Of review of the November 2009 Court of Appeal decision of Brien v.
Niagara Motors Ltd is an interesting read. In this case the appellant
employer raised three grounds of appeal from a wrongful dismissal
decision which awarded 24 months severance plus Wallace (for bad faith)
damages of two months.
Firstly, the employer argued to the Court of Appeal that the trial
judge erred in treating the respondent employee as a 23-year employee
even though there was a two-year gap in her employment after 6 years
when she left to have her second child. The employee had been invited
back to work for the employer after two years. She had exhausted her
maternity leave and was not working. She did not return for family
reasons. She was not looking for another job, nor did she work
anywhere else within the 2 year gap. She was reintegrated into the
employer's employment as if she had never left. The Court of Appeal
noted that, for example, she immediately provided with a 2 weeks
vacation within the first year without first working for 12 months as a
new employee would have to. For these reasons, the COA did not give
effect to this ground of appeal.
The second issue is whether the two months award for Wallace damages
($8,826.56) can survive the decision of the Supreme Court of Canada in
Honda Canada Inc. v. Keays, 2008 SCC 39, which was released following
argument but before the reasons in this case were released by the trial
judge. For those who don’t know – the Honda case gave the employment
landscape quite the tilt with respect to damages. The Supreme Court
Re-formulated the legal principles surrounding both the availability of
“Wallace damages” and the manner in which they can be awarded. The
appeal was allowed on this ground. Although the appellant's conduct in
wrongfully alleging misconduct against the respondent was improper, any
claim for punitive damages based on that conduct was abandoned before
the trial.
While the respondent's misconduct in this respect could have led to a
proper award of mental distress damages as defined in Keays, the mental
distress that the respondent suffered upon her termination and the
manner of that termination was not of the nature and scope to qualify
for compensatory damages in accordance with that decision, as the
respondent did not seek any medical attention, professional assistance
or undergo any therapy for her mental distress
The third ground of appeal is based on the double counting of the
Employment Standards Act severance payment of $20,240. This probably
meant that the employee was paid statutory termination pay that was
also counted into the payment in lieu of notice. The lawyers agreed to
remove this.
In the result, the appeal was allowed in part, and the damages calculation was reduced by $8,826.56 plus $20,240.
This case may be a minor precedent setter with respect to
calculating damages in cases where the employee takes a stretch off
work and is re-hired. In the long run, does it really matter? It is all
circumstantial and factual based but it is good to remind ourselves of
these cases.
If you are in the Halton regions and your company
needs employment assistance please do not hesitate to give Haber &
Associates a call at 905-639-8894 and ask for me, Matt Lalande.