law529-midterm-1-overview-of-half-the-course

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lOMoARcPSD|7290461 MIDTERM 1 Introduction  Employment law: concerns the relationship between an individual and the employer in a nonunionized setting through employment contracts  Employment is understood through the province unless it is an area of national importance (p.247)  Employment: an organizational form through which a person sells his/her labour power to a buyer of labour in exchange for value through a contract  Contract principles of offer, acceptance and consideration apply to the employment relationships as well  Labour law: governs the relationship between the union and the employer through a collective agreement  Different from contract law as it is an on-going relationship which may expose you to more risks as labour is not a commodity (as it is hard to distinguish between an individual and their labour)  There has to be governmental intervention  There is an imbalance of power between employer and employee which leaves the employee open to certain vulnerabilities which is not the case in car selling example  Ontario Employment Standards Act and common law which are governmentally dictated and enforced within Ontario  Ex. common law reasonable notice when dismissing an individual  Collective bargaining within unions Three Governmental Regimes 1. Common law: judge made laws that effect future cases (precedent based/stare decisis)  Based on the idea that freedom of contract advances individual liberty while producing the most efficient and desirable distribution of skill/resource  Lower courts from the same jurisdiction have to apply the same reasoning and legal test as a higher court if it has similar factual/legal circumstances (binding precedent )  Made up of law of contracts  Legally binding agreement consisting of reciprocal promises between 2 or more parties  Employment contract: a contract between and employer and an employee that set out the conditions that the employee will provide labour under in exchange for money and sometimes other benefits (written or oral) lOMoARcPSD|7290461  Breach: occurs when a party to a contract violates one or more of the terms in a legally binding contract  Law of torts  A legal wrong defined by judges to allow a person to recover damages for harm caused by the actions of another person  Damages can be recovered even if a contract/statute isn’t violated  Applicable when there is no contract or its outside of the contract (ex. during hiring processes) 2. Regulatory law: stems from the imbalance of power in employment relationships and the early poor working conditions  Regulations: government-made detailed rules introduced as a supplement to and in accordance with authority created in a statute  Protective standards regulation: government regulation designed to protect employees by imposing mandatory standards  Courts play a smaller role but provide judicial review of expert administrative tribunal decisions  Employment relationship is not like any other commercial relationship due to imbalance of power  Con: can’t keep up with societal changes, too extensive, enforcement is an issue and is reliant on individual to raise issues 3. Collective bargaining law: workers act collectively to even out the power imbalance through a certified union  Increase their bargaining power by withholding labour as a group  Made up of three categories of legal rules  Government made statutory rules regulating the formation and administration of unions, collective bargaining and industrial conflict

enforced by tribunals called the labour relations boards  Collectively bargain rules found in collective agreements (contract between employer and trade union) are imposed in whole or partly by interest arbitrators (group of 1/3 that set out the terms when the parities can’t) which are enforced by labour boards or labour arbitrators  Judge made rules based on common law torts that mainly apply to labour picketing and strikes which are issued and enforced in courts  Argument that unionization protects the 1% while negatively impacting the individuals  Civil law doesn’t pass laws it just interprets it so in some cases it might not be able to help some if there are no laws on that specific issues  Implied term of reasonable notice: if an employer fires you with no justifiable reason they have to provide you notice  P.8 court hierarchy  Section 91 & 92 lists the various jurisdictions each section of government has Chapter 2- Defining Employment Relationships  Courts may intervene in contract case when they think what the contractor is doing the same job as an employee to protect employee and their rights  Employers may choose to say it’s a contractor to avoid tax contribution, leave, vacation overtime pay, benefits, to forgo employment compensation funds, to avoid vicarious liability  Employee: a worker who enter into an employment contract with an employer that involves an exchange of labour for wages and maybe benefits and the contract is subject to all of the laws that govern employment contracts  Vicarious liability: legal rule where an employer is liable for damage caused to a third party by an employee  Independent contractor: a worker who is in business for himself and who, therefore isn’t an employee and isn’t protected under the common law of employment  Commercial contracts: a contract between 2 businesses including a business in the form of an independent contractor  Employee and contractor question on exam** Common Law Employee Test  Not all of them has to be present at the same time  Control: the more control that is asserted on the individual the more likely the person is an