CITATION: Stephanie Ozorio v. Canadian Hearing Society, 2016 ONSC 5440
COURT FILE NO.: CV-15-542335
DATE: 20160830
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
STEPHANIE OZORIO Plaintiff/Moving Party
– and –
CANADIAN HEARING SOCIETY Defendant/Responding Party
Daniel A. Lublin, for Stephanie Ozorio
Kimberly D. Pepper, for the Canadian Hearing Society
HEARD: July 5, 2016
A. O’Marra J.
[1] The plaintiff, Stephanie Ozorio has moved for summary judgment against the defendant, Canadian Hearing Society (CHS) for wrongful dismissal. The parties agree that this is a matter appropriate for summary judgment.
[2] The plaintiff, age 60, then the defendant’s Regional Director of its Toronto Region, was dismissed without cause November 30, 2015 as part of a restructuring process due to significant operating deficits the CHS was experiencing. She had been employed by the defendant for 30 years and had held the position of Regional Director since 2004.
[3] The defendant, CHS, is a not for profit corporation that provides services, products and information related to people of all ages who are culturally deaf, oral deaf, deafened and hard of hearing. It employs over 450 people throughout a network of 29 offices across Ontario and on its website reports itself to be “largest agency of its kind in Canada”.
Background of the Plaintiff
[4] The plaintiff began working for the defendant shortly after graduating from university in 1985. Her initial positions included Vocational Rehabilitation Counsellor and Intake Coordinator. From 1999 she held a number of managerial positions within the organization. In 2004 she was employed as the Regional Director, Toronto Region, the defendant’s largest region, overseeing the day to day operations of a number of diagnostic, counselling, resources and support services, as well as the audiology clinic in the Providence Hospital. Her duties included involvement in community relations, relations with a government funders, as well as providing long term program and services planning for the Toronto regional operations. In her position she had managed up to 65 staff, with a number of managers reporting to her. She was responsible for overseeing a budget of $8 million. She reported directly to the Chief Operating Officer of CHS who in turn reported to the President and CEO.
[5] The plaintiff is divorced and the primary caregiver of her son, who has an illness requiring medications that were covered by the defendant’s health plan. Further, the plaintiff cares for her elderly mother who also lives with her.
Compensation at Time of Termination
[6] The plaintiff’s annual compensation as the Regional Director at the date her employment was terminated was a base salary of $97,309.22 plus benefits and RRSP contributions in the amount of $4,789.64 annually, for a total compensation package of $102,098.86.
Circumstances of Employment Termination
[7] On November 18, 2015, the defendant’s new President and CEO, Ms. Julia Dumanian, met with the plaintiff and “without any warning” according to the plaintiff presented her with a “voluntary separation offer”. The terms of the offer would have provided the plaintiff with $93,000, less than her annual salary, in exchange for a release. Ms. Dumanian left the offer with the plaintiff for her review and any independent advice. On or about November 25, 2015, the plaintiff declined the offer as in her view it was unfair and inadequate given her long tenure and senior role in the organization.
[8] On November 30, 2015, the defendant sent the plaintiff a termination letter then offering 12 months’ pay (approximately $97,000) and limited contribution of benefits for 2 months. No offer was made to provide the plaintiff with a letter of reference or any out-placement counselling services to assist her with alternative employment.
[9] In lieu of acceptance, the defendant chose to pay the plaintiff her regular salary from November 30, 2015 to July 27, 2016, the minimal 34 week period for statutory notice and severance pay compliance under the Employment Standards Act, 2000 S.O. 2000 C. 41, in addition to benefit coverage for 8 weeks.
[10] The plaintiff commenced her action for wrongful dismissal December 15, 2015.
Reasonable Notice in the Circumstances
[11] The position of the plaintiff is that the reasonable notice period in the particular circumstances of this case is one of 24 months, relying on cases set out in Appendix A.
[12] The defendant’s position has changed considerably since its original offers. Initially, the offer was basically 12 months’ salary in lieu of notice however, in its written and oral submissions the defendant urged the court to find that the reasonable notice period in the circumstances of this case is one of 18 to 20 months, relying on cases set out in Appendix B - a tacit acknowledgment of the inadequacy of the original offers.
