Many employers include termination clauses in employment contracts to limit their liability when dismissing employees. When employers draft generous termination provisions providing for more than statutory minimums, they must follow through on that generosity when terminating employees. Failing to do so could leave employers exposed to full liability under the common law.
Given the elimination of mandatory retirement years ago, employees are working for longer periods of time and well into their 60s and some into their 70s. Age has always been one of the key Bardal factors, in addition to title, length of service and compensation, that courts use to determine an appropriate common law notice period. In the recent case of Ozorio v. Canadian Hearing Society, 2016 ONSC 5440, Justice O’Marra confirmed that an employee’s age remains a significant factor in determining a common law notice period.
Three popular articles this week on HRinfodesk deal with employer vicarious liability for employee misconduct; reasonable notice and the failure to mitigate; and, the legal definition of “immediate family” for the purpose of bereavement leave.
Three popular articles this week on HRinfodesk deal with an independent medical examination; wilful misconduct; and, 27 months of common law reasonable notice.
Even though Ontario judges have been using the same test for 55 years to determine how much notice of termination an employee is entitled to receive, employees and employers continue to disagree on an appropriate notice period in individual cases.
Can’t afford to keep them, can’t afford to fire them: Poor finances do not reduce termination obligations
Employee salaries and benefits can be some of the greatest costs borne by a business. As a result, when a company faces financial hardship, they will often terminate positions to reduce their costs. However, many employers may not realize that the obligation to provide reasonable notice of termination could negate any short-term cost savings they hoped to realize.
Small to midsize employers, many HR professionals, and many lawyers proceed based upon completely inaccurate understandings of how employment law works. While there are many examples of this, there are three that I see regularly in my practice: the myth that the severance entitlement in Canada is one month per year, regardless of other factors […]
While many employers may be aware of the difficulties in enforcing non-competition clauses, they may not be aware of another risk associated with such clauses: their potential to increase the reasonable notice period.
The Supreme Court of British Columbia confirmed that following the termination of a senior employee who had over 20 years of service with the employer, the employee was entitled to a reasonable notice period of 17 months considering the Bardal factors. However, due to the employee’s extremely passive attitude towards finding new employment, the notice period was reduced to 14 months. In a nutshell, the employee just did not do enough to seek alternate employment.
Determining the actual notice period an employee is entitled to upon termination is often a frustrating exercise for employers. This is especially true of the more recent case-law which has tended to place more emphasis on certain factors (age and tenure) at the expense of other factors (nature of position and compensation). There have been widely divergent awards in recent years. This undermines the ability of employers to plan, with some certainty, for large scale restructurings and the required notice/severance to provide staff.
Three popular articles this week on HRinfodesk deal with Statistics Canada 2013 study on hours worked and labour productivity; Bardal factors; and, the award of punitive damages for failure to investigate workplace harassment.
The impact of the employer’s financial condition at the time of termination on the notice period has been the subject of some debate. In 1983, the Ontario Court of Appeal held, in Bohemier v. Storwal International Inc., that the financial circumstances of the employer are a factor that can be considered in the assessment of the notice period. Some courts have explicitly rejected the notion, however…
Last October, I wrote a post cautioning employers to beware of using the one month per year of service “rule of thumb”. A recent case from the Ontario Superior Court of Justice has again affirmed that, depending on the circumstances, courts are willing to award short service employees significantly more than one month per year of service.
Assessing how much notice of termination a particular employee is entitled to is a challenge most employers would like to avoid. As those of you who deal with the issue on a regular basis know, employment standards legislation sets out the minimum amount of notice, but it will almost never be sufficient unless the employee has an enforceable contract that limits them to the statutory amounts. In most cases, the common law will require that an employer provide “reasonable notice”, and though there are many myths, there are no easy ways to determine what is reasonable.
We know that there is no precise method to determine the common-law period of reasonable notice when terminating employees. What has evolved and has been the most quoted case to help with this is the infamous Bardal vs. Globe and Mail. This case tells us that reasonable notice must be decided with reference to each specific case, considering the character of employment, 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.