Wrongful termination occurs when an employee is terminated without justifiable cause. For reasons unknown to the employee, employers are entitled to terminate as they wish. When they do terminate without cause however, they must provide pay in lieu of notice. They may also be required to enhance the statutory minimum notice period to pay based on the common law. Additionally, severance may be a live issue that increases that figure further. An ROE must be issued within 5 days of termination and the reason for the termination, absent termination letter by the employer.
Constructive termination aka ‘constructive dismissal’ is a different and more complex matter. It exists in many forms from perpetual forced leaves of absence, modification of primary terms of the employment contract, reduction of pay and demotion, toxic work environments, reduction in shiftwork or removal from overtime eligibility, and the list goes on. It is essentially a unilateral modification of the employment agreement by the employer to the detriment of the employee that is not reasonable in the circumstances. Sometimes several small factors add up to constructive dismissal, others one big event creates the circumstance to litigate.
Unlike wrongful termination, the employee is usually employed to varying degrees; including inactive employees who are on a perpetual leave of absence without accommodation. Employers use their ‘business decision’ powers and requirements to attempt to justify their decisions. Sometimes they use false promises of accommodation or hope for re-hire as tools to stop claims before they start. Employees are usually frustrated, angry, emotional and depressed when being “gamed” by their employers. There are tell-tale signs and factors the Courts consider when litigating constructive dismissal matters. We are very familiar with these factors and have been down this path many times with our clients.
Damages for termination of any kind include notice and severance. The Employment Standards Act sets the minimum requirements for payment only. The common law has increased that standard based on the relevant factors of the employee, their age and education, the position and wage level, re-employability in a market, and their performance. Most times, the notice and severance periods are much higher than what your employer may tell you or what the Act offers. Should your employer treat an employee poorly, harass them, make fun of them, abuse them during the termination process, additional damages are awarded ‘Wallace Damages’ aka emotional damages, to increase the notice and severance periods even further. Should the employers conduct be highhanded and reprehensible, punitive and aggravated damages are also considered by the Courts. Transition damages to new job locations, damages for the breach of contract, loss of earning capacity and loss of competitive advantage are also additional damages that could be sought and awarded in the right circumstances.
Employees must however reasonably mitigate their losses. If medically able to, they must attempt to re-enter the workforce or use social services to offset their losses. These efforts, if not availed by employees can result in substantial discounts to employers as they are viewed as off-sets by the Courts for the purposes of damages calculations. The types of jobs applied to must be reasonable by virtue of the employees past wage rate, training, education and experience, however. Normally efforts for job applications and interviews are kept so as to satisfy this requirement, unless someone is medically unable to do so. Note however that if an employer seeks to argue mitigation, they now bear the onus of proof.
The imbalance of bargaining power has led the Supreme Court of Canada to create what is known as the ‘proportionality’ test when considering whether the employee was actually terminated for just cause. Regardless of what the employer says or does, it is not the final determination on the subject matter. Employers will use HR professionals and lawyers to train their employees with the power to terminate so as not to terminate without an educated guess as to cause sometimes. Employers will dump employment files, shred positive employment performances and certificates, create conflict, use absenteeism or theft allegations, statements by loyal employees and other unfair practices to justify cause for termination.
Because your employer holds most of the leverage on hiring and firing, it is important to contact Lemieux Law as soon as possible to review your matter. Do not sign away your rights on termination day and accept a cheque waved in front of you by executing a waiver/termination agreement or release of liability agreement. Employers may exploit your emotions and fears on termination to get a document signed that releases them from liability in exchange for money. Often that cheque is ¼ the potential value of your compensation or less.
Often an employment contract attempts to dictate employee rights on termination. Whether it is trying to limit notice and severance compensation, enforce non-compete clauses or non-solicit clauses, trade secret clauses, restrictive covenants, benefits termination or pension contributions, they are each interpreted by the Courts for validity and scope. Many employees do not understand their rights and obligations. These are complex matters requiring experienced lawyers. Employees are particularly vulnerable to the whims of their employers and require proper legal representation.
If you are the victim of a constructive dismissal or wrongful termination, call Lemieux Litigation today for fair, dedicated and affordable representation.
We’re on your side.