COURT FILE NO.: CV-17-578834
DATE: 2019/01/24
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
KELLY CORMIER
Plaintiff
– and –
1772887 ONTARIO LIMITED carrying on business as ST. JOSEPH COMMUNICATIONS
Defendant
Christopher Perri and Alex St. John for the plaintiff
Damien Buntsma for the defendant
HEARD: January 17, 2019
PERELL, J.
REASONS FOR DECISION
A. Introduction
[1] This is a summary judgment motion in a wrongful dismissal action. The Plaintiff, Kelly Cormier, sues her former employer 1772887 Ontario Limited, which carries on business as St. Joseph Communications.
[2] Ms. Cormier was dismissed without cause, and she claims $136,577.75 in damages. This claim is based on an almost twenty-three-year workplace relationship. She submits that she is entitled to twenty-four months of pay and benefits in lieu of reasonable notice, and she claims reimbursement of $3,264 that she submits was wrongfully deducted from her salary while she was an employee.
[3] St. Joseph Communications submits that the case is not appropriate for a summary judgment, unless it is a summary judgment for St. Joseph’s communications dismissing Ms. Cormier’s action.
[4] St. Joseph Communications denies that Ms. Cormier is entitled to any reimbursement, and it denies that she is entitled to any damages for wrongful dismissal. It submits that Ms. Cormier was an employee only for ten years and not for almost twenty-three years. It submits that Ms. Cormier was an independent contractor for the first ten years of their relationship and that she has only been an employee for thirteen years. St. Joseph Communications submits that Ms. Cormier has received all her entitlements, and in this regard, it relies on termination clauses in the employment contracts signed by Ms. Cormier in 2008 and 2012 as rebutting the common law presumption that Ms. Cormier is entitled to pay in lieu of notice.
[5] In the alternative, St. Joseph submits that if Ms. Cormier is entitled to pay in lieu of reasonable notice, the appropriate notice period would be twelve and not twenty-four months.
[6] For the reasons that follow, I grant Ms. Cormier a judgment for $112,863.75, plus prejudgment and postjudgment interest.
B. Facts
[7] St. Joseph Communications is an Ontario corporation that carries on business across Canada in marketing and advertising.
[8] Ms. Cormier graduated from college in 1989, and she began a career in the marketing and advertising industry. In 1994, she began to do work for St. Joseph Communications.
[9] In 1994, pursuant to an oral employment contract, St. Joseph Communications retained Ms. Cormier as a Freelance Wardrobe Stylist. Ms. Cormier submits that she became an employee of St. Joseph Communications. However, St. Joseph Communications submits that she was an independent contractor; or, in the alternative, it submits that there is a genuine issue requiring a trial as to Ms. Cormier’s employment status in between 1994 and 2004.
[10] As a Freelance Wardrobe Stylist, Ms. Cormier’s job was to select the clothing and accessories for the models used in St. Joseph Communication’s advertisements and promotions. St. Joseph Communications purchased the clothing and hired the models. It supplied Ms. Cormier with an iron to press the garments. The assignments came from St. Joseph Communications and she was compensated on an hourly basis or sometimes on a project basis. Her work arrangements were made more or less day-to-day.
[11] Between 1996 and 2004, except for the months of May and November, which are said to be slow periods for the advertising industry, Ms. Cormier worked approximately 37 to 40 hours per week and exclusively for St. Joseph Communications. During this period, in the slow periods, she worked less than 37 hours per week for St. Joseph Communications and she did occasionally work for others.
[12] After 2004 and until to 2006, she worked exclusively for St. Joseph Communications during the busy and slow periods.
[13] Between 1996 and 2004, Ms. Cormier invoiced St. Joseph Communications weekly as if she was a sole proprietorship. St. Joseph Communications did not withhold any amounts for taxes, or any other amounts, nor did it make any payments for items that would typically be paid to employees. Ms. Cormier does appear to have held herself out as a sole proprietor, and St. Joseph Communications did not hold her out as its employee or agent and she had no administrative, managerial, or business responsibilities at St. Joseph Communications.
[14] On June 3, 2004, St. Joseph Communications hired Ms. Cormier as a Wardrobe Stylist pursuant to a written employment contract, under which she received an annual salary of $54,000 paid bi-weekly. There is no dispute that Ms. Cormier was an employee as of and after June 3, 2004.
[15] On January 16, 2008, Ms. Cormier was promoted to the position of Fashion Studio Producer. She signed an employment contract dated January 16, 2008, under which she received an annual salary of $65,000 paid bi-weekly. For reasons that will become apparent below, it is necessary to note that the 2008 Employment Contract contained the following termination clause.
Termination:
It is always difficult to consider termination when a new relationship is beginning. After completion of your probationary period, the Company may terminate your employment at its sole discretion, for any reason, without cause, upon providing to you the greater of (i) or (ii) below:
(i) two weeks of advance notice in writing (or at the Company’s option, two weeks of salary as pay in lieu of notice) and subject to the consent of the Company’s insurers, employment benefits continuation for two weeks or
(ii) advance notice in writing (or, the equivalent pay in lieu of notice) -required by the Employment Standards Act, plus twice the amount of severance pay, if any, required by the Employment Standards Act plus employment benefits continuation for the period required by the Employment Standards Act.
The decision to provide actual notice of termination or pay in lieu of such notice or any combination thereof shall be in the sole discretion of the Company. Pay in lieu of notice will be subject to all required tax withholdings and statutory deductions and will be provided by way of salary continuance as per our regular payroll.
You may be terminated for “cause” at any time, without notice or pay in lieu of such notice. “Cause” for this purpose includes such things as unsatisfactory performance, dishonesty, insubordination, serious misconduct, and a false statement on either your resume or employment application, as well as anything else which constitute cause at law.
[16] On September 19, 2012, Ms. Cormier was promoted to the position of Fashion Studio Manager. She became responsible for managing the fashion team comprised of thirteen employees and approximately eighty freelance contractors who intermittently were retained on advertising and marketing projects.
[17] On September 19, 2012, with her new promotion, she signed a new employment contract. Her annual salary was $85,000 payable bi-weekly. She received a $113 per month allowance for a cellular phone. She was enrolled in St. Joseph Communication’s group employee benefits plan, which included health, dental, life, and disability insurance coverage.
[18] For present purposes, the relevant terms of the September 19, 2012 employment contract are set out below:
[…] The following outlines the terms and conditions of employment with [St. Joseph Communications].
Recognition of Past Service
Your original hire date of June 7, 2004 will be recognized as your start date for the calculation of your years of service, vacation entitlement and heath care benefits under this agreement.
Severability
In the event that any provision of this Agreement is found to be void, invalid, illegal or unenforceable by a court of competent jurisdiction, such finding will not affect any other provision of this Agreement, which will continue in full force and effect.
Waiver
The waiver by either party of any breach or violation of any provision of this Agreement shall not operate or be construed as a waiver of any subsequent breach or violation.
Modification of Agreement
Any modification of this Agreement must be in writing and signed by both you and the Company or it shall have no effect and shall be void.
Termination without Cause
(a) The Company may terminate your employment at its sole discretion, at any time for any reason, without cause, upon providing you the minimum notice, pay in lieu of notice and/or severance pay required by the Ontario Employment Standards Act, 2000, as amended from time to time. You will have no other entitlement to notice of termination, pay in lieu of such notice, and/or severance pay.
(b) In addition to the foregoing and subject to the consent of the Company's insurers, you will be entitled to continue to receive Company benefits (excluding STD and LTD benefits) during the notice period specified above.
The decision to provide actual notice of termination or pay in lieu of such notice or any combination thereof shall be in the sole discretion of the Company. Pay in lieu will be subject to all required tax withholdings and statutory decisions and will be provided by way of salary continuation as per our regular payroll.
These payments are all inclusive of all amounts owing to you under the Ontario Employment Standards Act or other applicable legislation. Your receipt of any payments is conditional upon your signing the Company’s form of Release.
