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Posts tagged: MacLeod Law Firm

Punitive Damages: Rare But Not Unheard Of

By , January 2, 2019 10:00 am

As we have written before, an employer may generally terminate an employee for any good business reason as long as it provides the employee with adequate notice of termination (or pay in lieu of this notice). Failure to provide adequate notice results in a wrongful dismissal. However, if an employer has ‘just cause’ for the termination, then the employer does not generally need to provide the employee with any notice of termination.

In addition to awarding damages for wrongful dismissal, courts have the authority to award “aggravated” or “moral” damages, and “punitive” damages, in certain circumstances (see here for some examples). Although punitive damages are rare, the courts will not shy away from awarding them if the circumstances merit it. A recent case from the Ontario Court of Appeal provides a good example of when these kind of damages may be awarded by the courts.

In Hampton Securities Limited v Dean, Hampton Securities employed Ms. Dean from March 2008 to April 2009 as a securities trader. Under the terms of the employment contract, Ms. Dean bore partial responsibility for losses resulting from her trades. It is industry practice for securities traders to absorb part of the losses they incur in the ordinary course of their duties. However, a dispute arose as to how much responsibility Ms. Dean had to bear for her losses. In the end, Ms. Dean resigned.

Hampton Securities initiated a claim against Ms. Dean for failure to pay her share of the losses resulting from her trades. Hampton Securities also reported Ms. Dean’s termination to the Investment Industry Regulatory Organisation of Canada (“IIROC”), and in its report, stated that Ms. Dean had been terminated for failing to follow established trading policies and engaging in unauthorised trading.

Ms. Dean then brought a counterclaim for constructive dismissal, alleging that Hampton Securities sought to alter the terms of her employment by unilaterally reinterpreting her contract. She also alleged that Hampton Securities’ report to IIROC constituted defamation. The Superior Court of Justice agreed with Ms. Dean regarding her allegation that her employer had sought to rewrite her employment contract without her consent.

Having found that she was constructively dismissed, the court then asked what damages it should award to Ms. Dean. Ms. Dean claimed $25,000 in aggravated damages, $25,000 in damages for defamation and $25,000 in punitive damages. The court found that although Hampton Securities’ conduct in misstating the reasons for Ms. Dean’s termination to IIROC was reprehensible, aggravated damages were not available, particularly due to concern of overlap between Ms. Dean’s defamation claim and her claim for aggravated damages.

With respect to punitive damages, these damages are awarded to sanction conduct that represents a “marked departure from ordinary standards of decent behaviour.” Whereas most damages at law are meant to compensate the injured party, punitive damages, as their name suggest, are meant to demonstrate retribution, deterrence and denunciation. Although punitive damages are the exception rather than the norm, the court found that this was an exceptional case. Hampton Securities’ conduct in filing a notice of termination containing allegations that went to the heart of Ms. Dean’s integrity represented a marked departure from ordinary standards of decent behaviour. Hampton Securities knew the allegations, which were untrue, would be available to all potential employers of Ms. Dean and would be fatal to the prospect of her obtaining future employment in the securities industry. The court found that such conduct which had potentially lifelong implications for an employee warranted condemnation and punishment.

The court found that Ms. Dean was entitled to $25,000 in punitive damages. The court also awarded Ms. Dean with six months’ pay in lieu of notice, which I will address in my next blog.

Conclusion

If an employer engages in malicious conduct during the termination of an employee, this conduct may be sanctioned by a court.

If your employer engages in similar behaviour to the behaviour described in this blog, such as making frivolous allegations that may impact your ability to gain re-employment, you should consult an employment lawyer to find out about your rights.

“The material and information in this blog and this website are for general information only. They should not be relied on as legal advice or opinion. The authors make no claims, promises, or guarantees about the accuracy, completeness, or adequacy of any information referred to in this blog or its links. No person should act or refrain from acting in reliance on any information found on this website or blog. Readers should obtain appropriate professional advice from a lawyer duly licensed in the relevant jurisdiction. These materials do not create a lawyer-client relationship between you and any of the authors or the MacLeod Law Firm.”

How Important Are The Deadlines In Your Severance Package?

