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Duty to Mitigate

BC Court of Appeal addresses how lump-sum pension payments should be calculated over notice period

Jurisdiction: - British Columbia
Sector: - Manufacturing

In the wrongful dismissal case of Lewis v. Lehigh Northwest Cement Limited, 2009 BCCA 424, the BC Court of Appeal addressed the manner in which special allowances, discretionary increases in salary and pension benefits should be treated over the notice period. It also discussed the duty the mitigate and the awarding of costs.

Background

The appellant employee had been employed by Lehigh Northwest Cement Limited ("Lehigh") for 26 years.  He was the manager of computer systems. He was dismissed without cause in 2006 following a 28 month medical leave of absence because there was no position for him to return to.  He was 58 years of age.  Lehigh offered him a severance package equal to 15 months salary, which he declined.

At trial, he was awarded 22 months notice, which equalled about $200,000, and about 30% of his costs (see  Lewis v. Lehigh Northwest Cement Limited, 2008 BCSC 542).  read more »

Evidence needed to establish that dismissed employee has not satisfied the duty to mitigate

Jurisdiction: - British Columbia

In Marshall v. Old Meets New Furniture Ltd. dba Stokes Furniture, 2009 BCSC 748, the BC Supreme Court discussed the evidence required to prove that an employee has failed to take reasonable steps to mitigate her loss in relation to a wrongful dismissal matter. The court also discussed the impact of a depressed economy on the notice period. 

Background

The employee was 46 years old and had seven years of service at the time her employment was terminated in June 2007. She had been manager of a retail furniture store, earning approximately $65,000 per year.

The employer alleged at trial that it had cause to terminate the employee based on poor job performance, dereliction of duty, and insubordination. However, at the time of dismissal it had provided the employee with seven weeks pay in lieu of notice pursuant to the Employment Standards Act and a positive letter of reference.

Notice Period  read more »

38 year-old restaurant manager awarded 15 months notice

Jurisdiction: - British Columbia

In Chapple v. Umberto Management Ltd., 2009 BCSC 724, the 38 year old plaintiff was a manager at Il Caminetto restaurant in Whistler with 13.5 years of service when her employment came to an end in January 2007. She was earning a base salary of approximately $50,000 per year, plus gratuities.

The employer argued that the plaintiff had been suspended and then failed to return to work. The court, however, found that her employment had been terminated. 

Notice Period

The court awarded the plaintiff 15 months notice, pointing to the following features which it stated led to a somewhat longer notice period than the plaintiff's length of service justified:  read more »

Production Manager at pulp mill entitled to 20 months notice

Jurisdiction: - British Columbia
Sector: - Forestry

Mr. Zaitsoff was dismissed without cause from his position as a Production Manager at a pulp mill in Castelgar. He was 46 years old and had worked at the mill for 19 years. He had four people reporting directly to him and 215 indirectly reporting. He earned $142,000 per year.

Notice Period

In relation to the fourth "Ansari" principle, the plaintiff pointed to the lack of available jobs in the pulp and paper industry, particularly in the current economic downturn.

In awarding the plaintiff 20 months, the court stated that while the lack of available employment opportunities resulting from a depressed economy is a factor to be taken into account, it “must not be given undue emphasis”.

Discounted Notice Period
 read more »

Notice period reduced by six months for failure to mitigate

Jurisdiction: - British Columbia

The plaintiff was 63 years old and had been employed by the defendant for 38 years as a bench jeweller/goldsmith. He worked full-time and earned $26.50/hour, or just over $58,000 annually. His employment was terminated as a result of the business being sold.

The court found that the plaintiff was entitled to a notice period of 18 months, but that it should be reduced by six months because he had failed to mitigate his damages.

On the mitigation issue, the totality of the plaintiff's evidence was that he had: (1) personally delivered his resume to eight possible employers who were chosen because he had some familiarity with them, and (2) spoken to individuals at one company regarding opportunities for jewelers.

The defendant, in contrast, produced two affidavits that suggested that there were similar employment opportunities available that the plaintiff had not pursued.  read more »

"Managing Flexibility in the Workplace While Avoiding Constructive Dismissals"

Jurisdiction: - British Columbia

A lawyer with Clark Wilson LLP in Vancouver has written a paper entitled, "Managing Flexibility in the Workplace While Avoiding Constructive Dismissals (2008)". She ends her paper with a list of "Helpful Hints" for employers when restructuring.