Employers may be justified in requesting an independent medical examination as part of the procedural aspect of the duty to accommodate

 

Jurisprudence on independent medical examinations (IME) in the context of the employer’s duty to accommodate is sparse.  The Ontario Superior Court of Justice recently provided much-needed guidance in Bottiglia v Ottawa Catholic School Board.  In Bottiglia, the Court held that in certain circumstances, an employer may be justified in requesting an IME as part of the duty to accommodate under the Ontario Human Rights Code (the Code).

The Facts

Marcello Bottiglia worked for the Ottawa Catholic School Board (School Board) from 1975 until he went on sick leave in April 2010.  At the time he went on sick leave, Mr. Bottiglia was being treated by his family doctor for anxiety and stress.  In May 2011, Mr. Bottiglia began to see a psychiatrist, Dr. Levine.

In a letter dated March 19, 2012, Dr. Levine opined that: (i) Mr. Bottiglia’s condition had been relatively treatment resistant, (ii) Mr. Bottiglia required an extended period of time off work, and (iii) a return to Mr. Bottiglia’s current workplace entailed a risk of relapse and the loss of the gains that Mr. Bottiglia had made to that date.  However, in a letter dated August 31, 2012, Dr. Levine indicated that Mr. Bottiglia was ready to return to work.

Concerned that Dr. Levine’s August 2012 letter contradicted the March 2012 letter, the School Board eventually decided to seek a second, independent medical opinion.  Mr. Bottiglia refused the request for an IME.

In November 2012, Mr. Bottiglia commenced an application under the Code, in which he alleged that the School Board had discriminated against him by failing to accommodate him and return to work and subsequently resigned without ever returning to work.  He argued that the School Board had required him to attend an IME before it would permit him to resume his duties, leaving him with no choice but to resign to begin drawing on his retirement pension.

The Ontario Human Rights Commission’s Policy on ableism and discrimination based on disability  states that an IME should not be used to “second guess” a person’s request for accommodation.  An employer is only entitled to ask an employee to ask that an employee undergo an IME where there is a reasonable and bona fide basis to question the legitimacy of the employee’s accommodation request or the adequacy of the information provided.  The Policy also states that, while no one can be made to attend an IME, “failure to respond to reasonable requests may delay the accommodation until such information is provided, and may ultimately frustrate the accommodation process.”

The Decision of the Human Rights Tribunal of Ontario

The Human Rights Tribunal of Ontario (the Tribunal) dismissed Mr. Bottiglia’s application, holding that the School Board had acted in good faith and that its request for an IME fulfilled the procedural aspect of the duty to accommodate.

Mr. Bottiglia applied for judicial review of the Tribunal’s decision.

The Ontario Superior Court of Justice Decision

The Ontario Superior Court of Justice dismissed Mr. Bottiglia’s application, holding that the Tribunal’s decision fell within a range of acceptable, defensible outcomes.  The Court found that Dr. Levine’s apparent “about-face within a span of roughly five months with respect to Mr. Bottiglia’s ability to work” provided a “reasonable and bona fide basis for the School Board to question the adequacy and reasonableness of Dr. Levine’s opinion, because he had been writing for two years that Mr. Bottiglia was unable to resume his duties at all.”  More generally, at paragraph 76 of the decision the Court stated that “In certain circumstances, the procedural aspect of an employee’s duty to accommodate will permit, or even require, the employer to ask for a second medical opinion.”

Seeing no reason to depart from the usual rule that the successful party should be awarded costs, the Court awarded the School Board costs in the all-inclusive amount of $30,000.

Written with the assistance of Scott Thorner, summer student.

