Where an employee is found to have failed to mitigate their damages, their entitlement to damages may be significantly reduced. So what happens if an employee is too sick to look for new work? Does that count as a failure to mitigate?
failure to mitigate
Some employees receive a large percentage of their total remuneration in variable compensation. A much litigated issue is whether the employer is required to pay variable compensation to a terminated employee during the applicable notice period and if so how is this compensation calculated.
In wrongful dismissal litigation, one of the key issues is always the dismissed employee’s duty to mitigate. When an employee is terminated or constructively dismissed, he or she has a positive obligation to minimize his or her damages by seeking out comparable, alternate employment. Anything the employee earns in the common law notice period is subtracted from what the company owes. An issue that often arises is whether or not it was reasonable for an employee to refuse exploring a potential new job because of the length of the commute.