In Brake v. PJ-M2R Restaurant Inc., the Court of Appeal for Ontario considered two frequent issues in wrongful dismissal actions: constructive dismissal and the duty of an employee to mitigate employment losses by finding alternative employment. The Court found that the trial judge was correct in finding that the employee had been constructively dismissed. Of greater note, the Court confirmed the trial judge’s decision that the employee’s income during the reasonable notice period would not be deducted from the award for damages. The employee was awarded a twenty month reasonable notice period after working for the employer for twenty years….

Classification of employees versus independent contractors is important for several notable reasons. Employees are entitled to statutory benefits and protections under the Employment Standards Act (ESA) such as minimum wage, notice of termination, severance pay and overtime pay. Independent contractors enjoy no such entitlements under the Employment Standards Act for these benefits and protections. In late-2017, the Ontario government amended several aspects of the ESA in the form of the Fair Workplaces, Better Jobs Act, also known as Bill 148. Particularly notable was Bill 148’s tightening of the law with respect to who should be classified as an employee. For…

In order for a termination clause in an employment contract to be considered valid, it must adhere to the minimum standards under the Ontario Employment Standards Act (“ESA”). Many employers include termination clauses to reflect their intention to limit entitlements owed to an employee based on these standards. In order for courts to consider the termination provisions in an employment contract valid, the clause must be drafted in a manner that clearly reflects the parties’ intentions to abide by the ESA’s statutory minimums. This includes addressing issues such as continued payment of employee benefits, severance, providing reasonable notice and payment…

When an employer deliberately misleads or lies to a prospective employee to induce him or her to accept an offer an employment, the employer can be held liable for their negligent misrepresentations. Courts have held that both employers and employees owe a duty of care to each other during the recruitment process. The British Columbia Court of Appeal decision in Feldstein v 364 Northern Development Corporation provided employers with a reminder that negligent misrepresentation during the hiring process can prove to be a costly mistake. In Feldstein, a prospective employee for an engineering position was misled about the eligibility requirements…

Employers must exercise caution when drafting the terms of employment contracts. An improperly drafted provision in an employment contract can have unintended consequences, even if those provisions seem valid at the time the contract is executed. Contract provisions, at minimum, must fall within the minimum standards set out in provincial legislation, both in the present and as the contract endures into the future. The Ontario Employment Standards Act (ESA) provides the minimum standards for most employees in Ontario. The Act establishes rights and responsibilities for employees and employers, including the minimum standards surrounding reasonable notice or payments in lieu of…

The duty of good faith imposed on employers is a well-established principle of Canadian employment law. Following the decision in Wallace v. United Grain Growers Ltd., bad faith conduct by an employer became yet another factor Courts will consider when determining the period of reasonable notice for an employee. Bad faith damages were typically referred to as Wallace damages and allowed Courts to extend the reasonable notice period where bad faith conduct by an employer was found. The Supreme Court of Canada changed the calculation for bad faith conduct in their decision in Honda Canada Inc. v. Keays. Now, damages…

In Greenlees v. Starline Windows Ltd., [2018] B.C.J. No. 3074, the British Columbia Supreme Court awarded an employee six months’ notice after working for only six months. Prior to working for Starline Windows, Mr. Greenlees worked for Trevor Jarvis Contracting, earning roughly $100,000 per year as a sales representative. In January 2017, Mr. Greenlees received a cold-call from a sales manager at Starline Windows to discuss a job opportunity. Over the course of two meetings, Mr. Greenlees was offered a position working primarily in new residential projects with occasional work in renovation construction projects. The Starline representative estimated potential income…

The applicable jurisprudence on mitigation makes it clear that following a wrongful dismissal, if an employee declines a job, then the monies that would have been earned through performing the rejected job may well be deducted from any damages ultimately obtained by the plaintiff. But what about earnings from a second job or a side job? When an employee consults on the side or has a side job that is continued into the post-termination period, will this count as mitigation income?