[13] Reasonable notice must be decided in reference to the particular facts of each case having regard to the factors as set out in Bardal v. Globe & Mail Ltd. (1960), 1960 294 (ON SC), 24 D.L.R. (2nd) 140 (H.C.) at p. 145:
There can be no catalogue laid down as to what is reasonable notice in particular classes of cases. The reasonableness of notice must be decided with reference to each particular case, having regard to the character of 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.
[14] The plaintiff in this matter, now 61 years of age, had worked for the defendant for 30 years. As noted in Drysdale v. Panasonic Canada Inc., 2015 ONSC 6878, para. 13:
Generally, a longer notice period will be justified for older long term employees who may be in a competitive disadvantage securing new employment because of their age (McKinney v. University of Guelph, 1990 60 (SCC), [1990] 3 S.C.R. 229 at para. 92).
[15] The plaintiff has been applying for a variety of manager and senior managerial positions both in the public and private sectors continuously since her dismissal without receiving an interview. Many of the positions available in the social services field require an advanced graduate degree, which the plaintiff does not possess.
[16] The plaintiff does have administrative and managerial skills that would be transferrable to other sectors beyond the not for profit sector, however as observed by Lederman J. in Drysdale v. Panasonic Canada Inc. that the plaintiff “having served one employer for such a lengthy period of time, a potential new employer may view that individual as rather set in his ways and not as adaptable to change.”
[17] Further, age is an impediment. In Hussain v. Suzuki Canada Ltd., [2011] O.J. No. 6355, L.B. Roberts J. observed that a plaintiff in his 60s would undoubtedly face “extremely stiff competition with much younger applicants for the same kind of employment”. Such a plaintiff would be significantly disadvantaged because of his age when competing with younger employees. Similarly, in Leeming v. IBM Canada Ltd., 2015 ONSC 1447, [2015] O.J. No. 1020, Perell J. noted that the plaintiff who was 60 years of age did not have particularly bright prospects for re-employment “competing with younger, more recently trained and less likely expensive talent”.
[18] I accept that the plaintiff is at a competitive disadvantage given her age in the broader job market and having virtually no work experience outside that of the defendant, a not for profit organization.
[19] The defendant submits that the plaintiff’s position is properly characterized as a mid to senior level managerial position - as such she is not entitled to a notice period of 24 months, which would be more appropriate with respect to an executive position.
[20] However, I note that the qualifications in the position description provided by the defendant for the position she held requires “3-5 years managerial experience with 1-2 years at the senior management level”. In my view, the plaintiff was not a mid-level manager as suggested by the defendant. Rather, at the time of her dismissal, she was a very senior manager of the defendant’s largest regional office with significant operational responsibilities reporting directly to the defendant’s Chief Operations Officer.
[21] Further, while 24 months may be the notional cap, which can be exceeded where exceptional circumstances are demonstrated, there have been numerous cases in which older and long term employees in non-executive positions such as the plaintiff have been found to be entitled to 24 months’ pay in lieu of notice (see: Bolibruck v. Niagara Health System, [2015] O.J. No. 1074, Brien v. Niagara Motors Ltd., [2009] ONCA 887, Lowndes v. Summit Ford Sales Ltd., 2006 14 (ON CA), [2006] O.J. No. 13, Kerr v. Canada Alloy Castings, [2000] O.J. No. 5169, and Cowper v. Atomic Energy of Canada Ltd., [1999] O.J. No. 2021).
[22] In Paquette v. TeraGo Networks Inc. 2015 ONSC 4184, Perell J. observed that older and long term employees should receive greater damages because they are at a significant disadvantage competing for work.
[23] The defendant does not contend that there has been any failure on the part of the plaintiff to mitigate losses, which is her obligation. In the six months following her termination the plaintiff has applied to more than 20 positions in the public, private and not for profit sectors and had received no job offers. The materials submitted in support of the plaintiff’s continuous job search and applications submitted establish that she has made significant efforts to try to mitigate her loss, unfortunately with no effect to date.
