In Maticevic v Bank of Montreal (2020 CarswellNat 2661), Adjudicator Marvy had to determine the damages owing to an employee who had been out of work for 29 months following an unjust dismissal.
The employee had done nothing to look for a job in those 29 months. The Adjudicator found that for about 22 months he was too sick to work but that he had no good excuse for the other 7 months so he reduced the compensation by 25%.
As said, he was too sick to work for 22 months. The Bank said that he should not be paid for this period either. They quoted a case where a part time employee with no disability benefits and who was ill during the whole notice period received nothing as he would have earned nothing even if he had been dismissed.
But the Bank had both STD and LTD which one can only think the employee would have been on had he not been dismissed.
The Adjudicator however awarded him FULL PAY for the 22 months that he was too sick to work. This is what he said:
29. The Bank acknowledged the issue it relied on was only “briefly addressed”. I agree and I do not find that it provides sufficient support for the position the Bank asserts. I prefer the decision in Sylvester v. British Columbia, 1997 CanLII 353 (SCC), where the Supreme Court of Canada in finding that an employee, who was on a disability leave when he was terminated, was not entitled to both his disability payments and reasonable notice damages, but rather the salary he would have earned during the notice period. The SCC stated the following:
9. On appeal to this Court, there was no challenge to the finding that the respondent was entitled to short-term disability benefits under the STIIP from June 1, 1992 to December 31, 1992, and to long-term disability benefits under the LTDP from January 1, 1993 to December 31, 1993, nor to the finding that the respondent was entitled to 20 months’ notice from July 23, 1992. The appellant did not challenge the finding that the respondent was entitled to damages of $102,100, being the salary he would have earned had he worked during the notice period. This is consistent with the principle that an employee who is wrongfully dismissed without adequate notice of termination is entitled to damages consisting of the salary the employee would have earned had the employee worked during the notice period. The fact that an employee could not have worked during the notice period is irrelevant to the assessment of these damages. They are based on the premise that the employee would have worked during the notice period. Therefore, an employee who is wrongfully dismissed while working and an employee who is wrongfully dismissed while receiving disability benefits are both entitled to damages consisting of the salary the employee would have earned had the employee worked during the notice period. 15. [Damages] for wrongful dismissal are designed to compensate the employee for the breach by the employer of the implied term in the employment contract to provide reasonable notice of termination. As discussed above, the damages are assessed by calculating the salary the employee would have received had he or she worked during the notice period, notwithstanding that the employee may, in fact, have been prevented from doing so. The damages are based on the premise that the employee would have worked during the notice period. [Emphasis added]
30 Given the above principles, the fact that I have found that his medical issues reasonably prevented him for some time from mitigating his damages does not lead to the conclusion that this time must be deducted from his damages award. He was clearly still entitled to the salary he would have earned during this period.
First of all, it is interesting that the Adjudicator deducted the entire 7 months from the award as the employee did nothing to look for a job during that period. However there was no evidence led by the Bank which would have showed that had he looked for a job that he would have got one immediately. Imagine that the employee did nothing for the entire 29 month period and that he was not sick. Would this mean that he would get nothing? Other cases that I have recently blogged about show that even in those situations, the employer must lead some evidence that had he looked for a job he would have found one in some reasonable time frame.
Secondly, I do not understand why the Bank took the position that when he was sick he should get no back pay. The better position would be to say as follows:
“If the Bank had not breached his rights under the CLC and had not terminated him, then let us look at what he would have earned in the last 29 months. Well we know that for 22 of those months he would not have worked. Our STD plan pays 100% for 6 months and then LTD pays 66%. Oh, by the way the Bank pays all the LTD premium. For 22 months those payments equal $75,000. That is what we owe him. That puts him in the exact same financial position had he not been terminated.”
What about Sylvester v British Columbia?
First of all this is not a wrongful dismissal case where the only remedy is damages for reasonable notice. Under the CLC the adjudicator is to make the employee “whole” which can include reinstatement. The case law is clear that in assessing damages under the CLC one is not limited to reasonable notice.
Second making someone “whole ” is neither under compensating them nor over compensating them.
Third, Sylvester was really about where a person receives a disability payment during the notice period, does this act as a reduction to his wrongful dismissal damages. The SCC decided that where the employee pays the premium for the LTD, the damages are not reduced but where the employer pays the premium (or in STD simply continues his salary) there is an offset otherwise the employee would be overcompensated.
There is no finding in the case as to who paid the premiums on the LTD policy.