NEWMARKET COURT FILE NO.: 65406-02

DATE: 20140528

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: Naeem Syed Ahmed, Plaintiff

AND:

Concord Hard Chrome Limited, Defendant

BEFORE: THE HON. MR. JUSTICE P.H. HOWDEN

COUNSEL:
P. DiMonte, Counsel for the Plaintiff
L. Todd, Counsel for the Defendant

HEARD: May 21 and 22, 2014

ENDORSEMENT

[1] This action relates to a contract of employment that came into being and was terminated some twelve to fifteen years ago. I do not recall, in a court which over the years has at times suffered from severe backlogs, any case more delayed than this one. It is a relatively straightforward case; it took less than two days to try. There is no good reason for this happening. Previous counsel for the plaintiff did nothing to prosecute this action and move it forward from January 2003 when the statement of defence was filed until it was set down for trial in October 2012. It was about that time when new counsel was retained by the plaintiff. He and the defendant’s counsel got it on a trial list in 2013. It was reached at the May 20, 2014 sittings though it had to be tried in Barrie due to the full list of current trials proceeding in Newmarket.

[2] Both parties had serious problems as a result of this delay when it came to recalling anything more than broad outlines etched in their memories.

[3] The issues in this case are:

i) Did the defendant terminate the plaintiff with just cause?

ii) Is the action barred by s. 97 of the Employment Standards Act S.O. 2000, ch.41 (ESA)?

iii) If not, what is the period of reasonable notice that the plaintiff should have received, considering the factors in Machtinger v. HOJ Industries Ltd., 1992 102 (SCC), [1992] 1 SCR 986?

iv) Did the plaintiff act to mitigate his damage?

v) What should be the quantum of damages in this case?

[4] The plaintiff Naeem S. Ahmed had worked for twelve years with another company in the hard chrome plating business as of 1999. He had come to Canada in 1977 and, like many recent arrivals, has had a variety of jobs in the commercial and industrial sectors of Toronto. In or about 1987 he got his first job with the hard chrome company. In 1999 he heard that the defendant Concord Hard Chrome Limited (“Concord”) wanted someone and would pay more. No one from Concord had attempted to recruit him. He met Ram Verma, the managing partner, who, knowing Ahmed had been with another hard chrome company and was able to work with the machinery, offered him a job.

[5] The first and only witness called on behalf of the plaintiff was Mr. Ahmed himself. He said that their contract was oral; nothing was reduced to writing. His understanding was that he would work for a salary of $960 per week, and that he would have to work 55 to 60 or 65 hours per week. He took the job because it meant more money. He began work for Concord on May 31, 1999. His last day of attendance at the place of work was January 28, 2002. According to the pay stubs marked in Tab 10, Exhibit 1, his gross pay in 1999 was $1920.00 for a two-week period, or $960 per week before deductions.

[6] In late 2001, the plaintiff was allowed to take time from his job partly as a leave of absence, unpaid, to visit his family in Pakistan. The airline reservation says he was away from the afternoon of December 7, 2001 and returned to Toronto January 15, 2002. He attended for work the next day and several days after that. On January 25, 2002, he noticed that his cheque did not pay him for the statutory holidays through the Christmas period. Mr. Verma said they would not pay for those days. Ahmed said that Verma told him to go home and he would call him. Ahmed went home that afternoon. Verma did not bother to phone him. Mr. Ahmed returned to work on Monday, January 28 and was told again to go home. He was informed by letter dated January 31, 2002 that, “I regret to inform you that we will be terminating your employment effective immediately. Your regular salary will cease as of January 25, 2002.”

[7] In chief, Mr. Ahmed returned to what happened on January 25 due to Mr. DiMonte’s insistence. Mr. Ahmed said that the order of Mr. Verma for him to go home occurred after he had a verbal exchange with Mr. Verma. When Ahmed received his cheque on January 25, he saw that he was not paid for the three statutory holidays between December 25 and New Year’s Day. He asked why this was the case. Mr. Verma said no one is getting paid for those three days.