By , December 6, 2018 1:43 pm

You are terminated from your job and your employer offers you a severance package. They give you one week to sign the offer and ask that you sign a full and final release confirming that there will be no further payments. Are you obligated to sign and return the offer within a week?

We often receive this question from recently terminated employees who are scrambling to find legal advice within a few days while also dealing with the stress of their termination.

If we are first contacted close to the deadline we often advise employees to simply request an extension from their employer. In our experience, the vast majority of employers will consent to this request. It is important to remember that it is in your employer’s best interest to reach a reasonable deal with you.  Just because you do not sign and accept their severance package before the deadline, does not make their legal obligations to you disappear. Further, the deadline is only important if you are accepting the offer.

You should have your severance package reviewed by a lawyer before accepting it because, in many cases, it is possible to negotiate a better severance package. It is not unusual for employers to offer severance packages that barely meet the minimum standards set out in the Employment Standards Act. You may be entitled to considerably more pay than the minimum standard.  Even if have signed an employment contract with a legally enforceable termination clause, it is possible that you could be entitled to a large severance package because of conduct that occurred during your employment such as harassment and discrimination. Unless you are certain that their severance package is fair you should not sign a severance offer and release until you have consulted with a lawyer.

At least one Ontario judge has unfavourably viewed stringent deadlines requiring an employee to sign a severance package and release.  In Rubin v. Home Depot Canada Inc., 2012 ONSC 3053 the Court found that even though an employee had signed a “release” shortly after his termination, the release was not binding. The Court found that the employee had not been given sufficient time to consider the offer.  Ultimately the Court awarded him significantly more notice than his employer had offered him.

Lessons for Employees:

  1. If you need more time to obtain legal advice ask your employer for an extension to sign the severance package, particularly if you are given less than 5 business days to consider the settlement offer.
  2. Always consider having your severance package reviewed by a lawyer because it is possible you could be entitled to a greater notice period. Especially if you are a long service employee. Remember: you don’t know what you don’t know.

If you would like to speak to an employment lawyer at the MacLeod Law Firm, you can reach us at [email protected] or 647-204-8107.

The material and information in this blog and this website are for general information only. They should not be relied on as legal advice or opinion. The authors make no claims, promises, or guarantees about the accuracy, completeness, or adequacy of any information referred to in this blog or its links. No person should act or refrain from acting in reliance on any information found on this website or blog. Readers should obtain appropriate professional advice from a lawyer duly licensed in the relevant jurisdiction. These materials do not create a lawyer-client relationship between you and any of the authors or the MacLeod Law Firm.

Amendments to Increase Human Rights Protections for Ontarians

By , December 4, 2018 10:05 am

Various members of the Ontario legislature are working to give additional human rights protections to Ontarians.

Bill 35, the Human Rights Code Amendment Act, 2018 is a private member’s bill brought by Liberal MPP, Nathalie Des Rosiers.  Whereas Progressive Conservative MPP, Christina Mita introduced Bill 40, the Human Rights Code Amendment Act (Genetic Characteristics), 2018, which has passed Second Reading and been referred to the Standing Committee on the Legislative Assembly.

Given the current makeup of the government, it seems much more likely that Bill 40, rather than Bill 35, will pass and become law.  

Bill 40

Bill 40 proposes to add genetic characteristics as a prohibited ground of discrimination under the Ontario Human Rights Code. “Genetic characteristics” would mean “genetic traits of an individual, including traits that may cause or increase the risk to develop a disorder or disease.” It will also include protections for those who refuse to undergo a genetic test or refuse to disclose, or authorize the disclosure of, the results of a genetic test.

If passed into law, Ontario will join the Federal government in its protection against genetic discrimination. Of note, however, Bill 40 has an exemption for insurance companies allowing them to make distinctions, exclusions, or preferences with reasonable grounds on the basis of genetic characteristics. Practically, the majority of discrimination on the basis of genetic characteristics currently occurs in the provision of insurance, so this bill may have little actual impact.

Bill 35

Bill 35 resurrects a previous private member’s bill, Bill 164, which attempted to significantly alter the Code.

Bill 35 proposes to add immigration status, genetic characteristics, police records, and social condition as human rights grounds.