employee  Ownership of tools: if the organization provides the tools you are an employee  Chance of profit : if there’s higher chance of profit they are more likely to be a contractor and if there’s less chance of profit they are more likely an employee  Risk of loss: if there’s a higher risk of loss they are more likely to be a contractor and if there’s little to no risk of loss they are more likely an employee  Organization/integration test : is what you are doing an integral part of the organization? (the individual doesn’t have to be essential)  Exclusivity: if the organization tells you that you cannot work for anyone else  Duration: the longer that you work for an organization the more likely you are an employee  Formality: how do the parties represent themselves  Ex. p. 20* p.21 helpful questions to understand the tests Definitions of intermediate category (regulatory regime)  Dependent contractor: has more autonomy and independence but is financially dependent on the organization and is treated like an employee in employment relations act (collective bargaining legislature broadened the def. of employee to include this)  Regulations can also narrow the employment definition  ESA defines interns in 6 conditions : (narrow) 1. Training is similar to that of a school 2. And the training is in the benefit of the individual 3. The person providing the training is get little to no benefits from the training 4. The person is not replacing an employee 5. The individual is not entitled to a job 6. The person is advised that they will receive no pay for the time they spend training  Bill 148 which made changes to intern definition (Wynne)  Bill 47 repealed a few things about 148 (Ford)  148 removed the six conditions making an intern an employee the only conditions left is training is similar to that of a school (we don’t have the six anymore) but it isn’t enforced enough to have enough change  To avoid exploitation: added section 5 (1) in the ESA through Bill 148 which created the reverse onus of proof (so the employer has to prove that someone is an employee but it’s gone now repealed by Bill 47) and it is (an offence on its own to misclassify an employee)  Currently, one can be legally an unpaid intern only if they are in an approved college and Uni. program Precarious work  There’s a proliferation of non-standard work  The idea behind temporary workers are a good idea but as more organizations used them it became a way of saving money and distance themselves from

workers to avoids various obligations and liabilities Chapter 6-Recruitment and the Hiring Process  Has several problems and is governed by human rights code and discrimination laws lOMoARcPSD|7290461  Most of the law that effects this process occurs under the regulatory regime because a contract hasn’t been created yet  Common law has a limited role in policing the hiring process as shown by Seneca v. Bhadauria  There are no laws under common law against discriminatory behaviour individual governments have created their own regulations to protect people  Seneca case: person was told to take it to the human rights tribunal  They are mainly concerned with regulating the control of information between the parties (so both have enough/truthful information to enter into a contract) Common law torts that apply to recruitment & hiring  Torts by a prospective employer  Deceit: where party A makes a false statement with the intention of misleading party B, B relies on that false information and suffers a loss for which they can claim damages  Fraudulent misrepresentation: party A knowingly makes a false statement with the intention to mislead party B and the statement induces party B to enter into a contract and suffer a loss 4 elements  Party B can rescind (set a contract aside and go back to original position) the contract and seek damages  Negligent misrepresentation: party A who owns a duty of care makes an untrue statement to party B without sufficient care as to the accuracy of it, which party B relies on and suffers a loss which they can seek damages for 1. There must be a duty of care from the prospective employer to the hiring employee (reasonable foreseeability) always the case 2. The representation in question must be untrue, inaccurate or misleading 3. The representor must have acted negligently in making the misrepresentation (should have known) 4. The representee must have relied in a reasonable manner on the misrepresentation 5. The reliance must have been detrimental to the representee (loss)  Only those who owe a duty of care can commit negligence torts  Duty of care: special close relationship between two parties that creates an obligation in tort law to take reasonable steps to avoid harming the other party  Ex. Queen v. Cognos Inc.  Torts by job applicant  Fraudulent and negligent misrepresentation (similar to misrepresentation by employers)  When the employee is fireable without notice (just cause) if the applicant lied  When the job applicant lied about a material fact that the employer relied on (is required for the job)  When the job applicant lied about a non-material fact like assets, (you can fire them if you can prove that a high level of trust is needed)  Wrongful dismissal: lawsuit by an employee against a former employee claiming that the employer terminated their contract without complying with the implied term in the contract requiring reasonable notice  Summary dismissal: termination of an employment contract by an employer without notice to the employee in response to a serious breach of contract by the employee Chapter 8- Expressed and ancillary employment contract terms  Contracts are best done in writing to manage