The Ontario Superior Court of Justice has recently decided a
motion in Kimball v. Windsor Raceway Inc. and
decided that it will have to hold a full trial to determine a
dispute of alleged wrongful dismissal. The issues for
determination will be whether Kimball is entitled to pay in lieu of
notice equal to 24 months' pay as claimed by the employee, and
whether a long service employee is entitled to a decreased award on
wrongful dismissal if they intended to retire shortly after
John Kimball was employed by Windsor Raceway Inc. beginning
August 25, 1960. In February of 2007, the employer asked
Kimball if he had any plans to retire. In response, Kimball stated
that he planned to retire after his 65th birthday in
December 2007. At that time, he began to collect a pension of
$921, but he did not retire. In the summer of 2010, during a
human resources planning meeting, Kimball again was asked if he had
plans to retire. He responded that he planned to work until
the end of 2012.
In March of 2012 the Ontario Lottery and Gaming Commission
announced that it was going to cease operation of slot machines at
a number of sites, including the Windsor Raceway. As a
result, the employer lost funding and on July 9, 2012 it gave
Kimball notice that he would be placed on indefinite layoff on
August 31, 2012.
The employer provided Kimball with some of his entitlements
under the Employment Standards Act, 2000, indicating his
termination. Kimball, who was not quite 70 years old at the
time of termination, had accrued 43 years of service, and brought a
claim seeking 24 months' pay in lieu of notice at common
In the recent motion for summary judgment, the Court ruled that
the employee was entitled to receive an amount equal to 26
weeks' pay for full payment of Severance Pay as required by the
Employment Standards Act, 2000. However, the Court
also decided that it would have to hear a full trial to determine
the merits employee's actual claim at common law. In
relevant part, the Court decided that a full trial was required to
consider the impact of the employee's stated intention to
Typically, any terminated employee is required to mitigate their
losses or potential losses by taking reasonable steps to secure
subsequent employment after being terminated. The Courts
historically have not recognized an exception to this rule for
senior employees. Rather, the duty to mitigate is regardless
of age of employee because the purpose of reasonable notice of
termination (or pay in lieu thereof) is to help bridge an employee
to the point of subsequent employment. The question that
arose in this case was how potential retirement affects an
employer's obligation with regard to notice.
In its decision the Court stated at paragraph 37:
If the dismissed
employee has no intention to look for work, but has instead decided
to retire, the very purpose for which reasonable notice is required
to be given is absent. That is a factor that may well be
relevant in assessing what constitutes reasonable notice in this
It would seem rational and consistent with the purpose of
reasonable notice provision that an employee who intends to put an
end to their working career does not have an entitlement to receive
reasonable notice payments that would create an effective windfall,
continuing their salary after they intend to stop working for a
If the Court ultimately agrees with this rationale, one
predictable consequence for employers may be that employees will be
less willing to disclose their intentions to retire with much
notice, for fear that, in the event of termination without cause,
they will be entitled to a shorter notice period.
The lawyers at CCPartners have a great deal of experience
advising employers on workplace issues, including how to
effectively manage an aging workforce.
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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