Employer ordered to pay $141,000 for tort of harassment and intentional infliction of mental suffering at the workplace

In a previous post on this blog, we discussed how an employer’s non-compliance with workplace harassment and violence provisions of the Occupational Health and Safety Act resulted in a $70,000 fine ordered against the employer. Recently, the Superior Court reminded employers of the importance of ensuring that a harassment-free workplace is maintained and that all complaints are taken seriously and thoroughly investigated. After 40 days of trial spanning over the course of a year and a half, the Court in Merrifield v Canada (Attorney General) ordered the Royal Canadian Mounted Police (“RCMP”) to pay general damages of $100,000 and special damages of $41,000 to a member of the RCMP for harassment and intentional infliction of mental suffering at the workplace.

The Plaintiff stated that he was harassed and bullied by his superiors, which damaged his reputation, impaired his career advancement and caused him to suffer severe emotional distress. The harassment faced by the Plaintiff included accusations that he had committed criminal offences and a subsequent investigation as a result of these allegations. In this case, the Court held that the tort of harassment exists and it is recognized as an independent cause of action in Ontario. The Court made the following findings:

(a) the Defendants’ conduct toward the Plaintiff was outrageous;

(b) the Defendants had reckless disregard of causing the Plaintiff to suffer emotional distress;

(c) the emotional distress suffered by the Plaintiff was severe; and

(d) the Defendants’ outrageous conduct was the actual and proximate cause of the Plaintiff’s emotional distress.

As such, the Plaintiff had proven all of the elements of the tort of harassment. Further, the Court was satisfied that the tort of intentional infliction of mental suffering was made out because the Plaintiff suffered depression and post-traumatic stress disorder as a result of the RCMP’s actions. The general damages of $100,000 were meant to compensate him for the harm suffered as a result of these actions. This case illustrates the potentially costly result of an employer’s failure to ensure a workplace free of harassment, especially now that there appears to be a relatively new tort of harassment, which is not based on any of the prohibited grounds of discrimination. This potentially constitutes an alternate route for employees to seek damages against employers who are not careful in ensuring that their workplaces are harassment-free.

Please note that this decision has been appealed.

 

The (latest) reform of the French employment code is ongoing

As part of candidate Emmanuel Macron’s program during the Presidential elections campaign, a substantial reform of the French employment Code was promised. After his election as President, French commentators anticipated new changes would be implemented quickly, given Emmanuel Macron’s indications that he wished to go ahead as soon as possible, without too much debate before the French Parliament.

This reform is now on track, and will be implemented through a specific procedure:

  • an “enabling” law (loi d’habilitation) shall be voted by Parliament to set a specific framework for the reform;
  • ordinances (ordonnances) will be published after being agreed by the Government; and
  • a “ratification” law (loi de ratification) shall then be voted by Parliament to ratify the decrees made by the Government.

The enabling law was definitely voted on August 2nd, 2017 but it has not been published yet as it is currently subject to a claim before the French constitutional court. The Government announced that after publication of the law, the ordinances will be published around September 2017.

Based on the content of the enabling law and on the various announcements made by the Government, the expected reform should focus on the following topics.

More flexibility through negotiation

The link between collective agreements entered into at sector-wide level and collective agreements entered into at company level should be redefined, in particular to authorise employers and unions to negotiate company-level collective agreements which could take over from industry-level collective agreement regarding certain topics.

Staff representation

The announced reform also proposes to extend the possibilities to merge the three main employee representative bodies into a single staff representation body covering the attributions of the works council, the staff delegates and the health and safety committees. In principle, all companies should benefit from this possibility of merging staff representation.

Termination of contracts

It is also proposed to redefine the scope of assessment of the economic difficulties justifying redundancies (group, company, etc.) and to specify the scope and extent of the research for alternative reclassification and of the selection criteria for dismissals. Termination of employment contracts would also be made more secure for employers by various new measures: (i) the creation of a “pro-forma” dismissal letter, (ii) the establishment of a mandatory scale of damages to be granted by courts in case of unfair dismissal, and (iii) the setting of uniform time-limits for employees’ claims.

Adaptation of rules relating to employment contracts

The Government also wishes to adapt the rules regarding homeworking, night work, fixed term contracts, and lending of employees.