expectations, have proof and avoid ambiguities/ less legal disputes Interpreting ambiguous (multiple interpretations) terms  Parole evidence rule: a common law rule of evidence where a judge must decide what a contract means by only looking at the clear words of the contract (when terms are unambiguous)  When terms are ambiguous evidence from either parties about what they intended the contract language to mean evidence can include what was said in negotiations and how it was applied in the past  Contra proferentem doctrine: a rule of contract interpretation in which a judge interprets an ambiguous contract term in the manner that is most favourable to the part that did not draft the contract Sources of employment contract terms  Expressed contract terms: terms of a contract that the parties have explicitly agreed to either written or orally  Restrictive convent clauses  Non-disclosure clause: prohibits a former

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employee from disclosing information that has propriety value to the employer  Non-solicitation clause: prohibits a former employee from attempting to persuade the employer’s customer to stop doing business with the employer instead do business with the employee  Non-competition: prohibits a former employee from entering into a competing business with the employer  A court can find a non-compete clause as against public policy (public policy illegality) and make it unenforceable due to the imbalance of power and right to trade  The clause is effective if employer can prove: 1. They were trying to protect a legitimate proprietary interest (confidential info, key business connections) 2. They drafted a non-compete clause that is reasonable against time and space (reasonable depends on the circumstance but more than 2 years is unreasonable and more limited the space the better) 3. The employer had to use a non-compete there was no other less restrictive clause and is needed to protect the legitimate interest of the employer  Ex. Lyons v. Multari it failed this since Multari was not the face of the business  If the employee was the face of the business the non-solicitation clause is not enough 4. Its clear and unambiguous  Can protect yourself by including severance?  If the employer terminates the contract without reasonable notice the contract has been repudiated and the clause is not enforceable  Termination of clauses:  Fixed term contract: contract with a defined end date  Fixed task contract: contract to perform a defined task which when done ends the contract  Indefinite term contract: contract with no specified end date so reasonable notice is required for termination  At-will contracts: default in the US where either party can terminate a contract with no lOMoARcPSD|7290461  Ancillary contract terms : terms found in secondary documents such as human resource manuals or employee handbooks that have been incorporated into an employment contract (physically separate from the employment contract)  Are they enforceable, there has to a clause that these documents are part of the contract  Problem arises when the it is later signed as there is no consideration  Legally enforceable only if 1. It is made clear that the additional document was intended to be legally enforceable and 2. That the employee understood and agreed to that condition 3. New consideration Chapter 9-Implied Employment Contract Terms  Implied contract terms: a default contract term invented by common law judges and read into employment contracts when the written terms of the contract don’t address the specific issue addressed by

the implied term  Terms that aren’t specified but are integral part of the employment relationship  Honesty, working safely, to act in a civil manner, respectful treatment aka decency, civility, respect and dignity (employer’s implied terms)  Courts have recognized 2 ways of implying contract terms 1. Implication by fact: when terms are implied based on the presumed intention of the parties 2. Implication by law: term is implied into a contract a matter of legal duty that the judge believes ought to be imposed due to the nature of the contract  Business efficacy test: used by common law judges to justify implying a contract term on the basis that the term is necessary to make the contract effective  Officious bystander test: approach used to justify implying a contract term on the basis of presumed intention of the parties, its implied if it is obvious to an uninterested bystander that other parties intended for the contract to be part of the contract  This way a practice that have been followed and accepted by both parties then court may find that they intended the term be implied in the contract  Wrongful dismissal: lawsuit by an employee against a former employer alleging that the employer terminate their contract without complying with the implied term of reasonable notice  If there is a serious breach of contract by the employee, the employer doesn’t need reasonable notice aka summary dismissal Standardized Implied Terms Regulating Employee Conduct  Implied obligation to obey the lawful order(instruction) of the employer where a breach of this term is considered insubordination  But they are not required to follow an order that is unreasonable or is inconsistent with an expressed term  Constructive dismissal: fundamental change to an employment contract by an employer that an employee may treat as an effective termination of the contract  Ex. you quit your job but it is as if you were fired/you had no choice but to quit  Implied obligation to cooperate in advancing the employer’s commercial interest  Implied obligation to not compete and to protect