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Slaw: Employee constructively dismissed, but no damages awarded because of failure to mitigate

Co-authored with Christina Catenacci LLB

The Ontario Superior Court of Justice just decided that although an employee was constructively dismissed when he was suddenly “laid off,” the employer did not owe the employee any damages because he failed to mitigate his loss.

Facts of this case

The employee, Earl Chevalier, worked at an automobile service centre for 33 years, and was manager of one of the locations for 18 years.

In 2007, the employer was taken over by another company, Active Tire & Auto Centre Inc.

Chevalier signed a new employment agreement with Active Tire & Auto Centre Inc. that required him to fully comply with, and implement the new employer’s operating procedures set out in its manual. The agreement also stated that Active Tire & Auto Centre Inc. could unilaterally change the employee’s duties, responsibilities, reporting relationships and the location of his employment. An email added to the agreement stated that, should a change in an employee’s work location be required, the change would not require the employee to travel further than 50 kilometres from the employee’s home, or the current distance from home to work should it be greater than 50 kilometres.

From the time of the acquisition by Active Tire & Auto Centre Inc. and over the next year and a half, Chevalier worked in his original location, then three other locations he commuted to (some more than 50 kilometers away), and then back at his original location. Chevalier was of the view that some of the job duties he was given were demeaning.

Then, around the end of October 2008, Chevalier was told in writing that he was being laid off. Two weeks later, he commenced a wrongful dismissal action against his employer, Active Tire & Auto Centre Inc.

This is where it got interesting.

For more, read our latest post on Slaw.

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Yosie Saint-Cyr

Managing Editor at First Reference Inc.
Yosie Saint-Cyr, LL.B., is a trained lawyer called to the Quebec bar in 1988 and is still a member in good standing. She practiced business, employment and labour law until 1999. For over 15 years, Yosie has been the Managing Editor of the following publications, Human Resources Advisor, Human Resources PolicyPro, HRinfodesk and Accessibility Standards PolicyPro from First Reference. Yosie is one of Canada’s best known and most respected HR authors, with an extensive background in employment and labour across the country. Read more
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