[8] Under cross-examination, Mr. Ahmed confirmed that Concord had been critical of two behaviours of his: (i) he did not punch in and punch out on the time clock – he would do one or the other but not both; and (ii) he used his cell phone during working hours. Mr. Ahmed conceded that he had been told several times during his time with Concord that despite being on a salary, he was required to punch in and out each day on a time clock; and that he was spending too much time talking on his cell phone during business hours. He confirmed that the time clock use was told him on his first day of work Ahmed said Verma did tell him to lessen his cell phone use; then Ahmed said he thought he got permission to use it in regard to his son. This was not explained.

[9] On the time clock usage, when told all his punch cards were available to be seen, he was asked why he did not usually punch in and out, only one of the two. He said that he didn’t feel he should have to do this because he was on salary. He agreed that he was reminded of this requirement in January 2000 but he could not recall a similar order on March 17, 2000 and other specific reminders that Mr. Verma felt his work was suffering due to too much time using his cell phone during work time. Mr Ahmed said that they always were warning people, not just him, about cell phone use in working hours. He was shown written notes by Mr. Verma or Loretta Card, the office manager, warning that he should not waste so much time on his cell phone and/or reminders about punching in and out dated March 17, 2000, August 5, 2000, May 31, 2001, and December 7, 2001. He said he did not recall these last four occasions specifically. As to December 7, 2001, Mr. Todd put to him that Mr. Verma told him that morning that when he returned from Pakistan, his work must improve. Mr. Ahmed denied this.

[10] In answer to Mr. Todd putting to him that the exchange with Mr. Verma over the three holidays’ pay was quite heated, he agreed. He also agreed their voices were raised and that he was angry over this issue. This occurred in the front office where other employees could see and hear them. It was after that argument that Verma told him to go home and he would call Ahmed at home. Ahmed said he did not think his job was terminated at this time. He attended again on the following Monday January 28 and was told again to go home. Then he said he knew his job was gone. He admitted this after being confronted by his discovery answer to that effect in 2004. However before January 28, 2001, it was clear that he never knew his job was in jeopardy over any of these issues. He was never told that that was so.

[11] Ram Verma gave evidence as the defendant’s only witness. He is one of three partners who own the business. Mr. Verma appears to be the managing partner in the plant. He stated that Mr. Ahmed had been warned about his cell phone use during business hours and his failure to punch in and out several times. He identified the five notes up to and including December 7, 2001 and said Mr Ahmed was warned on each of the dates on those recorded notes to follow his instructions. He also stated that he told Mr. Ahmed on December 7 that after his holiday trip his work habits had to improve, that he spent too much time on the phone every day. At no time did Mr. Verma tell Mr. Ahmed that his job was in jeopardy over these warnings or what would happen if Mr. Ahmed did not do as he was told.

[12] Regarding the argument on January 25 and why he terminated Mr. Ahmed’s job, Mr. Verma said he was offended by Ahmed’s behaviour on his return from Pakistan, that he was continuing in the same ways at work and then on the 25th, Ahmed yelled at him. Mr. Verma agreed that Mr. Ahmed had never raised his voice to him before. But, Mr. Verma said, he could not have an employee yelling at him. After telling him to go home and that he would phone him, Verma did not follow up with the phone call. Verma said Ahmed knew he was wrong to act the way he had. He said he told his partners they would have to let him go. They agreed.

[13] After his job was terminated, Mr. Ahmed went to the Employment Standards Act (ESA) Branch of the Ministry of Labour. On February 6, he signed a letter directed to Concord stating that he had filed a claim and that he was claiming pay for the three holidays and vacation pay, amounts to be determined. Concord was given until February 20, 2002 to contact the Ministry. Mr Ahmed’s memory about this letter was not clear. In chief he said his wife or his lawyer wrote it for him. Later under cross-examination he recalled that it was the Ministry person who wrote the letter for him and mailed it. A similar letter was sent to Concord dated February 26, 2002, also written by the Employment Standards person he saw and sent under Ahmed’s signature. This letter added to the two claims made earlier another claim, this one for Overtime Pay.

