For the first time, the British Columbia Supreme Court has
addressed the issue of deducting certain amounts awarded under the
B.C. Employment Standards Act ( "ESA"), from the
damages recoverable in a wrongful dismissal action.
In Roy v. Metasoft Systems Inc. 2013 BCSC 1190
("Roy"), the Court accepted the employer's
argument that failing to set-off the amount of a Determination
under the ESA would amount to an unwarranted double recovery.
In Roy, the plaintiff employee was a sales consultant
who advised her employer in 2010 that she had not received all of
the commissions to which she was entitled. The employee was not
satisfied by the resolution of the matter and proceeded to file a
complaint, alleging that the company had failed to pay compensation
for length of service and had refused to continue to employ her in
contravention of the ESA.
In November 2011, the Director of Employment Standards issued a
Determination which found that the employer had contravened the
ESA, and rendered a $500 administrative penalty. In addition, as a
result of these findings, the employee was also awarded with lost
"wages" for a period of six months pursuant to section
79(2)(c) of the ESA, which requires the employer to "pay a
person compensation instead of reinstating the person in
Less than six months after the Determination was issued, the
plaintiff commenced a civil action claiming, amongst other things,
damages for wrongful dismissal. In its Response to Civil Claim, the
defendant employer pleaded that the ESA award "constituted
both statutory compensation for length of service and compensation
to address what the plaintiff would have earned in lieu of
reinstatement." The former employee argued that the ESA award
was granted as a remedy against an employer for behaving in a way
that obstructs the operation of the ESA and as a result, it ought
not to be deducted from the common law damage award for breach of
After a thorough analysis, Mr. Justice Joyce agreed with the
defendant that section 79(2)(c) of the ESA was largely compensatory
in nature, and its purpose is to make the employee
"whole". As a result, the failure to set-off this amount
would result in double recovery. Further, the Court held that this
conclusion accords with the law in Ontario with respect to the same
issue involving similar legislation.
The Roy case is important for employers as it now
affirms the fact that compensatory payments made under the ESA are
to be set-off against wrongful dismissal damages. It is worthy to
note, however, that the set-off does not mean an employee is barred
from bringing an action when there has been a Determination
pursuant to section 79(2)(c). In fact, employers should be aware
that the Court noted that, in fact, an employee's damages for
wrongful dismissal may actually exceed the amount of the
determination. This may lead to the interesting result that
employees with employment standards complaints could well now be
more inclined to proceed directly with civil claims in the
The foregoing provides only an overview. Readers are
cautioned against making any decisions based on this material
alone. Rather, a qualified lawyer should be consulted.
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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