Yes, an employee can recover for damage to his reputation caused
by the manner of termination of his employment. This is not a
surprising outcome based on the principles established by the
Wallace decision of the Supreme Court of Canada, but it took a
Federal Court of Appeal review of an earlier decision to get
Tipple v. Attorney General of Canada
, 2012 FCA 158)
Douglas Tipple was a senior executive in the federal public
service. He was terminated amidst some controversy but an
internal investigation cleared him of wrongdoing.
Unfortunately for Tipple, that message was never given to the media
and the idea that Tipple was fired because of the controversy was
promoted in the House of Commons and left uncorrected by his
An adjudicator awarded Tipple $250,000 (as part of an overall
award of approximately $1.4 million) for damage to his
reputation. The Federal Court overturned that award, saying
there was no independent duty to protect a terminated
employee's reputation. At our client conference last
year, we predicted a successful appeal of the Federal Court's
decision. The Federal Court of Appeal saw the case the
same way and has now restored the award for damage to Tipple's
It is important to note what the Federal Court of Appeal did not
decide. It did not create a free standing duty of an employer
to protect the reputation of a terminated employee. In fact,
it expressley rejected any such duty. Rather, it applied the
principle addressed in Wallace and in Keays v. Honda Canada Inc.,
where the damages were increased because of bad faith conduct by
the employer in the course of terminating the employment
relationship, and ruled:
... this principle may be applied if ... (a) the employee's
reputation is damaged by public knowledge of false allegations
relating to the termination, (b) the employer fails to take
reasonable corrective steps and offers no reasonable excuse for
such failure, and (c) the damage to the employee's reputation
has impaired his ability to find new employment.
To review the Wallace principles, you can find the decision here,
or look at the excerpts quoted in the
Tipple case at paragraph 15. This should not necessarily
be read as an endorsement of Wallace as current law (Wallace was
superceded by the Supreme Court of Canada's Decision in Keays);
rather, this decision simply reflects that where an employer plays
a direct or indirect role in causing harm to an employee's
reputation, the employer may be liable for damages caused by its
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about your specific circumstances.
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Unfortunately, reasonable accommodation for employees in the workplace continues to be the source of significant litigation and even today we continue to see outrageous examples of employers behaving badly.
We are now beginning to see reported cases involving charges and subsequent fines laid against employers for failing to provide information, instruction and supervision to protect a worker from workplace violence.
On October 13, 2016, the Supreme Court of Canada denied leave to appeal an Ontario Court of Appeal decision which ordered an employer to pay a former employee 37 months of salary and benefits following termination.
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