Court File and Parties

COURT FILE NO.: CV-18-594326 DATE: 20190415 SUPERIOR COURT OF JUSTICE - ONTARIO

RE: RISHI DREPAUL, Plaintiff AND: MIKLA FOODS CANADA INC. o/a TASTY SELECTIONS

BEFORE: MR. JUSTICE CHALMERS

COUNSEL: S. Chaudhri, for the Plaintiff S. Bernofsky and D. Saturno for the Defendant

HEARD: March 28, 2019

Endorsement

Overview

[1] Rishi Drepaul was terminated without cause from his employment as a Processing Improvements Coordinator with Tasty Selections on April 12, 2016. When he was dismissed Mr. Drepaul was provided with 9 weeks in lieu of notice.

[2] The following issues are to be determined on this motion:

a. Was Mr. Drepaul wrongfully dismissed, and if so, what is the appropriate length of notice? b. What was Mr. Drepaul’s total remuneration at the time of termination? c. Are Employment Insurance (EI) Benefits deducted from the amount of pay in lieu of notice?

[3] For the reasons set out below, I find that Mr. Drepaul was wrongfully dismissed from his employment with Tasty Selections, and that he is entitled to 11 months salary in lieu of notice. In determining the total remuneration I find that the benefits are reasonably estimated to be 10% of his income. I also find that EI benefits are not deducted from the award.

Analysis

Is This an Appropriate Case for Summary Judgment?

[4] Summary Judgment is appropriate if the judge on a motion is able to reach a fair and just determination on the merits. This will be the case if, on the written record, the judge is able to make the necessary findings of fact, to apply the law to the facts, and the motion is a proportionate, expeditious and less expensive means to achieve a fair result: Hryniak v. Mauldin, 2014 SCC 7.

[5] The parties both take the position that this is an appropriate case to be determined by Summary Judgment.

[6] I am satisfied that on the basis of the record before me, there is no genuine issue that requires a trial and as a result, Summary Judgment is appropriate in the circumstances of this case.

Was Mr. Drepaul Wrongfully Dismissed, and What is the Appropriate Notice Period?

[7] In this case, Mr. Drepaul was provided with 9 weeks in lieu of notice. I find that this payment in lieu of notice was not sufficient in all of the circumstances.

[8] In determining the appropriate amount of notice, the criteria to be considered is set out in Bardal v. The Globe and Mail Ltd. (1960), 24 D.L.R. (2d) 140 (Ont. H.C.). The Bardal criteria include the Plaintiff’s length of service, age, character of employment, and the availability of similar employment having regard to the employee’s experience, training and qualifications. The determination of the appropriate notice period is “an art and not a science”, and turns on the circumstances of each case.

(a) Length of Service

[9] Tasty Selections is taking the position that for the first year Mr. Drepaul was involved with Tasty Services, he was an independent contractor providing consulting services, and not an employee. Tasty Selections is taking the position that the length of service does not include the period of consulting.

[10] Mr. Drepaul first started providing services for Tasty Selections in January 2013. From January 1, 2013 to January 1, 2014, Tasty Selections paid invoices submitted by Mr. Drepaul. He was paid on a flat rate of $5,000 per month. Tasty Selections did not make any deductions at source. Starting January 2014, the way in which Mr. Drepaul was paid changed. After that date he received a salary of $80,000.

[11] Mr. Drepaul deposes in his affidavit, sworn on January 8, 2019, that although the method of payment changed as of January 2014, all other aspects of his relationship with Tasty Selections were the same. He deposed at paragraph 4 that he commenced employment with Tasty Selections in January 2013 and worked continuously on a full-time basis until he was terminated on April 12, 2016. He was not cross examined.

[12] The test to determine whether the nature of the relationship is one of independent contractor or employee is set out in Duynstee v. Sobeys Inc., 2013 ONSC 2050, at para. 27. In that case the court noted that the relevant factors are as follows:

(i) whether the agent was limited exclusively to the service of the principal; (ii) whether the agent is subject to the control of the principal; (iii) whether the agent has an investment or interest in the “tools” relating to his service; (iv) whether the agent has any risk in the business sense; and (v) whether the agent’s activity is partly the principal’s business organization.

[13] Although the above criteria can provide guidance, it is necessary to consider the overall nature of the relationship.

[14] There was very little evidence in the record with respect to the relationship between Mr. Drepaul and Tasty Selections. The only evidence put forward by Tasty Selections to support its position that the Plaintiff was not an employee for the period starting from January 2013 to January 2014 is the fact that over this period of time he was paid on a flat monthly rate basis. There was no evidence with respect to any of the criteria set out in the Duynstee case referred to above.

[15] The manner in which Mr. Drepaul was paid is not determinative of whether, for the first year of the relationship, he was an employee or independent contractor. Based on the evidence before me, the nature of the services provided by Mr. Drepaul was the same from January 1, 2013 until the date of his termination. Over that period of time he worked continuously as a Processing Improvements Coordinator.

[16] I find that Mr. Drepaul was continuously employed on a full-time basis with Tasty Selections from January 2013 until the termination of his employment on April 12, 2016; a period of 3 years and 3½ months.

(b) Age

[17] Mr. Drepaul’s age at the time of termination was 65 years of age.

[18] Courts have recognized that an older employee may be entitled to a longer period of notice. The reason is because an older employee may have more difficulty than a younger person in obtaining alternative employment: Manastersky v. Royal Bank of Canada, 2018 ONSC 966.

(c) Character of Employment

[19] There was very little evidence before me with respect to the character of Mr. Drepaul’s employment. In his affidavit, Mr. Drepaul deposes that he was a Processing Improvements Co-ordinator. Based on the 2015 T4 Statement, his annual income was $80,882. There is no evidence as to his responsibilities.