Non-Solicitation
You agree with and for the benefit of the Company that for a period of twelve (12) months following the termination of your employment (whether such termination is occasioned by you, by the company with or without cause, or by mutual agreement), you will not, for any reason whatsoever, directly or indirectly, solicit or accept business with respect to products/ services in which you traded on behalf of the Company from any of the Company's clients or customers, wherever situated, with whom you had direct contact in the twelve (12) preceding the termination of your employment. You further agree that during employment pursuant to this Agreement and for a period of twelve (12) months following the termination of your employment (whether such termination is occasioned by you, by the Company with or without cause, or by mutual agreement), you will not hire or take away or cause to be lured or taken away any employee of the Company for the purposes of employment in any business related to or competitive with the business of the Company.
Non-Competition
You agree with and for the benefit of the Company that for a period of six months following termination of your employment (whether such termination is occasioned by you, by the Company with or without cause, or by mutual agreement) within the geographical area of Ontario, either as an individual or as a partner or joint venturer or as an employee, sales representative, principal, consultant, agent, shareholder, officer or director, or for any person, firm, association, organization, syndicate, company or corporation, or in any other manner whatsoever, directly or indirectly, you will not carry on, be engaged in, concerned with, interested in, advise, lend money to, guarantee the debts or obligation of, or permit your name of any part thereof to be used or employed in a business which is the same as, or competitive with, the business of the Company.
Please review the Agreement carefully. If, after reading it and considering the contents, you are prepared to accept employment with the Company in accordance with the terms and conditions contained herein, please indicate your acceptance by signing your name where indicated and returning one copy to me.
EMPLOYEE'S AGREEMENT
[...] I accept employment with St. Joseph Content-Pi Media, on the terms and conditions set out in this letter, including those related to the termination of my employment. I understand and agree that this letter constitutes the entire agreement between myself and St. Joseph Content-Pi Media, with respect to my employment with St. Joseph Content-Pi Media and supersedes all prior commitments or understanding (written or oral) with respect to the matters provided for herein.
[19] For the next almost four years, nothing of significance to this action occurred, until on June 28, 2016, Ms. Cormier received a letter from St. Joseph Communication's Chief Executive Officer advising that as a cost-savings’ measure, the company had introduced an unpaid vacation program in which two weeks of additional vacation would be unpaid vacation. The letter stated:
Over the past year, we have witnessed a continuing decline in the traditional Canadian print, media and retail marketplace. Several large retailers such as Target and Future Shop have closed down their operations in Canada while other retailers such as Sears, Chapters and Grand & Toy have reduced their presence in Canada by eliminating a number of locations. Some of our industry peers such as Rogers, Bell, Torstar and Postmedia have all announced major staff reduction programs affecting hundreds of employees in the industry.
Earlier this year, we made some difficult decisions to implement some temporary and permanent layoffs. While these measures were regrettably unavoidable, they served as a stark reminder that the company was indeed feeling the impact of a less robust economy and a changing marketplace
[20] While Ms. Cormier was unhappy and disappointed by the unpaid vacation program, she did not protest or quit her employment and she participated in the program for an unpaid two-week vacation.
[21] To implement the unpaid vacation program, St. Joseph Communications deducted $125.54 from each of Ms. Cormier's biweekly payroll deposits beginning on July 1, 2016 until the end of her employment. In this action, Ms. Cormier claims $3,264 as reimbursement for these deductions, which deductions, she submits contravene s. 13 of the Employment Standards Act, 2000.[^1]
[22] The next event of significance occurred on June 1, 2017, when Ms. Cormier and approximately eighty other employees received written notice that their employment was terminated without cause effective October 27, 2017 (five months’ working notice). The background explanation for the dismissals was that St. Joseph Communications advertising business was harmed by the liquidation of Sears, one of its major clients. The letter stated:
Dear Kelly,
Re Notice of Termination
It is with regret that I inform you that as a result of the loss of a significant client, your employment with the Company will terminate effective Friday October 27, 2017.
This notice is given to you pursuant to the Employment Standards Act, 2000. During your working notice period, it is our expectation that you will continue to meet job standards for performance and attendance.
If you elect to resign your employment prior to October 27, 2017 you will be paid for any hours worked and accrued vacation entitlement up to and including your final day of employment.
The Company intends to offer a termination package based on tenure and the period of working notice. We will be in contact with you in respect of your specific details just prior to the end of your working notice end date of October 27, 2017.
We wish to take this opportunity to thank you for your service with us and wish you well in all future endeavors.
[23] Ms. Cormier began her working notice, but on July 6, 2017, St. Joseph Communications wrote to inform her that it was waiving the balance of the working notice and that her termination would become effective on July 7, 2017. She received a severance package offer, which she did not accept. The letter of July 6, 2017 stated:
Dear Kelly:
We are writing further to our letter of June 1 | 2017, in which we advised you of the termination of your employment with St. Joseph Communications (the ('Company") effective October 27, 2017. Unfortunately, with the insolvency of Sears, we no longer have sufficient work for you to perform until that date. As a result, this letter is to advise you that your termination date will be moved up to July 6, 2017 (the "Termination Date").
You have already been provided with 5 weeks of working notice. In lieu of further working notice, the Company will provide you with the following severance arrangements:
You will be paid all salary earned up to the Termination Date through payroll continuance.
You will be paid your current salary for an additional 3 weeks bringing your total notice or pay in lieu of notice to 8 weeks. This payment will be made through payroll continuance.
You will be paid any outstanding vacation pay accrued up to the end of your 8-week notice period (July 26, 2017). If you have been overpaid vacation pay, the amount of the overpayment will be deducted from your severance pay.
You will be paid any accrued Mandatory Unpaid Days that have not been taken.
After the above payroll continuance has finished and on the last pay, we will pay you 2x the ESA severance of 13 weeks for a total Lump Sum payment of 26 weeks base salary as per your current employment agreement.
Your coverage under the Company group benefits plan will be continue until July 26, 2017. Benefit premium deductions will continue for such time period.
[24] Ms. Cormier’s last day of work was July 6, 2017, and since July 7, 2017 until this date she has been unable to find new employment despite her efforts to do so. She says that her efforts to search for new employment were hampered by the non-competition and non‑solicitation clauses in her employment contract. She investigated and applied for jobs outside of the marketing and advertising industry, but she was unsuccessful in finding new employment. She has been unable to find employment or freelance work in advertising and marketing.
[25] Ms. Cormier was 52-years old at the time of her termination. Since June 1, 2017, St. Joseph Communications has paid to her the total sum of $55,576.92 as a combination of working notice and pay in lieu of notice (35 weeks, approximately 8 months).
[26] On July 13, 2017, Ms. Cormier commenced an action for damages for wrongful dismissal.
[27] Ms. Cormier claims $136,577.75 calculated as follows:
a. Pay in lieu of reasonable notice (24 months) $170,000
b. Damages for loss of benefits (10% of base salary) $17,000
c. Cellphone allowance (24 months) - $2,712
d. Reimbursement for deductions for the unpaid vacation program - $3,264
e. Less 1-month cellphone allowance during working notice - $113
f. Less 1-month benefits during working notice - $708.33
g. Less salary amounts paid by Employer to date - $55,576.92
C. Legislation
[28] For present purposes, the relevant provisions of the Employment Standards Act, 2000 are set out in Schedule “A” to these Reasons for Decision.
D. Discussion
1. Is the Case Appropriate for a Summary Judgment?
[29] Rule 20.04(2)(a) of the Rules of Civil Procedure provides that the court shall grant summary judgment if: “the court is satisfied that there is no genuine issue requiring a trial with respect to a claim or defence.” With amendments to Rule 20 introduced in 2010, the powers of the court to grant summary judgment have been enhanced. Rule 20.04 (2.1) states:
20.04 (2.1) In determining under clause (2)(a) whether there is a genuine issue requiring a trial, the court shall consider the evidence submitted by the parties and, if the determination is being made by a judge, the judge may exercise any of the following powers for the purpose, unless it is in the interest of justice for such powers to be exercised only at a trial:
Weighing the evidence.
Evaluating the credibility of a deponent.
Drawing any reasonable inference from the evidence.
