteria for the granting of a stay under rule 63.02(1)(b) of the Rules of Civil Procedure.The order sought to be stayed was an order removing all notices filed by the appellant on the land of the respondents (the "Owner"). The application judge held that the appellant did not have an interest in the land in question at the time the notices were registered.

Article 3.14 of the Development Management Agreement between the appellant and respondent contained a provision, which gave the appellant an option to purchase the land. The respondent was disappointed with the appellant's work and advised the appellant that it wished to terminate the Agreement. The respondent did not take the required steps to terminate as contemplated by the Agreement.

The appellant registered the notices in question on October 16 and 28, 2009, claiming entitlement to an unregistered interest in the Owner's property pursuant to s.71(1) of the Land Titles Act. The respondent subsequently sent a Notice of Complaint to the appellant on August 8, 2011, which referred to default on the part of the appellant. The appellant replied to the respondent's Notice of Complaint by letter a two and a half weeks later, providing its understanding of their agreement. Further, the respondent claimed to have formally terminated the Agreement on August 30, 2011 and brought an application to have the notices that the respondent registered on title removed.

Additionally, the appellant claimed that the fact the Agreement created a contingent option to purchase land signified that it had an interest in the land. The respondent submitted that the issue whether an interest in land had been created was a question of mixed law and fact. Moreover, they stated that the appellant only had a right to an "incorporeal hereditament" at common law, which is an intangible right. In Bank of Montreal v. Dynex Petroleum Ltd, the court held, "At common law, an interest in land could issue from a corporeal hereditament but not from an incorporeal hereditament". Therefore, the respondent's position was that since the appellant only had a right to an incorporeal hereditament, it did not have an interest in the land in dispute at the time it registered the notices.

The respondent also argued that Article 3.14 of the Development Management Agreement was void because it contained no time restrictions and thus violated the rule against perpetuities. According to Politzer v. Metropolitan Homes Ltd, an equitable interest is void if it can vest beyond the perpetuity period of twenty-one years.

The Court articulated the three criteria for the granting of a stay:
  1. The appeal must raise a serious question; 
  2. The appellant must demonstrate that it would suffer irreparable hard if the stay were not granted; 
  3. Finally, on a balance of convenience, the appellant must satisfy the court that it would suffer greater harm if the stay were not granted than the respondents would suffer if the stay were granted. 
In dismissing the appeal, the Court held that there was not a serious questioned to be determined. The appellant failed to provide any reasons why the common law prohibition on the creation of an interest in land from an incorporeal hereditament should not apply. Concerning the rule against perpetuities, the Court found that the appellant did not respond to the respondent's claim that the Agreement was void since it was in contravention of the rule.

Additionally, the Court noted that refusing a stay would not result in irreparable harm to the appellant. Irreparable harm is harm that cannot be quantified in monetary terms. The Court found that the appellant would not be able to enforce the Agreement by claiming specific performance, as it intended to sell the lands and it did not put forth evidence that the lands were unique in any fashion.

The appellant failed to satisfy the third criteria as the Court declared that the balance of convenience did not favour granting a stay. If a stay were granted, the respondent would not be able to refinance the lands and sell them pending the outcome of the appeal. On the contrary, if a stay were not granted, the appellant would not be without recourse as it would still be in a position to sue for damages for alleged breach of the Agreement.


Elsegood v. Cambridge Spring Service

One of the primary issues of this appeal was whether the Employment Standards Act ("ESA")could support an employee's claim for common law damages.

The respondent worked for the appellant employer for seven years as a spring technician. There was no written employment contract. The respondent was laid off on two occasions. After the first occasion, he was recalled to work only to be laid off again approximately seven weeks later. The cumulative duration of the layoffs exceeded the statutory maximum of 35 weeks within a 52 week-period, as prescribed by s. 56(1)(c) of the ESA. Once the respondent's layoff period reached 35 weeks, he commenced an action for common law damages for wrongful dismissal rather than claiming termination pay under s.54 of the ESA. Holub Deputy J. awarded him $9,900 in damages reflecting a notice period of six months.

