The Court of Appeal of British Columbia recently held that an employee
was entitled to damages for wrongful dismissal, even after he
refused to work during the 5-week notice period provided by his
employer. The employee argued that working through the notice
period would have been "intolerable".
The employee, Raymond Giza, was employed by Sechelt School Bus
Service Ltd. for 5 years at the time of his termination in
September 2009. Sechelt provided Giza with 5 weeks' notice of
termination – his minimum entitlement under the British
Columbia Employment Standards
Act. Giza did not return to work after
receiving his letter of termination.
The trial judge agreed that the 5-week notice period provided
was inadequate and the employer had therefore breached the
employment contract. Despite this, the judge declined to award
damages in lieu of notice to the employee because of the
employee's failure to work during the notice period. The
judge's view was that, Giza had repudiated the employment
contract by quitting at the commencement of the notice period and
was therefore not entitled to any damages for wrongful dismissal.
The employee appealed the decision.
The B.C. Court of Appeal Decision
The Court of Appeal agreed with the trial judge's conclusion
that the notice period provided was inadequate and that the failure
to provide adequate notice was a breach of contract on the part of
the employer. It did not agree with the trial judge regarding the
consequences of such breach; namely, that a failure to work during
the notice period disentitled the employee to reasonable notice or
damages in lieu thereof.
The Court of Appeal's view of the matter was that the
employee's repudiation of the employment relationship brought
the relationship to an end but did not eliminate the employee's
right to claim damages for such breach (i.e., damages arising from
the employer's failure to provide adequate notice). The
reasoning for this view was that the repudiation of a contract does
not affect any previously accrued rights or obligations of the
parties and, according to the Court of Appeal, an employee's
right to damages in lieu of reasonable notice accrues at the time
when the employee is provided with inadequate notice. Thus, the
fact that Giza repudiated the contract after receiving notice of
termination did not affect his right to sue for wrongful
With respect to the employer's right to the employee's
services during the notice period, the Court of Appeal did find
that, despite the inadequate notice, the employer still had a right
to the employee's services during the 5-week notice period.
Accordingly, after finding that the appropriate notice period in
this case would have been 6 months, the Court deducted the 5
weeks' notice that was provided to the employee by his employer
from the damages award because the employee could have worked and
been paid during that period.
This case is particularly notable because it may allow an
employee to resign during the notice period and still give the
employee a right to claim damages from the employer. This is
contrary to the widely held view that in order to maintain the
right to claim for damages in lieu of reasonable notice of
termination, an employee must work during the notice period, if
working notice is given.
Practically, this decision could create a disincentive to
employees to work during the notice period if they feel the notice
provided was inadequate. In such cases, based on Giza, the
damages would be equal to the difference between the notice given
and what is ultimately found to be reasonable notice. On the other
hand, if an employee takes his chances by quitting during the
notice period in hopes of getting a more favourable award of pay in
lieu of notice, the employee may lose his entitlement to any notice
or pay in lieu of notice, if the notice given by the employer is
later found to have been reasonable.
Further this decision may create confusion when applied to a
situation where an employee is given a combination of working
notice and a payment in lieu of notice at the end of the working
notice period. Based on the Giza decision, an employee who
is given both working notice and pay in lieu of notice could
presumably refuse to work during the notice period (thereby
repudiating the contract) but still be entitled to the payment
portion of the notice period because that right accrued prior to
the employee's repudiation.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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Labour and employment law had some interesting developments in 2016. What follows are a few highlights from the last year and an introduction to an issue that may attract significant attention in 2017.
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