[30] In Hryniak v. Mauldin[^2] and Bruno Appliance and Furniture, Inc. v. Hryniak,[^3] the Supreme Court of Canada held that on a motion for summary judgment under Rule 20, the court should first determine if there is a genuine issue requiring trial based only on the evidence in the motion record, without using the fact-finding powers introduced when Rule 20 was amended in 2010. The analysis of whether there is a genuine issue requiring a trial should be done by reviewing the factual record and granting a summary judgment if there is sufficient evidence to fairly and justly adjudicate the dispute and a summary judgment would be a timely, affordable and proportionate procedure.
[31] If, however, there appears to be a genuine issue requiring a trial, then the court should determine if the need for a trial can be avoided by using the powers under rules 20.04 (2.1) and (2.2). As a matter of discretion, the motions judge may use those powers, provided that their use is not against the interest of justice. Their use will not be against the interest of justice if their use will lead to a fair and just result and will serve the goals of timeliness, affordability, and proportionality in light of the litigation as a whole. To grant summary judgment, on a review of the record, the motions judge must be of the view that sufficient evidence has been presented on all relevant points to allow him or her to draw the inferences necessary to make dispositive findings and to fairly and justly adjudicate the issues in the case.[^4]
[32] Hryniak v. Mauldin does not alter the principle that the court will assume that the parties have placed before it, in some form, all of the evidence that will be available for trial. The court is entitled to assume that the parties have advanced their best case and that the record contains all the evidence that the parties will present at trial.[^5] Thus, if the moving party meets the evidentiary burden of producing evidence on which the court could conclude that there is no genuine issue of material fact requiring a trial, the responding party must either refute or counter the moving party’s evidence or risk a summary judgment.[^6]
[33] In my opinion, in the immediate case, there are no genuine issues requiring a trial and the case at bar is an appropriate case for a summary judgment. It is further my opinion that if there were genuine issues requiring a trial, then there is a more than adequate evidentiary record to decide the genuine issues and it would be in the interests of justice to do so.
[34] As matters of factual dispute, the issues are how to characterize the almost twenty-three year workplace relationship between Ms. Cormier and St. Joseph Communications and whether Ms. Cormier failed to mitigate her damages.
[35] As to the characterization of the relationship between Ms. Cormier and St. Joseph Communications, there is no dispute that for the period between 2006 to 2017 Ms. Cormier was an employee. The dispute between the parties is about the period between 1994 and 2006, for which Ms. Cormier submits that she was an employee or a dependent contractor. In contrast, St. Joseph Communications submits that Ms. Cormier was an independent contractor. As I shall explain below, I find that during the period between 1994 and 2006, Ms. Cormier was a dependent contractor. How this characterization of her relationship affects the calculation of damages will also be explained below. The point to note here is that there is no genuine issue requiring a trial about Ms. Cormier’s employment status for the period between 1994 and 2006.
[36] As to whether there was a failure to mitigate, as I shall explain below, I find that there was no failure to mitigate. In any event, once again, there is no genuine issue requiring a trial.
[37] In this case, there are no significant issues of credibility and the remaining issues for the summary judgment motion are essentially matters of contract and statutory interpretation where the court has an adequate evidentiary record. Moreover, there have been cross-examinations with respect to all of the factual issues, and it appears that the parties have done their best to put forward what they have by way of records and documents; the quantity and the quality of the evidence will not appreciably be enhanced by a trial. In short, a trial is not required to decide this case.
[38] I, therefore, conclude that the case is appropriate for a summary judgment.
2. Employee Status
[39] Turning now to the matter of Ms. Cormier’s employment status, there are three types or classes of workplace relationships;[^7] namely (1) employer-employee (master-servant); (2) contractor-independent contractor, and (3) contractor-dependent contractor, which is an intermediate classification where the relationship of master and servant does not exist but where an agreement to terminate the arrangement upon reasonable notice may be implied.[^8]
[40] In McKee v. Reid’s Heritage Homes Ltd.,[^9] the Court of Appeal described the methodology or analytical approach to the determination of the worker relationship. The first step is to determine whether or not the worker is an employee or a contractor in accordance with the established methodology and criteria for differentiating an employee from an independent contractor. The analysis of the classification of the relationship ends if the worker is determined to be an employee. However, if the worker is determined to be a contractor, the second step of the analysis is to determine whether he or she is a dependent or an independent contractor.
[41] The leading cases for the first step of differentiating employees from contractors, be they independent or dependent contractors (which is the focus of the second step of the analysis) are: Montreal v. Montreal Locomotive Works Ltd.,[^10] 671122 Ontario Ltd. v. Sagaz Industries Canada Inc.,[^11] Belton v. Liberty Insurance Co. of Canada,[^12] and Braiden v. La-Z-Boy Canada Ltd.[^13]
[42] The employee versus contractor cases establish that there is no litmus test or formula for determining the classification of the worker, and, rather, there is a non-comprehensive list of relevant criteria or factors which should be analyzed on a case-by-case basis to determine the true legal nature of the relationship. In determining whether the worker is an employee or contractor, the court must consider: (a) the intentions of the parties; (b) how the parties themselves regarded the relationships; (c) the behaviour of the parties toward each other; and (d) the manner of conducting their business with one another.[^14]
[43] In Montreal v. Montreal Locomotive Works Ltd., supra, Lord Wright indicated a fourfold test would be appropriate to differentiate an employee from an independent contractor; namely: (1) control of the work; (2) ownership of tools; (3) chance of profit; and (4) risk of loss. He stated that posing the question "Whose business is it?" would also serve, in some cases, to answer the question of the nature of the parties' relationship. In 671122 Ontario Ltd. v. Sagaz Industries Canada Inc., supra, at para. 47, the Supreme Court of Canada said that the central question for determining whether a worker is a contractor is whether he or she is providing services in business on his or her own account. The Court stated:
Although there is no universal test to determine whether a person is an employee or an independent contractor, I agree with MacGuigan J.A. that a persuasive approach to the issue is that taken by Cooke J. in Market Investigations, [1968] 3 All E.R. 732, supra. The central question is whether the person who has been engaged to perform the services is performing them as a person in business on his own account. In making this determination, the level of control the employer has over the worker's activities will always be a factor. However, other factors to consider include whether the worker provides his or her own equipment, whether the worker hires his or her own helpers, the degree of financial risk taken by the worker, the degree of responsibility for investment and management held by the worker, and the worker's opportunity for profit in the performance of his or her tasks.
[44] In Braiden v. La-Z-Boy Canada Ltd., supra, at para. 34, Justice Gillese suggested that the question of whose business was being operated was at the heart of the matter; i.e., was the worker carrying on business for himself or herself or was he or she paid to make a contribution to somebody else’s business enterprise. In determining that question, the following non-comprehensive factors were relevant but not necessarily determinative: (1) the extent to which the activities of the worker were controlled by the other contracting party; (2) whether the worker provided his or her own tools or equipment; (3) whether the worker hired his or her own helpers; (4) the extent to which the worker assumed financial risk; (5) the extent to which the worker had invested capital in the enterprise; (6) the extent to which the worker had management responsibilities; and (7) whether the worker had an opportunity for profit in the performance of his or her tasks.
[45] In John A. Ford & Associates Inc. (c.o.b. Training Services) v. Keegan[^15] at paras. 74-75, Justice D.G. Price provided a helpful description of the control factor, as follows:
The control test is the most traditional and frequently used method of determining whether an individual is an employee. If the employer has substantial control over the worker's operations, an employment relationship will be found, even if the worker has substantial freedom to operate, such as a professional employee normally has.
Control over the employee need not be complete in order to establish an employment relationship. Indicia of control include: the ability to decide when, where, and by what method the employee will perform his/her work; the ability to determine which customers can be served or sold goods, and which cannot; the requirement that the employee submit activity reports; the employee's ability or inability to attend meetings; assistance and guidance that the employer gives to the employee in connection to the work being performed; the employer's ability to set dress and conduct codes for the employee, and the discipline the employer exercises over the employee for breaches of company policy. The employer's ability to select and dismiss the employee, and the general power to control the employee, are also important factors in determining the existence of an employment relationship.
