CITATION: Skov v. G&K Services Canada Inc., 2017 ONSC6752

COURT FILE NO.: CV-16-556560

DATE: 20171114

ONTARIO

SUPERIOR COURT OF JUSTICE

BETWEEN:

KEVIN SKOV

Plaintiff

– and –

G&K SERVICES CANADA INC. and G&K SERVICES, INC., A MINNESOTA CORPORATION

Defendants

Stephen M. Gillman, for the Plaintiff

Muneeza Sheikh, for the Defendants

HEARD: November 6, 2017

REASONS FOR DECISION

DIAMOND J.:

Overview

[1] On July 5, 2017, I heard argument of the plaintiff’s motion for summary judgment in this wrongful dismissal proceeding. By Endorsement released on July 12, 2017 as Skov v. G&K Services Canada Inc. 2017 ONSC 4284, I ordered a mini-trial on the issue of the plaintiff’s character of employment, as that issue was relevant to both (a) the determination of reasonable notice owing to the plaintiff, and (b) the plaintiff’s mitigation efforts.

[2] The mini-trial proceeded before me on November 6, 2017. In advance of the hearing, the plaintiff filed the additional affidavit of Rui Da Silva (“Da Silva”, a former employee of the defendants), and the defendants filed the additional affidavit of Michael Prowse (“Prowse”, another former employee of the defendants).

[3] During the hearing, the defendants cross-examined Da Silva while the plaintiff cross-examined Prowse, Lanny Rahman (“Rahman”, the defendants’ former director of financial operations) and Kevin Fancey (“Fancey”, the defendants’ former president). Rahman and Fancey previously swore affidavits in response to the plaintiff’s motion for summary judgment.

[4] None of the other affiants (over and above the plaintiff and Deen Maharaj, the defendants’ senior director of human resources) were cross-examined on their affidavits.

Summary of Key Evidence

[5] The issue argued before me was, in essence, whether the plaintiff held a management position as at the date of his termination, and if so what type of management position.

[6] A summary of the plaintiff’s evidence is set out in paragraphs 15-16 of my original Endorsement. The defendants’ position throughout this proceeding has been that the plaintiff’s job as at termination (Customer Development Manager) was bestowed upon him “in name only”, and was in reality no more than a “legacy appointment” due to the plaintiff’s lengthy service with the defendants.

a) Lanny Rahman

[7] Rahman was employed by the defendants for 11 years until his departure in September 2017. For approximately one year prior to the plaintiff’s termination, the plaintiff reported directly to Rahman. The plaintiff was in fact one of approximately 14 employees who reported directly to Rahman.

[8] Rahman testified that prior to the plaintiff being made part of Rahman’s team, the plaintiff had been underutilized as he was essentially responsible for data reformatting on a day to day basis. The plaintiff was never part of the defendants’ executive management team, and while the plaintiff did assist with certain projects, he never managed any of those projects.

[9] To the best of Rahman’s memory, the plaintiff held previous titles of Service Manager and Route Manager, but had not had any employees directly report to him since approximately 2009. The plaintiff attended General Managers’ meetings, but never attended any executive management team meetings.

[10] Rahman further testified that the plaintiff’s $120,000.00 annual salary was more reflective of his long term service than his actual position, which Rahman described as “honorary”.

[11] Rahman admitted that the plaintiff was eligible for and did receive a bonus under the defendants’ annual Management Incentive Plan, but other non-managerial employees were apparently eligible for that bonus as well.

[12] In re-examination, Rahman testified that after the plaintiff was terminated “life at work went on…and the plaintiff’s function was swallowed up by the system.” Rahman effectively viewed the plaintiff’s role as somewhat redundant.

b) Kevin Fancey

[13] Fancey was the defendants’ president (and previously its president in training) for nearly four years until he left in April 2017. Prior to the plaintiff reporting to Rahman, the plaintiff reported to Fancey for approximately one year. In Fancey’s view, the plaintiff’s title did not reflect his actual role and responsibilities as the plaintiff was used, for the most part, as analytical support.

[14] The plaintiff did not have anyone directly reporting to him. Fancey led the executive management team, and the plaintiff was not part of that team. The plaintiff did attend some meetings where project updates were required, as the plaintiff had the requisite knowledge to provide those updates. Fancey admitted that the plaintiff was, for all intents and purposes, the defendants’ corporate representative for certain projects, but acted more as a project co-coordinator than a project manager.