confidential information  Implied obligation to avoid lateness and absenteeism (recognized term of punctuality)  Implied obligation to perform competently and safely  Implied obligation to avoid intoxication  Implied obligation to avoid harassment  Implied obligation to provide reasonable notice of resignation (usually 1-2 weeks) Standardized Implied Terms Regulating Employer Conduct  Implied obligation to provide reasonable notice of termination  Implied obligation to provide reasonably safe work environment  Implied obligation to treat employees with “decency, civility, respect and dignity” and engage in “fair dealing”  Implied obligation to permit employees to report to work (where temporary layoffs and unpaid suspensions violate this implied term)  Implied obligation to compensate employers for work performed  Quantum Meruit: entitlement to be paid fair market rate for work performed when an amount is not said in a contract Chapter 10-Modifying Employment Contracts  Important to be able to make changes to a contract because it is long-term relationship When a contract expressly deals with contract modifications  Usually require both parties to agree to the changes  Can be unilaterally changed by the employer if it is notice (prohibited in Canada) indicated in the contract When a contract does not expressly deal with contract modifications  When the employee agrees to the modification  New consideration is needed even if both parties sign the amended contract  Continuing employment is not enough to be new consideration since under the original contract the employer is required to continue the employment unless there is grounds for dismissal or reasonable notice is given (since they were already entitled to warning)  Forbearance: a promise by one party in a contract to another to refrain from exercising a contractual right for a period of time which can be new

consideration  Ex. forbearance by an employer to not exercise the right to terminate employment may constitute new consideration  When the employee doesn’t agree to the modification  The employee can reject the terms and sue for damages if the employer insists on the new terms (constructive dismissal)  The employer can provide the reasonable notice of dismissal and provide the employee a new contract with the amended term (reemployment) Chapter 11-Termination by Agreement of the Parties Repudiation of Contract: a breach of contract that demonstrates an intention by the party to treat the contract as at an end and no longer be bound by the contract Termination by a fixed-term or fixed-task clause  Where the contract ends at the defined time agreed on by the parties  If the contract is terminated earlier then the parties can recover damages based on the loss they incurred  If there is any question about whether both parties intended to replace the standard reasonable notice the judge will revert back to it  Misused by giving multiple fixed-term contracts  There has to be a clear indication that both parties meant the contract to be short-term Termination according to a contractual notice clause  When the notice of termination clause violates statutory notice provisions  Ex. you can’t be given 2 weeks’ notice since the ESA requires a minimum of 4 weeks since its contrary to the statute it is illegal and void so its replaced with the presumption of reasonable notice lOMoARcPSD|7290461  The notice determined by the employer has to be clear and meet the ESA requirements  Employees have a duty to mitigate damages (legal obligation on the victim of a breach to make reasonable efforts to limit the amount of damages suffered as a consequence of the breach)  When the notice of termination clause is “unconscionable”  Unconscionability doctrine: a contract or term that a court refuses to enforce because 1) it is a result of inequality of bargaining power arising from ignorance, need or distress of the weaker party 2) that was exploited by the more powerful party to obtain a contract that is 3) substantially unfair considering community standards of commercial morality  When changes to the employee’s job have rendered the original notice of termination clause unenforceable so the “ changed substratum doctrine ” applies  A legal doctrine in employment law in which an employees job responsibilities have changed so substantially from the time of the original contract the courts rule the original substratum (basis) of the contract has ceased to exist which may make it unenforceable Termination by a retirement clause  Mandatory retirement clause: legal rule in a statute/contract that terminates an employment contract upon the employee reaching a specific age  Required as there is no statutory retirement age and has to be clear Chapter 13-Termination by an Employer with Reasonable Notice “At will” employment contract: contract in which either party can terminate the contract at any time for any/no reason without any notice (used in US) Modern Assessment of Employers duty  Wrongful dismissal: lawsuit against a former employer by an employee alleging the employer terminated the contract with complying to the implied term of reasonable notice  Bardal factors: (more of a policy perspective that protects employees)  Require the court to take the situation at termination into consideration based on what’s fair and reasonable 1. Length of service: the longer the employee worked the longer the notice has to be

