Wrongful Dismissal not clear cut
Author: Daniel A. Lublin
Great services are not cancelled by one act or by one single error. – Benjamin Disraeli
Here are six factors to consider if you’ve recently been dismissed:
Severance: If legal cause for an employee’s termination is not asserted, her performance or lack thereof is not relevant when setting the appropriate amount of severance she should receive. That is, her bad judgment, poor performance, or, since the Supreme Court ruled that an employee fired for lying to his employer was entitled to severance pay, even her dishonesty or fraud, may not matter unless it meets an appropriate threshold – which may be a function of judge you happen to draw more than the facts of any given case.
Bad faith in the manner of dismissal: Before 1997, employers were relatively immune from liability for dismissal-related conduct that caused employees harm, apart from the fact of the dismissal itself. But since the Supreme Court ruled that companies that play hardball with employees at the time of their termination risk paying additional damages, employee-side lawyers have been sharpening their pens. Making frivolous allegations of just cause, withholding statutorily-required severance payments and providing misleading references are examples of the virtually unlimited spectrum of behaviour that can justify a bad faith damage award.
Unionized employees: Seldom will their disputes be heard by a judge. In a recent column, I wrote about Garry and Mark Coleman who sued their ex-employer and union in court, instead of advancing a grievance under their collective agreement. Rather than responding to the merits of the Colemans’ case, the defendants argued that, as unionized employees, they had no right to sue. In dismissing their claim, the judge echoed the sentiment held by Canadian courts – that absent exceptional circumstances, unionized employees must file a grievance, not a wrongful dismissal claim with the courts.
Discrimination and harassment: Previously, employers, and their lawyers, clung to the belief that these claims must proceed before human rights tribunals or were not sufficiently separate from an employee’s dismissal to merit awards of punitive and aggravated damages. However, Honda Canada’s actions in dismissing former employee Kevin Keays changed the name of the game. Since 2006, when the Ontario Court of Appeal awarded Keays $100,000 in punitive damages, confirming the trial judge’s finding that employment-related discrimination and harassment could found an award for punitive damages, these claims have been eminently relevant to wrongful dismissal lawsuits.
Employment Contracts: Anything can be incorporated into an employment contract. It can provide the right to limit employees’ severance entitlements, demote them or reassign their jobs, change their compensation, transfer them across-country and, not least, prevent them from competing after their employment ends. But despite employers’ freedom to introduce virtually any term, not all written promises will be enforced by the courts.
Releases: Are unnecessary when providing for only the minimum statutory severance payments an employee is already entitled to. To ensure that your end of the deal is fair, meet with counsel – before signing your name.