The Ontario Court of Appeal has decided that employers should
not get a discount on reasonable notice in bad times. On November
23, 2015, the Ontario Court of Appeal released its decision in
Michela v. St. Thomas of Villanova Catholic School (2015
ONCA 801). The Court decided, among other issues, that the period
of reasonable notice awarded to a dismissed employee is not reduced
as a result of an employer's poor economic circumstances. The
motion judge's decision in this particular case (2015 ONSC 15)
to the reduce notice period from twelve months to six months was
The motion judge heard evidence that the reason for the
termination of the plaintiffs' employment was lower than
anticipated enrollment at the defendant employer's school,
which would likely result in a $300,000 shortfall in revenue unless
five positions were eliminated. The motions judge specifically
noted that the employer was an independent school and not directed
to making a profit. He decided it should be
"self-evident" that the employer could not provide
"security of employment". He further decided that the
plaintiff employees worked at the school "understanding its
circumstances", and that such circumstances could not be
ignored in assessing what is reasonable notice. Citing the classic
test for assessing the notice period in Bardal v. Globe and
Mail Ltd., the motion judge decided to shorten the notice
period from twelve months to six months.
The question before the Court of Appeal was: "are an
employer's financial circumstances a relevant consideration in
determining the period of reasonable notice to which a wrongfully
dismissed employee is entitled?" The Court reviewed the case
law governing the calculation of the notice period, noting that the
motion judge included the employer's economic circumstances as
part of the "character of employment" factor. The
"character of employment" refers to the nature of the
position, such as the level of responsibility and expertise. The
Court concluded that the Bardal factors are not concerned with the
circumstances of the employer.
While the Court acknowledge that an employer's poor
financial circumstances might be the reason for termination, it is
not relevant to the determination of reasonable notice in a
particular case: "they justify neither a reduction in the
notice period in bad times nor an increase when times are
good." The employer's argument in this case was
well-reasoned and reflects the reality facing many Ontario
employers. The law, at this point, does not reflect such
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.
A former teacher at Bodwell High School has learned a valuable lesson from the B.C. Human Rights Tribunal— it is not discriminatory for an employer to offer child-related benefits to only employees with children.
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.
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