[15] Fancey described the plaintiff as a “master of data”, and the plaintiff usually travelled for the purpose of assisting with potential re-routing opportunities.

[16] According to Fancey, while the plaintiff was arguably paid like a low to mid-level manager, he was not a part of any leadership team. In fact, one of the reasons Fancey decided to have the plaintiff report directly to Rahman was that Fancey wanted to have only leaders directly report to him.

c) Michael Prowse

[17] Prowse was employed by the defendants between April 2004 and June 2017. He was the former Area General Manager for the defendants’ Scarborough locations, and was also responsible at one point for the South Central Ontario area.

[18] In his affidavit, Prowse stated that the plaintiff was not part of the senior management team, and that his functions were purely non-managerial. At paragraph 10 of his affidavit, Prowse “confirmed” that the plaintiff’s claim that he was a Director and General Manager with the defendants was “false”.

[19] Prowse further swore in his affidavit that the management incentive bonus received by the plaintiff was the “bare minimum entitlement for low level managers” within the defendants.

[20] In cross-examination, it became apparent that Prowse did not work at the same location(s) as the plaintiff, and only overlapped with the plaintiff at the defendants’ corporate head office for no more than a few months. Prowse admitted that most of his evidence was based upon his own observations and beliefs, and not necessarily first hand, personal knowledge. If the plaintiff was a manager at the date of his termination, Prowse believed that the plaintiff could not have been anything more than a low-level manager at best.

d) Rui Da Silva

[21] In his affidavit, Da Silva stated that he was a Service Manager who was ultimately promoted to the position of Branch Manager. Da Silva worked closely with the plaintiff as the plaintiff was his superior “throughout Da Silva’s employment with the defendant.”

[22] In 2006, the plaintiff trained Da Silva as a service manager and gave advice to the branch in which Da Silva was employed.

[23] Da Silva considered the plaintiff to be the “direct line of contact” for Da Silva and other employees to the senior management team. Da Silva did not agree that the plaintiff ever held the role of analyst “or any other type of non-managerial position”.

[24] In cross-examination, Da Silva testified that the plaintiff was “a superior”, but not Da Silva’s superior per se. At no time did Da Silva report directly to the plaintiff.

[25] At the time of the plaintiff’s termination, Da Silva understood the plaintiff to be a senior manager who worked with Fancey collecting and formatting information for the benefit of the defendants. Da Silva never knew that for approximately one year prior to the plaintiff’s termination, the plaintiff in fact reported directly to Rahman. Ultimately, Da Silva agreed that it was his assumption that the plaintiff was a senior manager.

What is a Manager?

[26] As stated above, the issue of whether the plaintiff held a management position as at his termination is relevant to the determination of (a) his damages for reasonable notice, and (b) whether the defendants have discharged their onus to prove that the plaintiff failed to mitigate his damages.

[27] The plaintiff continues to rely upon the Court of Appeal for Ontario’s decision in Di Tomaso v. Crown Metal Packaging Canada LP 2011 ONCA 469, and in particular for the proposition that the jurisprudence has distanced itself from the proposition that lower level, unskilled employees deserve less notice because they have an easier time finding alternative employment.

[28] In my view, whether or not the plaintiff held a management position as at his termination is still relevant, as the defendants take the position that the plaintiff’s contention that he was a manager is simply inaccurate. In support of the request that the Court fix reasonable notice at 24 months, it was the plaintiff who argued that he had a “senior and managerial role” as at termination. The defendants are merely responding to the plaintiff’s request that he be entitled to a resulting increased reasonable notice period.

[29] A manager is charged with exercising management functions. The hallmarks of being a manager include whether the employee had autonomy, discretion and authority in the conduct of the employer’s operation. The jurisprudence is clear that the nature of the work performed by the employee is more important than any title bestowed upon him/her. Managers are not liaisons between other employees and executive members who make significant decisions.

[30] In McCracken v. Canadian National Railway 2010 ONSC 4520, Justice Perrell heard a motion seeking certification under the Class Proceedings Act, 1992 S.O. 1992 c.C6 against Canadian National Railway (“CN”) for unlawfully classifying CN’s first line supervisors as managers and “depriving them of overtime and holiday wages payable under the Canada Labour Code R.S.C. 1985 C.L2 (“the Code”). While that decision dealt with employment matters under the Code, Justice Perrell’s comments are nevertheless quite apposite to the issue before me (citations omitted):

“The case law about who is a manager or who exercises a management function provides that this question is a question of fact for each case and in the context of the overall organization in which the person is employed.