[46] As noted above, if the first step of the analysis determines that the worker is a contractor, then it is necessary to go further and determine whether the worker is a dependent or independent contractor. In McKee v. Reid’s Heritage Homes Ltd., supra, Justice MacPherson identified a variety of factors to differentiate dependent and independent contractors including: (1) the extent to which the worker was economically dependent on the particular working relationship; (2) the permanency of the working relationship; (3) the exclusivity or high level of exclusivity of the worker’s relationship with the enterprise. It follows from the factors identified by Justice MacPherson that the more permanent and exclusive the contractor relationship, then the less it resembles an independent contractor status and the more it resembles an employee relationship and, therefore, the relationship should be classified as a dependent contractor relationship.[^16]
[47] Thus the extent to which, over the history of the relationship, the worker worked exclusively or near-exclusively or was required to devote his or her time and attention to the other contracting party’s business is an important factor in determining whether the worker is a dependent or independent contractor: the greater the level of exclusivity over the course of the relationship, the greater the likelihood that the worker will be classified as a dependent contractor.[^17]
[48] In McKee v. Reid’s Heritage Homes Ltd., supra, Justice MacPherson said that recognizing the intermediate category between employee and independent contractor accorded with the statutorily provided category of dependent contractor found in the Labour Relations Act, S.O. 1995. At para. 29 of his judgment in McKee v. Reid’s Heritage Homes Ltd., he stated:
- Finally, recognizing an intermediate category based on economic dependency accords with the statutorily provided category of "dependent contractor" in Ontario, which the Labour Relations Act, S.O. 1995, c. 1, Sch. A, s. 1(1), defines as:
[A] person, whether or not employed under a contract of employment, and whether or not furnishing tools, vehicles, equipment, machinery, material, or any other thing owned by the dependent contractor, who performs work or services for another person for compensation or reward on such terms and conditions that the dependent contractor is in a position of economic dependence upon, and under an obligation to perform duties for, that person more closely resembling the relationship of an employee than that of an independent contractor.
[49] It should be noted that if the analysis of the worker relationship reaches the second stage, there will inevitably be indicia that the worker was a contractor; for example, that he or she was paid in exchange for invoices and not issued salary cheques, but the analysis, nevertheless, continues to examine the true substance of the relationship. Thus, the case law reveals that the fact that the worker operated as a sole proprietor or through a business is relevant but not determinative of the worker’s status.[^18]
[50] What the parties may choose to call their relationship is relevant but not determinative, and the court will determine the nature of the relationship based on the conduct of the parties.[^19]
[51] In the case at bar, in my opinion, there is no genuine issue for trial about Ms. Cormier’s status in the workplace.
[52] While as the above account of the facts reveals, there are some indicia of a genuine independent contractor relationship, the issuance of invoices being one such indicia, and while it is arguable that during the very early years of the relationship there was more independence, nevertheless, within two years, if not earlier, Ms. Cormier was a dependent contractor. She worked exclusively for St. Joseph Communications and, practically speaking, it was her boss. In the immediate case, having regard to the nature of her work as a Wardrobe Stylist the indicia of independence or dependency such as tools and control are not very helpful in defining the relationship, and it appears that not much changed in how she carried on work before or after June 3, 2004, when she changed from a Freelance Wardrobe Stylist to a Wardrobe Stylist under an employment contract. In other words, there is little to distinguish between her years as a dependent contractor and her years as an employee. What stands out is that Ms. Cormier had a twenty-three solid workplace relationship with St. Joseph’s communications.
3. Damages for Wrongful Dismissal
[53] I shall conclude below that the termination clause in Ms. Cormier’s 2012 employment contract is unenforceable, and, therefore, under the common law, she is entitled to pay in lieu of reasonable notice. I shall further conclude below that she is entitled be reimbursed for the deductions made to her bi-weekly salary on account of the unpaid vacation program. In this section of my Reasons for Decision, I shall quantify her damages, and I conclude that Ms. Cormier is entitled to a judgment for $127,738.75.
[54] An employee or a dependent contractor who is dismissed without reasonable advance notice of termination is entitled to damages for breach of contract based on the employment income the employee would have earned during the reasonable notice period, less any amounts received in mitigation of the loss.[^20]
[55] There is no catalogue as to what is reasonable notice and the reasonableness of notice must be determined by reference to the facts of each particular case.[^21] In determining the length of notice, the court should consider, among other possible factors: (1) the character of employment; (2) the length of service; (3) the age of the employee; and (4) the availability of similar employment having regard to the experience, training, and qualifications of the employee.[^22] The factors are not exhaustive, and what is a reasonable notice period will depend on the circumstances of the particular case.[^23]
[56] The weight to be given each factor will vary according to the circumstances of each case, and the judge in a wrongful dismissal case is required to exercise judgment in determining what factors are of particular importance. In determining the reasonable notice period, the court should not apply as a starting point any rule of thumb attribution so many weeks or months of notice per year of service, because such an approach privileges length of service above all relevant factors in determining notice, and each case must be considered having regard to its particular facts.[^24] The length of the reasonable notice period is to be determined by the circumstances existing at the time of termination and not by the amount of time that it actually takes an employee to find new employment.[^25]
[57] The determination of a reasonable notice period is a principled art and not a mathematical science. In Minott v. O’Shanter Development Co.,[^26] Justice Laskin wrote at para. 62:
Determining the period of reasonable notice is an art not a science. In each case trial judges must weigh and balance a catalogue of relevant factors. No two cases are identical; and ordinarily, there is no "right" figure for reasonable notice. Instead, most cases yield a range of reasonableness.
[58] In Cronk v. Canadian General Insurance Company,[^27] Associate Chief Justice Morden stated at para. 85:
The governing rule is that a dismissed employee, in the position of Ms. Cronk, is entitled to reasonable notice or payment in lieu of it. The legal precept of reasonable notice, which is the essence of this rule, is a standard and not, itself, a rule. Unlike a rule, it does not specify any detailed definite state of facts which, if present, will inevitably entail a particular legal consequence. Rather, its application enables a court to take all of the circumstances of the case into account. It allows for individualization of application and, obviously, involves the exercise of judgment.
[59] Economic factors such as a downturn in the economy or in a particular industry or sector of the economy that indicate that an employee may have difficulty finding another position may justify a longer notice period.[^28]
[60] Generally speaking, the longer the duration of employment, the longer the reasonable notice period.[^29]
[61] The character of employment factor tends to justify a longer notice period for senior management employees or highly skilled and specialized employees and a shorter period for lower rank or unspecialized employees.[^30]
[62] Generally speaking, a longer notice period will be justified for older long-term employees, who may be at a competitive disadvantage in securing new employment because of their age. In McKinney v. University of Guelph,[^31] Justice La Forest stated at para. 92:
- Barring specific skills, it is generally known that persons over 45 have more difficulty finding work than others. They do not have the flexibility of the young, a disadvantage often accentuated by the fact that the latter are frequently more recently trained in the more modern skills. Their difficulty is also influenced by the fact that many in that age range are paid more and will generally serve a shorter period of employment than the young, a factor that is affected not only by the desire of many older people to retire but by retirement policies both in the private and public sectors.
[63] An employee who is wrongfully dismissed is entitled to recover the value of all losses arising from the failure to have been given reasonable notice of the termination of his or her employment.[^32] The damage award should place the plaintiff in the same financial position he or she would have been at the end of the reasonable notice period had he or she actually been given the appropriate notice of pending termination, and, thus, the employee is entitled to the salary, benefit, and bonuses he or she would have received during the period of reasonable notice.[^33] A terminated employee is entitled to claim damages for the loss of pension benefits that would have accrued had the employee worked until the end of the notice period, unless some contractual right limits that right.[^34]
[64] In McKay v. Camco, Inc.,[^35] Justice Blair discussed the nature of damages for wrongful dismissal:
The employee is entitled to damages measured by the salary and other benefits to which he would have been entitled during the notice period but subject to his duty to mitigate. Earnings from alternative employment during the notice period or such earnings as the employee might reasonably have been expected to earn had he diligently sought alternative employment must be deducted from the damages payable to the employee.
