What Does Mitigating Losses Mean?

Toronto Employment Lawyer Brian Bell: Those who have been terminated from their position on a With or Without Cause basis might be familiar with the term “Mitigate One’s Damages." It's worth going over the rules of mitigation again here.

Mitigation refers to making one’s situation less severe after a breach of contract. For instance, if a building's tenant skips out on their rent, the landlord can't leave the unit vacant for years and go after the tenant for all of that lost rent. The landlord must try to rent the unit to someone else.

An example in the employment realm is a fired employee who mitigates their damages from a Wrongful Termination by finding a new job. A fired employee cannot simply put their feet up and then go after their boss for the wages they're losing. Instead, they have to make a reasonable effort to look for work. By finding a new job, the terminated employee mitigates their losses, and also reduces any damages to which they would be eligible from their former employer.

There are several principles in mitigating one’s damages:

1. The first and most important principle is that the Plaintiff (employee) must take all reasonable steps to mitigate the loss.

2. The second principle states that the Plaintiff is able to recover for the loss incurred when reasonable steps were taken to avoid the loss.  In other words, if you tried to mitigate your losses through reasonable efforts to find a job, but were unsuccessful, you will not be penalized.

3. The last principle is when the Plaintiff has taken steps to mitigate the loss, and these steps are successful, that the Defendant (employer) is entitled to benefits accruing from the Plaintiff and is therefore only liable for the reduced amount of the loss.

Essentially, the employee is required to mitigate their losses, and make all reasonable efforts to do so. The former employee cannot claim both a payout and find a new job, and thereby be better off than they would have been if they continued to be employed by their former employer.

Note that it remains the Plaintiff’s responsibility to show that they have mitigated their damages by keeping records of their efforts to do so.

Lockout vs. Strike

Toronto Employment Lawyer Brian Bell: We're well into the second month of the NHL lockout, and everyone around the water cooler has an opinion about it. Still, you may be wondering what exactly a lockout is, and how it differs from a strike.

According to the legal interpretation, a lockout is generally defined as an employer’s withholding of work and closing of a business because of a labour dispute. The term is very literal: you're locked out.

A strike is the opposite. When an employer and and a union reach a deadlock, a strike sometimes occurs, whereby the union members withhold their skills and abilities and do not work until some agreement is reached.

A lockout is the option the employer has in dealing with the employee representatives with the intent to put pressure on the employees’ union: if the union members are locked out and can't work, then they aren't being paid, either.

If you consider yourself to be a sports fan, especially a hockey fan, you're probably getting sick of the term "lockout."

If you consider yourself to be a sports fan, especially a hockey fan, you're probably getting sick of the term "lockout." The term has been used in the NFL and the NBA over the last year or so, as well, as these two leagues recently went through their Collective Agreement negotiations process. For the NHL, though, this is their second lockout in the past 7 years.

The use of either a lockout or a strike is intended to force the other party to reach an agreement/renewal of the Collective Agreement. Whatever the case, whether employees choose to strike or the employers choose a lockout, there is a work stoppage.

The ultimate cost of such an action remains to be seen when the product or service is offered once again.  Will the consumer return?  I guess we will have to wait to see if consumers of professional hockey will return, or if they've had enough and will take their entertainment dollar elsewhere.

Maternity/Parental Leave

Toronto Employment Lawyer Brian Bell - It goes without saying that since the 1960’s, the number of women working outside the home has risen drastically.  Along with other issues, the notion of maternity/parental leave has been a constant topic of discussion within the workplace.  However, I am sometimes surprised how some employers still try to circumvent their obligations to new mothers and fathers.

I recently had a client who, upon returning from her authorized maternity leave, was advised that her hours had been reduced by a third; she would now have to work every Sunday, rather than through a rotation, and a previous accommodation due to family responsibilities would no longer be available to her.

Employees should remember that while maternity and parental leave - and yes, parental leave can be taken by men as well - might be a bit disruptive to an employer, it does not allow the employer to significantly alter the terms and conditions of employment with the person on leave.

For up to a year (i.e., 52 weeks) a female employee can take the maternity and parental leave options.  When she returns, she must be given her regular job back with the same responsibilities and same pay and benefits.  The only way this may be changed is if the former job no longer exists. Then the employee must be offered a similar position.

I shake my head when employers fail to comply with the specific guidelines in this matter.  Employers can replace the person who is on maternity/parental leave, but only on a short term or temporary basis. It may be a great opportunity to cross-train employees should the employee on leave decide not to return, but when the employee does return, it is their job again.

Not managing the maternity/parental absence productively can have long-term negative consequences. These include fines, charges for discrimination under the Human Rights Code, and a negative reputation for the company, especially if the situation gets some publicity.

The potential negative results far outweigh any inconvenience it takes to handle maternal/parental leave properly and professionally.