On appeal, the employer argued that an employee's employment status survives a statutory termination by the ESA.  It argued that the ESA and common law were independent regimes so that upon a statutory termination pursuant to the ESA, the employee was entitled only to remedies under the Act.

The Court did not agree. 

It held that the appellants could not rely on s. 56(1) of the Act, which provides that the employee is terminated "for purposes of section 54". The Court disagreed with the employer's position that the respondent was not terminated for all purposes, but only for the purposes of s. 54.  In fact, s. 56(1) prohibits an employer from terminating an employee without notice or payment in lieu of notice. The purpose of s. 54 is to prevent employers from avoiding their liabilities upon termination by pacing employees under a facade of indefinite layoff.

In holding that the ESA provides for the continued application of the common law despite its statutory termination provisions, the Court cited a passage by Iacobucci J. in Machtinger:
Section 4(2) states that a right, benefit, term or condition of employment under a contract that provides a greater benefit to an employee than the standards set out in the Act. I have no difficulty in concluding that the common law presumption of reasonable notice is a benefit...
The Court considered what would transpire if one accepted that the employee's employment at common law survived the operation s. 56(1). At common law, employers do not have a right to layoff employees. Unless there is an agreement to the contrary, a unilateral layoff by an employer is a substantial change in the employee's employment and is considered to be a constructive dismissal.

Employees are entitled to reasonable notice of termination, regardless of what an employment contract states. In Machtinger, one of the employees' contracts allowed his termination without notice, and the contract of the other individual allowed his termination on only two weeks notice. The trial judge found that the termination clauses were invalid because they violated the ESA. He held that the employees were entitled to seven and seven and a half months pay in lieu of notice respectively. On appeal, the Court agreed that the termination provisions were invalid, but held that the termination provisions supported the inference that the employees intended to have very short notice periods. The Supreme Court disagreed and stated, "If a term in null and void, then it is null and void for all purposes, and cannot be used as evidence of the parties' intention". Since the employees' contracts failed to address notice requirements, they were entitled to reasonable notice at common law.

The Court rejected the appellant's claim that an implied term in the employment agreement allowed the employer to place the respondent on indefinite layoff exceeding 35 weeks in a 52-week period. The Court noted that since the indefinite layoff provision failed to meet the ESA's minimum standard, it was void.  As a consequence, the Court declared that the implied term should not be read down but rather excised from the employment agreement.

R. v. Lalumiere

The appellant was convicted of two counts of counselling to commit murder against his ex-wife and her boyfriend. Prior to the convictions under appeal, the appellant accumulated 23 convictions for offences involving his ex-wife and her boyfriend ranging from uttering threats to criminal harassment. Various violence risk assessment tests conducted on the appellant indicated that he had a 70% likelihood of assaulting his ex-wife at least once in the next five years.

In 2007, the appellant was in jail for uttering threats and for breaching his probation order. During his time in jail, a confidential informant divulged to the police that the appellant desired to hire someone to kill his ex-wife and her boyfriend. On June 14, 2007, a police officer posed as a member of the Hells Angels and met the appellant in the visitor's area of the prison and told him that he understood that the appellant wanted to eradicate two individuals. The undercover officer provided the appellant with his phone number and the appellant was agreeable to the arrangement but he stated that he could not pay the officer until after his release at the end of the year. After failing to hear from the appellant over the ensuing two weeks, the officer returned to the jail and raised the issue once again with the appellant about having the two individuals killed. The appellant agreed to pay the officer $5,000 and later telephoned him to provide personal details about the targeted victims.

At trial, the appellant claimed that he knew all along that the undercover officer's intentions were not legitimate. The appellant asserted that he led the undercover officer on and planned to report him to authorities. Furthermore, prior to the undercover officer's meetings with the appellant, the police obtained a judicial authorization, which permitted the officer to secretly record his conversations with the appellant.  Also at trial, the appellant brought an application to exclude the audiotape of the June 27, 2007 telephone conversation under ss. 8 and 24(2) of the Charter. Moreover, the appellant applied to have evidence of his police interview excluded under ss. 10(a), (b) and 24(2) of the Charter. The trial judge found a breach of s.8 but rejected the rest of the appellant's applications.