[65] A wrongfully dismissed employee is entitled to be compensated for the value of the employment-related benefits that the employee had available when employed or the cost of replacement coverage for the reasonable notice period.[^36]
[66] As a general rule, additional damages are not awarded to compensate the employee for the disappointment, embarrassment, or other psychological effects flowing from the loss of employment.[^37] However, if an employee can prove bad faith conduct by the employer in the manner of the dismissal that caused mental distress that was in the contemplation of the parties, then the employee may be entitled to aggravated or punitive damages. These damages are calculated according to the same principles and in the same way as in cases dealing with moral damages and not by extending the reasonable notice period. Damages resulting from the manner of dismissal are available, if during the course of the dismissal, the employer’s conduct is unfair or is in bad faith by being, for example, untruthful, misleading, or unduly insensitive such as attacking an employee’s reputation, misrepresenting the reasons for the dismissal or depriving the employee of an accruing right.[^38]
[67] Wrongful dismissal is a breach of contract claim, and the normal principles of damages assessment apply to the determination of the quantum of damages, including the principle that a plaintiff cannot recover for avoidable loss; i.e., the mitigation principle.[^39] The so-called duty of a plaintiff to mitigate is somewhat mislabelled as a duty because the duty is a matter of self- interest and is not a duty owed to others. The policy idea behind the so-called duty to mitigate is that a plaintiff should not recover for losses that he or she could have avoided.
[68] The onus is on the defendant to establish a failure to mitigate.[^40] More particularly, the onus is on the employer to prove that the employee would likely have found a comparable position reasonably adapted to his or her abilities and that the employee failed to take reasonable steps to find that comparable position.[^41]
[69] In assessing the innocent party’s efforts at mitigation, the courts are tolerant, and the innocent party need only be reasonable, not perfect.[^42]
[70] The employee is entitled to claim as damages the expenses of mitigation provided that the expenses were reasonably foreseeable as damages.[^43]
[71] Applying the above principles to the immediate case, in my opinion, the appropriate reasonable notice period is twenty-one months. In its factum and in its oral argument, St. Joseph’s argument for a lesser notice period depended in the main on the enforcement of the termination clause or on defining Ms. Cormier’s years of employment as commencing with an original hire date of June 7, 2004. If she had a longer period of an employment relationship, while St. Joseph Communications disputed twenty-four months, it actually suggested that the appropriate notice period was around twenty to twenty-one months. Based on my own review of the case law applied to the circumstances of the immediate case, that was a fair and honourable concession.
[72] Putting aside the enforcement of the termination clauses, which was St. Joseph Communications’ main line of defence, its theory was that Ms. Cormier’s years as an independent contractor should be ignored and be given no weight in the determination of the notice period. It asserted then that the appropriate notice period for Ms. Cormier was twelve months reflecting her employment relationship from 2004 to 2017 (almost 13 years).
[73] However, in my opinion, even if I had concluded that Ms. Cormier was an independent contractor from 1994 to 2004, it would have been wrong in principle to ignore these years of their relationship in determining the reasonable notice period. The court should take all of the circumstances into account and in the immediate case even if I had found Ms. Cormier to be an independent contractor, I would not have ignored those years of their relationship. In either case, considering all of the relevant factors and the particular facts of this case, I conclude that the reasonable notice period for Ms. Cormier at the time of her dismissal is twenty-one months.
[74] Before quantifying Ms. Cormier’s damages claim, I come to the matter of mitigation. In discussing mitigation, it is well to keep in mind three legal matters. The first legal matter is that Ms. Cormier is under no legal obligation to mitigate her damages - but it is in her self-interest to do so because the law is that she cannot recover for avoidable loss.
[75] The second legal matter is that the onus of proving that there was avoidable loss is on the defendant. Practically speaking, a plaintiff will often adduce evidence that he or she did attempt to avoid loss, but this proffer of evidence is anticipatory or pre-emptive of the defendant’s argument that there was a failure to mitigate, and a plaintiff’s efforts to prove mitigation does not remove the burden on the defendant to prove that the plaintiff missed opportunities to mitigate.
[76] The third legal matter is that in assessing the innocent party’s efforts at mitigation, the courts are tolerant, and the innocent party need only be reasonable, not perfect.
[77] In the immediate case, Ms. Cormier provided evidence about her efforts to mitigate and she explained that her efforts were hampered in part because she felt constrained to honour the non-solicitation and non-competition clauses in her written employment contract. St. Joseph Communications criticized Ms. Cormier’s efforts to mitigate. I was, however, not moved by its criticism, and I thought its criticism somewhat unfair given that St. Joseph Communications never advised Ms. Cormier that she was relieved from honouring the restraints of trade in the employment contract.
[78] Notwithstanding St. Joseph Communications’ criticisms of her efforts, I find as fact that Ms. Cormier made reasonable efforts to mitigate her damages from her dismissal without cause. Although her evidence of mitigation was not elaborate, it was sufficient to show that she acted reasonably, and, I conclude that St. Joseph Communications has not met the onus of showing avoidable loss.[^44]
[79] Having addressed the matter of mitigation, I can now quantify Ms. Cormier’s damages based on a reasonable notice period of twenty-one months. I calculate Ms. Cormier’s damages award as, $112,863.75 as follows:
a. Pay in lieu of reasonable notice (21 months) + $148,750
b. Damages for loss of benefits (10% of base salary) + $14,875
c. Cellphone allowance (21 months) + $2,373
d. Reimbursement for deductions for the unpaid vacation program + $3,264
e. Less 1-month cellphone allowance during working notice - $113
f. Less 1-month benefits during working notice - $708.33
g. Less salary amounts paid by Employer to date - $55,576.92
[80] Since the court’s judgment comes within the reasonable notice period, I need the address the matter of on-going mitigation. In a wrongful dismissal action, the court may grant judgment before the expiration of the reasonable notice period but the employee will be subject to the so-called duty to mitigate for the duration of the reasonable notice period.[^45]
[81] Where judgment is granted before the expiration of the reasonable notice period, courts have employed three approaches to the duty to mitigate during the balance of the notice period; namely: (1) The Contingency Approach – The employee’s damages are discounted by a contingency for re-employment during the balance of the notice period.[^46] (2) The Trust and Accounting Approach – The employee is granted 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 any mitigation earnings;[^47] and, (3) The Partial Summary Judgment Approach – The employee is granted a partial summary judgment and the parties return to court during and or at the end of the notice period for further payments subject to the duty to mitigate.[^48]
[82] In the immediate case, I have already concluded that there has been no failure to mitigate to date, which is approximately twenty months of the twenty-one month notice period. In these circumstances, I see not need to utilize any of the three approaches to the duty to mitigate during the short balance of the notice period.
4. Is the Termination Clause Enforceable?
[83] The next matter to address is the explanation for my conclusion that the termination clause in the 2012 employment contract is not enforceable.
[84] In this regard, the short answer is that I agree with Ms. Cormier’s argument, which relies on the Court of Appeal’s decision in Wood v. Fred Deeley Imports Ltd.,[^49] that the termination clause in the 2012 employment contract contravenes the Employment Standards Act, 2000.
[85] I disagree with St. Joseph’s two-pronged counterargument that the termination clause in the 2012 agreement is lawful and effective but if the 2012 clause is unlawful, then the agreement between the parties defaults to the lawful and effective termination clause in the 2008 employment contract.
[86] I begin the longer explanation by rejecting the second prong of St. Joseph Communications’ argument. Apart from the circumstance that the revival of the 2008 employment contract is not a pleaded defence and apart from the circumstance that there is an argument that the termination clause in the 2008 agreement also is unlawful and ineffective, there is no legal basis for reviving the 2008 employment contract. The 2008 employment contract has been discharged and it simply does not apply after Ms. Cormier was promoted to the position she assumed under the 2012 employment contract, which expressly superseded the earlier agreement.
[87] Turning then to the first prong of St. Joseph Communication’s argument about the termination clause, it is necessary to interpret the 2012 employment contract. In this regard, I have no doubt that in signing the agreement, the parties shared a contractual intention to negate the common law’s approach to dismissal without cause and to substitute a different approach. I also have no doubt that there are ways in which this intent could have been be accomplished and there are ways an employer and employee may contract out of the minimum protections of the Employment Standards Act, 2002.