Being a manager relates to the nature of the work actually performed.

An employee’s title or job description is not determinative of whether the employee is a manager, and his or her status is determined by what the employee does or has been charged to do in the business enterprise.

An essential element of being a manager is that the person performs an administrative and leadership role and not just an operational role in the organization.

The case law reveals that certain activities or functions are regarded as management functions, such as representing the employer in collective bargaining or in discipline or grievance procedure, setting a budget, determining the organization’s structure, determining the organization’s policies; controlling day‑to‑day operations; determining staffing levels, supervising and reviewing the performance of subordinates, hiring and firing employees, and dealing with emergencies, but the mere presence of these activities is not enough and they must be accompanied by a significant level of autonomy and real decision‑making authority and discretion.

The degree of autonomy and decision‑making authority needs to be significant, but it need not be absolute or unfettered, and a manager may have to report to and be supervised by more senior managers and officials in the organization.”

Did the Plaintiff hold a Management Position as at Termination?

[31] After hearing the evidence elicited at the mini-trial, I conclude that the plaintiff’s position as at termination was not “senior and managerial”. While the plaintiff did, on occasion, exert some minor discretionary efforts in fulfilling his role, his function did not cross over into that of a manager as defined by the jurisprudence.

[32] I find the evidence of Rahman and Fancey to be credible. The plaintiff’s job title was more of a legacy appointment due to his years of service. The plaintiff had no one directly reporting to him. Fancey testified that the decision to have the plaintiff start reporting to Rahman was so that Fancey could focus upon his day to day interaction with the managers (i.e. which excluded the plaintiff). While the plaintiff no doubt assisted with project updates, the nature of his efforts were not such that he was in control of either the employees or the project itself. The plaintiff acted more like a conduit on those projects than a manager, or even supervisor.

[33] The plaintiff no doubt benefited from his lengthy years of service with the defendants in not only being bestowed the title of Customer Development Manager, but participating (albeit at a lower end) in the defendants’ Management Incentive Plan. The plaintiff also enjoyed the use of his own office. However, such factors do not translate into the plaintiff actually performing management functions.

[34] On the record before me, I find that the plaintiff did not hold a management position as at the date of his termination.

What Reasonable Notice is due and owing to the Plaintiff?

[35] I repeat and rely upon paragraphs 12-13 in my original Endorsement. While I have found that the plaintiff did not hold a management position as at termination, his character of employment is still but one of the traditional Bardal factors to consider in the assessment of reasonable notice.

[36] There is no dispute that the plaintiff was 54 years of age and was employed by the defendants for nearly 21 years until his termination. Like most terminated employees, the plaintiff spent the majority of his adult life employed with the defendants and thus has not had to search for new employment for a long time.

[37] I have reviewed the numerous cases filed and relied upon by both parties. In my view, I find the decision of my colleague Justice Dunphy in Patterson v. IBM Canada Limited 2017 ONSC 1264 to be instructive and helpful. Mr. Patterson was employed by IBM for approximately 22 years, and was 67 years of age as at his termination. Mr. Patterson’s job prospects were admittedly slim, although he was employed in a non-managerial role. In awarding Mr. Patterson’s 18 months’ reasonable notice, Justice Dunphy held as follows:

“While I would be disinclined to descend into hair splitting on the weight to be afforded length of service when dealing with long serving employees, there is nevertheless a quantitative and qualitative difference to be made in terms of reasonable expectations between an employee with 30-40 years’ service as was the case in Quinn, Waterman, Lee and Liboiron on the one hand and an employee in Mr. Patterson’s situation with only 22 years’ service on the other. They are all long service cases, but some recognition of those additional years of service is called for. These cases imply a range of reasonable notice for Mr. Patterson that ought to be somewhat lower than the 20 and 21 month range used in those cases. The Court of Appeal decision in Kotecha also points towards a range closer to 18 months on these facts and urges me strive to be consistent with precedent in the ranges considered. “

[38] In my view, having regard to the traditional Bardal criteria, I find the appropriate period of reasonable notice to be 18 months. This figure shall be reduced by the amount of termination and severance pay which the defendants have already paid the plaintiff in accordance with the Employment Standards Act 2000 S.O. c.411.