On appeal, the appellant argued that the trial judge erred by failing to exclude the audiotape under s. 24(2) of the Charter, by failing to exclude the evidence of his police interview under ss. 10(a), (b) and 24(2) of the Charter, in his instructions to the jury and in his ruling on entrapment.

Concerning the ss. 8 and 24(2) Charter issue, the Court noted that the trial judge correctly applied the Collins factors in support of his conclusion that the evidence obtained should not be excluded under s. 24(2) of the Charter. Furthermore, the Court stated that the Grant factors favoured admission of the evidence because the undercover officer's evidence concerning his telephone conversations with the appellant was admissible in any event.

In regards to the appellant's ss. 10(a) and 10(b) claims, the Court reviewed the trial transcripts and concluded that the appellant was advised of his 10(a) and 10(b) Charter rights and the police offered to assist the appellant in contacting counsel. Further, they asserted that the appellant invited the police to continue speaking with him and he declined to answer specific questions when he felt he should not do so without the benefit of counsel present.
Additionally, the Court found no legal errors in the trial judge's instructions to the jury, holding that the trial judge informed the jury that it was their recollection of the evidence that carried the most weight. More importantly, the jury heard the audiotape of the conversation between the undercover officer and the appellant as well as the appellant's explanation.

On the issue of entrapment, the Court saw no error in the trial judge's pronouncement that the police acted on reasonable suspicion and did no more than provide the appellant the opportunity to commit the crime. Also, they noted that the police were justified in giving credence to the tip received from the confidential informant and that the undercover officers' conduct fell short of inducement.

Poole v. Whirlpool Corporation

The appellant terminated the respondent without cause in early March 2010. The respondent brought a motion and was awarded summary judgment for wrongful dismissal, and the motion judge ruled that the respondent was entitled to a bonus in the amount of $5,598.38 per month during the 19-month notice period determined upon the motion.

The appellants challenged the motion judge's decision that the respondent was entitled to a bonus, her calculation of the bonus and her conclusion that no genuine issue requiring a trial arose concerning the respondent's bonus claim.

The appellants argued that in order to qualify for a bonus under the applicable Bonus Plan, the respondent was required to be actively employed on December 31st of the year for which the bonus was claimed. Since the respondent was terminated in March 2010, he was not eligible for a bonus in 2010 or 2011.

The Court found that the motion judge did not err in her rejection of this position. The Court held that the bonus eligibility stipulation relied on by the appellants was not incorporated in the respondent's letter of employment. Moreover, there was no evidence that the stipulation was drawn to the respondent's attention at any time, whether in writing, orally, by means of the appellants' internal intranet communication system, or that he had ever agreed to it. Furthermore, the Court noted that the appellant's failure to cross- examine the respondent on his affidavit material, in which he swore that he never agreed to the stipulation, precluded any reliance by the appellants on the stipulation to defeat the respondent's bonus claim.

In regards to the motion judge's calculation of the bonus, the Court held that the motion judge was correct in her analysis as to the appropriate method for the bonus calculation. Finally, the Court found that the motion judge did not err in her ruling that no genuine issue requiring a trial arose in regards to the respondent's entitlement to a bonus or the method of calculating the bonus.
In dismissing the appeal, the Court concluded that once it was determined that the respondent was wrongfully terminated, the determination of his bonus was straightforward and based on evidence that was mainly uncontested.

 - Alim Ramji, Toronto

Visit our Toronto Law Firm website: www.wiselaw.net

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Ontario Human Rights Tribunal Digest - December 1, 2011-January 1, 2012

Each month, Wise Law Blog reviews important decisions from the Ontario Human Rights Tribunal.

RULINGS ON DISCRIMINATION

Rampersaud v. Primary Response Inc. et al. 