While each of these grounds warrants a close examination, adding “social condition” would likely cause the most drastic change to the human rights landscape.  Social condition would be defined as social or economic disadvantage arising from employment status; source or level of income; housing status, including homelessness; level of education, or any other circumstance similar to those.

There has been much debate over adding social condition to the Code in the past.  The ground is meant to provide stronger  protection to the most vulnerable individuals in society. As recognized by the Ontario Human Rights Commission, the argument for its addition is that poverty frequently intersects with other protected grounds and without an explicit protection on the basis of poverty, the most marginalized members of our communities cannot truly benefit from human rights protection.  

Those against its addition often point to the illusive meaning of ‘social condition.’ They further worry about the strain on the system its addition would have by increasing the overall volume of cases. The Human Rights Tribunal of Ontario already has a sizeable backlog of cases with lengthy delays between the date of filing an application to the date of a mediation or hearing.

While a significant change, Ontario would not be alone in recognizing social condition as a protected human rights ground. Human rights acts in Alberta, Manitoba, New Brunswick, Quebec, Newfoundland and Labrador, and Northwest Territories all recognize social condition, social origin, or source of income as protected grounds.

Ontario would also be joining other provinces like British Columbia in having more fulsome protection against discrimination on the basis of “police records.” The Bill proposes to prohibit discrimination due to an individual’s charges, convictions, and contact with police. This would replace the current human rights ground of “record of offences,” which is defined only as an offence for which someone has been pardoned.

Of note, for genetic characteristics, Bill 40 does not include the same exemptions for insurance companies as Bill 35. This means that insurers would not be permitted to make decisions about policy and coverage on the basis of genetic characteristics. Bill 40 would provide much more significant protection to Ontarians on the basis of genetic characteristics.

If all of the changes in Bill 35 became law, employers, service providers, and landlords would need to carefully examine their policies and practices to ensure they are compliant with the new law.  

If you have any questions about  your human rights or these amendments, you can contact MacLeod Law Firm at 647-204-8107 or at [email protected]

The material and information in this blog and this website are for general information only. They should not be relied on as legal advice or opinion. The authors make no claims, promises, or guarantees about the accuracy, completeness, or adequacy of any information referred to in this blog or its links. No person should act or refrain from acting in reliance on any information found on this website or blog. Readers should obtain appropriate professional advice from a lawyer duly licensed in the relevant jurisdiction. These materials do not create a lawyer-client relationship between you and any of the authors or the MacLeod Law Firm.

Working Notice: When working more than 9 to 5 makes it hard to find a way to make a living

By , November 19, 2018 10:00 am

Sometimes, rather than receiving a severance package, employees are provided “working notice” that their employment is coming to an end. In other words, your termination date is set to a fixed date in the future and you are expected to work throughout this period.

While there is nothing inherently wrong with providing working notice, there are some circumstances where a court may find the employer should not get credit for this notice period, and therefore should provide pay in lieu of notice instead. The Ontario Court of Appeal has recently decided that there is a qualitative component to reasonable notice. In other words, that the quality of the reasonable notice is important in addition to the quantity of notice an employee receives.

Wood v CTS of Canada Co.

On April 17, 2014, CTS of Canada Co. (“CTS”) gave written notice to employees that it was closing its Streetsville plant and that their employment would terminate on March 27, 2015. It subsequently extended the termination date for most employees to June 26, 2015. A class action was brought on behalf of 74 former employees against CTS of Canada Company. On issue was the adequacy of the notice of termination given by CTS.

The motion judge concluded that CTS was not entitled to credit for working notice for any week in which an employee worked overtime contrary to the ESA, or in which the employee was forced to work overtime that had a significant adverse effect on the employee’s ability to look for new employment.

The motion judge noted that according to the Employment Standards Act, no employer shall require or permit an employee to work more than 48 hours in a work week (unless the employee has agreed in writing and the employer has obtained the approval of the Director of Employment Standards). There was evidence that a group of hourly paid production employees worked approximately 55 hours a week during the notice period, contrary to the Employment Standards Act. The evidence also showed that the employees were not pressured to work and actually wanted to make more money. However, there was also evidence that 18 key employees were forced to work up to 60 hours per week.

