CANADA Law and Practice Contributed by: Christopher Pigott, Rachel Younan, Jacob Wagner and Felisha Jagiah, Fasken
8. Disputes 8.1 Wrongful Dismissal
entitlements an employee would have received but for their wrongful termination. The Supreme Court of Canada has clarified that employees may be entitled to a bonus or payment under incentive compensation plans despite no longer being employed and found that clear language is required to oust the common- law presumption that such payments apply during the reasonable notice period. Additionally, and unlike statutory notice, dismissed employees claiming reasonable notice through a civil action have a “duty to mitigate” the damages result - ing from their dismissal by actively searching for new employment. A court will deduct from a dam - ages award any earnings gained through alternative employment subsequent to the wrongful dismissal and during the reasonable notice period. Where an employee fails to seek alternate employment after their wrongful dismissal, the court may reduce the damages award accordingly. Damages for emotional distress or punitive damages are rare, but may be awarded where the employer’s conduct was of such an egregious or malicious nature that it warrants judicial sanction. However, the Supreme Court of Canada has repeatedly stated that punitive damages should be awarded with restraint. 8.2 Anti-Discrimination Each jurisdiction in Canada has enacted human rights legislation that protects employees from discrimina - tion on a variety of grounds. Typical protected grounds include race, ancestry, place of origin, colour, ethnic origin, creed/religion, citizenship, sex, sexual orien - tation, age, record of offences, marital status, fam - ily status, and disability. Numerous jurisdictions have human rights legislation that includes protection on the grounds of gender identity and gender expression. Human rights legislation protects an individual in all aspects of the workplace environment and employ - ment relationship. In all jurisdictions, human rights legislation permits an employer to use the defence of bona fide occupa - tional requirement. The defence allows an employer to argue that a discriminatory requirement, qualification or factor of employment is reasonable and appropri -
Where an employee believes that their employer has violated one of the rights described in this chapter, the employee may pursue a statutory or common (or civil) law remedy, depending on the jurisdiction and specific right or entitlement at issue. Arguably the most com - mon type of claim is a civil claim for “wrongful dis - missal”, in which the employee alleges that the former employer did not provide sufficient reasonable notice of termination under the common law. In a civil wrongful dismissal claim, the onus is on the employer to prove cause for termination. It is gener - ally accepted to be a difficult onus to discharge. If the employer is unable to establish just cause or point to a valid contractual termination clause that specifically limits the employee’s entitlements on termination, then the employee’s wrongful dismissal claim will succeed. Where an employee has made a successful wrongful dismissal claim, the courts are required to determine the amount of reasonable notice that the dismissed employee should have received. The list of factors the court will rely upon in making this determination vary, but often include the characteristics of the former employment, the length of service of the employee, the employee’s age, and their re-employment pros - pects when considering the experience, training and qualification of the particular employee. Awarding Damages Although there is no cap on damages awarded to suc - cessful employees in wrongful dismissal claims, the range of common (or civil) law notice periods is typi - cally between a few weeks and 24 months. Recently, court decisions reveal a growing trend of awarding periods in excess of 24 months, and in the range of 24–28 months in cases involving very long-serving employees or exceptional circumstances where a long notice period is warranted for aggravating reasons. In determining the quantum of damages to be award - ed in a wrongful dismissal claim, Canadian courts primarily focus on lost wages and benefits. The value of damages will reflect the value of the employee’s sal - ary, bonus, healthcare benefits and other associated
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