In this case, the Applicant, a self-identified Black male of East Indian descent who was employed as a security guard, alleged discrimination against the Respondent security company on the basis of race, colour, place of origin, ethnic origin, disability and age, contrary to sections 5(1), 5(2) and 9 of the Code. The Respondent stated that the Applicant had been terminated after he was involved in an egregious incident at the assigned work site involving the exchange of unauthorized parking passes to cafeteria staff in return for  free beverages from them.

Employment Standards had determined that the Applicant was not entitled to termination pay since he had been guilty of wilful misconduct. Nevertheless, the Tribunal refused to dismiss the Application on the basis that the substance of the Application had been dealt with in another proceeding since none of the Code-related allegations in the Application were addressed in the ESA proceeding.

The Applicant cited the several incidents of discrimination against the Respondent, for which he sought substantial monetary compensation:
  1.  After his return from a medical leave, the Applicant claimed  that a specific Respondent employee, Ms. Oza, an employee who he believed had supervisory authority over him, tried to have him demoted. The Tribunal rejected this allegation on the basis that it was based on hearsay information and that the Applicant had not identified the informant nor how he or she would have known this information.
  2. The Applicant claimed that he was subject to discriminatory comments on the basis of his ethnic background, namely that he was called "Son of Slave" by Ms. Oza in the presence of other employees, a derogatory and demeaning term about the Applicant's ethnic group. With respect to this allegation, the Tribunal held in favour of the Respondents, noting that the Applicant had not mentioned this allegation in his Application and that sufficient particulars of the allegation had not been put into evidence. What language was the remark made in?  What was the context of the statement?
  3. The Applicant claimed he was improperly excluded from radio communications during the course of his shifts because of his race, but was not aware whether other security guards were being treated in a similar way. The Respondents claimed that this did not occur, or if it did, any denial of access was not done purposely and was as the result of faulty radios. The Tribunal accepted the Respondents' version of events, noting that even if he had been improperly excluded somehow from radio communication there was not evidence that this was done for reasons related to Code grounds.
  4. The Applicant claimed he was improperly denied computer access by the Respondents on the basis of Code Grounds. Again, here, the Tribunal sided with the Respondents, finding that the Applicant was only denied access to specific terminals for logistical reasons and that any improper denials were not linked to Code grounds in any event.
  5. The Applicant claimed he was falsely accused and verbally disciplined for giving false evidence to the media by the Respondents with respect to a security incident that had occurred in October 2008. The Tribunal rejected the Applicant's allegation here too, preferring the Respondents' evidence that the Applicant had been disciplined for violating company policy in not waiting  for the police and ambulance before attending at the scene.
With respect to the Applicant's position that he had been erroneously and falsely accused by the Respondents of giving free parking passes to cafeteria staff in violation of company policy on the basis of his ethnicity and race, in purported justification of his termination, the Tribunal concluded on all the evidence that the termination, while maybe not entirely fair, was not discriminatory:
In my view, the Respondents have established a reasonable non-discriminatory explanation for the termination of the Applicant's employment.
PROCEDURAL RULINGS 

Romero v. Mennonnite Brethren Senior Citizens Home et al. 

In this case, the Applicant filed an application alleging discrimination and harassment in employment contrary to the Ontario Human Rights Code. The Tribunal issued a Notice of Confirmation of Hearing to the parties, requesting that they comply with their disclosure obligations under Rule 16.1 of the Tribunal's Rules of Procedure.

Rule 16.1 states:
Not later than 21 days after the Tribunal sends a Confirmation of Hearing to the parties, each party must deliver to every other party (and file a Statement of Delivery): 
a) a list of all arguably relevant documents in their possession. Where a privilege is claimed over any document the party must describe the nature of the document and the reason for making the claim; and, 
b) a copy of each document contained on the list, excluding any documents for which privilege is claimed. 
The Respondents did not comply and the Applicant sought an Order compelling produce of documents from the Respondents. The Tribunal ordered the Respondents to comply with the requirement under Rule 16.1 within one week.

Vallee v. Fairweather Ltd.