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Downloaded by ( )  One month for every year of service  Soft cap of 20-24 months 2. Age: older you are the more difficult it will be to find a job  Older you are the more chances you will get more notice  Over 50 you get additional 3 months 3. Position/character of employment: up to 12 months for entry level positions whereas senior level positions are entitled to 24 months, character of employment is still taken in place, but it depends on the facts of the case  Those with versatile skills will get less notice 4. Availability of other jobs: looks at the persons skills and the job market (ie. Recession, high unemployment but other courts have said that businesses aren’t able to control the economy) courts have stayed in the mid ground where it is focused on but isn’t give “undue emphasis” Ex. calculating reasonable notice 1. Length of service: 10 years so 10 months 2. Age: 55 years plus 3 since they are over 50 3. Position: Senior level capped at 24 unofficially 4. Availability of other jobs lots of jobs  10-18 months of notice  Employees have a duty to mitigate damages (legal obligation on the victim of a breach to make reasonable efforts to limit the amount of damages suffered as a consequence of the breach)  But aren’t required to take a lower position with a 3 month recovery period Inducement: where you are working for company A and are being poached by company B and they offer good job prospects company B has to give you greater notice since they made you leave your other job  Depends on the length of work Rebuttable presumption: only applies to indefinite term contracts  Clear and unambiguous  In compliance with legislation  And reflects your current position  Just cause and poor performance doesn’t require notice Chapter 14-Termination with Just Cause Without Notice  Contracts can be terminated without notice if the employee commits a serious or fundamental breach of contract ( Summary Dismissal )  The penalty must fit the crime  Implied contractual terms are important here  Types of just cause: Serious misconduct or poor performance Test for Summary Dismissal  Onus on the employer  Has to prove a cause for dismissal exists and the seriousness of the misconduct justifies taking the employees notice entitlements 1. Proportionality is important: did the employee engage in such a serious misconduct that there is just cause for summary dismissal  Based on a balance of probabilities : it is more likely than not that the employee committed the misconduct and  How serious the misconduct was 2. Context/circumstances : isolated, intentional, provoked, record, why, were they remorseful  They don’t have to reinstate the people but they do have to pay for damages  Isolated incidence could be just cause but it has to be serious  Culminating incidence: Other incidence have to show a pattern of behaviour that have to be connected (cumulative) such as disciplinary record  Wilful breach: deliberate, defiant or premeditated violation of a contract  Poor performance/incompetence :  Identify the standard of expectation if you find the employee as performing below the standard of expectation (person performance much less than the standard)

 Make them aware and provide the corrective training  Give them reasonable time to improve  If warnings don’t improve behaviour there is just cause (pattern)  Employers have a duty to warn : requirement in both common law and collective bargaining to warn employees of their unacceptable behaviour/performance and give them opportunity to improve Condonation: the employer know you done something wrong which repudiates the contract but they don’t condone the behaviour and decides not to act  They have to act within a reasonable amount of time After the fact just cause can be used if they find the just cause after the fact Specific Penalty Clause: contract can outline the penalty that will result as a consequence of a specific breach lOMoARcPSD|7290461  Dishonesty/Conflict of Interest: used in rare/serious cases other small/big lies in certain circumstances also don’t imply just cause (context and seriousness)  Gross incompetence: a level of performance that is way below what is expected of a competent employee  Breach of faithful service: not acting in the employer’s economic interests  Insubordination/insolence : breach the implied term that employees have to obey employer’s instructions  When its isolated it doesn’t amount to just cause unless it is willful deliberate, intentional that harms the employer reputation  Harassment/Sexual harassment : usually higher positions like the employer committing this constitutes just cause  Violence: single incident is not sufficient and context matters  Intoxication: depends on context and how it affects the work  Absenteeism/Lateness: isolated incidents are not just cause  Off duty conduct: just cause if the conduct threatens the employee’s economic interests  There is a nexus/link between the behaviour and the employers business interests  Inappropriate use of employer technology: maybe a cause for dismissal if there are clear policies against the behaviour  Employers are liable to maintain a hostile-free  Isolated incidents can be used as just cause if a policy against it is clearly stated Chapter 15-Special Case of Constructive Dismissal Constructive Dismissal: wrongful dismissal that is caused by an employer who commits a fundamental or repudiatory breach of an employment contract that the employee treats as having terminated the contract (being forced to quit due to a unilateral circumstance or they make the employment environment difficult to work in)  Damages are claimed based on the employer’s failure to provide notice of termination  Based on the repudiation of a contract doctrine: breach of contract that demonstrates an intention by the party to treat the contract as at an end and no longer be bound by the contract (serious breach or an intention to do so)  In cases of constructive dismissal the fundamental breach of contract doesn’t automatically repudiate the contract  Constructive dismissal occurs only when an employee accepts an employer’s repudiation of contract by quitting and suing  Acceptance=employee accepting that the employer has terminated the contract  Four Questions Must be Asked 1. What are the express and implied terms of the contract? 