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Wrongful Dismissal

Ontario court refuses to certify class action based on claims of constructive dismissal and breach of ESA

Jurisdiction: - Ontario
Sector: - Insurance

In Kafka v. Allstate Insurance Company of Canada, 2011 ONSC 2305 - which was issued on April 12, 2011 - the Ontario Superior Court of Justice refused to certify a propsed class action that was based on allegations of:

  • constructive dismissal; and
  • a claim for termination pay and/or severance under the Ontario Employment Standards Act.

The claim pertained to a general announcement letter that Allstate issued on July 24, 2007, to approximately 350 to 450 active agents (employees) in Ontario, advising that effective September 1, 2009 a revised product distribution model and agent compensation system would be implemented.  The new model was then phased in from September 1, 2007 through 2009. 

The court summarized the issue on the certification motion (application), and its decision, as follows:  read more »

Supreme Court of Canada denies leave to appeal in Soost v. Merrill Lynch Canada employment termination case

The Supreme Court of Canada has denied leave to appeal of the Alberta Court of Appeal's decision in Merrill Lynch Canada Inc. v. Soost, 2010 ABCA 251.

The trial judge in this case had determined that the employer did not have just cause to terminate Mr. Soost's employment and had awarded him damages as follows:

  • $600,000 on account of his notice period; and
  • $1.6 million in damages to his reputation and book of business or goodwill. This award was made pursuant to the principles expressed in Honda v. Keays 2008 SCC 39.

On appeal, the Alberta Court of Appeal quashed the $1.6 million damages award. (The notice period damages were not appealed).

"Tax Considerations for Employment Related Settlements"

"Tax Considerations for Employment Related Settlements" (November 4, 2010) is the title of a paper prepared by Natasha Miklaucic for the Borden Ladner Gervais 13th Annual Labour & Employment Group Symposium. 

BC Court of Appeal overturns award of $20,000 in bad faith compensatory damages

Jurisdiction: - British Columbia
Sector: - Retail Trade

In a post on June 19, 2010 ("Failure to adequately follow-up after fire destroyed employee's home, attack on reputation, lead to $20,000 bad faith damages"), I summarized the BC Supreme Court's decision in Beggs v. Westport Foods Ltd., 2010 BCSC 833.

In that decision, the trial judge awarded the employee $20,000 in damages for the manner of dismissal, and the employer's conduct thereafter.  read more »

Employee who was “laid off” during recession was not required to return to same employer to mitigate damages

Jurisdiction: - British Columbia
Sector: - High Tech

Emmanuelle Renard ("Renard") was a valued with 12 years of service when her employer, Facet Decision Systems inc. ("Facet"), reluctantly laid her off in July 2009 because of the economic downturn.

Facet subsequently realized that it was not permitted to impose a layoff, and that the effect of a layoff was in fact a dismissal without cause. As such, a few months later, Facet offered to re-employ her in the same position.

Renard refused the offer of re-employment and instead commenced a wrongful dismissal lawsuit. Facet took the position that she had failed to mitigate her damages by not accepting her job back.

Court's Decision

Renard took the position that she was not required to return to Facet for three general reasons.

First, she argued that the relationship had broken down and become poisoned, making it impossible for her to continue working for Facet. The court rejected this argument, pointing to the following:  read more »

Lawyers call for reform of BC Employment Standards Act "temporary layoff" provisions

Jurisdiction: - British Columbia

I briefly discussed the Besse v. Dr. A.S. Machner Inc., 2009 BCSC 1316, decision in a post I wrote in October 2009 ("BC Employment Standards Branch announces change in how Act's "temporary layoff" provisions to be applied").

Besse confirmed that the temporary layoff provisions in the BC Employment Standards Act ("ESA") do not modify the common law such that all employers have the right to temporarily layoff employees for up to 13 weeks in a 20 week period without being exposed to a constructive claim. 

Rather, the provisions in the Act simply qualify employment agreements in which the right to lay-off has already been expressly agreed to by the parties. (i.e., in such a case, the parties cannot contract for a temporary layoff period that is greater than 13 weeks in a period of 20 weeks).  read more »