The Summer season will be busy for the French Government!

The German law on employee participation is compatible with European law

On July 18th 2017 the European Court of Justice (ECJ) held, that employees of a subsidiary located in the territory of another member state do not have the right to vote and stand as a candidate in elections of workers’ representatives on the supervisory board of the German parent company of that group and that such an exclusion is not contrary to EU law.

The plaintiff is a shareholder of a company, which is the parent company of a group of companies operating in the tourism sector. In the European Union, that group employs around 50,000 people, of which slightly more than 10,000 work in Germany.

The German Law on employee participation provides that half of the members of the supervisory board must be elected by the employees. Due to the principle of territoriality, which means that the German social order cannot extend to the territory of other states, employees of the group, who are located in another member state outside Germany, cannot vote or stand as a candidate in elections of representatives to the supervisory board. Moreover, any employee who carries out tasks on the supervisory board of the parent company must resign his position where he takes up a post with one of the subsidiaries of that group located in a state other than Germany.

The plaintiff therefore claimed that the supervisory board was not properly constituted. He argued, that the general principle of non-discrimination under European law (article 18 of the Treaty on the Functioning of the European Union (TFEU)) has been breached due to the fact that employees who live and work outside Germany are prevented from participating in the composition of the supervisory board. Furthermore, the loss of membership on the supervisory board in the case of a transfer to another Member State is likely about to dissuade workers from exercising their right to free movement within the EU (article 45 TFEU).

The ECJ distinguishes two situations in that regard. It points out, that with regard to employees employed in a subsidiary established in a Member State other than Germany, article 45 para. 2 TFEU contains a special clause of prohibition against discrimination on basis of nationality in respect of employment conditions relating to the free movement of workers. Therefore, the situation of all employees of the parent company must be examined solely on the basis of article 45 TFEU as a special regulation and therefore article 18 is not applicable. The court concluded, that article 45 para. 2 TFEU is not applicable to the situation of the affected employees, because that regulation does not apply to employees who have never exercised their freedom to move within the EU and who do not intend to do so. The fact that the foreign subsidiary is controlled by the parent company located in Germany is not relevant in order to be covered by that provision.

With regard to the employees in Germany who leave that employment in order to be employed in another entity outside of Germany, the ECJ held that article 45 TFEU is applicable. Any national measure which is suitable to hinder the freedom of movement or makes it less attractive is covered by that provision. However, EU law cannot guarantee, that moving into another member state will be neutral in terms of social security. The employee who decides to leave his state of origin in order to be employed in another member state is not entitled to claim for the working conditions which applied before in the country he was employed. The fact that those employees are required to give up exercising their mandate in Germany is merely the consequence of the application of a national legislation limiting the field of participation within Germany. The EU members are free to set criteria for defining the scope of legislation, as long as there is no harmonisation or coordination measures at union level. The affected national provisions are within the scope of collective labour law as well as company law.

As a consequence, the restriction of the national provisions of the German law on employee participation is in accordance with EU law.

Minimum hourly wage for service providers in Poland

For many years, the structure of employment law in Poland has been characterized by a large number of civil law agreements, which serve as a substitute for employment contracts.  According to statistical data, up to 85 per cent of service providers in Poland historically have  been hired under civil law agreements, but not as a matter  of choice – they would have preferred to work under an employment contract[1].  Although there are many reasons for this situation, one of the principal ones has been the practice of circumventing the minimum monthly wage legislation, which applies only to employment contracts.

In order to minimize the negative effect of such practices on workers, as from 1 January 2017, the legislator introduced a new minimum hourly wage act (Journal of Laws 2016, item 1265).

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Now you see it (now you don’t), or do you?  Can an employer retract an offer of employment?

The retraction of an accepted offer of employment can create significant legal challenges for an employer.  The BC Supreme Court recently reaffirmed that, absent an express contractual provision to the contrary or just cause, a pre-employment retraction of an accepted offer of employment constitutes termination of employment entitling the individual to reasonable notice or damages in lieu of notice.