In this case, the Applicant filed an application alleging discrimination against the Respondent. The Respondent had continued to fail to file a response in spite of rulings and notices by the Tribunal that it do so in accordance with the Rules of Procedure.

Rule 5.5 of the Tribunal's Rules of Procedure provides:
Where an Application is delivered to a Respondent who does not respond to the Application, the Tribunal may:  a) deem the Respondent  to have accepted all of the allegations in the Application; b) proceed to deal with the Application without further notice to the Respondent; c) deem the Respondent to have waived all rights with respect to further notice or participation in the proceeding; d) decide the matter based only on the material before the Tribunal. 
In accordance with Rule 5.5, the Tribunal held as follows:
. . . the Respondent is deemed to have waived all rights with respect to further notice or participation in the proceeding. The Tribunal will proceed without the participation of the Respondent. The Respondent is deemed to have waived its right to participate pursuant to Rule 5.5(c) and to have accepted all of the allegations set out in the Application pursuant to Rule 5.5(a). 
...........

If you believe you have experienced discrimination,  contact a lawyer who can advise as to your rights and entitlements under the Ontario Human Rights Code and other relevant legislation.

- Robert Tanha, Toronto
Visit our Toronto Law Firm website: www.wiselaw.net
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Wednesday, November 16, 2011

Ontario Employment Law: Prejudgment Interest On Wrongful Dismissal Damages

In Chandran v. National Bank, Pollak J. in his endorsement on costs dated July 21, 2011, neatly summarizes how prejudgment interest is calculated in a wrongful dismissal action as follows:
... [T]he prejudgment interest on the damage award is calculated as follows: - first, the interest owed from the beginning of the notice period to the end must be calculated monthly on the basis of what was owed at that time; - second, the interest on the total amount of the award outstanding at the end of the notice period must be calculated from the end of the notice period to the date of judgment.
Two calculations essentially need to perform to arrive at a figure for prejudgment interest. In the case, prejudgment interest was determined to be $15,931.93 for an employee with an annual salary of $98,824.00 and an entitlement to 14 months of pay in lieu of reasonable notice.
Pollick J. neatly set out his calculation of prejudgment interest, as follows:
This Court’s calculation of appropriate prejudgment interest on a monthly basis prior to the expiry of the notice period in this case as follows:
(i) Annual Salary of $98,824.00/ 12= $8235.33 a month
Interest Calculated Monthly:
Month 1
$8235.33 x 4.5% per annum for 14 months
$432.32
Month 2
$8235.33 x 4.5% per annum for 13 months
$401.44
Month 3
$8235.33 x 4.5% per annum for 12 months
$370.56
Month 4
$8235.33 x 4.5% per annum for 11 months
$339.68
Month 5
$8235.33 x 4.5% per annum for 10 months
$308.80
Month 6
$8235.33 x 4.5% per annum for 9 months
$277.92
Month 7
$8235.33 x 4.5% per annum for 8 months
$247.04
Month 8
$8235.33 x 4.5% per annum for 7 months
$216.16
Month 9
$8235.33 x 4.5% per annum for 6 months
$185.28
Month 10
$8235.33 x 4.5% per annum for 5 months
$154.40
Month 11
$8235.33 x 4.5% per annum for 4 months
$123.52
Month 12
$8235.33 x 4.5% per annum for 3 months
$92.64
Month 13
$8235.33 x 4.5% per annum for 2 months
$61.76
Month 14
$8235.33 x 4.5% per annum for 1 month
$30.8
Total
$3242.40
(ii) Lump-sum prejudgment interest on the damage award from the end of the notice period to the date of the decision:
• the notice period ended mid November 2008. The award was made on April 26, 2011. The Plaintiff calculated the exact number of days in this period as being 893.
• the total damage award was $115,294.66 x 4.5% a year= $5,188.26 a year
• $5,188.26/365 days in a year= $14.21 interest a day
• $14.21 x 893 days= $12, 689.53 (total lump sum prejudgment interest owed)
On the basis of these calculations a total of $15,931.93 prejudgment interest is owed on the damage award.