[14] During cross-examination, Mr. Ahmed admitted to Mr. Todd that he had been fully paid for overtime. He conceded that he had no claim whatsoever for overtime pay. Later by cheque dated June 7, 2002, Concord paid Mr. Ahmed for the three holidays despite stating that it was not required by law to do so.

[15] Mr. Ahmed said that he went to the ESA person at least five times, including on the dates of the two letters to the defendant, February 6 and 26, 2002.He could not say he had actually filed a formal claim with the ESA section. He said that the ESA person told him he had to choose whether to sue Concord in the court or pursue Concord through the Ministry under the ESA. Mr. Ahmed said that he decided the first time that choice was explained to him to go his own way and by March 20, 2002, he had retained a lawyer to pursue his common law claim for damages for wrongful dismissal.

[16] By letter of March 20, 2002, Mr. Ahmed’s lawyer (not Mr. DiMonte) advised counsel for Concord (not Mr. Todd) that:

...I wish to advise your client that they will not be called upon to answer Mr. Ahmed’s complaint before the Ministry of labour. Mr. Ahmed withdrew that complaint within the statutory time limit, preserving his right to commence legal action in the courts for all of his (ESA) and related claims.”

[17] The defendant has pleaded s. 97 of the ESA. Section 97 reads:

97. (1) An employee who files a complaint under this Act with respect to an alleged failure to pay wages or comply with Part XIII (Benefit Plans) may not commence a civil proceeding with respect to the same matter. 2000, c. 41, s. 97.

(2) An employee who files a complaint under this Act alleging an entitlement to termination pay or severance pay may not commence a civil proceeding for wrongful dismissal if the complaint and the proceeding would relate to the same termination or severance of employment. 2000, c. 41, s. 97 (2).

(3) Subsections (1) and (2) apply even if,

(a) the amount alleged to be owing to the employee is greater than the amount for which an order can be issued under this Act; or

(b) in the civil proceeding, the employee is claiming only that part of the amount alleged to be owing that is in excess of the amount for which an order can be issued under this Act. 2000, c. 41, s. 97 (3)

(4) Despite subsections (1) and (2), an employee who has filed a complaint may commence a civil proceeding with respect to a matter described in those subsections if he or she withdraws the complaint within two weeks after it is filed. 2000, c. 41, s. 97 (4).

1. Did the defendant terminate the plaintiff’s employment for just cause?

[18] As a general comment, I appreciated the honesty of both parties in this case. I do not see their evidence as seriously at odds over the happenings at Concord.

[19] I find that on several occasions throughout the two and a half year period of the plaintiff’s employment, it was suggested to him that he should be punching in and out each day on the time clock. As well, Mr. Verma felt that the plaintiff should not be using his cell phone on personal business as it was taking his attention from his work and told Ahmed on the occasions Verma mentioned. These reminders were repeated several times but at no time did they escalate in seriousness to give the plaintiff a sense that they were more than irritants. There was no warning such as one saying that if you fail to abide by this policy, disciplinary measures will follow, followed by deduction from pay or suspension. Furthermore Mr. Verma admitted under cross-examination that Ahmed was completing his work every day. He conceded to Mr. DiMonte that Mr. Ahmed never left a job uncompleted when he left for the day. It is clear that the use of the time clock and the cell phone use were annoyances to Mr. Verma but he did not threaten any serious repercussions because these were minor conduct issues.

[20] In my view, what happened here was that the plaintiff’s phone use continued to some unknown extent when he returned after six weeks away, He continued to not punch in or out. His salary was never docked to reflect time lost at work. And Mr. Ahmed continued to complete his work every day. Verma was somewhat annoyed by Ahmed’s continued behaviour. Then Ahmed stood up to Mr. Verma and yelled at him in an argument over entitlement to holiday pay. As Mr. Verma said, he would not stand for what he saw as disrespect in front of other employees whereas what was happening was Ahmed simply was complaining over loss of statutory holiday pay. No doubt there were terms of disrespect exchanged on both sides. But again, nothing occurred that led anyone to suspect that the plaintiff’s job was lost – some disciplinary measure maybe like being sent home early, that was all. It was only on the second day that Ahmed attended at work, on January 28, when he was told to go home, that it was clear the termination decision had been made.

