Wrongful dismissal, oftentimes referred to as unfair dismissal, is an area of employment law that is not readily understood. There are many reasons for this. While it sounds obvious, not every termination matter involves a wrongful dismissal element. Also, many people don’t appreciate that they are probably due better terms of termination than they have been offered. If that’s the case, then how do you know if you have been wrongfully dismissed?
What is wrongful dismissal?
Your ex-employer can fall on the wrong side of wrongful dismissal Ontario rules in a few different ways. There is outright ‘unjust dismissal’, a failure to compensate severance pay Ontario requires and insufficient notice period.
Of course, that’s not all. Firing ‘for cause’ and ‘without cause’ can also constitute wrongful dismissal. It can depend on the legitimacy of the reason, specific factors such as the duration of your service and more.
What is the difference between unfair dismissal and wrongful dismissal?
Unfair dismissal and wrongful dismissal are used very interchangeably. Wrongful dismissal Ontario rules cover a broad range of scenarios. Being colloquially familiar, unfair dismissal is used almost synonymously. Typically, a claim of wrongful dismissal or ‘unfair dismissal’ will arise out of not being given sufficient termination notice or severance pay Ontario provides, being sidelined for a new or younger employee or for reasons of ‘performance’.
What are some wrongful dismissal examples?
To better explain the subject, we are looking at some wrongful dismissal examples. Just don’t forget that every situation is different. And if you feel you have been wrongfully dismissed, you should consult Toronto employment lawyers.
1. Harassment complaints dismissed – Boucher v. Wal-Mart Canada Corp.
In our first wrongful termination example, Ms. Boucher was employed with Walmart for over 10 years. She was regarded as a good employee and was promoted to assistant store. However, her relationship with the store manager soured. He began to use profane language and was abusive towards her in front of other employees. Ms. Boucher complained to management, who conducted some investigations but failed to take action to stop the harassment. Subsequently, she fell ill and left work.
Why wrongful dismissal: Management ignored the many incidents of abuse before co-workers; there may have been a prevailing bias because she was a new assistant store manager.
Decision: Ms. Boucher was awarded $110,000 in punitive damages (in addition to the 8 months of salary and benefits she was paid by Walmart).
In a nutshell: Employers’ failure to respond adequately to harassment complaints can lead to wrongful dismissal.
2. Bad faith ‘for (just) cause’ dismissal – Morison v Ergo-Industrial Seating Systems Inc.
Mr. Morison was a top salesperson with his employer. He had a good record of work over the eight years he was with the company, till he has fired. His termination letter stated the company had just cause for removing him. Mr. Morison claimed there was no cause and it was a negotiation tactic.
Why wrongful dismissal: The court took the view that the company had not been candid and forthright about the action.
Decision: Mr. Morison was due 12 months’ notice period on account of length of service, age, qualifications and availability of employment; $50,000 in punitive damages.
In a nutshell: The attacks on Mr. Morison’s reputation were in bad faith, part of a negotiation strategy. The manner of dismissal had been high-handed.
3. Sudden dismissal without cause – McNevan v. AmeriCredit Corp.
Mr. McNevan had been working for his employer for 13 months when he was fired suddenly. The termination was without cause, with claims that he lacked the skills to perform his job. Since the dismissal was without cause he was offered 3 months’ notice.
Why wrongful dismissal: The employer erred in not communicating performance shortcomings to Mr. NcNevan before dismissing him.
Decision: Notice period should have been six months, given his age, and scarcity of employment opportunities; $30,000 for mental stress of wrongful dismissal lawsuit.
In a nutshell: Employers have to keep a holistic view before they dismiss an employee without cause, including age, expectation of the employee to be employed long term and more.
4. Employer’s financial position not relevant for termination pay – Michela v. St. Thomas of Villanova Catholic School
This is one of those particularly revealing wrongful dismissal examples. It affects three people who had each been employed with their employer, a school, for at least 8 years. Their contracts were rolling one-year contracts. Due to a shortfall in student enrolment, the school sent them termination letters. No notice period was given. The school argued that they were not entitled to termination notice periods.
Why wrongful dismissal: Though employment was on one-year contracts, they were indefinite employees. Reasonable notice was required to be given.
Decision: The three employees were entitled to 12 months’ notice as reasonable termination notice period; nearly $70,000 in costs of the motion and $10,000 for appeal.
In a nutshell: The financial situation of the employer does not affect the notice period it must give to employees; indefinite one-year contracts may be considered long term employment (case-by-case basis).
5. No duty to mitigate in fixed term contracts – Howard v. Benson Group Inc
Mr. Howard was employed under a fixed term contract for five years. However, he was terminated with over three years remaining on the contract. He filed a claim seeking the remainder of his salary under the contract.
Why wrongful dismissal: The employer was not an “unsophisticated party” and a reasonable notice period for termination had to be given.
Decision: Mr. Howard was entitled to a reasonable notice period; he was owed the remaining part of his salary under the contract.
In a nutshell: There was no duty to mitigate damages by seeking alternative employment in the absence of any such condition in the fixed term contract.
Am I entitled to severance pay?
Another common question, other than about wrongful dismissal, is when is severance pay Ontario prescribes due. Severance pay and termination pay are phrases often used interchangeably. However, both are very different concepts.
Termination pay is the amount you are owed if your employer terminates your employment without giving the requisite notice period. This ‘severance pay’ Ontario rules state must be calculated on the basis of the duration of service you have given to your employer.
Actual severance pay Ontario requires is something else altogether. The rules state that you are eligible for severance pay if:
- You worked for the employer for five years or more
- Your employer has a payroll of $2.5 million or more in Ontario or has severed 50 or more employment contracts in a six month because of the business being closed.
Moreover, you must also establish you have been ‘severed’ from employment. Broadly, this means you have been:
- dismissed due to bankruptcy or insolvency;
- constructively dismissed;
- laid off for more than 35 weeks in a 52 week period;
- laid off because all business at an establishment has been closed;
- given a termination notice and you resign with a two week notice period which ends before the termination notice.
Get in touch with Toronto employment lawyers to understand the specifics of severance pay Ontario prescribes and what termination pay you are owed.
Wrongful Dismissal Lawyers Toronto
Wrongful dismissal can be an emotionally draining event. You are left without employment and have the added burden of pursuing a legal claim to fight for what you are owed. At Soni Law we make your journey that much easier. We will guide you from start to finish on your best options, help build a strong case and get you the termination or severance pay Ontario entitles you to.