Employee Duty to Mitigate Damages After Being Terminated

| January 18th, 2017 | No Comments »

Being terminated from employment can be an emotional and impassioned time but it is important that employees remain mindful of their duty to mitigate damages. This simply means that an employee must make the necessary efforts to lessen their losses and, in turn, the amount of damages the employer is obligated to pay. In court, employees are required to initially show that they have taken reasonable steps to mitigate damages.

The duty to mitigate requires the employee to accept a comparable position if offered by the employer providing the working environment has not turned hostile. As established by past court cases, this offer may be made immediately or after some time has passed. The offer, however, must be a position that is comparable and not one that leads to embarrassment or loss of status. In determining whether a position is comparable, factors usually include wage/salary, location, status, and training. Employees must also seek and accept comparable offers of employment from other employers. If it is proven that a comparable position was offered by another employer and it was turned down, employees may not be entitled to damages from their previous employer.

If an employer challenges the employee’s efforts in mitigating damages, they must go beyond just proving that there was an availability of comparable jobs during that time. The employer must also show that the employee had a reasonable chance at obtaining such positions and that the employee failed to pursue the employment opportunities.

There are many other factors that can influence the amount owed in damages depending on the complexity of the situation. Such factors may include retraining and career changes, the decision for the employee to pursue their own business and so forth. It is thus important to speak to a legal expert to clear up any uncertainties and to ensure the amount paid in damages is fair.

Important Additions in a Severance Package

| December 21st, 2016 | No Comments »

severance package calculateThe purpose of a severance package is to make a terminated employee “whole” over a reasonable period of time.  Very commonly, severance packages include only base salary, neglecting other elements of compensation – such as benefits, RRSP or pension contributions, bonuses, commissions, and so forth.  If a severance package excludes any of these elements, the employee ought to speak with an employment lawyer.

Sometimes, the missing elements of severance packages are subtle.  For example, many benefit schemes include more than just health and dental coverage – they also often include life insurance, long-term disability coverage, critical illness, a health spending account, and the like.  Each of these items has a dollar value – whether it’s the company’s cost or the replacement cost.  Where the severance package offers health and dental continuation and nothing further, the extra cost of these missing items needs to be accounted for in some other way in order to make you “whole”.

Bonuses are also a major bone of contention in severance package negotiations.  The Ontario courts have been very clear recently that bonuses which would have been earned during the severance period must be included in a severance arrangement, unless the company has communicated very clear language to the contrary through its bonus plans and/or employment contracts.  Employees ought to remember that in severance negotiations there are often two different bonus issues: 1) the bonus earned during the year of the termination; and 2) the bonus which would have been earned if not for the termination.  Both these elements are up for negotiation.

Finally, it is very common to negotiate non-monetary items into a severance package, such as a reference letter, employment transition counselling, and reeducation allowances.  Although companies generally do not have to offer these items, some companies include them anyway, if they feel it could provide value to the departing employee.

 

Author: Daniel Chodos, Employment Lawyer

Employees’ Wrongful Actions and Employers’ Liability

| December 20th, 2016 | No Comments »

wrongful actionsEmployers may be found liable for the wrongful actions of their employees under certain conditions. The wrong must be tortious – this is a wrongful action that can be brought to civil court – which includes torts such as trespassing, assault, theft, negligence and so forth. There are certain factors established by the courts in determining whether the employer is vicariously liable for the wrongful act(s) of their employee. These factors are analyzed thought the ‘Salmond’ test established by common law.

Salmond Test – Vicarious Liability

The ‘Salmond’ test seeks to establish whether the employer created an opportunity for the employee to commit the wrongful action through the duties required for the position. If the act was related to such duties, then the employer can be found liable. The test seeks to analyze the following:

  • The opportunity the employer gave the employee
  • The extent to which the wrongful act may have furthered the employer’s aims (i.e. making this action more likely to be committed by the employee)
  • The extent to which the wrongful act was related to friction, confrontation or intimacy inherent to the position/business
  • The power conferred on the employee in relation to the victim
  • The vulnerability of the victims in relation to the employee’s power

In general terms, the principle underlying the ‘Salmond’ test is whether the duties required gave an enhanced opportunity for actions of wrongdoing. This can be examined though a combination of the above factors in the ‘Salmond’ test. Employers are encouraged to seek an employment law expert for a full understanding of any situation raising concern. The above is by no means comprehensive.

An example that illustrates the relevant principles is Bazley v. Curry (SCC 1999). This case established that vicarious liability extends to enterprise risk. Simply, this can be viewed as the necessary duties employees are given to conduct business in the specific industry. This means that employers can be found liable for the risks inherent in the job itself, and not just acts that are authorized by the employer.