2. Has the employer breached one of those terms? 3. It that breach fundamental or repudiatory? (most important question)  Minor breaches aren’t enough if the employee treats a non-repudiatory breach as a constructive dismissal is seen as resigning 4. Did the employee accept the repudiation and treat the breach as having terminated the contract?  Has to accept the repudiation in a reasonable amount of time  If not, then the employee has condoned the breach (which occurs when a party could’ve treated the contract as having been repudiated by the other parties breach elects not to treat it as terminated) so an action of constructive dismissal is not allowed  The test is an objective test “reasonable person” (Farber p.189)  Onus is on the employee to prove that a constructive dismissal has occurred  Cumulative Effect Constructive Dismissal: constructive dismissal that is based on an accumulation of breaches of the employment contract by the employer none of which alone would constitute a serious

enough breach  Balancing interests between providing balance for the employee and employers business interests is done by not making every change a cause  Important to consider the intention bad and good faith changes Situations that Give Rise to Constructive Dismissal  Changes to an employee’s compensation and benefits  Amounts to a fundamental breach since it is the basis for employment relationships  When the cut is to the base pay rather than other benefits or variable pay  More than 30% is significant less than 10% is not always  Changes to an employee’s job assignment  Is there a term within the contract to unilaterally Just Cause Scenarios for Summary Dismissal: reassign the employee?  If not stated employers still have the implied right to reassign employees within reasonable limits 1. The reassignment must be for good faith business reasons and not as a guise to force the employee to quit 2. The reassignment/change in duties must be relatively minor; involve skills within the work the employee was hired to do, the more substantial the change the more likely that courts will find it to be a fundamental breach 3. If the reassignment results in a demotion (less prestige, pay and/or less responsibility), then it is far more likely to constitute a constructive dismissal  Promotions even if objected are not cause for constructive dismissal  P. 192 Dykes  Reassignment of an employee to a different work location  There is an implied term that an employer can reasonably move you to another location  Is there an expressed term? (easiest to avoid future litigation)  Is the relocation reasonable/ based on legitimate business reasons  Can’t be to punish an employee, to make them quit or if the new location involves a demotion  Unpaid suspension and Temporary Layoffs  The employer is preventing the employee from performing his/her job which is the basis for an employment contract so it is a breach of an implied term  Employer can impose paid suspension as a discipline but unpaid can be a constructive dismissal if the employee doesn’t accept it  The contract could include an express or implied term which could be based on a history of unpaid suspensions  If the employee’s misconduct leading to the suspension was serious enough for a summary dismissal for cause which is acceptable since it is a lesser for of discipline  Can use this as a disciplinary method  Under 13 weeks it is okay but over 13 weeks its constructive dismissal under the ESA  But under common law even under 13 weeks it is constructive  Layoff that is indefinite is a fundamental breach  Employee harassment and poisoned work environment  Breach of the implied term to treat employees with “decency, civility, respect and dignity” Employee Acceptance and Condonation of the Employer’s Repudiation of Contract  When a fundamental breach occurs the employee has 3 options 1. Condone the employers breach of contract: doesn’t object to it which barres them from constructive dismissal but the same breach can be used for cumulative effective constructive dismissal 2. Accept the employers breach and treat the contract as repudiated: (constructive dismissal) by quitting within a reasonable period 3. Protest the employers breach of contract without quitting and sue for breach: the employer can comply with the original terms or provide reasonable notice for termination  If they allow the employee to continue work it has to be under the original terms