In Buchanan v. Introjunction Ltd., 2017 BCSC 1002, the employer decided that it needed to retract an accepted offer of employment for business reasons.  A key issue was whether the employer could rely on a probation clause within the contract which would have enabled it to terminate the plaintiff’s employment, had he already started work, without any obligation to pay damages in lieu of notice within the first three months of employment. Despite the employer’s argument that it would be illogical for the plaintiff to have stronger rights before starting work than after, the Court found that the employer could not rely on the probation clause for three reasons.

First, the probation clause provided that the three month probation period commenced on the plaintiff’s scheduled start date of November 1, 2016. Therefore, the probation provisions were not applicable at the time of the pre-employment retraction.

Second, a probation clause does not give an employer an unfettered right to terminate an employee without notice or cause. The court referred to a recent decision in Ly v. British Columbia (Interior Health Authority), 2017 BCSC 42, which was discussed in more detail in our blog, available here.  In short, there is seemingly growing support in B.C. caselaw for the proposition that employers must engage in a good faith assessment of the employee’s suitability for permanent employment before exercising a “probationary” termination clause.

Third, although it was not argued by the parties, the Court also commented that the employer’s retraction of the employment offer amounted to an anticipatory repudiation of the contract, which was accepted by the plaintiff. The employer’s retraction communicated its clear intention not to be bound by the contract.  In the Court’s view, the repudiating party could not rely on a provision of the contract, here the probation clause, to avoid or limit its damages.  We note that this appears to be contrary to a seminal principle of contract law, namely that the party subject to the breach of contract is to be placed in the position he/she would have been in had the contract been performed.  Therefore, there are some strong arguments to be made that employers should be able to rely on a termination clause or other important clauses in an employment contract despite a breach by the employer.

Finding that the plaintiff was wrongfully terminated and the probation clause was not applicable, the Court determined that a reasonable notice period of six weeks would be reasonable for a 27 year old senior software engineer in the circumstances.  The Court also considered the plaintiff’s duty to mitigate and found that although the employer had genuinely offered other re-employment of short-term work to the plaintiff it was not an offer a reasonable person, given all the prevailing circumstances, would accept. The offer was vague and lacked particulars about start date, number of available hours and scope of work, as well as pay (which was framed as “reasonable hourly wage”).

Employers should utilize termination clauses to limit liability.  Buchanan demonstrates that to rely on a termination provision to revoke an offer, such clauses have to be drafted to have legal effect even before the employment commences.  Employers continue to have the lawful right to enter into agreements that provide the minimum termination entitlement required by employment standards legislation.  For example, this may include no notice for employment periods of less than three months for provincially regulated employees in B.C.  Further, employers should carefully consider whether it is advisable to refer to the word “probation”, at all, as it may import more legal obligations (or at least uncertainty) than intended.

UK Employment Tribunal Fees Unlawful

The Supreme Court in the UK handed down its judgement on 26 July 2017, holding that the introduction of fees in the Employment tribunals prevents access to justice and is unlawful under both domestic and EU law. This is a very significant decision in the field of employment law and the enforcement of employment rights.

Under the Employment Tribunal and Employment Appeal Tribunal Fees Order 2013 (the Fees Order) introduced in 2013, claimants in Employment Tribunals or the EAT became liable to pay a fee in order to bring and pursue their claims, including both an “issue fee” when a claim form is presented to the tribunal and a “hearing fee”. The level of the fee depends on whether the claim is brought by a single claimant or by a group and also depends on the nature of the claim. Fees for a single claimant total £390 for a “type A” claim and £1,200 for a “type B” claim.  In the EAT, fees of £1,600 are payable.  Claimants and appellants can seek remission of fees based on their disposable capital and gross monthly income.

