Court File and Parties
COURT FILE NO.: CV-109-18 DATE: 20191202 ONTARIO SUPERIOR COURT OF JUSTICE
BETWEEN:
Gregory Clark Plaintiff – and – Township of Otonabee-South Monaghan Defendant
COUNSEL: Stephen Moreau and Kaley Duff, for the plaintiff John Ewart and Jessica Chapman, for the defendant
HEARD: May 21, 2019
Reasons for Decision
S.T. Bale J.
[1] The plaintiff moves for summary judgment on a claim for wrongful dismissal. The parties agree that it is an appropriate case for summary judgment, and ask that I finally determine the plaintiff’s entitlement.
Background facts
[2] The plaintiff began working for the defendant Township in or around 1998, as a part-time employee. At some point, he left the Township briefly to pursue full-time employment with the County of Peterborough, but returned to the Township in July 2003, and was employed as a full-time truck driver.
[3] In 2005, the plaintiff was promoted to the position of grader operator, and in 2006, he was moved to the position of equipment operator. In January 2016, he was promoted to the position of foreman.
[4] Between 2016 and 2018, the plaintiff’s relationship with his supervisor and his crew members became increasingly strained. On February 23, 2018, tensions in the Public Works Department came to a head. On that day, while the plaintiff was relating instructions to his crew, one crew member jumped into his truck, slammed the door, and sped out of the garage in reverse. This conduct irked the plaintiff who then picked up a broom, and threw it toward a wall. Unfortunately, the broom bounced off a snow plough, hitting and injuring a crew member.
[5] Following this incident, the plaintiff was suspended briefly, and then demoted to his previous position of grader operator. He immediately regretted his actions, apologized to the Township, and reached out to the employee who was injured. The Township concluded that the injury was unintentional and did not, at that time or ever, allege that the incident constituted just cause for termination of the plaintiff’s employment.
[6] Following the plaintiff’s return to work, tensions in the workplace continued, and a number of employees filed refusals to work with him. Ultimately, the Township came to the conclusion that the tensions between the plaintiff and his fellow employees could not be managed, and on September 4, 2018, his employment was terminated, effective immediately. The defendant concedes that he was terminated without cause.
[7] Upon termination, the plaintiff was offered a severance package consisting of salary and benefits continuation for approximately four months. He rejected the package.
[8] Following his rejection of the package, the plaintiff was paid a lump sum equivalent to 15 weeks’ wages. However, his enrolment in the OMERS pension plan, and his insurance benefits, were terminated, effective the date of termination.
Positions of the parties
[9] The plaintiff’s position is that he was entitled to 16 months’ notice of termination, and he claims his economic loss as a result of the defendant’s failure to provide him with such notice. In addition, he claims damages related to the manner of his dismissal.
[10] The defendant’s position is that the plaintiff was entitled to ten months’ notice, and that there are no grounds for an award of damages, based upon the manner of dismissal. The defendant also argues that the period for which the plaintiff is compensated should be reduced, as a result of his failure to mitigate his damages.
Discussion
Period of reasonable notice
[11] The purpose of the requirement of reasonable notice of termination is to provide an employee with an opportunity to find comparable employment. Factors to be considered in determining reasonable notice include the employee’s age and length of service, the nature of the employment, and the availability of comparable employment having regard to their experience, training and qualifications.
[12] When his employment was terminated, the plaintiff was 43 years of age, and had been employed by the defendant for approximately 15 years - substantially his whole career.
[13] As a grader operator, he was responsible for operating a grader to maintain gravel roads, for maintaining and repairing his equipment, and occasionally for doing some manual labour. During the period of time that he was a foreman, he had supervisory responsibilities, at least to the extent of assigning work to fellow employees in the Department of Public Works.
[14] Plaintiff’s counsel argues that the position of grader operator “represents a specialized or niche role, with very few available comparable opportunities.” However, on this issue, I agree with defendant’s counsel that with his experience, the plaintiff would be capable of operating other heavy machinery, and truck driving.
[15] With respect to the availability of similar employment, the plaintiff lives and worked in a small rural community, and I agree with plaintiff’s counsel that a job with similar salary and benefits would be unlikely to be readily available.
[16] The case law cited by plaintiff’s counsel suggests a notice period of between 15 and 18 months, for employees with similar considerations to those of the plaintiff. The case law cited by defendant’s counsel suggests a notice period of between 10 and 12 months.
[17] Of course, each case must be assessed on its own facts. Having reviewed the case law cited, and in the circumstances of the present case, I find the period of reasonable notice to have been 15 months.
Mitigation
[18] The defendant argues that the plaintiff has failed to properly mitigate his damages, citing the facts that he has made no applications for employment, has not sought the assistance of a professional employment agency, and has limited the scope of his search to “grader operator”.