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 You have to say in writing that you are acknowledging the change but you’re not agreeing or condoning the new changes but you are staying to mitigate damage  Duty to mitigate still applies to constructive dismissals  If the work terms and conditions are the same and the work environment is the same and the relationship isn’t hostile or humiliating then you have to accept the job otherwise you haven’t mitigated damages Chapter 16-Damages in Wrongful Dismissal Cases Damages: an amount of money a party guilty of a contract or tort violation is ordered to pay the innocent party to compensate for the harm incurred  According to courts the damages for breach of contract should place the party in the same position as if the contract was performed  Courts can order specific performance in the case of termination without notice which is an order by the court requiring a party found to be in breach of a contract to carry out its obligations as specified in the contract  In terms of wrongful dismissal the employee may have to return to work if they quit or the employer may have to rehire the employee  Common law regime: don’t reinstate employees who have been dismissed without notice (monetary damages only)  Regulatory standards regime: can include reinstatement if human rights were violated or employees were fired for enforcing their statutory rights  Collective bargaining: reinstatement is appropriate for improper dismissal Categories of Damages in Wrongful Dismissal Lawsuits Wrongful dismissal damages- Bardal/compensatory, aggravated damages and punitive damages  Compensatory damages: lost wages & benefits based on Bardal factors  Apply the reasonable contemplation test: damages for breach of contract are available only for harms that the parties would reasonably have contemplated at the time the contract was formed  Damages that aren’t reasonably contemplated are “remote”  Other benefits and entitled payments will also be calculated into the damages  Aggravated damages: rewarded to the innocent party that compensate for mental/psychological pain and suffering caused by the guilty party’s wrongful act with Bardal factors  Awarded if the employer engages in bad faith in the manner of dismissal (bad-faith discharge)  Damages for bad-faith could be awarded by extending the reasonable notice period  Wallace damages range form 1-4 months of added notice  To accept that extra reasonable notice is arbitrary (difficult to quantify) and subject to mitigation  Under the Honda approach the employee must call medical evidence or evidence of loss of monetary funds that they suffered physical harm caused by the employer’s insensitive behaviour and mental distress (p.205)  Employee has to prove bad faith ex. p. 206  Test: bad faith by the employer, as a result you suffered mental distress and as a result you suffered monetary value  Harder to prove since there is possible monetary damages  Punitive damages: damages ordered against a party who engages in outrageous or egregious behaviour deserving special denunciation and retribution  Punish the employer rather than compensate the employee  Test: Malicious and intentional, it amounts to a legal independent actionable wrong  Awarded when other damages don’t satisfy the goals of denunciation, deterrence and retribution  High legal threshold so its rarely awarded Duty to Mitigate Compensatory Damages  When a contract entitles the employee to a fixed amount of money the employee has no obligation to mitigate  When it expresses reasonable notice the employee has a duty to mitigate if no reasonable notice is provided but there is a reasonable recovery period of  Standard of mitigation required: onus is on the employer to persuade the court that employee could have mitigated  Two key obligations on the employee 1. To make reasonable efforts to look for a new job 2. To accept a job that a reasonable person in their position would accept (including accepting a job from employer that fired them)  Employees can decline job opportunities that would amount to a substantial step backward from their previous job  Aren’t required to apply for jobs they are not qualified for Mitigate with a Job Offered by the Former Employer  If a reasonable person in the employees position would have accepted the employers offer under two conditions

 The salary offered is the same the working conditions aren’t substantially different or the work demeaning and the personal relationships are not hostile 1. Returning to the old workplace wouldn’t place the employee in an atmosphere of hostility, embarrassment or humiliation 2. Has been criticized since it gives the innocent party a dilemma to work with an employer they don’t want to or give up damages Chapter 17-Termination of an Employment Contract by an Employee Test For Assessing If An Employee Has Resigned  Resignation: when an employee terminates the employment contract by engaging in conduct the shows a clear intention to terminate a contract  Employees intention to resign has to be clear and unequivocal  Could be clear by conduct (clearing desk, not showing up)  You can change your mind if it is a verbal resignation at the heat of the moment you have to give them lOMoARcPSD|7290461 time to change their mind before you accept their resignation  Objective test: asks whether a reasonable person of normal intelligence looking at what happened would conclude that the employee unequivocally resigned from his or her job  Employees that have been given an ultimatum hasn’t resigned since they didn’t act voluntarily with an intention to resign  Employee giving employer an ultimatum to get a raise or quit is expressing intention Requirement of Notice of Termination by an Employee  No statutory requirement of notice in Ontario  But under common law an implied term is to give some notice  Usually an expressed contractual term Calculating Damages When an Employee Fails to Give Notice  Damages are assessed based on actual harm caused to the employer due to lack of notice  Hiring and training costs can’t be included in these damages since they would occur regardless  Recoverable damages include sudden loss of production, costs of hiring immediate temporary workers  Wrongful Quitting: lawsuits filed by an employer alleging that an employee resigned without providing the employer with a proper amount of notice Chapter 23-Regualting the End of Employment Contracts Just Cause Provisions: term in collective agreement between a union and an employer