Bazley v Curry Example

In Bazley v. Curry, the employer was a child care facility. Employees here were caretakers of mentally disabled children. The nature of this business required caregivers to have a relationship of total intervention – bathing, preparing children for bed, and so on. Mr. Curry was the caregiver and Bazley was the child subjected to abuse by Mr. Curry. The employer here was found to be vicariously liable for the wrongdoing. In simple terms, this was because Mr. Curry was put in a position that made the abuse more likely when examining the duties of the job. The focus here is on the enterprise risk.  The nature of the business made these actions by Mr. Curry more likely to occur; the employer was therefore vicariously liable.

Final Thoughts

The courts place an increased responsibility on employers for the actions of their employees for two reasons. The employer has the means to compensate potential victims for the wrongdoing of their employees. Also, the court recognizes the employer’s ability to deter their employees from committing such wrongful acts. This may include performing criminal background tests or placing third-party supervision as deemed necessary for the position and enterprise, as this will mitigate risk and deter employee wrongdoing. It is important for employers to be diligent and take the necessary precautions to prevent wrongful actions by employees.

Holiday Party & Corporate Liability

| November 29th, 2016 | No Comments »

holiday party at workA staff holiday party is a great way of celebrating the holiday season.  It can also be an effective way of showing appreciation to employees.  These events can be lots of fun, but what many employers often forget is that they can attract unwanted liability. 

The most common types of legal issues employers face as a result of staff parties are related to harassment and alcohol consumption.  The following are brief guidelines that employers should carefully consider in order to create a fun-filled holiday celebration, while avoiding legal liability.

Harassment

An employer can be held liable for harassment, including sexual harassment, even if it occurs after hours at a staff social event.  The following are simple things that employers can do to not only help reduce the risk of harassment, but also the risk of liability if harassment does occur: 

  • Develop and circulate an anti-harassment policy that clearly states that it applies to all work functions, including all social events;
  • Members of management should be reminded that they are expected to set an example for other employees during workplace functions;
  • Invitations for a holiday party should include a reminder that the anti-harassment policy extends to the event;
  • Consider inviting non-employees to the event.  The presence of customers, suppliers, or significant others can help reduce the occurrence of harassment or offensive behaviour;
  • Take steps to limit the consumption of alcohol;
  • Anti-harassment training should have fact scenarios that include work social events; and
  • Have an action plan ready in the event of an incident of harassment, and be prepared to implement it. 

Realistically, employers may not be able to fully control how guests behave at social events.  However, they can certainly avoid being held responsible for another guest’s conduct if they take proactive steps to help prevent the conduct, and if they take appropriate and swift action in response to inappropriate conduct.

Alcohol Consumption

The consumption of alcohol at a work function can lead to undesirable conduct by guests.  One of the main concerns employers should have is being held liable for injuries or damages caused by an intoxicated guest.

A social host is not typically liable for injuries/damages resulting from a guest who has consumed alcohol at the host’s residence.  However, employers are not ordinary social hosts.  The case law in Canada suggests that employers who host staff holiday party owe a duty of care to their employees which is closer to that of a commercial host.  Consequently, an employer who hosts a party has a greater duty to protect intoxicated individuals and the public than a social host. 

To help reduce the risk of liability arising from an intoxicated guest’s actions, employers should be following these simple tips:

  • Only serve a reasonable amount of alcohol to every guest.   Effective methods include the issuance of a set amount of drink tickets per guest, and limiting the period during which alcohol is served;
  • Do not provide open access to alcohol; 
  • Hire certified, licensed and insured professionals to look after the distribution of alcohol;
  • Serve food at the event;
  • Prevent “binge drinking” by discouraging/prohibiting drinking games;
  • Offer a selection of non-alcoholic beverages;
  • Hold the event off-site at a licensed and insured establishment;
  • Appoint members of management to monitor alcohol intake by guests, warn people against driving intoxicated, and to arrange taxis for intoxicated guests;
  • Provide paid transportation to and from the event for all guests; Invitations to the event should include a statement discouraging drinking and driving and excessive alcohol consumption.  Similar announcements should be made regularly throughout the event;
  • Do not conduct any business at the event; and
  • Avoid drinking with employees at other sites after the conclusion of the social event.

If an employer wishes to throw a staff party without having to worry about liability, it should refrain from cutting corners at the organizational stage.  Careful and thoughtful preparation is the key to a successful and liability-free event.

Two Years of Severance Awarded to Dedicated Employee

| September 26th, 2016 | No Comments »

severanceDaniel Lublin was once again successful in obtaining one of the lengthiest severance awards for an employee in Ozorio v. Canadian Hearing Society.

The Court awarded our client 24 months payment of salary and benefits following her termination and entirely accepted our position that even with our client’s competence and experience she would have a difficult time obtaining a similar job.  The Court accepted our position that 30 years of service and a dismissal at age 60 ought to result in a significant severance payment and mentioned that our client was justified in declining a 1 year severance package which the employer ought to have known was insufficient.