The trade union UNISON sought judicial review of the Fees Order, and the challenge was rejected by the High Court and the Court of Appeal. However, the Supreme Court has held that the Fees order must be quashed so that tribunal and EAT fees cease to be payable under the existing scheme and those fees already paid will be reimbursed by the Government.

The Court considered the UK common law right of access to justice. It held that unimpeded access to the employment tribunals is of value not only to the litigants, but also to the benefit to the public as a whole. Tribunal claims ensure that legislation made by Parliament and the common law created by the courts are applied and enforced. To deny access to tribunals would mean that laws were liable to become a dead letter and that the work done by Parliament may be rendered nugatory.

For fees to be lawful they had to be set at a level that everyone could afford, taking into account the availability of remission. The evidence was that this requirement had not been met. The dramatic fall in the volume of cases received since the introduction of fees (approximately 70 per cent reduction in the number of cases) showed that that a significant number of people who would otherwise have brought claims were unable to afford to do so. This was the case even taking into account the availability of fee remission, which was far lower than the Government had anticipated.  In addition, fees can prevent access to justice if it was considered futile or irrational to bring a claim.  This could apply where no sensible person would proceed in a low value claim unless he or she could be virtually certain that the claim would succeed, that the fees would be reimbursed and that the tribunal’s award would be paid in full by the employer.  In practice, many ET claims do not receive full payment from the respondent or seek only modest amounts. The Fees Order effectively prevented access to justice and was unlawful.

The Court did accept that a statutory power could authorise an intrusion upon the right of access to the courts, but such a degree of intrusion must not be greater than is justified by the objectives which the measure is intended to serve. Whilst it could be possible to justify  the Fees Order, for example by showing that higher fees would generate a higher income, transferring a higher proportion of costs to users of the system, it had not been shown that a less onerous fee would have been any less effective in meeting that objective.  In addition, there was no evidence that fees at the level in the Fees Order  had been justified by other objectives: deterring weak or vexatious claims, or achieving earlier settlements through Acas.

As well as being unlawful under UK common law, the Court also held that the Fees Order was contrary to the EU principles of effectiveness and effective judicial protection and the right to a fair hearing under Article 6 of the European Convention on Human Rights. Although the proper administration of justice may justify imposing a financial restriction under EU law, that restriction must maintain a level of proportionality between the means employed and the legitimate aim sought.  Since the Court had held that the fees imposed by the Fees Order are unaffordable by some people, and that they are so high as to deter those who can afford them from pursuing claims for small amounts and non-monetary claims, the Fees Order imposes limitations on the exercise of EU rights which are disproportionate, and is unlawful under EU law.

In a separate judgment, Lady Hale held that the Fees Order was indirectly discriminatory under S.19 of the Equality Act 2010. She held that because ‘Type B’ cases (including discrimination claims) attract a higher fee, and a higher proportion of women bring Type B claims than bring Type A claims, women are placed at a particular disadvantage compared with men. There was no evidence that the higher fees for Type B claims could be justified as a proportionate means of achieving the Government’s aims.

The Government must now seek to repay claimants who have paid fees. This will not be an easy task with some employers having already reimbursed fees where the claimant has been successful.

It is also not clear whether fees will disappear entirely. As set out in the judgment, if the level of fees could be shown to be proportionate to achieving the aim, the government could bring in a different fees regime, such as a lower level and contribution from both parties.  The government could also promote the use of ADR or expand the use of the concept of losing party pays (as is the case in other courts).

A question also arises as to whether there will now be a rush of claims by employees who were deterred from bringing claims between 2013 and 2017 due to the fee regime. It may be possible for them to bring them ‘out of time’, claiming it was not reasonably practicable for them to bring a claim.  No advice has yet been given to tribunals as to how they should deal with any such claims.

