February 1, 2024
Employees in Ontario dismissed without cause are entitled to reasonable notice of termination or pay in lieu of notice. It is established law that in the absence of “exceptional circumstances”, the maximum award should be 24 months’ notice or pay.
THE ISSUE
The reliability of this “rule” is called into question by two Ontario Court of Appeal decisions released on the same date but decided by different panels of judges. In each case, the judges say that the 24-month rough limit still exists, yet they uphold Superior Court awards of more than 24 months. Where does that leave the “rough upper limit”?
THE CASES
Milwid v. IBM Canada Ltd., involved an employee who was forced to take early retirement. He was a manager, but not an executive. He had worked for the defendant for 22 years but had been employed by an affiliated company since 1982. The Court of Appeal upheld an award of 26 months notice. In addition to the traditional factors such as age, seniority, nature of the position, and job prospects, the Court recognized that COVID increased the difficulty of job search. These factors supported a finding of “exceptional circumstances”, despite being the same factors (except for COVID) that go into the traditional approach theoretically capped at 24 months. There was no need to look for additional factors.
Lynch v. Avaya Canada Corporation upheld a 30-month award- a full half year longer than the typical maximum. The Plaintiff was not a manager but had been employed by the company and its predecessor since 1982. The Superior Court judge had not set out which factors made up the “exceptional circumstances”. The Court of Appeal indicated that the proper approach is to give that level of detail, but excused the lapse in this case, since they agreed with the Superior Court result, after setting out the facts that the Court of appeal believed justified the exceptional award:
- The Plaintiff’s highly specialized skills.
- The unique nature of his job.
- His contributions to the employer by developing patents.
- The employer described him as a “key performer” in performance reviews.
- The scarcity of comparable jobs in the community in which the 64-year-old Plaintiff resided.
The last of these points might have particular importance in Thunder Bay and Northwestern Ontario, where communities may have only one or two specialized employers.
TAKEAWAYS
- At what point do the exceptions overwhelm the rule?
- Will we see more high awards?
- What evidence is necessary to prove exceptional circumstances?
- What local circumstances may affect the result?
WHAT WEILERS LLP CAN DO TO HELP YOU
Whether you are an employer or a dismissed employee, the growing complexity of the rules surrounding dismissal requires that you obtain timely advice. This applies particularly to cases of long service specialized employees. As the Lynch case demonstrates, local knowledge may be important.
At Weilers LLP, we have a track record of over 75 years in employment law in Thunder Bay and throughout Northwestern Ontario. Our progressive approach melds with this proud tradition to put our clients’ best interests first. This equips us to give you the sound advice you need, tailored to local and regional circumstances.
For the timely advice you need, give us a call, and find out if Weilers LLP are the right lawyers for you.