The grievor was reinstated with back pay after a wrongful dismissal, receiving four years of income in a single lump sum.
This resulted in a significantly higher tax burden than if the income had been earned over the four years.
The union sought additional compensation to cover this extra tax, plus a 'gross up' to account for the tax payable on the additional compensation itself.
The Grievance Settlement Board allowed the claim, applying the 'make whole' principle of contract damages.
The Board held that the increased tax burden was a reasonably foreseeable consequence of the employer's breach and ordered the employer to compensate the grievor for the tax differential, grossed up.
