Wrongful Dismissal: Do I Just Have to Look at the Employment Standards Act?
A common misconception that lawyers practicing in the area of employment law often encounter is that clients think that their rights and obligations start and end with the Employment Standards Act. This is particularly so when trying to determine the proper notice or pay in lieu of notice to be given to a terminated or soon to be terminated employee.
Section 63 of the Act states that, on termination, after three months consecutive service an employer owes an employee one weeks’ wages, after 12 months that rises to two weeks’ wages and after three years of employment it rises to three weeks’ wages plus one week per year of service to a maximum of eight weeks’ wages. An employer can give working notice rather than wages.
The Employment Standards Act is only a starting point and sets out the minimum notice periods but it is not necessarily the end point.
An often quoted passage regarding the factors to be considered in determining the reasonable notice period is:
There can be no catalogue laid down as to what is reasonable notice in particular classes of cases. The reasonableness of the notice must be decided with reference to each particular case, having regard to the character of the employment, the length of service of the servant, the age of the servant and the availability of similar employment, having regard to the experience, training and qualifications of the servant. (Bardal v The Globe & Mail Ltd. (1960), 24 D.L.R. (2d) 140)
The following are some examples of cases where the Courts have awarded damages based on notice periods greatly in excess of what is set out in the Employment Standards Act.
• In Bavaro v. North American Tea, 2000 BCSC 419, and 2001 BCCA 149 the 35 year old plaintiff was initially a purchasing manager and then a production manager. His annual salary was $60,000. His employment was terminated after 13 months. After 11 months of unemployment, he found work in New York City and relocated. The plaintiff was awarded six months, which was upheld on appeal.
• In Zadorozniak v. Community Futures Development Corp. et al, 2005 BCSC 26 a 49 year old general manager who earned $57,000 annually was terminated after 14 months and awarded a notice period of 1 year
• In Nelson v. Trinity (N.A.) Holdings Ltd., 2001 BCSC 303, the plaintiff was the advertising manager, 49 years old, earned $68,602.92 and a $4200 car allowance annually. He terminated after almost 8 years employment and awarded 10 months’ severance
In all of the cases noted above, the Courts awarded damages based on notice period which were greatly in excess of the minimums set out in the Employment Standards Act.
A written employment contract can add to the minimum standards set out in the Employment Standards Act but cannot reduce or eliminate the minimums. The Courts give significant weight to written employment contracts particularly when the contract sets out an agreement regarding the notice period requirement for termination. In all of the cases noted above no written employment contacts existed.
Do you have employment contracts with your employees? When is the last time you reviewed those employment contracts? Having employment contracts in place can provide certainty with respect to notice periods or pay in lieu of notice as opposed to the uncertainty of leaving the determination of those notice periods to the Courts.
Contact Jon Walsh at DuMoulin Boskovich LLP for your legal needs.