[88] The problem, however, for St. Joseph’s Communications is that while some aspects of the termination clause found in the 2012 employment contract were unobjectionable, the treatment of the employee’s benefits during the notice period were contrary to the Act. There was a fatal flaw, an Achilles’ heal so to speak, in the 2012 agreement making its termination clause void and unenforceable.
[89] To be more precise, the termination clause in the 2012 employment contract purports to allow St. Joseph Communication upon termination to provide Ms. Cormier with only some of the employee benefits that she received before termination and even then, only subject to the consent of St. Joseph Communication’s insurers. With respect to the employee benefits, the termination clause therefore provides Ms Cormier with a lesser right than the rights set out in the Employment Standards Act, 2000 and therefore, the entire termination clause is void.
[90] The case at bar is on all fours with Wood v. Fred Deeley Imports Ltd. In the Wood case, Ms. Wood’s employment was terminated without cause and her employer relied on a termination clause in her written employment contract to avoid the common law presumption that Ms. Wood was entitled to pay in lieu of reasonable notice. Pursuant to the termination clause, she received thirteen weeks of working notice plus a lump sum equivalent to eight week’s pay. Although some of the payments made to Ms. Wood under the termination clause were superior to what she would receive under the Employment Standards Act, reversing the motion judge, the Court of Appeal ruled that the termination clause was unenforceable because it excluded the employer’s statutory obligation to make benefit contributions during the notice period and the termination provision also did satisfy the employer’s obligation to pay severance pay.
[91] The Court of Appeal held that there is a rebuttable common law presumption that if a person who is hired for an indefinite period is dismissed without cause, then he or she is entitled to reasonable notice or a continuation of pay in lieu of reasonable notice. The presumption of reasonable notice can be rebutted by the parties agreeing to a different notice period provided that their agreement is compliant with the minimum employment standards of the Employment Standards Act.[^50]
[92] Justice Laskin, who wrote the judgment for the Court, stated out that if the termination clause was not compliant with even one of the employment standards by not substituting a greater benefit for that standard, this would make the termination clause unenforceable and entitle the employee to reasonable notice in accordance with the common law presumption.[^51] Further, Justice Laskin held that even if the employer ignored the provisions of the termination clause and offered to meet the minimum standards of the Act, the termination clause would be unenforceable. He said that the enforceability of the termination clause depends only on the interpretation of the clause itself and not on what the employer may have done on termination.[^52]
[93] As noted above, the termination provision in the 2012 employment contract does not provide benefits better than the minimum standards of the Employment Standards Act, 2000. It follows that the termination clause is unenforceable.
5. Is Ms. Cormier Entitled to be Reimbursed for the Unpaid Vacation Plan Deductions?
[94] The final issue to discuss is the question whether Ms. Cormier is entitled to be reimbursed for the deductions made for the unpaid vacation plan.
[95] While it is arguable on a moral plain that St. Joseph Communications’ introduction of the unpaid vacation plan was a well-intended means to preserve the jobs of its employees and to avoid layoffs because the advertising and marketing industry was being battered by adverse economic forces, on a legal plain, the unpaid vacation plan did not comply with the Employment Standards Act, 2000.
[96] The plan was implemented by deductions from wages, and s.13 of the Employment Standards Act prohibits an employer making deductions from wages unless, among other things, the deductions are authorized by court order or by the employee’s written authorization. There was no proper authorization in the immediate case, and, therefore Ms. Cormier has unpaid wages equal to $3,264.
E. Conclusion
[97] For the above reasons, I award Ms. Cormier $112,863.75 plus prejudgment and postjudgment interest.
[98] If the parties cannot agree about costs, they may make submissions in writing beginning with Ms. Cormier’s submissions within twenty days from the release of these Reasons for Decision following by St. Joseph Communication’s submissions within a further twenty days.
Perell, J.
Released: January 24, 2019
Schedule “A” – Excerpts Employment Standards Act, 2000
1 (1) In this Act,
“benefit plan” means a benefit plan provided for an employee by or through his or her employer;
“employment standard” means a requirement or prohibition under this Act that applies to an employer for the benefit of an employee;
“regular wages” means wages other than overtime pay, public holiday pay, premium pay, vacation pay, domestic or sexual violence leave pay, termination pay, severance pay and termination of assignment pay and entitlements under a provision of an employee’s contract of employment that under subsection 5 (2) prevail over Part VIII, Part X, Part XI, section 49.7, Part XV or section 74.10.1;
“statutory notice period” means,
(a) the period of notice of termination required to be given by an employer under Part XV, or
(b) where the employer provides a greater amount of notice than is required under Part XV, that part of the notice period ending with the termination date specified in the notice which equals the period of notice required under Part XV;
“wages” means,
(a) monetary remuneration payable by an employer to an employee under the terms of an employment contract, oral or written, express or implied,
(b) any payment required to be made by an employer to an employee under this Act, and(c) any allowances for room or board under an employment contract or prescribed allowances,
but does not include,
(d) tips or other gratuities,
(e) any sums paid as gifts or bonuses that are dependent on the discretion of the employer and that are not related to hours, production or efficiency,
(f) expenses and travelling allowances, or
(g) subject to subsections 60 (3) or 62 (2), employer contributions to a benefit plan and payments to which an employee is entitled from a benefit plan;
Agreements in writing
(3) Unless otherwise provided, a reference in this Act to an agreement between an employer and an employee or to an employer and an employee agreeing to something shall be deemed to be a reference to an agreement in writing or to their agreeing in writing to do something.
Electronic form
(3.1) The requirement in subsection (3) for an agreement to be in writing is satisfied if the agreement is in electronic form.
Exception
(4) Nothing in subsection (3) requires an employment contract that is not a collective agreement to be in writing.
No contracting out
5 (1) Subject to subsection (2), no employer or agent of an employer and no employee or agent of an employee shall contract out of or waive an employment standard and any such contracting out or waiver is void.
Greater contractual or statutory right
(2) If one or more provisions in an employment contract or in another Act that directly relate to the same subject matter as an employment standard provide a greater benefit to an employee than the employment standard, the provision or provisions in the contract or Act apply and the employment standard does not apply.
No treating as if not employee
5.1 (1) An employer shall not treat, for the purposes of this Act, a person who is an employee of the employer as if the person were not an employee under this Act.
Deductions, etc.
13 (1) An employer shall not withhold wages payable to an employee, make a deduction from an employee's wages or cause the employee to return his or her wages to the employer unless authorized to do so under this section.
Statute or court order
(2) An employer may withhold or make a deduction from an employee's wages or cause the employee to return them if a statute of Ontario or Canada or a court order authorizes it.
Employee authorization
(3) An employer may withhold or make a deduction from an employee's wages or cause the employee to return them with the employee's written authorization.
Exception
(4) Subsections (2) and (3) do not apply if the statute, order or written authorization from the employee requires the employer to remit the withheld or deducted wages to a third person and the employer fails to do so.
Same
(5) Subsection (3) does not apply if,
(a) the employee’s authorization does not refer to a specific amount or provide a formula from which a specific amount may be calculated;
(b) the employee’s wages were withheld, deducted or required to be returned,
(i) because of faulty work,
(ii) because the employer had a cash shortage, lost property or had property stolen and a person other than the employee had access to the cash or property, or
(iii) under any prescribed conditions; or
(c) the employee’s wages were required to be returned and those wages were the subject of an order under this Act.
PART Xv TERMINATION and severance OF EMPLOYMENT
Termination of Employment
No termination without notice
54 No employer shall terminate the employment of an employee who has been continuously employed for three months or more unless the employer,
(a) has given to the employee written notice of termination in accordance with section 57 or 58 and the notice has expired; or
(b) has complied with section 61.
Employer notice period
57 The notice of termination under section 54 shall be given,
(a) at least one week before the termination, if the employee’s period of employment is less than one year;
(b) at least two weeks before the termination, if the employee’s period of employment is one year or more and fewer than three years;
(c) at least three weeks before the termination, if the employee’s period of employment is three years or more and fewer than four years;
(d) at least four weeks before the termination, if the employee’s period of employment is four years or more and fewer than five years;
(e) at least five weeks before the termination, if the employee’s period of employment is five years or more and fewer than six years;
(f) at least six weeks before the termination, if the employee’s period of employment is six years or more and fewer than seven years;
(g) at least seven weeks before the termination, if the employee’s period of employment is seven years or more and fewer than eight years; or
(h) at least eight weeks before the termination, if the employee’s period of employment is eight years or more.
