20 Month Wrongful Dismissal Award for Employee Upheld

The Ontario Court of Appeal has released several wrongful dismissal decisions over the past few months.  It has also released some employment law cases that are not specifically wrongful dismissal.  This is a first of a group of blogs to review those cases and provide some commentary.  There is no clear pattern to the decisions.  In some cases, the Ontario Court of Appeal has been very sympathetic to employees and to employee rights.  In other cases, the Court has shown a willingness to side squarely with employers, particularly when dealing with certain contractual clauses.  Ultimately, these cases seem to be dependent on the particular facts – as well as the particular panel of judges hearing the appeal.

Brake v. PJ-M2R Restaurant Inc. (2017) ONCA 402, is one of those wrongful dismissal cases in which the Court has sided with the dismissed employee completely.

Esther Brake was a McDonald’s restaurant manager for more than 25 years.  She had been working with a specific franchise owner for more than 20 years.  For most of her career, she had been given excellent performance reviews.

After years of receiving excellent reviews, she was given her first negative review in late 2011.  She was then transferred to a poor-performing location, one of the worst locations of all the McDonald’s in Canada.  Ostensibly, this was done to enable her to improve her performance.  After three months at the new location, she was called into a meeting and told that she was being put on a 90 day performance review program due to her poor performance.  The program included goals that were found to be “arbitrary and unfair” and very difficult to meet.  At the end of the 90 day program, in mid-2012, the employer gave Ms Brake a choice between accepting  a demotion and being fired, claiming that she had “failed” the program.  Ms Brake refused the demotion.  She brought a lawsuit for constructive dismissal.  She was successful at trial.  The trial judge held that this was a wrongful dismissal and awarded Ms Brake 20 months’ pay plus legal costs.

The trial judge had ruled that Ms Brake had not been given a sufficient and reasonable opportunity to correct issues that the employer may have had with her performance.  She was “set up to fail.”  The decision to demote her was “substantial and fundamental” and was a constructive dismissal.

The employer appealed on several grounds, all of which were dismissed.

The Court of Appeal came to the following conclusions, some of which will be quite helpful to other dismissed employees.

  1.  If a trial judge reviews the evidence carefully, articulates the relevant legal principles and applies those principles to the facts, the trial judge’s decision will be entitled to reasonable deference from the Court of Appeal;
  2. A demotion from a managerial or supervisory position to one that is non-supervisory is a constructive dismissal and does constitute a substantial or fundamental change to a an employee’s position;
  3. Despite the Supreme Court of Canada’s decision in Evans v. Teamsters, Local 31, an employee is NOT obliged to mitigate damages after being dismissed by accepting an offer of continued employment with the same employer in an atmosphere of hostility, embarrassment or humiliation.  In this case, it would have been unreasonable to require Ms Brake to continue working in the demoted role.
  4. A credit letter provided by the employer confirming years of service can be relied upon to demonstrate the length of service of the employee. The trial judge in this case was entitled to award 2o months to a 20 year McDonald’s employee.  The notice award was well within the reasonable range.
  5. With respect to mitigation – the Court of Appeal noted that any amounts earned during the statutory notice and/or severance period are NOT deductible from the dismissal award.  In other words, a 20 year employee would be entitled to 8 weeks’ statutory notice pay and 20 weeks’ statutory severance pay under the Ontario Employment Standards Act.  Any earnings during those first 28 weeks would NOT reduce the amount owing to the employee.
  6. The Court also noted that part time income that the employee was earning or could have earned while working in the previous position is not necessarily deducted from damages, especially in cases where the part-time employment is a continuation of part-time employment that the employee had while working in her or his old position.
  7. The Court concluded by noting that some income earned during the notice period need not be deducted from the damages award if the income is not really a “substitute” for the original loss of income.  The Court noted that the income earned was part of the income that the employee could have earned anyways, even if she had still been working for the employer.  The Court expressly stated that EI payments are NOT to be deducted from the amount owed by the employer in a wrongful dismissal case.

Having dismissed all of the grounds of appeal, the Court of Appeal awarded costs in the sum of $19,500 for the appeal, which would be in addition to the costs awarded at trial.

