Unskilled employee gets 22 months’ notice, Canadian Employment Law Today (September 7, 2011)

04 Sep Unskilled employee gets 22 months’ notice, Canadian Employment Law Today (September 7, 2011)

UNSKILLED EMPLOYEE GETS 22 MONTHS’ NOTICE
By Nikolay Y. Chsherbinin

Determination of an appropriate notice period is a crux of virtually every wrongful dismissal lawsuit. However, there is no formula for what will constitute proper notice in circumstances surrounding termination. In the pursuit of determining a proper notice period, judges are guided by the so-called Bardal factors: the character of the employment, the employee’s length of service, the employee’s age and the availability of comparable employment in the market.

In Love v. Acuity Investment Management Inc., the Ontario Court of Appeal acknowledged trial judges’ tendency to give a disproportionate weight to the “length of service” factor in their assessment of a proper notice period. Four months later, the court was presented with an opportunity, in Di Tomaso v. Crown Metal Packaging Canada LP, to consider the “character of the employment” factor, in the context of terminating a non-managerial employee’s employment, which came about through a string of five working notices of termination. Like in Love, the court reinvigorated the importance of attributing equal weight to all of the Bardal factors when determining notice. It further clarified the law of reasonable notice for unskilled, clerical and low level employees.

Antonio Di Tomaso, 62, was a 33-year non-managerial employee of Crown Metal Packaging Canada. On Sept. 9, 2009, Crown Metal informed Di Tomaso that it no longer required his services. Days before his expected termination date, Crown Metal informed him his employment would be extended by several weeks. Over the next five months, Crown Metal repeatedly extended Di Tomaso’s employment for a “temporary period” just before each termination date. In total, Di Tomaso received five separate written notices of termination, containing a total of four termination dates. On Feb. 26, 2010, Crown Metal closed the facility, resulting in a de facto termination of Di Tomaso’s employment.

Displeased with his severance package, which consisted of just his statutory entitlements, Di Tomaso sued Crown Metal for wrongful dismissal, seeking common law damages equivalent to 24 months’ pay. Crown Metal argued that its Sept. 9, 2009, notice of termination was valid and Di Tomaso’s subsequent “temporary employment” constituted an authorized period of “working notice” under Ontario’s Termination and Severance of Employment regulation. This should reduce Di Tomaso’s reasonable notice entitlement to 12 months, having specific regard to the character of his employment as unskilled and low level worker, said the employer.

Regulation’s impact on working notice

Crown Metal relied on section 6 of the regulation, that each of its extensions of the notice of termination was less than 13 weeks in length and, as such, the original notice remained valid, thus providing him with working notice. The court rejected Crown Metal’s argument, stating that the regulation contemplates a “single period of temporary work that is not to exceed 13 weeks.” The court further observed that to assume the regulation allows employers to give notice of termination, but then extend employment for multiple, serialized periods of less than 13 weeks would be inconsistent with the Employment Standards Act, 2000’s status as remedial, benefit-conferring legislation designed to protect the interests of employees. Additionally, the court stressed the importance of giving employees a “clear and unambiguous” notice of termination with a final termination date. The cumulative effect of the multiple extensions created uncertainty for Di Tomaso as to when he would no longer have his job.

No 12-month cap on notice

In support of its proposition that Di Tomaso’s common law notice should be 12 months, Crown Metal unsuccessfully invoked the court’s 1995 decision in Cronk v. Canadian General Insurance Co., arguing it established a hard limit of 12 months on the notice to unskilled workers. This now-discredited proposition is rooted in the theory that low-level, unskilled employees have an easier time finding comparable employment. The court disagreed, relying on its 1999 decision in Minott v. O’Shanter Development Company, which rejected the notion that 12 months is the cap for every clerical and unskilled employee. Having acknowledged its limited discretion to interfere with the motion judge’s determination of the appropriate notice, the court upheld the award of 22 months notice, adding that any interference with the original award of damages would amount to “unwarranted tinkering.”

With regard to Crown Metal’s argument that Di Tomaso’s non-managerial, technical position should minimize the notice period, the court unequivocally rejected this approach. As in Love, the court observed the character of the terminated employee’s employment must not be eclipsed by other Bardal factors. The importance of this approach was stressed by the Supreme Court of Canada in Keays v. Honda Canada Inc., where the court cautioned: “no one Bardal factor should be given disproportionate weight.”

The Di Tomaso decision has several important implications for employers, judges and legal advisors alike:

  1. No longer will the “length of service” factor dominate the process of determining proper notice of termination.
  2. The “character of employment” factor will no longer be accorded lower priority, when determining proper notice, particularly for unskilled, clerical or low-level employees.
  3.  Employers need to monitor the total number of weeks that have passed if employment is extended beyond the original termination date. Should the employee’s last day of work fall outside 13 weeks following the original notice of termination, a new notice of termination must be provided.
  4.  All notices of termination must be clear and unequivocal and must specify, preferably in writing, the employee’s final day of work. Without such clarity, judges may find the employee is entitled to her entire common law notice from the date of dismissal, despite any prior working notice.
  5.  The law of reasonable notice for unskilled employees has been clarified.

In both Love and Di Tomaso, the court rejuvenated the 51-year old Bardal factors. It sent a clear message that employers dismissing employees without cause should properly recognize and afford equal weight to all the Bardal factors when determining proper notice of termination. This, however, may cause employers uncertainty when calculating pay in lieu of notice, necessitating legal advice before proceeding.

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