This case demonstrates that  the method of calculation for prejudgment interest in a wrongful dismissal action is not something that can be ignored or taken lightly - it can amount to a significant add-on to the damage award.

- Robert Tanha, Toronto

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Thursday, October 20, 2011

Ontario Employment Law: Summary Judgment In Wrongful Dismissal Actions

In Thorne v. The Hudson Bay Company, a case decided September 21, 2011, the Plaintiff, a 37.5 year employee who had been dismissed without just cause sued for wrongful dismissal after receiving a bare-bones severance package that was limited to her Employment Standard Act minimums.

The Plaintiff, an Allocation Associate,  moved for summary judgment, arguing that since there were few factual issues which were contentious between the parties, the judge could rule on the period of reasonable notice she was owed "without the need for the forensic machinery of a trial".

Based on consideration of the legally relevant factors, the Defendant employer took the position that she was owed 12-16 months of pay in lieu of notice. Considering the same factors, the Plaintiff employee took the position she was owed 24-30 months, a very divergent position indeed.

Under Rule 20.04 of the Ontario Rules of Civil Procedure, summary judgment motions are appropriate where the court is satisfied that there is "no genuine issue requiring a trial."

In the affidavits filed by the parties upon the motion, they took starkly contrasting views on the character of the Plaintiff's employment. While she did not have a supervisory function, the Plaintiff claimed that her job was far from entry-level and clerical. She, for example, provided operational support to the high volume merchandise industry which required a solid grasp of the employer's business. The Defendant argued that the Plaintiff's job was clerical, and stated she merely produced purchase orders.

Campbell J. held that a trial would be required to resolve the disagreement:
Having carefully examined the evidence that has been provided by the parties on this issue, it is apparent that they view the nature of the plaintiff’s job very differently. Their disagreement on this issue is not just a matter of the appropriate legal characterization of the job, but rather extends to the nature and details of the responsibilities performed by the plaintiff. The evidence filed by the parties on this motion, none of which has yet been subjected to cross-examination, is in stark conflict. In my opinion, it is simply not possible to fairly and appropriately resolve this important issue without the machinery of a trial. 
Faced with this fundamentally conflicting evidentiary record it is simply not possible to resolve this important factual dispute without the forensic machinery of a trial. Without hearing viva voce testimony from these witnesses as to their understanding of the specific details of the plaintiff’s job responsibilities, and being able to assess their credibility and the reliability of their evidence, and seeing the impact of cross-examination, there is simply no fair and accurate way of resolving the dispute between the parties on this important issue.
Hence, Justice Campbell concluded that in all the circumstances there was a genuine issue for trial given that character of employment remains a relevant factor in the determination of reasonable notice:
I appreciate that the court is entitled to assume that the parties have put forward their best evidence on the summary judgment motion and that, if the case were to go to trial, no additional evidence would be presented. See: Rogers Cable TV Ltd v. 373041 Ontario Ltd., 1994 CanLII 7367 (ON SC), (1994), 22 O.R. (3d) 25 (Gen.Div) at para. 4; Bluestone v. Enroute Restaurants 1994 CanLII 814 (ON CA), (1994), 18 O.R. (3d) 481 (C.A.) at para. 30; Dawson v. Rexcraft Storage & Warehouse Inc. 1998 CanLII 4831 (ON CA), (1998), 164 D.L.R. (4th) 257 (Ont.C.A.) at para. 17. But in some cases, like the present one, that assumption is of little assistance in actually resolving the factual dispute between the parties, as the court is limited to paper review of the evidence provided by the parties, without greater explanation, and wholly untested by cross-examination.
As an aside, for those judges and academic who have doubted the importance of character of employment in the determination of reasonable notice, Justice Campbell had this to say:
. . . it cannot be said that the resolution of this factual issue is of no importance to the outcome of this case. There are authorities which suggest that the character of the employee’s employment may be “a factor of declining relative importance” in the overall analysis of all of the Bardal factors. See: Di Tomaso v. Crown Metal Packaging Canada LP, 2011 ONCA 469 (CanLII), 2011 ONCA 469, at para.22-29; Medis Health and Pharmaceutical Services Inc. v. Bramble 1999 CanLII 13124 (NB CA), (1999), 175 D.L.R. (4th) 385 (N.B.C.A.) at para. 64; Vibert v. Paulin 2008 NBCA 23 (CanLII), (2008), 291 D.L.R. (4th) 302 (N.B.C.A.). Nevertheless, unless and until the governing legal standard for determining “reasonable notice” is changed in a more fundamental way, the character of the employment of the employee will properly remain a factor that must be taken into account in an appropriately “holistic review” of all of the Bardal factors. The fact that the parties in this case have devoted so much energy to producing evidence on this issue demonstrates their own appreciation of this legal reality.
When it comes to what he himself refers to as the "controversial scope of summary judgment motions", there is no doubt that Justice Campbell's reasons for decision raise as many questions as they do answers.
- Robert Tanha, Toronto