 

Foot and bicycle couriers may be entitled to a tax deduction that’s easy to swallow

The digital age has revolutionized the way we eat out.  At the tap of a finger we can now enjoy our favourite restaurant-cooked meals in the comfort of our own homes.  This “dining in” trend has speckled bike lanes with couriers sporting thermal backpacks.  As the trend is on an upswing, bicycle and foot couriers should turn their minds to a unique tax deduction they may be able to claim.

It all began nearly 20 years ago when Alan Wayne Scott, a Toronto-based “foot and transit courier”, pushed the limits of tax law in Scott v the Queen.  In the decision, the Federal Court of Appeal described a day in Scott’s life as a “foot and transit courier”:

  • 6:45 am: A dispatcher advises Scott of the packages to be delivered;
  • 7:45 – 9:30 am: Scott picks up and drops off packages in the downtown Toronto core;
  • 9:30 am – 6:00 pm: Scott travels by subway and foot to make deliveries.

Scott worked 5 days per week, 52 weeks per year.  Each day, he covered approximately 150 km by foot and public transit, for a total of 39,000 km per year.  According to Scott, the physically demanding nature of his job required him to consume what essentially amounted to an extra meal each work day.   He sought a tax deduction for the amount of the extra food and water he was required to consume as fuel for his job.

Subsection 9(1) of the Income Tax Act (the Act) applies to independent contractors and provides that a taxpayer is required to declare profit from a business as income.  In calculating profit, certain business deductions are allowed.  Subsection 18(1)(a) provides that that allowable deductions include an expense made or incurred “for the purpose of gaining or producing income from the business”.

Typically, the costs of food and water during the work day are not allowable deductions.  Rather, they are considered non-deductible personal and living expenses captured by subsection 18(1)(h) of the Act.  Nonetheless, the Court found in Scott’s favour, stating that “just as a courier’s automobile requires fuel in the form of gas to move”, Scott required “fuel in the form of food and water”.  The Court reasoned that, since couriers who drive automobiles are allowed to deduct the costs of their fuel,  so too should Scott, as a foot and transit courier, be allowed to deduct the cost of his fuel; i.e., the extra food and water he consumed to do his job.

Following the Scott decision, Canada has allowed self-employed foot and bicycle couriers, as well as rickshaw drivers, to deduct a daily flat rate of $17.50 (without receipts) for the cost of the extra food and beverages they must consume in a normal working day (8 hours).  The applicable Government of Canada notice requires individuals claiming the deduction to be prepared to provide logbooks demonstrating the days and hours worked on each of the days the deduction is claimed.  The Canada Revenue Agency may also ask for dispatch slips and other documentation.  Any deduction claimed beyond the $17.50 flat rate requires supporting receipts and evidence that the nature of the work demanded an amount of food and beverages in excess of what the average person would consume.

Written with the assistance of Elana Friedman, summer student. 

Data protection and employment law update (Italy)

The Italian Data Protection Authority (IDPA) is increasingly faced with issues relating to the ways employers may monitor the Internet usage of its employees. In 2016, the Authority handed down two important decisions on this topic.

In the first decision, the IDPA stated that an Italian University (the University of Chieti and Pescara) was acting unlawfully in the way that it used e-mails to trace the identity of Internet users. This University, without having given any prior warning to its employees, implemented a system that retained information regarding personal Internet access, for the purpose of service monitoring, internal security and for the prevention of possible investigative inquiries by the Authorities. In essence, the policy, which controls, filters and monitors information on Internet data, enabled the employer to indiscriminately monitor employees from a distance. The IDPA’s decision was based on the argument that this policy breached the relevant principles of “actual need and proportionality of the treatment”. The IDPA considered that the policy was not in accordance with the law because it did not refer to tools used by the employees in performing their duties and had not been previously communicated to the employees.

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Mitigation Income and Wrongful Dismissal Damages – The Court of Appeal Muddies the Waters

The Wrongful Dismissal – What Happened?