Lying About Office Romance Leads to Termination

Brian Bell

Toronto Employment Lawyer Brian Bell: Since we probably spend at least half of our time with our office colleagues, it shouldn't come as a shock when we hear of an office romance. Just a word of warning to the romantics: be careful. Depending on the circumstances, an office romance can cost you your job.

This example involving a manager named Bryan Reichard, and his subordinate Ms. Thompson, is worth a look.

The company was Kuntz Electroplating Inc., and they were astute enough to recognize that office romances happen.  In an attempt to manage such situations, they developed a non-fraternization policy for staff to follow.

While the company did not forbid office romances outright, they did require an employee to advise upper management if they entered into a romance with another worker. The company wished to be made aware of such relationships for operational and Human Rights reasons, such as possible sexual harassment claims, or accusations of favouritism.

In the Reichard case, the company confronted him with the rumour that he was involved in a romantic relationship with a subordinate. Reichard denied the claim, and continued to deny it on several other occasions. He was married, which likely had something to do with his denials. When he was confronted a final time by his superiors, he finally came clean and said that yes, he was involved with a co-worker. When management suspended him and told him not to come back to the office until further notice, he returned to the office twice, in direct violation of their orders.

The employer ultimately terminated Reichard, and the Court supported the employer’s position.  The Court felt that Reichard's deliberate and continuous lying to the employer amounted to Willful Misconduct, calling into question "the trust, integrity and honesty required of him." Said the court: 

While the married Reichard certainly put himself between a rock and a hard place because of the affair, he compounded his problems significantly by deliberately and continuously lying to Kuntz and then deliberately and willfully disobeying orders from his superior.

This outcome gives both the employee and employer things to consider.  The employer should have a policy about office romances and what conduct is considered acceptable. The employees should be aware of what the policy says, and be prepared to follow that policy.

The Reichard case makes it clear: don't lie about an office romance if you are required to disclose it. The romance itself might not get you fired, but lying about it could.

What To Do When An Employee Says, "I Quit."

Brian Bell

Toronto Employment Lawyer Brian Bell - So, you are a manager of a mid-sized company and it has been one of those days. Everything that could go wrong, has.  Sometime during the day, one of your sales people comes into your office with just another “lame excuse." You challenge what the sales person is saying.  The conversation gets heated, and voices get louder. Within minutes, the sales person states that they do not deserve to be treated like this. They finish by saying, "I quit," and then walk out of the office.

Question: Has this person truly resigned?

I recently encountered a situation similar to the one above.  Employers beware: resignations given in the heat of the moment may not be upheld in a hearing.

Resignations that are upheld are generally supported by a resignation letter. Such a letter will help confirm that an employee gave considerable thought to leaving employment.

In the case I was dealing with, the employee, in the heat of the moment, said he was quitting right then and there.  No resignation letter was provided at the time, nor was one to follow.

When this type of thing happens, the employer should proceed with caution. Before taking the employee's word for it that they have quit, the first thing you should do is give everyone - yourself included - a few days to cool off. Then wait to see if the employee contacts you. In a lot of cases, when the parties calm down, the employee could very well rescind their “resignation,” and they are allowed to do so.

In the case I was involved with, three to four days had passed with no contact from the employee.  I then advised the employer to confirm in writing with the employee that since we had neither received a letter, nor heard from the employee, we were concluding that their oral resignation was valid and all appropriate documents would be forwarded to the former employee as required. That is where the case ended.

It doesn't always work out that way. For a peek at how things can turn out poorly for you if you take an angry conversation as a resignation, you should look at this case from BC. In it, an employee laid his company keys on the table, wished the company luck, and walked. Sounds like a resignation, doesn't it? Not so fast. Read the article and see what the judge decided.

Taking the necessary steps to confirm and reaffirm the actions of the former employee are sure to reduce the risk of problems for the future.

Busted For Lying On A Resume

It should go without saying not to lie on your CV, but here's a piece about resume cheating that should remind everyone to think twice before they do it:

After just four months on the job, Yahoo! CEO Scott Thompson is out of work this week after it was discovered he had lied on his resume.

While his resume boasts 1978 degrees in both accounting and computer science from Massachusetts' Stonehill College, Thompson has since admitted he never earned the latter.

Thompson isn't alone. Here's six more stories of execs who were busted for lying on their resumes.

You Can Be Fired For Facebook Postings

Brian Bell

Toronto Employment Lawyer Brian Bell - The growth of social media has provided a vehicle for some individuals to vent their frustrations on a lot of issues, including stuff that happens in the workplace. But take heed: there is no immunity in using social media to voice workplace displeasure.

A recent case involving a Canada Post employee and Facebook is a good example:

The woman had been given a three-day suspension without pay after being part of a confrontation between older workers and a younger supervisor.