For the most part, these points are not particularly new.  Much of this decision is a review by the Court of Appeal of the trial judge’s factual findings and the trial judge’s application of wrongful dismissal and constructive dismissal law to those factual findings.

However, the case does illustrate that the Court of Appeal can be very sympathetic to employees in specific cases.  In this case, Justices Gillese, Feldman and Pepall were wholly supportive of the decision of the trial judge and have provided a decision that fully vindicates the rights of the dismissed employee.

As I will note in my other blog posts, some other employees who have come before the Ontario Court of Appeal recently have had measurably less success.  Of course the panels have been different.  Aside from the specific factual details of the particular case, it is quite clear that the specific judges who form part of any particular Court of Appeal panel will also have a major effect on the outcome of almost any employment law case.

CBC Fires Evan Solomon for Conflict of Interest: Just Cause?

The CBC continues to provide wonderful material for Canadian employment lawyers.  Its very public employment disputes are fascinating case studies.  The most recent case involves allegations of conflict of interest against prominent host Evan Solomon.  Mr. Solomon was apparently dismissed by the CBC.  Do the allegations warrant a finding of just cause?  We don’t know yet, since the case has not yet been adjudicated.  But it is worth considering some aspects of conflict of interest cases.

In Canada, employees do owe a duty of fidelity to their employees.  This does not mean that employers can control an employee’s extra-office activities.  However, if personal activities can be linked back to the employer and can be seen to create a conflict of interest, employers may have legal grounds for concern.

In Mr. Solomon’s case, the Toronto Star has printed a story alleging that Mr. Solomon was engaged in brokering the sale of high end paintings and masks, accepting significant commissions for these activities, and failing to disclose the fact that he was earning commissions to the purchasers of the art.   The article alleges that Mr. Solomon came to know the buyers and sellers in the course of his role as a journalist working for the CBC.  The apparent suggestion is that he used his CBC access to certain individuals to further his private art brokerage business.  These allegations have not been proven in a court.  However, the Star has also referenced a public statement by Solomon in which he stated that he never “intentionally” used his position that the CBC to further his art business.

To make things a bit more interesting, the Star also quotes CBC spokesman Chuck Thompson as having stated that Mr. Solomon had disclosed his involvement in the art business and that CBC had not had any concerns.  Thompson supposedly stated that Mr. Solomon had not “traded on his journalistic contacts.”

It seems that the Star was not satisfied with this response and set out to push the matter further with the CBC by disclosing further results of its own inquiries.

There may well be significant factual disputes between Mr. Solomon, the Star and the CBC over these allegations.  It is impossible to know, at this point, what facts will emerge.

If all of the allegations as stated in the Star report were proven true and the CBC were to be able to demonstrate that Mr. Solomon was using his journalistic contacts to further his personal art brokerage business, this could well be the type of conflict of interest violation that would substantiate a dismissal for cause.

However, If Mr. Solomon were to show that he disclosed his activities in a truthful manner to the CBC and that the CBC had approved, even implicitly, Mr. Solomon could have a reasonable case.  Any examination of the facts will involve a careful review of the details that Mr. Solomon disclosed to the CBC compared to the actual facts and activities that can be proven.

In this picture, it appears that cracks in the paint started to appear when one of Mr. Solomon’s art deals became acrimonious.  Apparently there was a dispute over commissions owing with respect to one of Mr. Solomon’s sellers.   The story involving allegations of conflict of interest broke subsequently.

Although only a few Canadian employees might have the opportunity to broker high end artwork with the connections that they meet at the workplace, there are many other types of conflict of interest.  Hundreds of reported cases have looked at a wide range of conflicts and considered guidelines.  Many of these cases, for example, involve bank employees, who enter into deals with clients outside of bank auspices.  There are many other examples as well in other workplaces.

Here are few key points that both employers and employees should consider in conflict of interest cases:

1.  Employer Policy:  Employers should certainly have detailed conflict of interest policies in place that spell out expectations with respect to gifts, private activities with clients and other related matters.  Employees should be provided with these policies when they first commence employment.