[19] The law relating to an employee’s duty to mitigate damages is described as follows in Evans v. Teamsters Local Union No. 31, 2008 SCC 20, [2008] 1 S.C.R. 661, at paras. 99 f:
In Red Deer College, at p. 332, the Court held that the burden of proving that an employee has failed to mitigate his or her damages lies with the employer. Laskin C.J. cited Cheshire and Fifoot's The Law of Contract (8th ed. 1972), to explain the nature of the burden:
the burden which lies on the defendant of proving that the plaintiff has failed in his duty of mitigation is by no means a light one, for this is a case where a party already in breach of contract demands positive action from one who is often innocent of blame. [p. 599]
As this passage suggests, the burden of proof is onerous. This is consistent with the approach to [page705] mitigation as a principle in damages more generally. As Waddams observed: "In case of doubt, the plaintiff will usually receive the benefit, because it does not lie in the mouth of the defendant to be over-critical of good faith attempts by the plaintiff to avoid difficulty caused by the defendant's wrong" (15.140).
An employer alleging a failure to mitigate must prove two things: that the employee did not make a reasonable effort to find new work and that had the employee done so, he or she would likely have been able to obtain comparable alternative employment. In other words: that the loss was avoidable.
[20] While I agree that the plaintiff’s efforts at mitigation seem, at least on the surface, to be somewhat lacklustre, this may very well be a factor of the limited availability of comparable jobs where he lives, and has worked. In any event, there is no evidence to suggest that the plaintiff could have obtained comparable alternative employment had he put more effort into the search.
[21] In the result, I find that the defendant has failed to satisfy its onus of proving that the plaintiff has failed in his duty of mitigation.
General damages
[22] The plaintiff claims damages for breach of the Township’s duty of good faith. He argues that the Township demonstrated bad faith in the manner of dismissal, and a wanton disregard for his reputation in the community. In particular, he relies upon the fact that he did not receive his full entitlement under the Employment Standards Act at the time of dismissal, and a false statement made by a Township employee as to the reason for his dismissal. In support of his position, the plaintiff relies upon Honda Canada Inc. v. Keays, 2008 SCC 39, at para. 59, where the court gave the following examples of conduct in dismissal which may result in damages:
Examples of conduct in dismissal resulting in compensable damages are attacking the employee’s reputation by declarations made at the time of dismissal, misrepresentation regarding the reason for the decision, or dismissal meant to deprive the employee of a pension benefit or other right, permanent status for instance (see also the examples in Wallace, at paras. 99-100).
[23] For the following reasons, I am unable to find that the Township demonstrated bad faith in the manner of the plaintiff’s dismissal.
[24] Under s. 61 of the Employment Standards Act, the Township was required to pay to the plaintiff termination pay in a lump sum equal to 8 weeks wages, and to continue making whatever benefit plan contributions were required to maintain his benefits for a period of 8 weeks. The Township paid the plaintiff termination pay equal to 15 weeks wages; however, it did not continue to make the contributions required to maintain his benefits, or continue to contribute to his pension, during the eight-week period.
[25] In my view, the Township’s failure to make the required contributions did not constitute bad faith, entitling the plaintiff to damages. The Township showed good faith by paying him a lump sum well in excess of the minimum requirement under the Employment Standards Act, and the Township CAO explained that because following his termination the plaintiff was no longer a Township employee, the Township’s insurance provider would no longer continue providing benefits under the Township’s benefits program. While I suspect that the Township could have found a way to continue the benefits, I am unable to find, in these circumstances, that the failure to do so was an act in bad faith.
[26] The false statement made by a Township employee as to the reason for the plaintiff’s dismissal arose as follows. In December 2018, a letter carrier, after being told by the plaintiff that his employment with the Township had been terminated, approached a group of Township employees in a restaurant where they were having coffee. She asked them why the plaintiff’s employment had been terminated. A Mr. Down then showed her a photograph of the employee injured in the February broom incident, said that the plaintiff had been responsible for the injury, and that his employment had been terminated for causing the injury. The plaintiff argues both that the Township demonstrated bad faith by not taking steps to ensure that such a thing would not happen, and that the Township should be held vicariously liable for the defamatory remarks made by Mr. Down. I disagree for the following reasons.
[27] First, there is no evidence of the reason why Mr. Down told the story that he did. It seems unlikely that he was mistaken about the reason for dismissal. The broom incident had taken place in February 2018. The plaintiff was briefly suspended, and then demoted. He then worked for the Township as a grader operator, until his employment was terminated on September 4, 2018, approximately six months later. It appears more likely that Mr. Down did not like the plaintiff, was anxious to tell the broom story, and took the letter carrier’s question as an opportunity to do so. In those circumstances, it is not at all clear that anything the Township did, or did not do, was responsible for the incident.
