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Posts tagged: dismissal

The Perils of Dismissing a Disabled Employee

By , July 12, 2016 1:08 pm

On June 30, 2016 the Ontario Court of Appeal (the “OCA”) released its decision in a case involving the dismissal of a disabled employee who earned about $ 22 000 per year. I wrote about the trial decision in April (see here for my blog post).

The OCA increased the damages the employer was ordered to pay from about $ 110 000 to about $ 245 000 which was basically the amount the person claimed in her Statement of Claim. One wonders if the OCA would have ordered the employer to pay more damages if the employee had sought more damages.

This decision is an evolution of the OCA’s 2014 Walmart decision which awarded an employee significant damages in addition to traditional wrongful dismissal damages. I have also written about the Walmart decision (see here).

The Facts

Ms. Strudwick worked for an employer that recruits individuals to participate in focus groups. She was paid $ 12.85 per hour and her duties involved data entry, and instructing recruiting staff.

In 2010, Ms. Strudwick became deaf. According to the trial judge: “…her employer’s attitude towards her and treatment of her became unconscionable. The plaintiff deposed she was constantly belittled, humiliated and isolated.” Among other things, the employer refused to accommodate her disability.

Damage Award

Wrongful Dismissal Damages

At the time she was terminated, Ms. Strudwick was 59 years old, had worked for almost 16 years, and held an administrative position. The trial judge ordered the employer to pay her a total of 24 months’ pay in lieu of notice and about $ 6000 in lieu of lost benefits during that time. This included twenty months pay in lieu of reasonable notice of termination and 4 months pay for bad faith termination or Wallace Damages. The OCA applied the traditional Bardal Factors and deferred to the trial judge and upheld the 24 month damage award which is the unofficial cap on wrongful dismissal damages.

Human Rights Damages

The judge awarded her $ 20 000 in general damages under the Ontario Human Rights Code. The OCA looked at court cases and Ontario Human Rights Tribunal cases including one of our cases and increased the damages to $ 40 000.

Damages for Intentional Infliction of Mental Stress

The judge concluded that the employer’s conduct caused Ms. Strudwick to suffer an adjustment disorder with mixed anxiety and depressed mood which required psychological treatment and ordered the employer to pay almost $ 19 000 for the cost of this treatment. The OCA increased this damage award to $ 35 294 including $ $5,000 to address Ms. Strudwick’s pain and suffering, and loss of enjoyment of life.

Aggravated Damages

The trial judge awarded Ms. Strudwick no aggravated damages. Taking all of the abuse Ms. Strudwick endured, the OCA decided to award her $61,599.82 damages after deducting the Wallace Damages she was awarded.

Punitive damages

The judge ordered $ 15 000 in punitive damages because he did not think the other damage awards adequately accomplished the objectives of “retribution, deterrence and denunciation.” The OCA increased this amount to $ 55 000.

I expect this decision will hasten the trend for employee side lawyers to claim non-traditional damages in wrongful dismissal cases. The OCA’s decision to increase the damage amount in four of the damage claims will likely mean that employee counsel will be seeking higher settlements in the future.

I will be interested to see if the employer appeals this decision to the Supreme Court of Canada (the SCC”) and if the SCC grants leave to appeal how the SCC will view this case in light of its 2008 decision in Honda.

Lessons to Be Learned

  1. Disabled employees have additional legal rights. Accordingly, employers should make themselves aware of these rights. For more information on the rights of disabled employees, click here.
  2. Any request for accommodation should be taken very seriously and failure to do so can result in significant legal damages. For information on the duty to accommodate, click here.
  3. Trying to force an employee to quit – especially a disabled employee – can result in additional legal damages.
  4. Judges have the discretion to order an employer to pay a sympathetic employee many different types of damages. For more information on different types of wrongful dismissal damages, click here.
  5. Always consult with an employment lawyer before terminating a disabled employee.

Special Damages in Wrongful Dismissal Cases: Two Ships Passing in the Night

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By , August 6, 2013 10:58 am

Wrongful dismissal occurs when an employer does not provide an employee with adequate notice of termination.

Wrongful dismissal cases result in two main types of damages; these are,

(i) damages for pay in lieu of reasonable notice (i.e. reasonable notice damages) (The test for establishing and assessing reasonable notice damages has been virtually the same since 1960); and,

(ii) special damages, like Wallace damages, punitive damages, and damages for the intentional infliction of mental distress. (The test for establishing and assessing special damages has changed significantly since 1997.)

Special Damages according to the Supreme Court of Canada (S.C.C.)

In 2008, the Supreme Court of Canada released its most recent major pronouncement on special damages. Many employment law practitioners believe the S.C.C . intended to severely restrict the circumstances in which special damages can be awarded in a wrongful dismissal case. In that case, the court, (i) overturned a $500,000 punitive damage award that had been reduced to $100,000 by the Ontario Court of Appeal; and (ii) overturned a Wallace damage award that was equal to 9 months of the employee’s pay.

Special Damages according to Some Trial Judges & Juries

Some trial judges and juries have had significantly different ideas about special damages.

In a 2010 decision, an Ontario trial judge noted… “if the employee can prove that the manner of dismissal caused mental distress that was in the contemplation of the parties, those damages will be awarded not through an arbitrary extension of the notice period, but through an award that reflects the actual damages” and awarded the employee $ 75 000 in “moral” damages.

In a 2012 decision, a jury ordered a B.C. employer to pay a former employee, among other things, $573,000 in punitive damages. I understand the employer appealed the punitive damages award and the parties settled before the appeal was held.

In another 2012 decision, a jury ordered Walmart to pay a former employee, among other things, $200,000 for intentional infliction of mental suffering, and $1,000,000 in punitive damages. I understand Walmart has appealed this jury award.

How to Reduce This Legal Uncertainty

The apparent disconnect between the S.C.C.’s 2008 decision and the more recent trial and jury decisions has resulted in legal uncertainty. Employee counsel see a trend towards higher wrongful dismissal awards and employer counsel believe the appeal courts will overturn the recent  special damage awards rendered by jury and trial judges.

As a result, until the appeal courts clarify the law in the area of special damages, we believe it will be more difficult to settle wrongful dismissal cases when special damages are claimed.

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