2.  Disclosure:  Employees who would like to run a private business that might be viewed as a conflict are well advised to ensure that they have employer approval for their activities.  It may make sense to get legal advice first but, ultimately, full disclosure to an employer of the type of business activities that the employee intends to operate, coupled with explicit or, at least, tacit approval from the employer can have a prophylactic effect.  Having a paper record of these disclosure, even in email form, can be crucial.

3.  Honesty and Legality:  Even if the employer is aware of the activities, that does not give an employee carte blanche.  If the employee’s business veers into the realm of illegal activities or activities that otherwise create exposure for the employer, the employer may still have grounds to terminate employment for cause, even if some of the activities were disclosed initially.  In the CBC case, if the CBC were able to prove that any of Mr. Solomon’s activities were actually illegal (for example, earning a secret commission or tax evasion), this could put Mr. Solomon in a very difficult spot.  At this point, there is certainly no basis for believing that Mr. Solomon was involved in anything in this category.

As with the situation involving Mr. Ghomeshi, it will be fascinating to follow this case and see the ultimate outcome.  If a confidential deal is reached between Mr. Solomon and the CBC, Canadians may never really find out how the situation was resolved.  For now,  it certainly looks as though Mr. Solomon will require the services of an entirely different type of broker to arrange for a settlement that may well be worth far more than many of the pieces of art that he was allegedly involved in trading.

 

 

Use of Summary Judgment Motions in Dismissal Cases

What are summary judgment motions?  Are they effective in wrongful dismissal cases?  A recent decision of the Ontario Court of Appeal in Arnone v. Best Theratronics Ltd. has provided some helpful guidance for those who would like to use this process.

A summary judgment is a motion for judgment that bypasses the need for a trial.  It can be used where there is no “genuine issue” that requires a trial.  It can often allow parties to save time and legal costs and has been used quite often in Ontario more recently in non-cause wrongful dismissal cases.

The case involved a 53 year old employee who was dismissed without cause after 31 years.  After the parties could not come to a mutually agreeable severance arrangement, the employee sued for wrongful dismissal.  Rather than proceed to a trial, he brought a summary judgment motion in the Ontario Superior Court.  Although this process allows parties to bypass some of the more expensive procedures in other litigation cases, including extensive examinations for discovery, motions and a trial, it can still be a costly process.  Here there were cross examinations on affidavits filed in preparation for the summary judgment.

The motions judge hearing the case initially made a number of findings and awards that were challenged on appeal to the Court of Appeal.  For purposes of this note, I wanted to highlight some key findings of the Court of Appeal, which are relevant and helpful to future litigants.

1.  Summary Judgment is a Great Process for Without Cause Wrongful Dismissal Cases

The Court of Appeal had little trouble concluding that there were no “genuine issues requiring a trial.”  It noted that “a straight-forward claim for wrongful dismissal without cause, such as the present one, strikes me as the type of case usually amenable to a Rule 20 summary judgment motion.”  The defendant tried to resist the motion by arguing that it was unclear whether the plaintiff was a customer service specialist or a manager.  The defendant argued that this issue required a trial.  The Court of Appeal held that there was no issue requiring a trial.  It also noted that, in any event, “character of employment” is a “factor of declining importance.”  In other words, the factors that are far more important to consider include a dismissed employee’s age and length of service rather than the actual position that the person held.

2. Reasonable Notice

The motions judge awarded the plaintiff a notice period of 16.8 months since that was the amount of time that the plaintiff needed to bridge his pension.  The Court held that this was an incorrect approach.  However, the Court increased the notice period to 22 months, upholding the alternate finding that the motions judge had made.  The defendant argued at the Court of Appeal that the notice period should have been 14.4 weeks.  This position was roundly rejected and the Court of Appeal held that 22 months was “within the acceptable range of notice periods for employees in circumstances similar to the plaintiff.”

3.  What About Mitigation?

The Court of Appeal confirmed that any money earned by a dismissed employee during the applicable notice period is to be deducted from the amount that the employer is ordered to pay for the applicable notice period.  There is little new here as this is a statement of well settled law.   If the plaintiff starts earning a higher income during the applicable notice period, this decision suggests that the plaintiff could actually lose money by having a longer notice period.  However, the notice period in this case ensured a full pension for the plaintiff.

