Punitive damages

Date: 2009
Author: Daniel A. Lublin
Publication: Metro

Reasons for dismissal must be honest

“Every man has his fault, and honesty is his.” – William Shakespeare
In the often twisted world of Canadian workplace law, both employers and employees tend to exaggerate facts in an effort to improve their own cases. Whether it’s a deliberate strategy or a simple white lie, our courts are increasingly signalling their disdain when stories without the conviction of truth find their way to trial. A recent decision from British Columbia reminds us all that honesty remains the best policy.
About halfway through his apprenticeship as a repairman at Dams Ford Lincoln Sales Ltd. in Surrey, British Columbia, Tyler Marchen was given an envelope with two weeks’ pay and his record of employment stating that he had been dismissed, and told to leave. When he asked why he was being fired, he was told that it was not up for discussion and that he was no longer welcome on the property.
After Marchen’s dismissal, Dams made several comments suggesting that he was fired due to a police matter. Although Marchen was viewed as a good employee, his brother (who was also an employee at Dams) had been implicated in some thefts from the dealership. When a government employee called to request the reasons for Marchen’s dismissal in order to qualify him for employment insurance, she was told it was due to a police issue and they couldn’t risk keeping him on.
As Marchen and Dams had a fixed-term agreement for the duration of his apprenticeship, Marchen promptly sued Dams, claiming that he was entitled to the value of the remaining term of the contract. As soon as Marchen started his legal action, Dams changed its story. It called the employment insurance office and told it that, despite an investigation into Marchen’s brother, it had actually fired Marchen because it had downsized its body shop.
At trial, Dams’ witnesses denied that Marchen was fired because of his brother’s potential theft but maintained its story that there had simply been a lack of work. Judge Richard Goepel wasn’t convinced. He found that Marchen was dismissed because of Dams’ unfounded suspicion that he was involved in his brother’s potential theft and that it had deliberately attempted to mislead the court as to its true motives.
Dams’ decision to mislead the court turned a seemingly routine case for wrongful dismissal into a legal nightmare. Marchen was awarded over $18,000 in lost wages, another $25,000 for loss of training and status, $100,000 in punitive damages and most of his legal fees, usually awarded only in extraordinary circumstances.