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Thursday, July 21, 2011

Ontario Court of Appeal: No Hard Cap on Notice Entitlement of Non-Managerial or Unskilled Employees

In Di Tomaso v. Crown Metal Packaging Canada LP, 2011 ONCA 469, a decision of the Ontario Court of Appeal released June 22, 2011, the appellant, Crown Metal Packaging ("CMP") appealed from an October, 2010 decision of the Superior Court Judge, Justice Beth A. Allen, granting the respondent, Mr. Di Tomaso summary judgement in a wrongful dismissal action under rule 20.

Background:

Mr. Di Tomaso was an employee of CMP for over 33 years as a mechanic and press maintainer. On September 23 2009, Mr. Di Tomaso was informed that his services were no longer required at CMP. However, just before Mr. Di Tomaso had left, he was notified that his employment would be extended by several weeks. In fact, CMP in total issued 5 different termination dates, which in effect extended Mr. Di Tomaso's employment just before each previous termination date. Extension letters were delivered by CMP, as follows:
  • 1. September 9, 2009, with a termination date of November 6, 2009;
  • 2. November 4, 2009, with a termination date of December 18, 2009;
  • 3. December 15, 2009, with a termination date of February 19, 2010;
  • 4. February 18, 2010, with a termination date of February 26, 2010; and
  • 5. February 24, 2010, confirming the termination date of February 26, 2010
Claims by Mr. Di Tomaso:

Mr. Di Tomaso's action claimed that CMP failed to provide reasonable notice or termination pay as required by the Employment Standards Act, 2000 ("ESA"). He also sought common law damages for wrongful dismissal equivalent to 24 months pay.

CMP's Position:

The employer claimed that its first notice of termination (September 9, 2009) was valid, and alleged that Mr. Di Tomaso's subsequent employment constituted "working notice".

Concerning the Plaintiff's common law claim, CMP's position was that at most, Mr. Di Tomaso was entitled to 12 months notice, based on the character of his employment. CMP emphasized that Mr. Di Tomaso was an "unskilled" and "low level worker".

Motion Judge's Reasoning:

On the issue of working notice, the motion judge reviewed the ESA regulation that authorizes an employer to count a period of work commenced after the termination is served but before the termination date (temporary employment)- compared to an employee's statutory notice of entitlement: Termination and Severance of Employment, O. Reg. 288/01, s. 6 ("Regulation"). For instance, the Regulation states:

6. (1) An employer who has given an employee notice of termination in accordance with the Act and the regulations may provide temporary work to the employee without providing a further notice of termination in respect of the day on which the employee’s employment is finally terminated if that day occurs not later than 13 weeks after the termination date specified in the original notice.

(2) The provision of temporary work to an employee in the circumstances described in subsection (1) does not affect the termination date as specified in the notice of the employee's period of employment.
CMP was of the view that all of its extensions was valid, as each was for a period of less than 13 weeks. Therefore, it claimed, Mr. Di Tomaso was provided with working notice up until the last notice of termination dated February 24, 2010. Mr. Di Tomaso argued to the contrary, stating that various period of extensions should be viewed cumulatively which would exceed the 13 week period set out in s. 6(1) of the Regulation.