[21] It seems to me that without some escalation in warning and action that would indicate to the employee his behaviour was more than a minor irritant that was being tolerated but not liked, I see no grounds in fairness to find just cause for termination of employment. The argument over holiday pay was more serious, but even there, Mr. Verma did not follow up with the phone call he said he would make to Mr. Ahmed. Verma preferred to leave him at home without knowing how the defendant company was treating the incident. Mr. Verma should have used the weekend to calm down and see that he may have played a part in something he said that triggered the uncharacteristic outburst from an otherwise mild man who did his job day and day out. And Mr. Ahmed owed Mr. Verma an apology for his behaviour, as did Mr. Verma. As the man with the power to hire, fire and discipline, it was incumbent on Mr. Verma to take the initiative, make the first step in that process. But there is no ground shown in this evidence to establish a dismissal for cause.

2. Is s. 97 of the ESA fatal to this claim?

[22] In two letters drawn by the Ministry staff for Mr. Ahmed, it is confirmed that he had filed a claim or as Mr. DiMonte stated, perhaps two claims, given the change of claim in the second letter. The parties have tried to find what really happened at the Ministry but there is no documentation of the filing of any formal claim by Mr. Ahmed before me or produced by the Ministry. And Mr. Ahmed is not familiar with the forms and could not say he did more than talk on five or six occasions with Ministry staff who helped him with the letters. In the end, I am not satisfied, despite the literal words in the two letters and given the absence of any Ministry documentation of a claim being filed, that the factual foundation has been laid for s. 97 to apply in these circumstances.

[23] Even if I am wrong in that conclusion, it is clear that he attended the ESA section several times and was not merely sitting back on his claim. And when he was told that he had a choice, I accept that Mr. Ahmed chose to bring an action in court.

[24] In Scarlett v. Wolfe Transmission Ltd. [2002] O.J. No. 4403 (SCJ), Pepall J. held that the court could rely on its inherent jurisdiction to control proceedings before it to extend the time set in the statute for withdrawal of an ESA claim where special circumstances exist. She stated at para. 16, as to the purpose of the limitation for withdrawal of the ESA claim:

16 There are no cases involving a decision based on section 97(4) or its predecessor. The legislative debates are silent on this provision. Presumably, the objective of the section is to ensure that the issue of parallel proceedings is dealt with at an early stage in the proceedings. It also ensures that the employment standards officer does not proceed to fact find unnecessarily. The purpose surely was not to limit an applicant's ability to pursue any proceeding whatsoever. [Emphasis added.]

[25] I agree with the finding of ability to extend the time on the basis of the court’s inherent jurisdiction, and in this case there are special circumstances. Mr. Ahmed did not delay in determining that he wanted to pursue this matter in the court. The purpose of the provision is therefore satisfied in this case as Mr. Ahmed, on the first opportunity after he understood he had a choice, made his choice known immediately. No unnecessary investigation was begun. In these circumstances, I exercise my discretion to extend the period for withdrawal to the extent required to allow for his withdrawal, being no later than March 20, 2002 when his lawyer informed the defendant that it was not required to answer to the ESA claim, if the claim ever existed on more than an informal basis.

3. What should be the period of reasonable notice?

[26] Mr. Ahmed was a machinist in 2002, 42 years of age, who had worked in the hard chrome industry for some 15 years and for the defendant for 2.5 years?

[27] The law on reasonable notice where no notice period has been set by the parties is in Machtinger, supra; Wrongful Dismissal by D. Harris; Carswell, Toronto, Vol.2, p.4-11. In Harris’s view, Machtinger marked the end of the Lazarewicz approach and the fictional search for the parties’ likely attitude toward reasonable notice if they had ever thought of it. In addition, with regard to Mr. Todd’s reference to the informal rule of thumb equating one year worked to one month’s notice, the Ontario Court of Appeal rejected it as being neither “warranted in principle nor…supported by authority.” Minott v. O’Shanter Development Co. (1999),1999 3686 (ON CA), 42 O.R. (3d) 321. The Harris text mentions that nevertheless some judges have continued to use it, e.g. Webb v Eaton Yale Ltd. [2003] O.J. No. 5013 (SCJ). It is not good law any longer, if it ever was.

