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Sales employee constructively dismissed when employer lost contract to sell products, but failed to mitigate damages

Jurisdiction: - British Columbia

In Whiting v. First Data Canada Merchant Solutions ULC, 2010 BCSC 764, the court found that:

  • The plainitff had been wrongfully or constructively dismissed from his Director of Corporate Sales position when the employer lost a contract to sell certain products and services.
  • The plainitff, who was 39 years old and had 6.5 years of service at the time of dismissal, was entitled to an 8 month notice period.
  • The plainitff was not obliged to mitigate his losses by accepting a new position offered by the employer because the employer had "arbitrarily" refused to pay a bonus owing to the plaintiff and thereby created "an atmosphere of hostility" between the plainitff and senior management.
  • The plainitff's refusal to accept a job offered by a third party was not reasonable given that:
  1. his base salary would have been the same as with his former employer;
  2. he would had the opportunity to earn an overall compensation amount almost identical to his average earnings over the last three years;
  3. his service with his former employer would have been recognized for the purposes of pension and vacation;
  4. the type of work he would have been doing was "substantially  the same" as he was doing with his former employer; and
  5. he would have been able to sell the same products and services that he had been selling with his former employer.

In light of the above, the court ruled that plaintiff was not entitled to any wrongful dismissal general damages from his former employer because he had failed to mitigate his damages, although he had opportunity to do so.