60 (1) During a notice period under section 57 or 58, the employer,
(a) shall not reduce the employee’s wage rate or alter any other term or condition of employment;
(b) shall in each week pay the employee the wages the employee is entitled to receive, which in no case shall be less than his or her regular wages for a regular work week; and
(c) shall continue to make whatever benefit plan contributions would be required to be made in order to maintain the employee’s benefits under the plan until the end of the notice period.
Pay instead of notice
61 (1) An employer may terminate the employment of an employee without notice or with less notice than is required under section 57 or 58 if the employer,
(a) pays to the employee termination pay in a lump sum equal to the amount the employee would have been entitled to receive under section 60 had notice been given in accordance with that section; and
(b) continues to make whatever benefit plan contributions would be required to be made in order to maintain the benefits to which the employee would have been entitled had he or she continued to be employed during the period of notice that he or she would otherwise have been entitled to receive.
Deemed active employment
62 (1) If an employer terminates the employment of employees without giving them part or all of the period of notice required under this Part, the employees shall be deemed to have been actively employed during the period for which there should have been notice for the purposes of any benefit plan under which entitlement to benefits might be lost or affected if the employees cease to be actively employed.
Benefit plan contributions
(2) If an employer fails to contribute to a benefit plan contrary to clause 61 (1) (b), an amount equal to the amount the employer should have contributed shall be deemed to be unpaid wages for the purpose of section 103.
Same
(3) Nothing in subsection (2) precludes the employee from an entitlement he or she may have under a benefit plan.
Severance of Employment
What constitutes severance
63 (1) An employer severs the employment of an employee if,
(a) the employer dismisses the employee or otherwise refuses or is unable to continue employing the employee;
(b) the employer constructively dismisses the employee and the employee resigns from his or her employment in response within a reasonable period;
Entitlement to severance pay
64 (1) An employer who severs an employment relationship with an employee shall pay severance pay to the employee if the employee was employed by the employer for five years or more and,
(a) the severance occurred because of a permanent discontinuance of all or part of the employer’s business at an establishment and the employee is one of 50 or more employees who have their employment relationship severed within a six-month period as a result; or
(b) the employer has a payroll of $2.5 million or more.
Calculating severance pay
65 (1) Severance pay under this section shall be calculated by multiplying the employee’s regular wages for a regular work week by the sum of,
(a) the number of years of employment the employee has completed; and
(b) the number of months of employment not included in clause (a) that the employee has completed, divided by 12.
Termination without notice
(4) If an employer terminates the employment of an employee without providing the notice, if any, required under section 57 or 58, the amount of severance pay to which the employee is entitled shall be calculated as if the employee continued to be employed for a period equal to the period of notice that should have been given and was not.
COURT FILE NO.: CV-17-578834
DATE: 2019/01/24
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
KELLY CORMIER
Plaintiff
– and –
1772887 ONTARIO LIMITED carrying on business as ST. JOSEPH COMMUNICATIONS
Defendant
REASONS FOR DECISION
PERELL J.
Released: January 24, 2019
[^1]: S.O. 2000, c. 1.
[^2]: 2014 SCC 7.
[^3]: 2014 SCC 8.
[^4]: Campana v. The City of Mississauga, 2016 ONSC 3421; Ghaeinizadeh (Litigation guardian of) v. Garfinkle Biderman LLP, 2014 ONSC 4994, leave to appeal to Div. Ct. refused, 2015 ONSC 1953 (Div. Ct.); Lavergne v. Dominion Citrus Ltd., 2014 ONSC 1836 at para. 38; George Weston Ltd. v. Domtar Inc., 2012 ONSC 5001.
[^5]: Dawson v. Rexcraft Storage & Warehouse Inc., 1998 4831 (ON CA), [1998] O.J. No. 3240 (C.A.); Bluestone v. Enroute Restaurants Inc. (1994), 1994 814 (ON CA), 18 O.R. (3d) 481 (C.A.); Canada (Attorney General) v. Lameman, 2008 SCC 14, [2008] 1 S.C.R. 372 at para. 11.
[^6]: Toronto-Dominion Bank v. 466888 Ontario Ltd., 2010 ONSC 3798.
[^7]: Keenan (c.o.b. Keenan Cabinetry) v. Canac Kitchens, a Division of Kohler Ltd., 2016 ONCA 79, affg. 2015 ONSC 1055; McKee v. Reid’s Heritage Homes Ltd., 2009 ONCA 916; Braiden v. La-Z-Boy Canada Ltd., 2008 ONCA 464; Conde v. National Sign Manufacturers Ltd., 2013 ONSC 229 (Div. Ct.); John A. Ford & Associates Inc. (c.o.b. Training Services) v. Keegan, 2014 ONSC 4989; Wyman v. Kadlec, 2014 ONSC 4710; Huber v. Way, 2014 ONSC 4426; Filiatyrault v. Tri-County Welding Supplies Ltd., 2013 ONSC 3091; Duynstee v. Sobeys Inc., 2013 ONSC 2050; Sarnelli (c.o.b. East End Lock and Key) v. Effort Trust Co., 2011 ONSC 1080; Ross v. 413554 Ontario Ltd. (c.o.b. Chouinard Bros. Roofing), [2008] O.J. No. 3381 (S.C.J.); Slepenkova v. Ivanov, [2007] O.J. No. 4708 (S.C.J), affd. 2009 ONCA 526; Moseley-Williams v. Hansler Industries Ltd., [2008] O.J. No. 4457 (S.C.J.).
[^8]: Carter v. Bell & Sons (Canada) Ltd., 1936 75 (ON CA), [1936] O.R. 290 (C.A.).
[^9]: 2009 ONCA 916.
[^10]: 1946 353 (UK JCPC), [1947] 1 D.L.R. 161 (P.C.).
[^11]: 2001 SCC 59, [2001] 2 S.C.R. 983.
[^12]: (2004), 2004 6668 (ON CA), 72 O.R. (3d) 81 (C.A.).
[^13]: 2008 ONCA 464.
[^14]: Charbonneau v. A.O. Shingler & Co., [2000] O.J. No. 4282 at para. 12 (S.C.J.); Wyman v. Kadlec, 2014 ONSC 4710 at para. 28.
[^15]: 2014 ONSC 4989.
[^16]: Keenan (c.o.b. Keenan Cabinetry) v. Canac Kitchens, a Division of Kohler Ltd., 2016 ONCA 79, affg. 2015 ONSC 1055.
[^17]: Keenan (c.o.b. Keenan Cabinetry) v. Canac Kitchens, a Division of Kohler Ltd., 2016 ONCA 79, affg. 2015 ONSC 1055.
[^18]: McKee v. Reid’s Heritage Homes Ltd., 2009 ONCA 916 at para. 54; Braiden v. La-Z-Boy Canada Ltd., 2008 ONCA 464 at para. 30; Kordish v. Innotech Multimedia Corp. [1998], 46 C.C.E.L. (2d) 318, (Ont. Gen. Div.), aff'd [2000] O.J. No. 2557 (C.A.).
[^19]: John A. Ford & Associates Inc. (c.o.b. Training Services) v. Keegan, 2014 ONSC 4989 at paras. 72, 77.
[^20]: Sylvester v. British Columbia, 1997 353 (SCC), [1997] 2 S.C.R. 315.
[^21]: Bardal v. Globe & Mail, 1990 6677 (ON SC), [1990] O.J. No. 149 (H.C.J.).
[^22]: Cronk v. Canadian General Insurance Co. (1995), 1995 814 (ON CA), 25 O.R. (3d) 505 (C.A.); Machinter v. HOJ Industries Ltd., 1992 102 (SCC), [1992] 1 S.C.R. 986; Bardal v. Globe & Mail, 1990 6677 (ON SC), [1990] O.J. No. 149 (H.C.J.).