4.  Pension Benefits

Dismissed employees are entitled to the “present value of the loss of pension benefits during the notice period.”  This calculations should be performed by an actuary.  In this case, the assessment of $65,000 as the pension loss by an expert actuary was not challenged.

There were two other issues in this case that are less commonly contested.  The plaintiff was awarded a “retiring allowance of 30 weeks’ pay” based on a company policy that provided a retiring allowance of one week’s pay per year to retiring employees.  The court held that the “retiring allowance” policy did not clearly exempt dismissed employees from receiving the retiring allowance.  This allowance was payable in addition to the other wrongful dismissal damages.

It is also worth noting that the motions court made a cost award of $52,280 on this summary judgment motion.  The cost award was challenged by the plaintiff, who had apparently made an official “Offer to Settle” before the motion that was not seen by the motions court judge after the issue of liability was determined.  The plaintiff wanted to argue that he would be entitled to costs on a higher scale as a result of having submitted valid offers to settle before the motion.  Moreover, there would still be further costs to be awarded as a result of this appeal.  The Court of Appeal agreed that the issue of costs should be reexamined in light of the offers.

The end result is that this was certainly not an inexpensive summary judgment motion.  While it is true that the parties avoided many days of trial, there were still affidavits, cross examinations and submissions.  Nevertheless, the process seems to have worked out quite well for the plaintiff, on paper at least, who was ultimately awarded 22 months’ pay less any amounts earned during that period, a retiring allowance equal to 30 weeks’ pay, pension damages of $65,000 and a significant costs award.

Plaintiffs who have been dismissed without cause and provided with a low ball offer may be well advised to consider a summary judgment motion as the best way to advance a wrongful dismissal claim through the legal process.

 

 

Fixed Term Employment Contract? Better Prove It!

When is a fixed term employment contract not enforceable?  A recent decision of the Ontario Superior Court in Tossonian v. Cynphany Diamonds Inc. addressed this issue.  The court held that the fixed term guarantee was not part of the original deal between the parties and threw out that part of the contract.  The plaintiff was still awarded wrongful dismissal damages but they were much lower than they would have been if the employment contract had been enforceable.

The plaintiff, Razmig Tossanian, moved from Vancouver, B.C. to accept a position at Cynphany Diamonds in Toronto.  According the trial decision, the plaintiff was looking for an opportunity to move his family to Toronto.  After lengthy negotiations, he accepted an email offer of employment that purported to be based on an oral agreement.  The email set out the various terms that had been agreed upon, but made no mention of a five year fixed term.  The plaintiff did not respond in writing, though he indicated that he had called the owner of Cynphany to confirm the five year guarantee.

The plaintiff moved from Vancouver to Toronto without anything further in writing.  He began working for the defendant in late August 2011.

Some weeks later, the parties signed an “Employment Contract.”  This document did not reference the five year term.  A further document, for mortgage purposes was prepared, and signed by the defendant.  The second document stated that the plaintiff had a “guaranteed five year position.”

There was yet another document that also referenced a five year period, which was also prepared for mortgage confirmation purposes.  When the bank called to confirm, the owner of the defendant confirmed the five year term.

Mr. Tossanian worked for a total of approximately 8 months for the defendant.  At some point, according to the evidence, the plaintiff began having discussions with another potential employer and he shared information with these discussions with at least one co-worker.  He apparently suggested to his co-worker that he had a guaranteed job if he was fired by Cynphany Diamonds.  The owner of the defendant found out about these discussions and became quite upset.  There was a factual dispute about whether or not the plaintiff resigned or was fired but the evidence seems to be fairly clear in this regard that he was fired.  He was not fired for just cause as it is not cause to fire an employee for looking for other work.  Just cause was not argued at trial.

After being dismissed, the plaintiff went to the potential employer but the job opportunity that he had been pursuing fizzled.  Ultimately, he wound up returning to Vancouver and going back to his old position after just more than 4 months.  This position was at a much lower rate of pay.

The plaintiff sued for wrongful dismissal.  He alleged that he had a five year fixed term employment agreement and that it had been breached.  Even though he found work after four months, he claimed that his losses over a period of five years would amount to approximately $175,000.