Should Reasonable Notice be Reduced due to an Alleged Failure to Mitigate?

[39] As set out in paragraph 24 of my original Endorsement, there is no dispute that (a) post-termination, the plaintiff created an updated resume which listed his last position with the defendants as Director of Process Improvement and Customer Development, and (b) the plaintiff never held any such position during his entire employment with the defendants.

[40] I repeat and rely upon paragraph 14 in my original Endorsement. As held in Carter v. 1657593 Ontario Inc. ONCA 23, the Court may consider the employee’s age and the fact that the employee had worked for the same employer for most of his/her adult life in the assessment of mitigation efforts.

[41] As recently held by my colleague Justice Glustein in Benjamin v. Cascades Canada ULC 2017 ONSC 2583, in order for an employer to discharge its onus of proving that an employee failed to mitigate, the employer must establish:

(a) that the employee did not take reasonable steps to seek comparable employment “by the exercise of proper industry in the search”; and

(b) had the employee taken those reasonable steps, he/she “could have procured” such comparable employment.

[42] The evidence discloses that the plaintiff applied for 43 managerial positions through the LinkedIn platform. However, it was his LinkedIn profile which described his final position with the defendants as Director of Process Improvement and Customer Development.

[43] Over and above his use of the LinkedIn platform, the plaintiff applied to an additional (approximate) 80 managerial positions. Some of those positions were for the roles of vice-president or director. The defendants argue that none of the managerial positions applied for by the plaintiff were comparable with his actual position of “data analyst”, and as such the plaintiff’s damages for reasonable notice ought to be significantly reduced.

[44] I have already found that the plaintiff did not hold a management position as at the date of his termination. That said, even if his resume (LinkedIn or otherwise) was prepared correctly, he would still have had to represent all potential future employers that, at least in title, his last position was that of Customer Development Manager.

[45] While his particular experience and skill set may have narrowed the type of managerial role (if any) he could fill with a new employer, the defendants argue that the plaintiff had an obligation to “correct the record” and describe himself to future employers as something other than what was effectively printed on his business card. The difficulty I have with the defendants’ position is that the “record” sought to be corrected was created by the defendants, and I believe it reasonable to conclude that the plaintiff likely had a subjective, honest belief that he could find comparable employment in some type of management role.

[46] That said, there is no dispute that the plaintiff’s LinkedIn’s resume was inaccurate, as the plaintiff never held any Director position with the defendants. I do agree with the defendants that the plaintiff’s mitigation efforts were compromised by his decision to “overshoot” and seek employment in a position which was simply not comparable with his actual duties, responsibilities and abilities. The Court cannot and should not condone this type of misrepresentation, especially given that the plaintiff did not offer a satisfactory explanation for doing so.

[47] As a result, I cannot find that the plaintiff reasonably mitigated his damages through his creation of an inaccurate resume and his decision to apply for incomparable positions. For the most part, the plaintiff did not attempt to secure a job for which he was qualified, and he knew or ought to have known same. As a result, I reduce his reasonable notice period by two months and award the plaintiff net damages in the amount of 16 months.

[48] The parties have already agreed upon the plaintiff’s total remuneration as at the date of his termination. As more than 16 months have passed since the date of the plaintiff’s termination, any concerns with respect to whether and how to apply the Trust and Accounting approach for ongoing payments is not triggered.

Costs

[49] I would strongly recommend that the parties exert the necessary efforts to try and resolve the costs of this motion, and the action itself.

[50] If such efforts prove unsuccessful, the plaintiff may serve and file written costs submissions (totaling no more than four pages including a Costs Outline) within 10 business days of the release of these Reasons.

[51] The defendants shall thereafter serve and file their responding costs submissions (also totaling no more than four pages including a Costs Outline) within 10 business days from the receipt of the plaintiff’s costs submissions.

Diamond J.

Released: November 14, 2017

CITATION: Skov v. G&K Services Canada Inc., 2017 ONSC 6752

COURT FILE NO.: CV-16-556560

DATE: 20171114

ONTARIO

SUPERIOR COURT OF JUSTICE

BETWEEN:

KEVIN SKOV

Plaintiff

– and –

G&K SERVICES CANADA INC. and G&K SERVICES, INC., A MINNESOTA CORPORATION

Defendants

REASONS FOR DECISION

Diamond J.

Released: November 14, 2017