[28] In Machtinger, the Supreme Court of Canada stated the law at the conclusion of Section B titled The Common Law Approach:

What constitutes reasonable notice will vary with the circumstances of any particular case. The most frequently cited enumeration of factors relevant to the assessment of reasonable notice is from the judgment of McRuer C.J.H.C. in Bardal, supra, at p. 145:

There can be no catalogue laid down as to what is reasonable notice in particular classes of cases. The reasonableness of the notice must be decided with reference to each particular case, having regard to the character of the employment, the length of service of the servant, the age of the servant and the availability of similar employment, having regard to the experience, training and qualifications of the servant.

[29] In this case, the plaintiff had worked in the hard chrome plating sector with one company for twelve years before he joined Concord. With Concord, he met the demands of a difficult work load, his employer insisting on a six-day, 55-60-hour work week. Despite his unorthodox work habits, his employer had to admit he never failed to complete his work every day before leaving. And it rewarded Mr. Ahmed despite its complaints by giving him a raise to $990 per week plus extra work which took his gross usually to $1,056 per week or $2,112 over a two-week pay period (Ex. 1, Tab 10, pp. 33 and 58 et foll.) If that is so, and Mr. Verma agreed that it was, one fails to see the importance of the punch-in-punch-out regime attempted to be forced on him, or concern over his cell phone use which, if it was serious, surely would have attracted some discipline short of firing in 2.5 years. It did not.

[30] I have respect for Mr. Verma and I have the sense that he felt disrespected by the plaintiff in front of his other employees. He and Mr. Ahmed both had fallen into an argument in January 2002. They became angry. It became heated and their voices were raised. They yelled at each other. The only difference between them was that one was an employer with the power to fire the other and the other had no equivalent power. Mr. Verma told the plaintiff to go home. He did. Instead of using the intervening weekend to think through the situation and cool off or to phone the plaintiff as he said he would, Mr. Verma simply decided on January 28 to pull rank and fired Mr. Ahmed.

[31] In fifteen years, Mr Ahmed had held steady employment. For the prior two years with Concord he was earning in the range of $50,000 per year, a considerable increase over prior years, which Mr. Ahmed had to earn by working 60-hour work weeks and did. At 42 years of age, and for one brief episode, Mr. Ahmed was out on the street, an immigrant with limited English and with some skill in a marginal sector of the economy. There was a degree of arbitrariness which I find was part and parcel of Mr. Verma’s slow boil over twenty-four months that reached a high of heated and upset behaviour when Mr. Ahmed refused to accept his decision and refused to accept that Verma was the only one allowed to shout during an argument. As well, Mr. Ahmed had asked a valid question: why was there no pay for statutory holidays? And within days of asking, and arguing the point, he is fired.

[32] None of the cases I have found are directly on point. However, each one represents an attempt by a court to deal with reasonable notice using the guideline approach in Machtinger and Bardahl. To that extent, they are useful because they did not settle for the simple rule of thumb which has been rejected by the appellate court of this province. In Pollinger v. Bergman Graphics (1993), 1993 8719 (ON SC), 18 O.R. (3d) 31 (O.G.D.), a 50-year-old journeyman in a skilled position, hired for an indefinite term, was terminated within a day after he complained of another employee being allowed to smoke despite a no-smoking policy. He had only been with the company for eighteen months. The court held he was entitled to four months’ notice in the circumstances. In Haftbaradaran v. St. Huberts Estate Winery Ltd., 2011 BCSC 1424, (BCSC), the employee’s skill as a winemaker put him in a narrow and specialized field. Though he only worked for the employer for twenty-three months, he applied for employment to wineries he had reason to believe might have a job for him. His income level was similar to Mr. Ahmed, close to $50,000. He was found to be entitled to eight months’ notice despite his young age due to the narrow field he was in and the degree of work required of him, a more specialized field than Mr. Ahmed.

