The Ontario Superior Court of Justice recently reduced the
notice period awarded to a wrongfully terminated employee for his failure to
properly read his contract before signing on the dotted line. In
Miller v. A.B.M.
Canada Inc., the plaintiff’s job involved staying
abreast of employment
standards legislation, and he had previous experience in human
relations. As such, the court found that he had some responsibility
for ensuring the employment agreement was
valid prior to signing, which it was not, and reduced the notice
The plaintiff, Miller, was employed as the Director, Finance and
Business Process Improvement of the defendant corporation for 17
months when he was terminated without cause. The contract
stipulated an entitlement to the minimum notice amount prescribed
by the applicable legislation, in this case the Employment
Standards Act, 2000, but made no mention of benefits. The
plaintiff rejected the notice offered on termination and brought
an action for wrongful dismissal, seeking a
greater notice period as well as the payment of benefits during
Justice Glithero referred to the principle enunciated in
Machtinger v. Hoj Industries Ltd. that
…a contract of employment for an indefinite period
target=_blankrequires that the employee be given reasonable notice
of an intention to terminate the contract if dismissed without
cause…this principle is characterized as a presumption,
rebutted only if the contract clearly specifies some other period
of notice, either expressly or impliedly, and such other period is
not inconsistent with legislated minimums.
Where a termination clause calls for pay in lieu of notice, but
does not provide for the payment of benefits during the notice
period, the entire clause is void as contrary to the Employment
Standards Act, 2000. As the court stated, if a term makes the
contract unlawful, then no lawful contractual term can be extracted
such as to preserve or save the length of the notice period where
the entitlement to benefits during the notice period is contrary to
the statute. In the contract at hand, the pension contribution and
car allowance benefits were not included in the amounts to be paid
during the period of notice. As such, the termination clause as a
whole was void, and notice was to be determined on the basis of
common law principles.
Interestingly, when determining the proper notice period, the
judge took into account the plaintiff’s failure to properly
read and understand the employment contract. At trial, the
plaintiff testified that when he reviewed his original employment
contract, he saw the heading marked Termination, knew what it
meant, but chose to ignore the terms set out thereunder. He also
agreed, in his testimony, that he would never recommend to one of
his own clients of his new business that they sign a contract
without reading it, and would in fact advise them to seek legal
advice before signing anything. While Glithero J. did not enumerate
how much he reduced the notice period in recognition of the
plaintiff`s negligent reading, he stated:
I also take into account Mr. Miller`s evidence that he did not
read the termination provisions in the contract…Had he done
so, he could have voiced objection to whatever provisions he found
unsatisfactory, either as to length of the notice period, or the
fact that it did not call for payment of benefits during that
period…In the circumstances of this case, the employee
cannot escape bearing some responsibility for the fact that both
parties entered into a contract which fell below ESA standards.
In the result, the plaintiff was awarded 3 months pay in lieu of
notice, as well as benefits for that same period, an amount on the
low end of the spectrum awarded to plaintiffs in similar cases. It
remains to be seen whether future cases will pick up Glithero
J.’s admonition of an employee’s failure to properly
review their contract in future termination cases.
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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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