Later, the company discovered a series of Facebook postings by the employee that included derogatory statements about her supervisors and Canada Post. She claimed she had a voodoo doll of one manager and also if she hadn't been drinking she would "take her out on the driveway and run her over," according to the ruling.

The posts were sent to more than 50 Facebook friends, including some co-workers, The Star reported.

Bad move.

Social media can give individuals the unjustified confidence that they can say anything they wish under the protection of privacy. They can't.

In this case, the employee was terminated for the comments. Her union - the Canadian Union of Postal Workers - grieved on the basis that she was a long tenured employee and close to retirement. The Union’s position was that some lesser form of discipline might better suit the circumstances, given the employee’s age and service.

The arbitrator considered these issues, but felt that the lack of remorse displayed by the woman, and her attitude in general, outweighed any factors for leniency.

Everyone needs to be aware. Social media can give individuals the unjustified confidence that they can say anything they wish under the protection of privacy. They can't.

Before posting something online, a question one might ask is, “Would I say the same thing to my supervisor if I were talking to them face to face?" Probably not. As a result of thinking falsely that she was untouchable, this employee did lose her job, and the arbitrator upheld the termination.

Social media does not remove the responsibilities an employee has toward their employer and their supervisor. I agree with the arbitrator’s decision in this case.

In short, take care and be aware, and if in doubt: don't post it online.

Changes Coming to Employment Insurance?

It looks like there may be some changes coming to Employment Insurance. A taste from the CBC:

Finance Minster Jim Flaherty. Photo: CBC

The omnibus budget bill making its way through Parliament makes changes to the Employment Insurance Act, including how suitable employment is defined and determined.

"There’ll be a broader definition and people will have to engage more in the work force," Finance Minister Jim Flaherty told reporters on May 14.

Right now, people who become unemployed and who have paid into the Employment Insurance system can collect benefits for a length of time that varies depending on the region where they live. But they must also look for a new job, and start work if something suitable becomes available.

Catch more here.

Some Notes on Drug and Alcohol Testing in the Workplace

Toronto Employment Lawyer Brian Bell - Regarding the alcohol testing case currently headed for the Supreme Court, this type of thing has been an issue for years. I recall cases within the financial industry where institutions wanted to test employees for substance abuse, and ultimately the action was thrown out - primarily because of the answer to one question: is the testing necessary for the job (i.e. safety concerns)?

If the answer to that question is yes, then the next issue is whether the company’s testing program is too invasive. Ultimately, a blanket yes to testing has the potential for a very slippery slope.

In the current testing case, the company’s position is that testing is necessary for safety reasons, and given this article's content, I would agree.

I would also agree with the unions who say such a policy is not required where it infringes excessively on the rights of the workers. An additional valid point is whether there has to be an “incident” before an employer can introduce such a policy to protect other workers as well as themselves.

It remains unclear where the line should be drawn, and the Supreme Court will have to determine whether a line needs to be drawn at all. I'm looking forward to the outcome of the case.

Should Random Alcohol Tests Be Allowed in the Workplace?

Testing?

Here's a look at an interesting case that's heading to the Supreme Court. At issue is whether unionized workers should have to face random alcohol tests:

It’s a fight that began with one pulp-and-paper mill worker in Saint John, and a “zero” reading on a breath-analysis alcohol test six years ago. Now, it is headed to Canada’s highest court. 

The case, which pits the Communications Energy and Paperworkers Union of Canada Local 30 against Irving Pulp & Paper Ltd., is being watched closely by employment lawyers across Canada, who say it could have broad implications.

Read the rest of the story here.

Union vs. Non-Union Legal Options

Brian Bell

Toronto Employment Lawyer Brian Bell - Pace Law Firm: I'd like to take a minute to talk about the employee/employer relationship and how it differs in union and non-union shops. Note that this is not a critique of either a unionized workplace or a non-unionized workplace. That discussion is best left to the workers in their place of employment.

What needs to be remembered is that the employer/employee relationship is different in a unionized place of work.  I sometimes receive phone calls from union members stating they have lost faith in their union representative, and that they want to take the employer to court themselves.  Unfortunately, I have to tell them they're out of luck. It simply isn't an option for union members.

Workers of a unionized environment have a Collective Agreement which outlines all of the terms and conditions of employment between the parties. These include grievance/arbitration procedures that form the basis for resolving disputes in the workplace.

It may be difficult for some workers to understand this, because the situation may leave them feeling that they have limited access to justice.  Not so.

Essentially, unionized workers must follow the Collective Agreement. It doesn't matter if the worker does not agree with the final outcome - the Collective Agreement does not provide that worker with an additional avenue to pursue their issue in a way that workers in a non-unionized environment might.