[28] Second, while an employer may be held vicariously liable for defamatory remarks of its employees made in the scope of their employment [1], the telling of the story was not in the scope of Mr. Down’s employment. He was not authorized to speak on behalf of the Township, nor was telling the story related to his duties as an employee of the Township.
[29] Third, I am not persuaded that the false statement of the reason for dismissal would be likely to cause injury to the plaintiff’s reputation in the community. It would have been different had the story of the injury been false. However, it was a fact that the plaintiff’s employment was terminated, and if the story of the injury was likely to cause damage to his reputation, it would be because he had thrown the broom, and seriously injured the employee.
[30] Fourth, there is no evidence that the coffee shop incident did result in any damage to the plaintiff’s reputation in the community. There is no evidence of any other instance of a Township employee making a false statement of the reason for dismissal, and the evidence is that after speaking with Mr. Down, the letter carrier reported the conversation to the plaintiff’s mother because, “She [knew] Greg … and just couldn’t believe what she had been told.” There is no reason to believe that after speaking with the plaintiff’s mother, she continued to believe (if she ever did) that the plaintiff’s employment was terminated as a result of the broom incident.
[31] In his affidavit, the plaintiff says:
Ideally I would prefer to work for a municipality, as I have done for most of my career. However, I fear that my reputation with the Township and its neighbouring municipalities has been tarnished as a result of stories that I understand my former colleagues have been telling about me.
However, he is apparently only able to provide one example of such stories – that being the conversation between the letter carrier and Mr. Down.
Calculation of damages
[32] The parties agree that as a grader operator, the plaintiff’s base salary was approximately $57,649 per year. However, they disagree as to the overtime pay the plaintiff was likely to earn during the period of reasonable notice. In 2017, he earned $12,756.90 in overtime pay, and was on track to earn an additional $11,951.69 for overtime in 2018. The plaintiff submits that his overtime entitlement should be based upon the average of the two years, being $12,354.30. The defendant submits that the entitlement should not be based upon the average of the two years, because in 2017, and early 2018, the plaintiff was a foreman, and foremen work more overtime than grader operators. I agree, however, the defendant’s estimate of $5,000 on a yearly basis is too low. I find that the expected overtime during the period of reasonable notice should be calculated based on yearly overtime pay of $10,000, or $833.33 per month.
[33] In addition to the overtime for which the plaintiff was paid, he banked overtime in order to earn additional time off, in order to work on his farm. I agree with the plaintiff’s valuation of this banked overtime at $184.77 per month.
[34] The parties agree the value of the plaintiff’s lost benefits to be $480.41 per month.
[35] The plaintiff claims $583.36 per month for lost vacation. However, in Cronk v. Canadian General Insurance Company (1995), 25 O.R. (3d) 505 (C.A.), at para. 15, the court held that entitlement to vacation pay is a statutory benefit that does not apply to the period of notice to which an employee is entitled at common law, if that period exceeds the period to which the statutory benefit applies. The cases cited by the plaintiff do not assist him. In Munoz v. Canac Kitchens, [2008] O.J. No. 4774 (S.C.J.), the court held that in the circumstances of that case, to award compensation in lieu of notice, and an allowance for vacation, would be double recovery, and a windfall for the plaintiff. In Dubey v. CDA Industries Inc., the plaintiff obtained compensation for lost vacation; however, the evidence in that case was that he was often asked to work through his vacation, and received compensation instead.
[36] The plaintiff obtained an actuarial calculation establishing the loss in value of his pension to be $20,159, based upon a notice period of 16 months. Because I have found the period of reasonable notice to be 15 months, the amount awarded for loss of pension entitlement will be $18,899. [2]
[37] The plaintiff is also entitled to a work boot allowance of $266.67.
Disposition
[38] In the end result, the plaintiff is entitled to the following amounts:
- $72,061.65 for lost wages, less the amount the defendant has already paid;
- $12,500 for lost overtime pay;
- $2,771.55 for lost overtime previously compensated as “time off in lieu”;
- $7,206.15 for lost benefits;
- $18,899 for lost pension value; and
- $266.67 for lost work boot allowance.
[39] If the parties are unable to agree on costs, I will consider brief written argument provided that it is delivered to monica.mayer@ontario.ca, within thirty days of today’s date.
“Bale J.”
Released: December 2, 2019
COURT FILE NO. CV-109-18 DATE: 20191202 ONTARIO SUPERIOR COURT OF JUSTICE Gregory Clark – and – Township of Otonabee-South Monaghan
REASONS FOR DECISION S.T. Bale J.
Released: December 2, 2019
Footnotes
[1] Lysko v. Braley (2006), 79 O.R. (3d) 721 (C.A.), at para. 124
[2] An actuary would likely arrive at a somewhat different result, but the parties agreed that if I were to find a notice period shorter than 16 months, I should simply recalculate the amount on a prorated basis.