Esther Brake worked for McDonald’s for over twenty-five years, first in Cornerbrook, Newfoundland, and then as a restaurant manager in Ottawa. She had received nothing but excellent reviews for years, but in 2011 she was suddenly told her performance was inadequate and that she had two options: accept a demotion or be fired. Ms. Brake refused the demotion and filed a successful action for wrongful dismissal.

The most interesting issue in this case was not the question of whether the dismissal was justified or not, but whether the trial judge erred by not subtracting Ms. Brake’s post-dismissal income from her damages.

The Trial Judge Holds Inferior Income is Not Deductible as “Mitigation Income”

The trial judge awarded Ms. Brake damages based on 20 months of remuneration, and made no deductions for the new work she had acquired in the meantime. Ms. Brake had obtained significantly lower-paid work that the trial judge described as “so substantially inferior to the managerial position she held with the defendant that the former does not diminish the loss of the latter”. In other words, her new income was so insignificant that it should not be deducted from her damages.

This cast doubt on the application of the well-established principle that following related to an employer’s duty to provide notice of termination is the employee’s duty to mitigate the damages flowing from a wrongful termination. Mitigation income, being the income earned in the “reasonable notice” period following an employee’s dismissal will typically be deducted from any amount owing to the employee.

The Court of Appeal Weighs In

The trial judge’s findings with respect to Ms. Brake’s constructive dismissal were largely upheld.

However, with respect to mitigation income, the majority in the Court of Appeal held that her mitigation income did not need to be deducted, but for different reasons, which were:

  1. Some of it included employment insurance benefits, which are not to be deducted.
  2. Brake was entitled to termination and severance pay that could not be deducted because they are statutory minimums and the majority of her income in the intervening period since her termination was earned during Ms. Brake’s “statutory entitlement period”.
  3. Some of Ms. Brake’s income earned following her dismissal was from a job she had while she was still working at McDonald’s and so was not mitigation income.

The Court of Appeal’s comments regarding a “statutory entitlement period” appear inconsistent with how statutory amounts have typically been treated when an employee commences a wrongful dismissal action and receives damages inclusive of any statutory amounts. In such a case, the employee’s statutory entitlements are paid by way of lump sum, and so it is that lump sum amount that the employee, regardless of mitigation income, at minimum must receive. It is not the case, however, that mitigation income earned over the period that corresponds with the period over which statutory amounts would have been paid (if the severance payment was treated as a severance period, which it is not. Indeed, the Ontario Employment Standards Act, 2000 requires severance be paid by lump sum and an employer cannot simply provide an employee with working notice instead of severance pay) is not to be otherwise deducted from the common law wrongful dismissal damages award.

Interestingly, Justice Feldman wrote a concurring opinion agreeing with the trial judge’s reasoning that the inferiority of Ms. Brake’s new employment should be considered when awarding damages. The question for Justice Feldman is whether the or not the employee would be in breach of their duty to mitigate if they turned down the inferior job offer. If the answer is no, then the income is not mitigation income. This, however, seems contrary to the well-established principles of mitigation in the employment law context and the principle that the employee is not to be placed in a better position than they would have been had reasonable notice of termination at common been provided.

Employer Takeaways

The Court of Appeal majority has likely created some confusion over how mitigation income is to be deducted based on their discussion of a “statutory entitlement period”.  And Justice Feldman in her concurring opinion agreeing with the trial judge’s conclusion that “inferior” mitigation income may not need to be deducted from a wrongful dismissal damages award further muddies the water on this issue.

We may have to wait until the Court of Appeal weighs in again, or until such an issue is addressed by the Supreme Court of Canada, to gain some clarity on these issues.

For now, however, employers should be aware that it may not be the case that any income earned over the reasonable notice period will be deducted from wrongful dismissal damages. That said, it remains the case that if an employee finds a new job during this period, it is likely that this will serve to reduce any common law liability on the employer. Thus, employees should still be held to their duty to mitigate and employers should help if possible, and certainly not hinder them, in doing so.

Written with the assistance of Kevin Schoenfeldt, summer student.

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