It may be difficult for some workers to understand this, because the situation may leave them feeling that they have limited access to justice. Not so. The grievance/arbitration process allows the worker/union to seek a resolution in a manner that is intended to be efficient, productive, less costly, and equally as time sensitive as it would be when proceeding through the courts.  Employees in a non-unionized workplace, on the other hand, are left to their own means in establishing the terms and conditions of employment, and in some cases even they make use of employment agreements to outline their terms.

In any event, if “arguments” are in place within either a non-unionized or unionized workplace, the employee is governed by the terms of their respective agreements. One does not really have any procedural advantage over the other, but it is worth remembering what their differences are.

CPP Benefits Awarded to Client After Appeal

Brian Bell

Toronto Employment Lawyer Brian Bell - Pace Law Firm: I had a client come to me a while back who had been in declining health for some time. We'll call him Bill.

Prior to his disability, Bill worked some 30+ years for a large computer company. After the company went through restructuring, he was given a package.

During his entire employment period, Bill had paid into CPP. After his termination period of notice expired, his health deteriorated to such an extent that he was rendered unemployable. His issues included a broken back and a prolonged disease with disabling treatments. He recovered from the back injury enough to be mobile. When he applied to CPP Disability, he was turned down because 1) he was not currently paying CPP payments and 2) he had not made payments for 4 of the last 6 years prior to his total disability.

In fact, he was disabled well before their determination of 2008 disability year. The Board agreed.

I made application for an appeal in January, 2012. I had to determine both medically and in the course of practicality, when Bill was totally disabled. I argued that the nature of his disease was difficult to diagnose in the strict time frames established by the CPP guidelines, and in fact, he was disabled well before their determination of 2008 disability year. The Board agreed.

I'm happy to say that the subsequent award gives Bill the full retroactive period back to April 2010, with benefits starting in August 2010 after the normal waiting period.

Dealing With Termination Issues On the Cheap Can Get Pricey

Brian Bell

Toronto Employment Lawyer Brian Bell - Pace Law Firm: There have been a significant number of Termination Packages pass across my desk recently with one overwhelming similarity: the Employer tends to offer the Employment Standards Act Notice amount - and, if applicable, the severance amounts - plus a couple of weeks above these statutory amounts.

The Employer, for this additional time period above the minimum, requests a “Full and Final Release” on return.

It would seem that no matter how long the Employee has been with the company, this same approach would apply. In a recent edition of the Lawyers Weekly, Daniel Lublin at Whitten and Lublin recounts the case of Hussain v. Sinclair Canada Inc. Daniel Lublin represented Mr. Hussain.

Mr. Hussain was a 36 year employee who received only the equivalent of 9 months for a Termination Without Cause. At the time of the Termination, he was 65 years old. He had not retired. The Court, in its decision/award, exceeded the prior maximum of 24 months for a long-termed employee like Mr. Hussain. Thus, the Employer’s maximum exposure of 24 months Termination had been increased to 26 months, reflecting the Court's sympathy with long-termed employees who are offered a Termination Package that is viewed as clearly inadequate.

There are other reasons Employers should consider. Employers who feel they want to deal with the Termination issue “on the cheap” can be exposed to even more expense.

While this issue may be viewed to be applicable only to those employees with a long history with their company, it may be useful for employers to remember that offering slightly above the legislation's minimum may be a very costly strategy.

Termination Without Cause and Notice Periods

Brian Bell

by Brian Bell - Pace Law Firm: Most employers and employees think that a “Termination Without Cause” is all about money. However, there are other issues to consider. A Notice Period - whether issued under the Employment Standard Act or the Common Law - is basically a notification that the employer/employee relationship will be ending at some reasonable point in the future.

Throughout any Notice Period, all terms and conditions of the employment relationship must remain the same. Ironically, I see Termination Without Cause packages that limit the term of the fringe benefits (ie dental, eye glasses, so forth) that may be limited to the Employment Standards Notice while the additional Notice Period paid exclude these items as part of the Termination Without Cause package.

A significant portion of employees I see feel that this is not a significant feature. In some cases this could be accurate, especially if the employee’s spouse or partner has similar benefits. However, if the Notice Period is to reflect employment conditions throughout, why does the employer limit benefits which may also include employer pension contributions, group RSP contributions and so on? The cost of these features may be significant for the employer, but the overall cost of fringe benefits for the Notice Period is minimal in the overall scheme of things. Besides, it is quite possible these items could be used as a “negotiating” tool should the employee feel they deserve more than the Employment Standards or Common Law outline. In either case a “Release” would ultimately dictate the final agreement.

In any event, both the Employer and Employee need to be aware of their rights and obligations in the Termination Without Cause process.

Ultimately, both parties save time and money, and the employment period ends on a more positive note for each.