Mr. Hooge was a mill worker for Gillwood Remanufacturing Ltd.
("Gillwood"), which owned and operated a mill in
Chilliwack. He was originally hired in 1975 and worked his way up
the ranks to the position of production supervisor. Hooge
maintained that position through a series of ownership changes
until Gillwood purported to "lay him off" Indefinitely in
By way of a letter from his lawyer, Hooge denied that Gillwood
had the right to lay him off and asserted that the layoff
constituted a fundamental breach of his employment contract. He
sought damages for that breach and stated that absent a timely
response to his demand, he would commence legal proceedings.
Indeed, Hooge commenced an action seeking damages for wrongful
dismissal on September 12, 2011. One week later, Gillwood stated
that it was recalling Hooge to work, effective immediately. Hooge
declined to accept Gillwood's offer to return to work.
Given that Hooge's employment contract did not provide for a
temporary layoff and the fact that he clearly did not accept
Gillwood's attempt to lay him off, the Court agreed that the
purported layoff amounted to a wrongful termination. It further
found that the reasonable notice period for Hooge was 18
The issue then became whether Hooge had failed to mitigate his
loss by declining Gillwood's offer of re-employment. The
obligation to mitigate by returning to a position offered by the
same employer is governed by the considerations set out in
Evans v. Teamsters Local Union No. 31, 2008 SCC
20. The test is essentially a reasonable person test:
"whether a reasonable person in the employee's position
would have accepted the employer's offer". It requires a
multi-factored and contextual analysis, and the expected work
environment during the period of continued employment is of
significance. An employee is not obliged to continue to work in an
atmosphere of hostility, embarrassment, or humiliation.
Hooge alleged that it was reasonable for him to decline the
offer to return to work for various reasons, including his sense
that his employer was "out to get him" and that he was
someone it wanted to "get rid of". He reported feeling
belittled and experiencing hostility and aggressiveness from the
employer. He described personal and professional humiliation, which
included the fact that he was laid off at a time when the mill was
busier than it had been for years and a junior employee took over
Despite Hooge's testimony, the Court found that the layoff
decision was based on the financial viability of the company and
was designed to improve its productivity. The newest owner may have
had a "different management style", but the evidence did
not establish, on an objective basis, acrimony, mistreatment, or
similar actions, or the undermining of Hooge's authority in the
workplace of such a nature that a reasonable person would refuse to
mitigate his loss by returning to his former position. The Court
reduced Hooge's damages by the 9 month period that Gillwood
likely would have had work for him.
Hooge also argued that he was entitled to refuse the
re-employment offer because it was motivated solely by
Gillwood's realization that it faced a significant claim for
damages for constructive dismissal. The Court rejected this
"Even if the offer to re-employ was motivated by a
desire to avoid the payment of damages in lieu of severance, that
does not make it reasonable to decline the offer. It seems to me
that an employer who has laid off an employee, or wrongfully
terminated an employee without due notice, may very well come to
the conclusion, particularly with the benefit of legal advice, that
its actions constituted a wrongful dismissal and may seek to
mitigate its own exposure to the payment of damages by offering to
re-hire the employee."
Take-Away Point for Employers
When facing liability for wrongful or constructive dismissal,
employers should consider offering re-employment to avoid being
compelled to pay damages.
An employee will only be required to accept re-employment where
it would be reasonable for him or her to do so and the workplace
atmosphere is a major component of that highly fact-dependent
analysis. Employer conduct before, during, and after the
termination is all considered in determining whether the employee
would face a hostile or humiliating work environment.
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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