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“Cowboy” employer ordered to pay aggravated damages for bad faith termination

In this case, the Plaintiff brought a claim for wrongful dismissal and aggravated damages on account of how he was treated before and during the termination.

aggravated damagesIn a recent case titled Lalonde v. Sena Solid Waste Holdings Inc. 2017 ABQB 374, the Alberta Court of Queen’s Bench considered whether failing to hear an employee’s side of the story before dismissing him for cause could increase an employer’s liability.

The Plaintiff was a Journeyman Millwright. While employed, he was called into a meeting by his manager where he was accused of serious safety violations, insubordination, and lying. The Plaintiff was given little opportunity to present his side of the story to the employer. The Plaintiff had been accused of stealing company property and was escorted off company property in plain view of his co-workers. The Plaintiff brought a claim for wrongful dismissal and aggravated damages on account of how he was treated before and during the termination.

On the eve of trial, the employer dropped its wrongful allegations of cause which it held for nearly five years. Gill J. stated at paragraph 66 that this is a case where the Defendant decided to “shoot first and ask questions later.” Missing in the investigation into the Defendant’s allegations was any serious consideration to hear the Plaintiff’s side of the story prior to being suspended and prior to being fired. Gill J. went on to find that the evidence showed that the Defendant made up its mind to dismiss the Plaintiff within days of his suspension, supporting the conclusion that the investigation was at best incompetent and unfair and at worst a sham.

Gill J. held at paragraph 72 that he was satisfied that the actions of the Defendant amounted to a breach of the obligation of good faith and fair dealing, including that the employer would act in good faith in the manner of dismissal. As the Plaintiff proved that the manner of dismissal caused him mental distress, by the Defendant attacking his reputation and asserting that there was sufficient cause to terminate his employment, this supported an award of aggravated damages.

After providing some examples of conduct that would warrant an award of aggravated damages highlighted by the Supreme Court of Canada in Wallace v. United Grain Growers Ltd., [1997] 3 S.C.R. 701, Gill J. stated at paragraph 80:

“In this case there was abusive conduct leading up to the dismissal, inappropriate and false reasons for dismissal and an inadequate and unfair investigation…Although the Defendants actions appear not to have been vindictive, they were intentional, unnecessarily prolonged and caused the Plaintiff significant mental distress. The wrongful allegations were maintained for almost 5 years causing the Plaintiff considerable mental distress during and after his sudden termination. He was publicly humiliated at the time of dismissal and the humiliation continued as rumors concerning the reasons he was dismissed continued to circulate. Consequently substantial aggravated damages are justified for the Defendants failure to comply with their duty to act in good faith.”

For employers, these decisions suggest that the cowboy attitude of “shoot first and ask questions later” will not cut it so far as the courts are concerned and may leave an employer on the hook for aggravated damages in addition to damages for reasonable notice at common law. For plaintiffs, where an employer has breached the implied duty to act in good faith, an employee may be entitled to substantial aggravated damages.

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De Bousquet PC Barristers and Solicitors

Civil Litigation Lawyers at De Bousquet PC Barristers and Solicitors
De Bousquet law offers experienced counsel and representation in multiple aspects of employment law, labour relations, commercial law and civil litigation. Jean-Alexandre De Bousquet, founder of the firm, interned for the Canadian Centre for International Justice, worked for an Ottawa law firm and pursued a career with the Attorney General of Ontario. In 2014, Jean-Alexandre was named one of Ontario's "leading experts" in human rights law by Legal Action Magazine. Jean-Alexandre handles cases related to wrongful dismissal, workplace discrimination, breach of contract, fraud and commercial disputes. Jean-Alexandre is fully fluent in French and English and represents clients before courts and tribunals using both official languages.Before the practice of law, Jean-Alexandre was a journalist at the CBC for 3 years. Other notable achievements include employment with the Canada Research Chair on Native Peoples and Legal Diversity, the Canadian Research Chair on Metis Identity and the Urban League, a U.S. civil rights organization. Jean-Alexandre has also published articles in prominent academic journals and presented papers at international conferences in Canada and the U.S.Read more here
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