With respect to our client’s dedicated service the Court concurred that her lengthy period of employment was likely to be a serious impediment in finding another job.  Specifically, having virtually no work experience outside of that obtained through her former employer placed our client at a competitive disadvantage in obtaining new employment.

Further, this was yet another Whitten & Lublin decision where the Court agreed with our view that an employee 60 years of age or older must be entitled to greater severance.  The Court cited our past cases of Hussain v. Suzuki Canada Ltd. and Leeming v. IBM Canada Ltd. to confirm that “age is an impediment” for older worker’s seeking new employment.  Simply, the job market is difficult for older workers competing with younger, more recently trained and likely less expensive talent.

If you have been dismissed consider consulting the experts at Whitten and Lublin for an informed assessment of your severance.

Author: Paul Macchione, Whitten & Lublin

Pokémon GO vs. Work FLOW

| July 26th, 2016 | No Comments »

 

no pokemon at work

In case you have been living under a rock for the past month the Pokémon GO game craze has hit Canada.   Players catch, trade and battle Pokémon that pop into existence alongside real-world physical objects when viewed through a smartphone.  A large element of the game requires players to travel to various locations to engage Pokémon.

In less than one month Pokémon GO is reported as being on more than 6 percent of Android devices in Canada, it is the most downloaded app in the history of the App Store and in the past weeks it has had more active users than twitter with more engagement than Facebook.

The game’s level of engagement means a number of people are playing it during their working hours and productivity is likely impacted.  After all, employees have been reported to have left the workplace on unscheduled, unapproved and extended breaks to catch or train Pokémon.  The result at this time seems to be a number of amusing signs posted in workplace but the concern should be greater and knowledge around the topic of time wasting should be understood and properly monitored.

Generally, an employee found playing games on company time does not justify a termination for cause.   Stated differently, catching Pokémon during working hours is unlikely to justify a dismissal without proper notice or payment in lieu of notice.  A termination with cause is regarded as the capital punishment of employment law and time wasting of this sort is not enough to justify it.

Despite the above, various factors could influence a judge to uphold a just cause dismissal.  For example, a disciplinary record tied to time wasting / time theft; game playing while driving or using company equipment (putting the safety of others at risk), an employee’s senior level, game play on a company issued devices, frequent game play, attempts to conceal or deny the misconduct and/or an intentional violation of a company cell phone, hours of work, internet or distracted driving policies may justify a with cause termination.

pokemon go work

Employees should be mindful that even though it is unlikely that their employer can justify a termination for cause on account of Pokémon GO game play they are certainly not free from serious consequences.  Most of Canada’s non-union employers can still impose other discipline and certainly terminate without cause.  Stated differently, employees can be fired for playing the game so long as an employer provides notice of that termination or makes payment in lieu of notice.  If a valid termination clause is in the employment contract the employer might only need needs to provide a few weeks’ notice before the employee becomes a full-time Pokémon GO hunter and Employment Insurance collector.

It will not be long before Pokémon GO results in reported dismissals but don’t let the excitement cloud your reality.  If you have any questions on this topic or other areas of employment law consider contacting our team to assess you situation.  If you are looking for well thought out options our team is well equipped to “catch ‘em all”.

 

 

Your Legal Rights in Disability Insurance Disputes

| June 9th, 2016 | No Comments »

disabilityAn employee who becomes disabled, or otherwise becomes incapable of performing the essential functions of their job, and may be entitled to income replacement through the employer’s short-term and long-term disability insurance policies.  The process is not always straightforward, making it important for both employees and employers to understand their rights:

For Employees

Employees have a basic right to dignity and fair treatment in having their disability insurance claims assessed.  While medical evidence will be required to substantiate a claim for disability insurance coverage, the employee will not be subject to the whim of the insurer’s medical team.

Similarly, the employee has the right to have their claim fairly treated, and on the presumption that their claim is legitimate.  An employer or provider that treats an employee with suspicion about the validity of the claim may find itself in hot water if the claim is rejected.

It is common to see an employee’s disability insurance coverage terminated before they are fit to return to work.  An employee may also find their initial application rejected, despite not being able to perform their duties.  Employees are entitled to challenge unfair or unsupported determinations about their coverage, which means that the employee should promptly retain legal counsel if this situation arises.

The result of this right is that the employee is entitled to retain their employment with the employer while receiving disability insurance benefits.  This right, however, is not absolute.

For Employers

In very limited circumstances, the employer may have the right to dismiss a disabled employee, where it appears that the employee will be unlikely to perform the essential functions of their job for the foreseeable future.  An employer should never dismiss a disabled employee without first obtaining sound legal advice.  Disability is a protected ground under both federal and provincial human rights legislation, which means that dismissing a disabled employee may constitute discrimination.