[24] I accept the plaintiff’s submission that competition for senior managerial roles is very high in the Greater Toronto area and much more difficult for a person the age of the plaintiff, notwithstanding her undoubted competence and experience.
[25] Given the age of the plaintiff, the length of her employment with the defendant, more than 10 years as its Regional Director, a senior managerial position of significant responsibility, the limited availability of similar employment commensurate with her experience, training and qualifications, she is entitled to 24 months payment of salary and benefits in lieu of notice less compensation and benefits received under the ESA.
Trust and Accounting v. Contingency Approaches
[26] As there is a significant period of time before the expiration of the reasonable notice period in this case, I now turn to the question as to the method of payment of the award and the continuing duty of the plaintiff to take appropriate mitigating steps.
[27] The courts have generally recognized two approaches to account for the employee’s continuing obligation to mitigate his or her damages:
(a) The Contingency Approach – the employee’s damages are discounted by a nominal percentage as contingency for re-employment during the balance of the notice period.
(b) The Trust and Accounting approach – the employee is granted the full judgment, but a trust in favour of the employer is impressed on the judgment funds for the balance of the notice period requiring the employee to account for and repay any mitigation earnings.
[28] The defendant favours the contingency approach whereby the damages are discounted as a contingency for the likelihood of re-employment during the balance of the notice period for the reasons as set out by Myers J. in Peticca v. Oracle Canada ULC, [2015] O.J. No. 1985 at para. 25:
Civil litigation is “one stop shop”. We do not require personal injury plaintiffs to come back and prove their future costs of care have actually been incurred. Instead, the system recognizes that there is early payment, and takes a contingency with the discount as best as the court can do. I agree with Justice L.B. Roberts in Hussain v. Suzuki Canada Ltd., [2011] O.J. No. 6355 at para. 13, “a once and for all assessment is the most consistent with the goals of expeditious, affordable and proportional civil litigation resolution”.
[29] Where the likelihood of re-employment is considered slight courts have discounted the award by 1 percent, as in Hussain v. Suzuki and Ziten v. Sadie Moranis Realty Corp., [2015] O.J. No. 6839, to 10 percent recently in Peticca v. Oracle because of a difficult job market. The defendant suggests that the discount in this instance should be 5 to 10 percent given the likelihood that the plaintiff will find some alternate employment.
[30] The plaintiff favours the trust and accounting approach as applied in Paquette v. TeraGo and Drysdale v. Panasonic as it would accurately reflect the mitigation earnings. As of today there is approximately 15 months in the notice period. Counsel submits that to impose a percentage discount to the award at this point would be quite speculative. I agree.
[31] In Thomson v. Bechtel Canada Ltd. (1983), 3 C.C.E.L. 16, at p. 23 Osborne J. observed:
The contingency of new employment within the notice period could be somewhat speculatively assessed and imposed upon the notice period to reduce it. In the circumstances of this case, I think it preferable to impose upon the plaintiff a trust, whereby any earnings of the plaintiff until the expiry of the 11 month notice period will be impressed with a trust in favour of the defendant. I am satisfied that the plaintiff has endeavoured to obtain employment throughout and that he will continue with his sincere endeavours to obtain employment.
[32] In this instance I am of the same view that the plaintiff will continue in her sincere efforts to obtain alternate employment.
[33] Accordingly, the entire award is impressed with a trust in favour of the defendant. At the end of the notice period the plaintiff shall account to the defendant any earnings obtained from new employment within the notice period so as to reduce the defendant’s obligation to pay the plaintiff.
[34] In the result, the plaintiff is awarded her base salary plus benefits and RRSP contributions for the notice period of 24 months, less payments received from the defendant, CHS to July 27, 2016 under the ESA. I leave it to the parties to calculate the relevant amounts.
[35] I would encourage the parties to try to settle the costs of the motion, however, if they are unable to do so, plaintiff’s counsel may serve and file written costs submissions not to exceed three pages together with the Bill of Costs within 15 days. The defendant shall deliver similar responding submissions within 10 days thereafter.
