Last year, we discussed a case which held that preventing an
employee from working during a purported "working notice"
period can constitute constructive dismissal. The rationale for the
decision was that unilaterally preventing an employee from
performing their duties (even when they're still receiving
their pay and benefits) is a fundamental change to the terms of
employment. In Thompson v Cardel Homes Limited
Partnership, 2014 ABCA 242, the Alberta Court of Appeal again
affirmed this principle, but in different circumstances. This case
highlights the dangers of preventing an employee from working, and
the importance of carefully drafting employment contracts.
Thompson was employed under a fixed term contract. One month
before the expiry of the fixed term, the employer gave him a letter
notifying him that it would not be entering into a new agreement
with him. The letter went on to advise him that he would not be
required to attend at work for the remainder of the term, but that
he would continue to receive his pay and benefits. The letter also
instructed him to immediately return his keys and his computer
Thompson brought an action against the employer alleging that he
had been constructively dismissed and that, as a result, he was
entitled to a 12-month contractual severance payment. The fixed
term contract provided that if Thompson's employment was
terminated before the end of the fixed term, he would be entitled
to receive a lump sum payment of 12 months of salary.
The employer argued that it did not terminate Thompson's
employment before the end of the fixed term. It submitted that the
letter was simply notification that his contract would not be
renewed at the end of the term, and that it had relieved Thompson
of his duties as a favour to him so that he could start looking for
The Court of Appeal rejected the employer's arguments. It
found that the employer had unilaterally denied Thompson the
opportunity to continue performing his duties until the end of the
term. The Court concluded that employer's actions, viewed
objectively, constituted constructive dismissal.
The Court of Appeal noted that typically, the damages for the
early termination of a fixed term contract would be the amount the
employee would have earned until the end of the term. However, the
parties in this matter had contracted otherwise and agreed that
Thompson would be entitled to 12 months' salary. The Court held
that there was no reason to depart from what the parties agreed.
Therefore, Thompson was entitled to the 12-month severance payment
notwithstanding the fact that he was only dismissed 1 month before
the end of his fixed term.
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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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