Employment Standards Damages Deducted from Wrongful Dismissal
A British Columbia employer has won a case to avoid double
recovery of Employment Standards and wrongful dismissal
damages. The decision in Roy v. Metasoft Systems Inc. is
another piece of good news for employers to go with our
recent post about the BC Human Rights Tribunal helping to
discourage forum hopping.
Ms. Roy was a software sales associate. She complained to
her employer about not getting all the commissions she thought
she had earned. She threatened to file a complaint for unpaid
wages with the Employment Standards Branch. The
employment relationship went downhill from there and her employment
was terminated about five months later. She found comparable
new employment about seven months after that.
Ms. Roy was successful in a complaint under the Employment
Standards Act that she had been initimdated and terminated because
she exercised her statutory rights. The employer was assessed
an administrative penalty of $500 and was ordered to pay "lost
wages" for a six month period.
Ms. Roy then sued for wrongful dismissal and claimed damages in
addition to what had been awarded under the ESA. The employer
argued that any wrongful dismissal damages would have to be reduced
by the ESA award.
The court agreed with the employer that both the ESA award and
wrongful dismissal damages are meant to be compensatory and to make
the former employee "whole", and noted that the same
factors are applied when determining the amount of each. If
the one was not set off against the other, the employee would
get double recovery.
This is a good result for employers, but it is worth remembering
that not every award under the ESA will lead to double
recovery. As the court said:
The court, when considering the
double recovery argument, must examine the purpose of the award
granted pursuant to the ESA to determine whether it fulfils the
compensatory principle for wrongful dismissal.
It is also worth remembering that similar arguments have not
succeeded with respect to other payments, like pension
benefits (see Waterman v. IBM).
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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