[33] In Rocca v. International Scissor Ltd. (1981) 7 ACWS (2d) 534 (Ont. H. Ct.), the employee faced a scarcity of employment in another very specialized field. He worked for 4.5 years for the defendant. He was described as a capable factory worker with skills in polishing, grinding, plating, hardening of metal and as a machinist. His job could also be described as a scissor factory foreman, an industry of limited earning opportunities. The court assessed reasonable notice at nine months because it chose the latter description as more apt to this plaintiff. He had the disadvantage of age and the disadvantage of restricted training. Mr. Ahmed had similar machinist skills in a rather marginalized industry; though not marginalized to the extent of Mr. Rocca, his predicament of skills in a narrow field was similar and his difficulty in trying to get similar employment showed the difficulty despite his efforts. For over two years, he was not able to approach his earnings with Concord.

[34] Finally, in Paddon v. Kamloops Electric Motor Sales & Services Ltd. (1994) 5 CCEL (2d) 191 (BCSC), the plaintiff did one year’s service. He had a small supervisory role, and at 40, he was handicapped in finding employment. The court found in these circumstances that reasonable notice was two months. Mr. Ahmed was a similar age but without supervisory experience and in a narrowed field and skill set. On the same ratio, Mr. Ahmed would be entitled to five months’ notice.

[35] I have no doubt that Mr. Ahmed took reasonable steps to get other work. His income in 2002 according to his tax returns, had fallen from approximately $50,000 per year to $29,848 in 2002. I understand Mr. Todd’s cynicism in the absence of a resume but I accept the evidence of Mr. Ahmed’s numerous fax cover sheets which indicate the numerous companies which Ahmed sent his resume to and the fact that within the year he was able to sustain some earnings despite only two-weeks’ pay in lieu of notice of termination. Considering his consistent work record, his relatively short time with the defendant after lengthy employment with another company, the indefinite nature of his employment, his age, and the slim availability of similar employment as well as the cavalier circumstances of his discharge, I find that a reasonable notice period in this case is six months.

Did the plaintiff meet his duty to mitigate his damage?

[36] I have reviewed his fax cover sheets as well as the fact he was able to earn over 50% of the income with Concord within the first year. I am satisfied that he used reasonable efforts to find similar employment.

What is the assessment of damage in this case?

[37] Six months’ salary including Sunday work amounts to $1,056 per week x 26 = $27,456. Mr. Ahmed earned $30,000 (rounded) over the year of 2002 into early 2003. The amount earned from the duty to mitigate must be accounted for, otherwise the plaintiff would be recovering both his earnings during the period of reasonable notice and his full notice period earnings which would put him in a better position at the expense of the defendant.

[38] Mr Todd suggests that as $30,000 is 58% of his prior earnings of $50,000, the $27,456 should be reduced in that proportion. That would leave a figure of $27,456 - $15,924 = $11,532.The problem with this is not the method but the 58%. It is not correct. Mr. Ahmed was making $2,112 every two weeks, sometimes less, sometimes more, because of additional work I think on Sunday. Using $54,912, or $55,000 rounded, his earnings the year after he was dismissed of $30,000 amounts to 55% of his prior earning level, not 58%.

[39] Using the reduction by 55% applied to his notice period earnings of $27,456, the result is $27,456 - $15,100 = $12, 356.

[40] Another approach is to simply subtract one-half of the $30,000 or $15,000 from his notice period earnings. That comes to $27,456 – $15,000 = $12,456.

[41] I assess the damages owed to the plaintiff by the defendant Concord for wrongful dismissal at $12,400.

[42] If costs and/or pre-judgment interest in this much delayed case are not agreed, I will receive written submissions from the plaintiff’s counsel within thirty days of release of this judgment. The defendant’s counsel will have a further thirty days to file Concord’s submissions. Reply on the plaintiff’s behalf will be allowed within a further seven days.

HOWDEN J.

Date: May 28, 2014