The British Columbia Court of Appeal (the Court) released its decision in Giza v.Sechelt School Bus Service Ltd. on January 13, 2012. The Court held that the employee, who quit his job immediately after being given working notice of termination of employment was nevertheless entitled to sue for damages for wrongful dismissal for the period of reasonable notice the employee should have received in excess of the working notice given. The decision marks a departure from the Court's previous decisions that stated clearly that the contract of employment was not terminated until the end of the working notice period and that an employee was required to work during such notice period so that the employer can benefit from the employee's services.
Mr. Giza was employed as a bus driver by the Sechelt School Bus Service Ltd. (SSBS) for a period of five years. In September 2009, the employer terminated Mr. Giza without cause, providing him with five weeks of working notice in accordance with the provisions of the British Columbia Employment Standards Act. No provision was made by the employer to compensate the employee for reasonable notice at common law based on the employee's length of service and other factors relevant to the employment relationship. When Mr. Giza received the letter, which was left on the seat of his bus by the employer, he returned the bus to the terminal and left work permanently. He subsequently sued his former employer for wrongful dismissal damages, seeking 10 months' pay in lieu of reasonable notice.
At trial, the judge held that the provision of five weeks of working notice was inadequate notice in the circumstances. However, because the employee left his employment immediately after receiving the termination notice, he effectively repudiated the employment agreement, which disentitled him to damages in respect of wrongful dismissal.
The trial judge also considered whether Mr. Giza was constructively dismissed, in light of his argument that it would have been "intolerable" for him to continue working for SSBS after receiving inadequate notice of termination by the employer simply leaving a letter on the seat of his bus. The trial judge emphasized that in assessing whether there has been a constructive dismissal, the court is required to consider, objectively, whether the employer changed a fundamental term of the employment, such that it would have been unreasonable for the employee to continue working. These circumstances did not exist in this case. An employer is entitled to give working notice of termination of the employment contract, and accordingly, the fact that SSBS gave such notice was not a constructive dismissal.
Court of Appeal Decision
The Court overturned the trial decision with respect to the employee's right to damages for reasonable notice. The Court agreed that the employee was not constructively dismissed and has, in fact, repudiated the employment contract by failing to work during the notice period. The Court found, however, that quitting did not deprive the employee of his right to damages for the company's breach of contract in providing him with inadequate notice in the first place. Even though Mr. Giza had quit after receiving his working notice of termination, the employee's right to damages in lieu of reasonable notice had already accrued when he was given inadequate notice of termination.
Essentially, the Court found that although the employee's repudiation ends the ongoing rights and obligations under the employment contract, it does not affect the rights that have already accrued by virtue of the employer's breach of contract. Thus, Mr. Giza was found entitled to the difference between reasonable notice he should have received and the actual working notice the employer attempted to provide.
The Court determined that a reasonable notice period would have been six months but reduced this award by the period of working notice that Mr. Giza refused to work, for a total of five months' pay in lieu of notice.
The decision in Gizastands for the principle that an employee who receives inadequate termination notice and quits without working through the working notice period does not lose his or her right to sue for damages for wrongful dismissal. Employers should take stock of their termination procedures and keep in mind that if they attempt to dismiss an employee by providing working notice but fail to do so properly, they could be liable for damages even if the employee quits. The employee will likely be entitled to damages in an amount equal to the difference between the working notice offered by the employer and the assessment of what constitutes reasonable notice at common law for that particular employee.
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