The term wrongful dismissal is generically used to mean a breach of the employment agreement by the employer at the time of termination. The term is not intended to mean any occurrence whereby an employee believes that he/she should not have been dismissed or where the dismissal was “unjustified”. In the vast majority of cases wrongful dismissal is claimed where an employee alleges that he/she has not received reasonable notice of termination or payment in lieu thereof. This arises typically where an employee is terminated for cause with no notice; is provided with notice which the employee believes is unreasonable and not in accordance with his/her employment agreement or as implied at common law; or lastly where the employment relationship is constructively terminated by the employer. Constructive termination is the unilateral alteration to the essential terms and conditions of employment by the employer.
When an employee claims wrongful dismissal, the employee makes a claim for all remuneration which the employee alleges ought to have been received by the employee during the notice period. Remuneration includes all salary and other benefits which the employee would reasonably have expected to receive during the notice period if his/her employment had continued during same.
The measure of damages is typically the compensation which the employee lost from his/her employment during the notice period less remuneration which the employee may have earned during the notice period from another source in mitigation of his/her damages. In addition to claims for breach of the employment contract, wrongful dismissal claims often include ancillary and related claims for the following:
- Aggravated damages which arise as a result of actions or inaction by the employer in relation to the employee’s termination. For example, if the employer wrongfully alleges that the employee has committed criminal or quasi-criminal activity which gave rise to the termination. These claims would in the ordinary course make re-employment more difficult for the employee. If the claims are false or unprovable will typically give rise to aggravated damages.
- Punitive damages if the employer’s conduct is so reprehensible and high-handed that a Court believes the conduct is worthy of censure or judicial remedy to dissuade such conduct, either by this employer or others.
- Breach of an employee’s human rights in the context of termination may give rise to separately actionable damages either as aggravated damages at common law or alternatively as a joint claim which is permitted in some jurisdictions, including specifically pursuant to Section 46.1 of the Ontario Human Rights Code.
- Lastly, there are separately actionable wrongs which might arise prior to or during the termination process. For example, the common law recognizes claims for conspiracy, intentional infliction of mental suffering, negligent misrepresentation, injurious falsehood, negligence, breach of confidence, intrusion upon seclusion and negligent investigation. These common law tort claims are commonly referred to and relied upon in the context of a“wrongful dismissal” claim.