Employers also have the right to be appraised of the status of the employee’s insurance claim.  If disability insurance coverage is rejected or discontinued, the employer may be at liberty to require the employee to return to work, or to dismiss that employee.  These steps should not be taken without legal advice, as termination of disability insurance coverage does not circumvent an employer’s obligations under human rights legislation.

 

Author: Marc Kitay, Whitten & Lublin

Your Legal Rights After Maternity Leave is Over

| May 4th, 2016 | No Comments »

rights after maternity leaveEmployers are usually obligated to reinstate an employee following a maternity leave.  The employee has the legal right to be returned to the position she held prior to the maternity leave, and if that position no longer exists after the leave, to a “comparable” position.

The “comparable” position must be comparable in all respects – location, hours of work, quality of work, degree of responsibility, job security, prestige, and so forth.

If the employer can prove that the person on maternity leave would have been terminated regardless of the leave, the employer might be able to avoid the consequences of breaching this obligation.  However, the company has the onus of proving its case.

If a company does breach its obligation after maternity leave, the employee can claim lost wages, associated expenses, emotional pain and suffering, and even damages for the “loss of reasonable expectation of continued employment” – this could amount to an extra month’s pay per year of service.

Moreover, if the failure to return to work is found to be a punishment or “reprisal” for taking the maternity leave, then there could be additional damages against the company.

This topic is without a doubt, one of the most misunderstood and contentious issues in employment law. To learn more about your options, contact an employment lawyer who can explain and advise on which steps should be taken to your benefit.

 

Author: Daniel Chodos, Whitten & Lublin

Severance Pay in Canada

| February 16th, 2016 | 2 Comments »

 

Typically, all non-unionized employees that are dismissed without cause are entitled to notice of their termination or pay in place of notice, known as severance. If you have been dismissed your employer may try to limit your severance pay through a written employment contract or offer letter.

The employer can limit your entitlements to the Employment Standards Act (the “ESA”) minimums if you are a provincially regulated or the Canada Labour Code’s minimums if you are a federally regulated.

Most employment relationships are provincially regulated and the ESA minimums can be as low as one week per year of service up to a maximum of eight (8) weeks. An additional week per year of service is possible up to a maximum of twenty-six (26) weeks if you have been with the organization for at least five (5) years and the employer has a payroll of at least $2.5 million in Ontario.

Despite the above, it is important to know that employers, including the largest and most sophisticated, often do not properly limit their employees’ entitlements to the minimums despite what might seem like appropriate language in the contract. In fact, they often get the language or procedure for limiting severance wrong. As a result, if you are terminated you may be entitled to months of severance pay above the ESA minimums. Factors such as your age, length of service, the job you performed, comparable cases and your total compensation will impact the amount of severance you are entitled to.

Our Severance Calculator can assist you in determining an estimate for your severance, but it does not replace the need to speak with a lawyer directly. A lawyer from the Whitten & Lublin team will assess your contract’s enforceability and apply the factors a judge uses to determine a fair amount of severance.

 

Author: Paul Macchione, Whitten & Lublin

Your Rights When You Face Termination Without Cause

| January 5th, 2016 | No Comments »

A terminated employee is typically entitled to fair severance, unless he or she did something so serious to warrant losing it (called “termination for cause”).

An employee’s actual entitlement is determined by first looking at whatever deal they might have made with their company.  Such a deal – called a “termination clause” – is usually found in an “employment agreement” or in a similar but less formal document signed by both sides.  Very commonly, these arrangements are set by the company itself and are most beneficial to it.  Therefore, it’s important to try to negotiate early on before signing anything, with the assistance of a trained lawyer.

Courts will only allow arrangements that provide for at least the minimum amount(s) required by the government.  Because these arrangements are usually company-friendly, it is necessary to speak to an employment lawyer to determine if there is a legal basis to get a better severance deal than what it appears to say in the agreement.  Our firm regularly finds ways to get much better deals for terminated employees in circumstances that allow for it.  One example is where an employee is hired to do one job, is promoted several times, and then is terminated years later.  The termination section in the employment agreement that was initially signed likely won’t be accepted by the courts in that situation, since the employee is serving a totally different role by that point.

That decision could be the difference between a severance of several thousand dollars… or tens of thousands of dollars.

From an employer’s standpoint, because fair severance can become very costly, the safest thing to do is have an employment lawyer draft an agreement with a legally enforceable termination clause.  Too often, we see companies pulling agreements off the Internet, or using non-specialized lawyers to put them together.  This is a problem, because very often the law has changed, or a non-expert misses something of significance.  The agreements can go a step further to address other issues of importance to the business, such as post-employment obligations, confidentiality, and so forth.

Author: Daniel Chodos, Whitten & Lublin