The court does not seem to have been impressed by the plaintiff or his evidence.  Despite the various written agreements, the court held that the initial email between the parties was the key document and it did not reference a five year term.  Although the employer made “inflated representations about the duration of Mr. Tossanian’s employment contract to help him get a mortgage” the five year term had not formed part of the initial employment contract.  The court held that there was no new consideration for the five year guarantee.  The decision notes that the presiding judge did not feel that a salesperson of fine jewellery would require a five year fixed term employment contract.

Even though the court refused to find that there had been a five year guarantee, it still found that the plaintiff had been wrongfully dismissed. The court then had to turn to the applicable notice period.  The judge was not particularly sympathetic to Mr. Tossonian.  He was awarded a total notice period of two months, amounting to just over $13,500.  This was awarded after a trial that spanned over seven days, not to mention all of the preliminary motions, examinations and other court appearances.  Ouch!

In some respects, the decision is puzzling.  The plaintiff had at least two documents, signed by the defendant, providing for a guaranteed five year period.  Although the owner of the defendant provided evidence that things were not really as they seemed, the court’s explanation of why the five year fixed term employment agreement should not be enforceable is not particularly convincing.  If the defendant signed a document guaranteeing a five year period, provided that document to third parties and answered oral inquiries in a manner consistent with that document, there seems to be ample reason to find that the document was binding.

The court’s decision was likely coloured by the plaintiff and by the court’s assessment of the plaintiff as a witness.  The judge did not seem to like the plaintiff’s explanation as to why the five year fixed term was not included in the original email.  The court was less than impressed by the plaintiff’s efforts to find work for another employer, while still employed by the defendant.  In particular, the court found that the plaintiff had discussed that with at least one other employee and this caused the judge to empathize with the employer. As well, the court noted that the plaintiff returned to his old position reasonably quickly after being dismissed and may have had other opportunities as well.

The judge’s assessment of the plaintiff and that plaintiff’s character was quite damaging.  Not only did the court reject the five year term but it also awarded the plaintiff a very short notice period of only two months.  Courts have a great deal of latitude in selecting the appropriate notice period.  Although judges are supposed to consider the length of service, age, type of position and a variety of factors, decisions are inevitably coloured by the likeability of the plaintiff as a witness.

It may well be that this case is headed for an appeal to the Ontario Court of Appeal for a reassessment.  While the two month notice period is probably not likely to change if the Court of Appeal upholds the court’s findings, the real issue is whether or not the employer was bound by a five year employment contract.  This seems to be a question of law and one which the Court of Appeal may well consider carefully and could even reverse, depending on the particular Court of Appeal panel.

The decision is a reminder of some very key points that apply to many employment law situations:

1.  An enforceable contract must contain all of the terms and must be agreed upon by both sides, in advance, prior to the start date.  Oral representations, side agreements and “confirmation of employment letters” may not be binding if they conflict with the original contract;

2.  Where an employee finds work after being dismissed, courts will be reluctant to award large scale damages unless there is a very compelling reason to do so;

3.  Whether or not a witness makes a favourable impression on the court is crucial.  If a court has concerns about a witness’s honesty, character, motivation or if a court has other concerns, that may well have disastrous consequences for that side.

 

 

 

 

 

Key Employment Law Cases of 2014

Another year has passed and that means it is time to reflect back and consider some developments in employment law that we witnessed in 2014.  It was not an earth shattering year in the employment law field in Canada.  There were certainly many decisions reached across the country dealing with wrongful dismissal, breach of human rights, non-competition covenants and a range of other topics.  But the number of decisions that really changed the law was limited.  That being said, I have highlighted a few cases and other employment law developments that are worth summarizing.  I have provided the links to my original blog articles where they are cases that I wrote about.

1.  Ghomeshi and the CBC

This case is not completely over since there is a still a potential labour arbitration pending.  Moreover, the case was not adjudicated.  It was settled.  However, it created a great deal of discussion in the employment law world and for that reason it is worth including.  What are the key points to think about?

A.  Unionized employees will have an incredibly difficult time launching wrongful dismissal or other employment law related cases in the court system.  The proper venue for these cases is labour arbitration hearings.  For the most part, dismissed unionized employees must file a grievance.