[^23]: Duynstee v. Sobeys Inc., 2013 ONSC 2050; Honda Canada Inc. v. Keays, 2008 SCC 39; Wallace v. United Grain Growers Ltd., 1997 332 (SCC), [1997] 3 S.C.R. 701; Minott v. O’Shanter Development Co. (1999), 1999 3686 (ON CA), 42 O.R. (3d) 321 (C.A.).
[^24]: Beatty v. Best Theratronics Ltd., 2015 ONCA 247; Love v. Acuity Investment Management Inc., 2011 ONCA 130; Minott v. O’Shanter Development Co., (1999), 1999 3686 (ON CA), 42 O.R. (3d) 321 (C.A.).
[^25]: Holland v. Hostopia.com Inc., 2015 ONCA 762, at para. 61.
[^26]: (1999), 1999 3686 (ON CA), 42 O.R. (3d) 321 (C.A.).
[^27]: (1995), 1995 814 (ON CA), 25 O.R. (3d) 505 (C.A.).
[^28]: Bullen v. Proctor & Redfern Ltd., 1996 8135 (ON SC), [1996] O.J. No. 340 at paras. 24-29 (Gen. Div.); Corbin v. Standard Life Assurance, 1995 3852 (NB CA), [1995] N.B.J. No. 461 (C.A.); Thomson v. Bechtel Canada, [1983] O.J. No. 2397 (H.C.J.); Leduc v. Canadian Erectors Ltd., [1966] O.J. No. 897 at para. 34-36 (Gen. Div.).
[^29]: Bullen v. Proctor & Redfern Ltd., 1996 8135 (ON SC), [1996] O.J. No. 340 at para. 21 (Gen. Div.).
[^30]: Bernier v. Nygard International Partnership, 2013 ONSC 4578 at para. 57; Tull v. Norske Skog Canada Ltd., 2004 BCSC 1098; Cronk v. Canadian General Insurance Co., (1995), 1995 814 (ON CA), 25 O.R. (3d) 505 (C.A.); Teitelbaum v. Global Travel Computer Holdings Ltd. (1999), 41 C.C.E.L. (2d) 275 (Ont. S.C.J.); Bullen v. Proctor & Redfern Ltd., 1996 8135 (ON SC), [1996] O.J. No. 340 at paras. 7-10 (Gen. Div.); Cronk v. Canadian General Insurance Co., (1995), 25 O.R. (3d) 505 (C.A.).
[^31]: 1990 60 (SCC), [1990] 3 S.C.R. 229.
[^32]: Koor v. Metropolitan Trust Co. of Canada, [1993] O.J. No. 1476 (Gen. Div.); Davidson v. Allelix Inc. (1991), 1991 7091 (ON CA), 7 O.R. (3d) 581 (C.A.); Locke v. Avco Financial Services Can. Ltd. (1987), 1987 7330 (NB QB), 85 N.B.R. (2d) 93 (Q.B.); Earl v. Northern Purification Services (Eastern) Ltd., [1980] O.J. No. 160 (H.C.J.); Leduc v. Canadian Erectors Ltd., [1966] O.J. No. 897 at paras. 41-51 (Gen. Div.).
[^33]: Bernier v. Nygard International Partnership 2013 ONSC 4578 at para. 45; Weibe v. Central Transport Refrigeration (Man.) Ltd. (1993), 1993 14877 (MB QB), 84 Man. R. (2d) 273 at p. 277.
[^34]: Beatty v. Best Theratronics Ltd., 2015 ONCA 247 at para. 32; Taggart v. Canada Life Assurance Co. (2006), 50 C.C.P.B. 163 at paras. 13-15 (Ont. C.A.).
[^35]: 1986 2544 (ON CA), [1986] O.J. No. 2329 at p. 10 (C.A.).
[^36]: Ludchen v. Stelcrete Industries, 2013 ONSC 7495; Zaman v. Canac Kitchens Ltd. (Kohler Ltd.), [2009] O.J. No. 872 at para. 19 (S.C.J.); Davidson v. Allelix Inc. (1991), 1991 7091 (ON CA), 7 O.R. (3d) 581 (C.A.).
[^37]: Fidler v. Sun Life Assurance Co. of Canada, 2006 SCC 30, [2006] 2 S.C.R. 3; Peso Silver Mines Ltd. (N.P.L.) v. Cropper, 1966 75 (SCC), [1966] S.C.R. 673 at p. 684; Addis v. Gramophone Co., [1909] A.C. 488 (H.L.).
[^38]: Honda v. Keays, Canada, 2008 SCC 39; Wallace v. United Grain Growers Ltd., 1997 332 (SCC), [1997] 3 S.C.R. 701.
[^39]: Zaman v. Canac Kitchens Ltd., a division of Kohler Ltd., [2009] O.J. No. 872 (S.C.J.); Apeco of Canada Ltd. v. Windmill Place, 1978 186 (SCC), [1978] 2 S.C.R. 385.Karas v. Rowlett, 1943 53 (SCC), [1944] S.C.R. 1; British Westinghouse Electric & Mfg. Co. Ltd. v. Underground Electric R. Co. of London, Ltd., [1912] A.C 673 (H.L.).
[^40]: Michaels v. Red Deer College I, 1975 15 (SCC), [1976] 2 S.C.R. 324; Dobson v. Winton & Robbins Ltd., [1959] S.C.R. 755; Morison v. Ergo-Industrial Seating Systems Inc., 2016 ONSC 6725.
[^41]: Di Tomaso v. Crown Metal Packaging Canada LP, 2011 ONCA 469 at paras. 36-37; Palmer v. Clemco Industries Inc., 2010 BCSC 230; Link v. Venture Steel Inc., 2010 ONCA 144 at para. 73.
[^42]: Leduc v. Canadian Erectors Ltd., [1966] O.J. No. 897 at paras. 52-60 (Gen. Div.); Banco de Portugal v. Waterlow & Sons Ltd., [1932] A.C. 452 (H.L.);
[^43]: Leduc v. Canadian Erectors Ltd., [1966] O.J. No. 897 at para. 52 (Gen. Div.)
[^44]: Morison v. Ergo-Industrial Seating Systems Inc., 2016 ONSC 6725 at para. 28.
[^45]: Markoulakis v. SNC-Lavalin Inc., 2015 ONSC 1081; Cronk v. Canadian General Insurance Co., (1995), 1995 814 (ON CA), 25 O.R. (3d) 505 (C.A.); Bullen v. Proctor & Redfern Ltd., 1996 8135 (ON SC), [1996] O.J. No. 340 at para. 38 (Gen. Div.).
[^46]: Russo v. Kerr, 2010 ONSC 6053; Smith v. Pacific National Exhibition (1991), 1991 2366 (BC SC), 34 C.C.E.L. 64 (B.C.S.C.).
[^47]: Bernier v. Nygard International Partnership, 2013 ONCA 780; Di Tomaso v. Crown Metal Packaging Canada LP, 2011 ONCA 469; Adjemian v. Brock Crompton North America, [2008] O.J. No. 2238 (S.C.J.); Correa v. Dow Jones Markets Canada Inc. (1997), 1997 12268 (ON SC), 35 O.R. (3d) 126 (Gen. Div.); Bullen v. Proctor & Redfern Ltd., 1996 8135 (ON SC), [1996] O.J. No. 340 (Gen. Div.); Thomson v. Bechel Canadian Ltd. (1983), 3 C.C.E.L. 16 at para. 23 (Ont. H.C.J.).
[^48]: Markoulakis v. SNC-Lavalin Inc., 2015 ONSC 1081.
[^49]: 2017 ONCA 158.
[^50]: Wood v. Fred Deeley Imports Ltd., 2017 ONCA 158 at paras. 15-16.
[^51]: Wood v. Fred Deeley Imports Ltd., 2017 ONCA 158 at para. 21.
[^52]: Wood v. Fred Deeley Imports Ltd., 2017 ONCA 158 at paras. 41-51; Stevens v. Sifton Properties Ltd., 2012 ONSC 5508; Wright v. Young and Rubicam Group of Cos. (Wunderman), 2011 ONSC 4720.