In the ever-evolving landscape of employment law, the recent decision of the Ontario Court of Appeal in the case of Lynch v. Avaya Canada Corporationhas caused a stir. This 2023 decision reflects the dynamic interpretation of wrongful dismissal, reasserting the complexities involved in determining reasonable notice periods for terminated employees – particularly where those employees are long-tenured.
The historical yardstick for wrongful dismissal cases has been predominantly rooted in the criteria established by Bardal v. The Globe & Mail Ltd., a beacon that has long guided the determination of reasonable notice periods. In Lynch, however, the Court of Appeal upheld a 30-month notice period, which is noteworthy as it extends beyond the traditionally-perceived cap of 24 months. While there have been other Canadian awards to exceed this "soft cap", they have been very specific about the types of "exceptional circumstances" that led to such awards.
In appealing the initial award of 30 months' notice from the motion judge, Avaya Canada Corporation's primary contention was that the motion judge erred in granting a notice period that exceeded Mr. Lynch's initial claim of 26 months, asserting that the Bardal factors were misapplied and alleging a failure on Mr. Lynch's part to mitigate his damages.
In evaluating the factors that led to the decision, the Court held that Mr. Lynch's situation bore the hallmarks of "exceptional circumstances." This term, though not definitively encapsulated, appears to hinge on what the Court articulated as the specific and specialized nature of Mr. Lynch's employment, the uniqueness of his role, his long tenure, and the corresponding dearth of comparable employment opportunities in his geographical locale. While these things may all be true, in general one would not have expected those specific factors to be the type to extend an award beyond the generally-recognize "cap" of 24 months' notice.
A Guide for Employers
For employers, the Lynch decision serves as a reminder to approach terminations and notice period assessments with caution and thoroughness. It is an exemplar of the Court's willingness to consider the fullness of an employee's professional circumstances, and the decision emphasizes the need for employers to have comprehensive and well-documented processes when restructuring and terminating employment.
Moreover, thisdecision underscores the importance of an individualized approach to each wrongful dismissal case. Employers must be cognizant that the "exceptional circumstances" could justify notice periods that surpass the traditional norms, especially for employees with specialized skills and significant tenure.
While the decision may not signal a seismic shift, it certainly nudges the boundaries of reasonable notice periods. Employers should take heed of the evolving judicial landscape and consider the potential for longer notice periods in cases with similar "exceptional circumstances." In that regard, the general context of an ageing "boomer" population being exited from the workforce may make such cases – and the legal debate that accompanies them – more and more common.
Employers would do well to absorb the nuances of this decision, ensuring their practices align with the current judicial expectations and recognizing that when it comes to termination, one size does not fit all. In that regard, the team at CCP is always ready to assist when considering the appropriate approach to any termination of employment.
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