[20] Based on the lack of evidence on this point, I am unable to make any findings as to the character of Mr. Drepaul’s employment other than the fact that his job title and level of income suggests a mid-level position.

(d) Availability of Similar Employment

[21] The ability of the employee to obtain alternative employment is a relevant factor in determining the appropriate notice period. A longer notice period may be appropriate if there are limited employment opportunities available to the dismissed employee.

[22] Mr. Drepaul argues that given his age and experience, there are no similar employment opportunities available. He makes reference to the fact that since the termination from his employment he has been unable to obtain even an interview from a prospective employer despite a fairly significant job search.

[23] Mr. Drepaul, in his affidavit, included his employment log which set out 230 applications and many follow up enquiries. Although Tasty Selections argued that there is limited information with respect to the jobs he may have applied for, there was no cross-examination of Mr. Drepaul. I am satisfied that Mr. Drepaul made diligent efforts to obtain alternative employment, but has been unsuccessful.

[24] Mr. Drepaul’s experience with respect to his job search, supports his position that there was limited availability of similar employment, given his experience, training and qualifications.

(e) Disposition on Notice Period

[25] I conclude that the “Bardal” factors that apply in this case are as follows:

a. Mr. Drepaul’s length of service is from January 1, 2013 to April 12, 2016; a period of 3 years, 3½ months; b. at the time of termination, Mr. Drepaul was 65 years of age; c. he was employed in a mid-level position as a Processing Improvements Co-ordinator, earning $80,882/year; and, d. there was limited availability of similar employment as evidenced by the fact that the Mr. Drepaul was unsuccessful in his job search despite his diligent efforts.

[26] Counsel referred me to a number of cases which set out reasonable notice periods. Although reference to other cases can provide some guidance, each case turns on its particular facts.

[27] The case I found most helpful was Barton v. Rona Ontario Inc., 2012 ONSC 3809. The facts in that case are quite similar to the case before me. In Barton, the Plaintiff was employed as an assistant store manager. He was earning over $70,000 per year. He had been employed for a period of 3 years and 8 months. He was 64 years of age at the time of his dismissal. The court considered all of the “Bardal” factors and concluded that the appropriate notice period was 10 months.

[28] In Barton, the Plaintiff’s age, level of income and length of service were similar to Mr. Drepaul, however in that case Mr. Barton had been successful in finding alternative employment within 12 months from the date of his termination. As stated above, Mr. Drepaul continues to be unemployed now almost 3 years after his termination, despite his persistent efforts. This is a factor which would support a longer notice period for Mr. Drepaul than as set out in the Barton case.

[29] Based on my consideration of the Bardal factors as set out above, I conclude that Mr. Drepaul is entitled to a notice period of 11 months.

Mr. Drepaul’s Total Remuneration at the Time of Termination

[30] Mr. Drepaul’s salary at the time of his termination was $80,882, plus benefits. There is no evidence as to the cost of providing the benefits.

[31] Mr. Drepaul is taking the position that, in the absence of any evidence as to the cost of the benefits, a reasonable estimate is 10% of his salary: Saikaly v. Akman Construction Ltd., 2019 ONSC 799.

[32] Tasty Selections, takes the position that the cost of the benefits package available to the Plaintiff was $450 per month. There is no evidence put forward by Tasty Selections to support this amount. The cost of the benefits would have been within the knowledge of Tasty Selections. I draw an adverse inference from the failure of Tasty Selections to adduce any evidence with respect to the cost of the benefits.

[33] In the absence of any evidence as to the cost of the benefits, I conclude that 10% of Drepaul’s annual salary is a reasonable estimate. I therefore value the benefits at $8,088.20 per year. As a result, Mr. Drepaul’s total remuneration at the time of his termination was $88,970.20.

Deduction of EI Benefits

[34] Tasty Selections argues that any damages awarded to Mr. Drepaul are to be reduced by the amounts Mr. Drepaul received in EI benefits since his termination.

[35] The issue of the deductibility of EI benefits from wrongful dismissal damages was considered by the Ontario Court of Appeal in Brake v. PJ-M2R Restaurant Inc., 2017 ONCA 402. The Court of Appeal held that; “the law is clear: EI benefits are not to be deducted from damages awarded for wrongful dismissal. (para. 101)”.

[36] I conclude on the basis of the Brake decision, that any EI benefits received by Mr. Drepaul following the termination of his employment are not deducted from the wrongful dismissal damages award.

Conclusions

[37] For the foregoing reasons, I conclude as follows:

(1) Mr. Drepaul is entitled to 11 months pay in lieu of notice. (2) Mr. Drepaul’s salary at the time of termination was $80,882 per year. The reasonable estimate of the cost of his benefits is 10% of his annual salary, or $8,088. Therefore his total remuneration at the time of the termination was $88,970 per year. (3) EI benefits received by Mr. Drepaul following termination shall not be deducted from this award.

Disposition

[38] Tasty Selections is ordered to pay Mr. Drepaul eleven months in lieu of notice. Eleven months’ notice is $81,495.53. From this amount will be deducted the 9 weeks salary which was paid to Mr. Drepaul at the time of his termination. Based on the Record of Employment, dated April 18, 2016, the amount paid on termination was $10,066.04. Therefore judgment is in the amount of $71,429.29, plus pre and post-judgment interest in accordance with the Courts of Justice Act.

[39] Mr. Drepaul is presumptively entitled to costs. If the parties are unable to agree on costs, Mr. Drepaul may make written submissions of no more than three pages (excluding Offers to Settle or Bills of Costs) within 21 days of the date of these reasons. Tasty Selections may provide responding written submissions on the same basis, within 21 days of receiving Mr. Drepaul’s cost submissions.

Chalmers, J. Date: April 15, 2019