The motion judge found that an employer that had employees work 16 hours a day during their notice period could not claim credit for working notice. To do so would be tantamount to saying “You had 8 hours a day to look for new employment and if you frittered it away sleeping, that was your choice.”

CTS had the onus to prove that it provided reasonable advance notice of termination. The motion judge concluded that there is both a quantitative and a qualitative component as to what is reasonable. If the primary objective of reasonable notice is to provide the dismissed employee with an opportunity to obtain alternate employment, to look for work, an employee needs both a reasonable aggregate notice period and a reasonable amount of time in the week.

On appeal, the employer argued that the “quality of the opportunity” is not a relevant factor in the determination of reasonable notice. The Ontario Court of Appeal upheld the motion judge’s determination that credit for working notice is dependent on the quality of the opportunity given to the employee to find new employment. The appellate court noted that the mere fact that the employee is required to work during the notice period does not automatically lead to denying the employer credit for a portion of the working notice period. Although an employee provided working notice period may have less time to look for alternate work, in some circumstances the fact that an employee is employed while job searching can improve the employee’s position when approaching prospective employers.

However, exceptional workplace demands on the employee during the notice period that negatively affect the employee’s ability to seek alternate work may warrant disentitling an employer from credit for some or all of the working notice period provided.

Takeaway for Employees

If you have been terminated and provided working notice and you are not sure whether what is being required of you during the notice period is fair, you should speak to a lawyer. Even if you are not being forced to work overtime, similar considerations with respect to quality could apply if you are not provided with time to attend job interviews. We can be contacted at [email protected] or 647-204-8107.

The material and information in this blog and this website are for general information only. They should not be relied on as legal advice or opinion. The authors make no claims, promises, or guarantees about the accuracy, completeness, or adequacy of any information referred to in this blog or its links. No person should act or refrain from acting in reliance on any information found on this website or blog. Readers should obtain appropriate professional advice from a lawyer duly licensed in the relevant jurisdiction. These materials do not create a lawyer-client relationship between you and any of the authors or the MacLeod Law Firm.

Employee Protections during Police Record Checks

By , November 14, 2018 4:14 pm

Often employers require a new hire to provide a police record checks. Starting November 1, 2018 changes made under the Ontario’s Police Record Checks Reform Act will be in force. Previously, police record checks were not regulated in Ontario. With the new Reform Act in force, the police record checks process becomes standardized across Ontario for all employers.  Employers will not have access to as much information, and employees must consent.

This Reform Act covers:

  • Criminal records check,
  • Criminal Record and Judicial matters checks; and
  • vulnerable sector checks.

The Reform Act now requires consent at two stages of police record checks. The first stage includes consent from the employee to conduct the particular type of check and the second stage requires consent to the police record check provider to provide a copy of this results to the employer.

These changes also limit the information given to employers upon conducting a police record check to what is necessary and relevant. Information such as mental health detentions and non-conviction information will not be disclosed unless deemed necessary for “exceptional disclosure.” This will occur primarily if the alleged offence involved a child or vulnerable person and there are reasonable grounds to believe the individual presents a risk of harm to a child or vulnerable person.  

Lessons for Employees

  • Make sure your current or future employer has your consent to conduct the search and see the results.
  • The record check process will likely take longer, so keep that in mind if you receive a conditional employment offer.  Don’t resign too quickly from any current job.
  • If an employer or another person willfully contravenes certain sections of the Reform Act can be liable for a fine of up to $5,000.

If you have any questions about hiring processes, employment contracts or police record checks, you can contact MacLeod Law Firm at 647-204-8107 or at [email protected]

The material and information in this blog and this website are for general information only. They should not be relied on as legal advice or opinion. The authors make no claims, promises, or guarantees about the accuracy, completeness, or adequacy of any information referred to in this blog or its links. No person should act or refrain from acting in reliance on any information found on this website or blog. Readers should obtain appropriate professional advice from a lawyer duly licensed in the relevant jurisdiction. These materials do not create a lawyer-client relationship between you and any of the authors or the MacLeod Law Firm.

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