A.J. O’Marra
Released: August 30, 2016
APPENDIX A
Case Name
Age
Tenure
Position
Salary
Damages
Garner v. Bank of Nova Scotia, 2015 NSSC 122, [2015] N.S.J. No. 166, Plaintiff’s BOA Tab 4
59
35 years
Branch Manager
$105,000
24 months
Bolibruck v. Niagara Health System, [2015] O.J. No. 1074, Plaintiff’s BOA Tab 5
30 years
Program Director
$127,000
24 months
Lee v. Bank of Nova Scotia, [2004] O.J. No. 3505, Plaintiff’s BOA Tab 6
57
29 years
Auditor
$41,100
26 months
Hussain v. Suzuki Canada Ltd., 2011 CarswellOnt 12251, Plaintiff’s BOA Tab 7
65
36 years
Assistant Warehouse Supervisor
$49,000
26 months
Brien v. Niagara Motors Ltd., 2009 ONCA 887, Plaintiff’s BOA Tab 8
51
23 years
Office Manager
24 months
Chorny v. Freightlined of Canada Ltd., [1995] B.C.J. No. 51, Plaintiff’s BOA Tab 9
56
28 years
Regional Manager
$149,000
24 months
Lowndes v. Summit Ford Sales Ltd., 2006 14 (ON CA), [2006] O.J. No. 13, Plaintiff’s BOA Tab 10
59
28 years
General Manager
$69,000
24 months
Mitchell v. Wesburne Supply, [2000] A.J. No. 246, Plaintiff’s BOA Tab 11
57
28 years
Manager
$88,000
24 months
Knox v. Interprovincial Engineering, [1993] N.S.J. No. 103, Plaintiff’s BOA Tab 12
50
27 years
Acting General Manager
24 months
Johnson v. Marine Roofing Repair & Maintenance, 2015 BCSC 472, Plaintiff’s BOA Tab 13
65
24 years
Manager
$134,000
24 months
Fraser v. Kelowna, 1993 1267 (BC SC), [1993] B.C.J. No. 1740, Plaintiff’s BOA Tab 14
59
23 years
Manager
$54,000
24 months
Blackburn v. Victory Credit Union Ltd., [1997] N.S.J. No. 297, Plaintiff’s BOA Tab 15
51
32 years
Manager
$45,000
24 months
Bell v. Izaak Walton Killam Hospital for Children, [1986] N.S.J. No. 504, Plaintiff’s BOA Tab 16
54
26 years
Director
24 months
Kerr v. Canada Alloy Castings, [2000] O.J. No. 5169, Plaintiff’s BOA Tab 17
62
33 years
Local President
$96,000
24 months
Cowper v. Atomic Energy of Canada Ltd., [1999] O.J. No. 2021, Plaintiff’s BOA Tab 18
60
35 years
Senior Manager
$95,000
24 months
APPENDIX B
CASE NAME
AGE
LENGH OF SERVICE (YEARS)
CHARACTER OF EMPLOYMENT
NOTICE PERIOD (MONTHS)
Deschenes v. Metal Shapes Mfg. Incorporated, 2005 CarswellOnt 42 (Ont. S.C.)
58
30 years
“Responsible position as part of the management team”
18
Novakowski v. Canadian Linen & Uniform Service Co., 2015 ABQB 53, 2015 CarswellAlta 69 (Alta. Q.B.)
63
30 years
General Manager
19
Johnson v. Top-Co LP, 2009 ABQB 731, 2009 CarswellAlta 2095 (Alta. QB)
53
34 years
Production Manager
20
Wright v. Kimberly-Clark Canada Inc., 1995 CarswellOnt 455 (Ont. S.C.)
56
30 years
District Superintendent Human Resources
20
Burry v. Unitel Communications Inc., 1997 CarswellBC 2742 (B.C.C.A.)
51
33 years
Project Manager/System Engineer
20
CITATION: Stephanie Ozorio v. Canadian Hearing Society, 2016 ONSC 5440
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
STEPHANIE OZORIO Plaintiff/Moving Party
– and –
CANADIAN HEARING SOCIETY Defendant/Responding Party
REASONS FOR JUDGMENT
A.J. O’Marra J.
Released: August 30, 2016