In agreeing with Mr. Di Tomaso's position, the motion judge stated:
... The legislation clearly allows for notices temporarily extending termination if the final date of termination in respect of the extension is not more than 13 weeks after the date of the initial termination notice. That interpretation makes practical sense since there would be no certainty for an employee as to when his employment would finally end if the employer was not limited in the length of extensions of employment. (para 19).
Furthermore, the motion judge stated that there is a requirement that the notice of termination be "clear and unequivocal".

The motion judge also rejected CMP's position that Mr. Di Tomaso's entitlement to notice was capped at 12 months due to the non-managerial and unskilled nature of his position.. The motion judge referred to factors in Bardal v. Globe & Mail Ltd. (1960), 24 D.L.R. (2d) 140 (Ont. H.C.J.) ("Bardal"), to determine the appropriate notice period. The Bardal factors include: the character of the employment, the employee's length of service, the employee's age, and the availability of comparable employment in the market.

In order to support its position concerning a capped limit of entitlement to notice at 12 months, CMP relied on the court's ruling in Cronk v. Canadian General Insurance Co. 1995 CanLii 814 (ON CAN), (1995), 128 D.L.R. (4th) 147 (“Cronk”). The employer contended that the Cronk ruling establishes a capped limit of 12 months notice for clerical and unskilled workers.

Mr. Di Tomaso relied on the more recent case of Minott v. O’Shanter Development Company Ltd. 1999 CanLII 3836 (ON CA), (1999), 168 D.L.R. (4th) 270 (“Minott”) to counter the argument that there is a cap of 12 months. Specifically, Laskin J.A. stated in Minott:
I do not regard this court's decision in Cronk as establishing an upper limit of 12 months notice for all non- managerial or non-supervisory employees. At most it deals with one occupational category, clerical employees. Moreover, the imposition of an arbitrary 12 months ceiling for all non-managerial employees detracts from the flexibility of the Bardal test and restricts the ability of courts to take account of all factors relevant to each case and of changing social and economic conditions.
Motion Judge's Findings on Notice:

The motion judge agreed that there is not a hard cap of 12 months notice. Additionally, after considering the Bardal factors, the judge held that Mr. Di Tomaso was entitled to 22 months of notice.

Mr. Di Tomaso was 62 years old on the date of his termination and had served 33 years with CMP. He also made efforts to mitigate his damages by looking for other employment in the work force.

Issues on Appeal:

The employer argued on appeal that the motion judge erred in finding that Mr. Di Tomaso did not have clear and unequivocal notice of termination until February 24, 2010; and that Mr. Di Tomaso received reasonable working notice of termination in light of his status as a non-managerial employee.

MacPherson J.A. did not accept either argument for the following reasons:

Termination Date

MacPherson J.A agreed with the motion judge that the Regulation takes into account a single period of temporary work that cannot exceed 13 weeks.

In addition, he added that "clear and unambiguous" notice of termination must incorporate the final termination date. The first four termination dates came and passed. It was not until the final termination notice on February 24, 2010 that Mr. Di Tomaso's termination was carried out as stated in the letter.

Bardal Factors

MacPherson J.A. agreed that there is not a hard cap of 12 months notice for unskilled low level workers. He also agreed with the motion judge's application of the Bardal factors to the instant case.

The appeal judge also stated that giving more weight to the particular factor of character of employment was unwarranted. MacPherson cited Bastarache J in the Supreme Court decision of Honda Canada Inc. v. Keays, 2008 SCC 39 (CanLII), [2008] 2 S.C.R. 362, where he asserted that "no one Bardal factor should be given disproportionate weight".

MacPherson J.A. noted that the proposition that junior lower skilled workers deserve less notice because they have an easier time finding employment has not been empirically proven.

Disposition:

The appeal was dismissed with costs to the employee/Respondent..

- Alim Ramji, Toronto
Visit our Toronto Law Firm website: www.wiselaw.net
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