B.  Egregious personal conduct, even off-hours conduct, can be cause for dismissal, particularly if at least some of it spills over into the workplace or into workplace related events.  Employers will need to pay careful attention to allegations of improper personal conduct and should address and deal with these matters before they become unmanageable.

C.  Taking an extremely aggressive approach to employment law litigation is simply not always the best strategy for plaintiffs.

There may still be more on this in 2015 as Canadians follow Ghomeshi’s criminal proceedings and his labour arbitration case.  The high profile nature of the dispute warrants its inclusion on a list of interesting developments.

2.  Boucher v. Wal-mart

The Ontario Court of Appeal awarded more than $400,000 to an employee who had been subjected to humiliating treatment in the workplace.  It is still rare in Canada to see these types of awards.  Although the amount of the trial judgment was reduced considerably, this case is still a significant weapon in the arsenal of decisions upon which abused employees and their counsel will rely.  It remains to be seen whether large scale punitive and aggravated damages become more commonplace in Canada.  Employees facing humiliating workplace conduct and bullying bosses have additional legal options to consider in light of this decision.

3.  AG Canada v. Johnstone

In this key case, the Federal Court of Appeal looked at the issue of “family status” under human rights legislation and concluded that family status includes childcare responsibilities and similar family care obligations.  This means that an employee with childcare responsibilities may, in certain circumstances, be entitled to protection and accommodation under applicable human rights legislation.  The Court set out a number of criteria that must be met and tried to make it clear that not every employee with some child care responsibilities will be able to request accommodation.  However, many employers are trying to deal with the issues pro-actively and are finding ways to accommodate the needs of employees with child care and elderly care responsibilities.

4.  Jan Wong and the Globe and Mail

Although I originally discussed this in 2013, the adjudicator’s decision was upheld in 2014 and Jan Wong was left facing a significant award as well as an award of legal costs.  The case illustrates a few points:

A.  The difficulty of proceeding in any kind of dispute in a unionized workplace without the backing and support of the union;

B.  The seriousness of confidentiality provisions in a settlement.  Employees who sign confidentiality provisions in settlements with their former employers can expect to face repercussions if they breach these provisions.  In some cases, a breach can mean a requirement to pay back to the employer the full amount of the original settlement.

5.  Fulawka v. Bank of Nova Scotia (Originally 2012 Ontario CA)

The Bank of Nova Scotia reached a settlement of a class action lawsuit with a group of bank employees claiming entitlement to overtime pay.  This settlement means that as many as 16,000 employees of the Bank of Nova Scotia could be entitled to overtime pay for overtime hours worked during the time period 2000 to 2013.  The affected employees were required to submit their claims by October 2014.  The case is a significant illustration of the availability of class actions to deal with widespread policies of large employers that may affect many different employees.  It is also which has caused employers and employees to examine their overtime hours and overtime policies.  Just because an employee is paid a salary does not mean that the employee can be required to work uncompensated overtime hours.

 

2014 Blog Posts – Selected Highlights

As well as they the key cases and issues set out above, I have highlighted a few of my blog posts from the past year.  In case you missed any of these, you might find them interesting:

1.  Hollander v. Tiger Courier Inc. (Sask C.A.)

It was not considered wrongful dismissal where a package of marijuana was delivered to an employee at his workplace.    The employee claimed that he knew nothing about the pot and that it wasn’t his…Fascinating reading.

2.  Rhebergen v. Creston Veterinary Clinic (B.C.C.A.)

The B.C. Court of Appeal upheld a very onerous non-compete provision for a veterinarian.  The clause prohibited a vet from setting up a practice within 25 miles of her employer’s clinic, for a period of 3 years.  It included huge financial penalties that would become payable in the event of a breach.  Surprisingly, the B.C. Court of Appeal upheld this clause.

3.  Steps to Take When You Are Fired

In this blog post, I have set out some things to consider when facing a dismissal situation.

4.  Are Employment Contracts Negotiable?

This post deals with aspects of employment contracts that can and should be negotiated.

5.  Poisoned Work Environment?  Not in this Restaurant.

Discussion of a recent Ontario Human Rights Tribunal decision addressing allegations of a poisoned work environment.

 

For 2015, I will aim to put up one or two new posts a month and I hope to send out an email update quarterly, or so.

