Unjust Dismissal – A Powerful Remedy for Dismissed Employees in the Federal Sector

Religious Freedom: Canada versus the U.S.: Two Recent Cases, Two Different Results.
July 3, 2018

Unjust Dismissal – A Powerful Remedy for Dismissed Employees in the Federal Sector

For most dismissed employees in Canada, a wrongful dismissal lawsuit is the best way to get a proper severance package if negotiations fail.  Fortunately, most employers are willing to provide or negotiate reasonable arrangements, so litigation is not always a required step. 

But for employees who are dismissed from Federally regulated employers in Canada, there is a remedy available that can be quicker, less costly and can provide for a better settlement.  The Unjust Dismissal provisions of the Canada Labour Code provide federally regulated employees with union-like protections against job loss. 

Non-unionized employees who work for banks, cable and telephone companies, radio and television stations, and other federally regulated enterprises can file an unjust dismissal complaint within 90 days of being let go.  This only applies for employees who have worked for the employer for at least one year and who are not “managerial employees.”  It is worth noting that “managers” are considered to be people with significant managerial authority.  Some cases have held that Branch Managers and Assistant Branch Managers in Banks are not excluded from accessing these provisions.

The key is that Canadian courts have affirmed that qualifying employees cannot just be dismissed “without cause” and provided with a severance.  If the employer can show that there was a genuine restructuring, with the discontinuance of a role or function, a dismissed employee may not qualify.  But in other cases, the employee can challenge the decision to terminate employment and ask for reinstatement with full back pay.

This is very different from the general common law that applies to employees across Canada.  In most cases, a Canadian employer can dismiss an employee at any time, “without cause” as long as the employer provides reasonable advance notice – or compensation instead of notice.  The dismissed employee can really only fight over the amount of money and, in some cases, whether the employer has committed any acts of “bad faith” or violated any other statute, such as the Canadian Human Rights Act.

But Federally regulated employees can claim that the dismissal was “unjust” under the Canada Labour Code and can ask for reinstatement to their old position.  If successful, they can be awarded reinstatement PLUS full back pay for the time that they were out of work and legal costs. 

The power of the Canada Labour Code Unjust Dismissal provisions was affirmed by the Supreme Court in Wilson v. Atomic Energy in 2016The Supreme Court’s approach was adopted last year (2018) by the Federal Court of Canada in Bank of Nova Scotia v. Randhawa, a case that was argued by our office. 

If you have been dismissed by a Bank or another federally regulated employer in Canada, it is crucial that you obtain proper legal advice and consider whether to file a Canada Labour Code Unjust Dismissal complaint within 90 days.  For most other wrongful dismissal lawsuits, employees have a longer period of time. 

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