that requires that the employer demonstrates “just cause” or a good business reason to discipline or dismiss an employee  Ex. figure 23.1  If there is no employment contract, then they should get common law dismissal damages under Bardal factor  If there is a contract, then it would say that the termination clause is under the ESA minimums  If the contract says it is under the minimum notice it is void so we go back to the common law  If the contract is more generous, we go by the ESA  Common law applies unless there is a clear expressed term Statutory Minimum Notice of Termination Requirements  Cushion for employees to plan for unemployment and seek alternative employment  Common Features of Statutory Notice of Termination Provisions in Canada  Statutory notice of termination: term describing the requirement found in employment legislation for employer to provide defined amount of notice that they are terminating an employment contract  Employers can either provide the statutory notice or pay an amount equal to the benefits and pay they would’ve received had they worked the notice period (termination pay)  Notice has to be written to avoid ambiguities  Common feature of termination provisions 1. Minimum notice of termination provisions: ranging from 30 days employment to six months (*question about the minimum notice/pay in lieu according to the ESA)  Introduced statutory probationary period: period at the beginning of an employment contract during which the employer evaluates the employee’s suitability for further employment and can dismiss without notice 2. Greater notice for mass termination: based on the presumptions that it will be harder for a large group to find a job (exact number depends on the province) 3. Definition of termination of employment: only a dismissed employee is entitled to statutory notice of termination  Employment standards legislation incorporates the common law doctrine of constructive dismissal into the definition of termination so that constructive dismissal triggers the employee’s entitlement to statutory notice  ESA defines temporary layoff and the legislations definition of termination of employment explains that termination includes layoffs that are longer than temporary layoffs  Right to statutory notice is not triggered until layoff lasts more than the temporary layoff 4. Exemption of certain employees from statutory notice entitlements:

 When the employee engaged in serious misconduct leading to termination without cause  Different from the common law principle of proportionality test, here anyone who is guilty of wilful misconduct, disobedience or wilful neglect is no entitled to statutory notice 5. Employees statutory obligation to provide notice of termination:  Many jurisdictions don’t have statutory notice of termination requirements since employees are already contractually obligated to provide notice Interrelationship Between Statutory and Contractual Notice of Termination Requirements  Statutory minimum notices were enacted since reasonable notice under contract terms are expensive, lengthy and complicated so it is more accessible  Contractual requirements may be more but employees either don’t know or don’t want to sue for wrongful dismissal Severance Pay: compensation that an employer must pay to a qualifying employee who has been dismissed; it is in addition to the required statutory notice obligations  Amount is dependent on length of service  Federally it is a minimum of 12 consecutive months  In Ontario only employees with at least 5 years of service is eligible and  Meet one of two conditions in the ESA 1. The severance occurred because of permanent discontinuance of all or part of the employer’s business at an establishment and the employee is one of 50+ employees who have their employment relationship severed within six-month period as a result 2. The employer has a payroll of 2.5 million or more in Ontario  In Ontario severance entitlement is one weeks pay for every year of service up to 26 weeks pay  For larger employer and those who have mass terminations  Federally, two days pay for each complete year of service  Those terminated with cause are disqualified and payments are deducted from wrongful dismissal damages Statutory Protection Against Unfair Dismissal: Two types 1. Laws that prohibit dismissals contrary to public policy  Ex. human right legislation that prevents dismissal based on discrimination  Labour relations legislation make it unlawful for an employer to dismiss ab employee for joining a union or engaging in lawful union activities  Remedies can include reinstatement and back wages and benefits  Anti-reprisal provisions: that make it unlawful to dismiss an employee for attempting to enforce their statutory obligation lOMoARcPSD|7290461  Whistle-blowers: an employee who discloses information about harmful or illegal conduct of their employee or co-workers 2. Unjust dismissal laws: statutory law that imposes restrictions on the contractual right of employer to dismiss employee for any reason at all  Apply to terminations where the employer alleges that there was cause for dismissal employee can challenge the decision with the possibility of reinstatement with backpay and other benefits  Meant to provide the nonunionized employee with substantially similar protections federally, in Quebec and Nova Scotia  S. 240 of the Canada Labour Code (applies to industries that are under the federal jurisdiction) prevent an employer from dismissing an employee for no reason at all by just giving notice  Another view is that it broader remedial powers that exist in common law including reinstatement

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