 

Wishing everyone a Happy New Year.

Just Cause for Dismissal? Hard to Prove.

What kind of conduct is just cause for the dismissal of a teacher?  If the teacher has been a long serving employee, the threshold will be quite high, according to a recent Ontario Superior Court decision.

In the case of Fernandes v. Peel Educational & Tutorial Services Limted, the plaintiff was awarded one year’s salary.  Perhaps more significantly, he was awarded the value of disability benefits that he would have been eligible to receive because he became disabled within a short time period after being dismissed.

Mr. Fernandes had been a teacher with Peel Educational Tutorial Services for more than 10 years.  In 2009, the school alleged that Mr. Fernandes had falsified students’ marks and committed “academic fraud” by doing so.  Mr. Fernandes conceded that some of his calculations were incorrect and that there were some issues with his submitted marks.  But he denied his conduct was “fraudulent.”

This case involved a 10 day trial, which featured the evidence of numerous witnesses.  One of the witnesses called by the school was  a “Mr. Zero,” who certainly has an interesting name for a witness in which one of the allegations is that certain students should have been given a mark of “0” for failing to hand in assignments.

In any event, after all of this extensive evidence, Justice Lemon concluded that Mr. Fernandes had been wrongfully dismissed.

The court made some interesting findings including:

  • Mr. Fernandes gave incorrect marks;
  • The marks he gave were late;
  • He allowed students to have overdue assignments;
  • Even though he was a computer teacher, his own computer program did not provide accurate marks;
  • He lied to his employers about how the marks were calculated;
  • He lied to the court about the student presentations were marked;
  • He admitted to falsifying some marks on students’ records.

These are all findings made by the court and appear in the decision.

However, the court also noted that Mr. Fernandes had been employed for more than 10 years and up to these incidents, was considered a “well-regarded teacher.”

Taking into account all of the circumstances and relying heavily on a charitable reading of McKinley v. B.C. Tel (2001) S.C.C. 38, [2001] 2 S.C.R. 161, the court concluded that “immediate termination was not the appropriate sanction for this misconduct.”  The court noted that “the defendants could have fashioned a reprimand and a warning that such conduct, if repeated, would lead to summary dismissal.”   The court awarded Mr. Fernandes one year’s compensation amounting to just over $50,000.

Mr. Fernandes had also sued for $300,000 in “intentional infliction of mental distress.”  This claim was rejected.

However, in addition, he had brought a claim for “long-term disability benefits” for $226,000.  At trial, he demonstrated that he was suffering from severe depression and other related symptoms.  The court held that he became disabled after being dismissed and during the applicable notice period.  The employer was therefore responsible for the full value of the disability benefits.  Given that Mr. Fernandes was 52 at the time of dismissal, this could mean approximately 13 years of LTD benefits, for which the defendant school would be responsible.

It remains to be seen what the Ontario Court of Appeal will do with this case.  Given the findings of the judge, there seems to be significant findings of improper conduct that may well warrant a just cause dismissal.  Although the judge was in the best position to make these findings of fact, the Court of Appeal may well review the court’s conclusion that just cause dismissal was not warranted in the circumstances.  It should provide for some interesting reading if the case is actually appealed and argued.

Irrespective of what ultimately happens with this case on appeal, if it gets there, here are some key points to consider:

1.  Establishing just cause for long service employees is extremely difficult and costly.  Many judges are willing to give plaintiffs the benefit of the doubt, even where serious misconduct is alleged.  Even were there is evidence of some misconduct, courts will consider the whole employment history of a dismissed plaintiff;

2.  Dismissed employees can and should fight employer determinations of “just cause” if there is any reasonable prospect of success and sometimes, these cases can sometimes even be won where the prospects look grim;

3.  Dismissed employees are entitled to insurance benefits during any applicable notice period.  If they are cut off from these benefits by their employer and then later found to have been wrongfully dismissed, employers will be responsible for the full value of the benefits.  This means that if an employee dies during a notice period, the employer will be responsible for the full value of the life insurance policy that had been in effect.  If the employee becomes disabled, the employer will be responsible for the full value of the disability benefits.  Employers need to consider liability very carefully before cutting of an employee from all benefits when making a termination decision.

 

 

 

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