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Mitigation: Demotion: Offer to Return to Work: Mifsud: Evans: Anecdotal Review

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Mitigation: Demotion: Offer to Return to Work: Mifsud: Evans: Anecdotal Review

The cases provided in the review which immediately follows are anecdotal and reflective purely of the individual fact context in each instance. They are not necessarily intended to be of any precedential value. Each decision depends on its particularized fact situation. They may be useful to depict the court’s assessment of the right of the employee to reject the offer extended or alternatively, the defence of the employer in extending the offer. There does, however, follow subsequently a principled analysis of the Evans caselaw.

These cases review issues of mitigation required from a constructive dismissal and also termination followed by the offer to remain employed for the period of working notice, from the date of the Evans decision forward. There is no real substantive distinction of test to deny the application of the defence in either instance.

Appellate Decisions

Brake v PJ-M2R OCA May 2017

The Ontario Court of Appeal agreed with the finding made by the trial judge that the plaintiff had no obligation to accept the demotion as offered. The plaintiff had been offered a position reporting to a young man whom she had trained. The employer was found to have been “downright insulting to Ms. Brake and her personality and abilities. The court also noted that the finding made by the trial judge was one of mixed fact and law and was reviewable only if there was a palpable and overriding error. ¹

Morgan v Vitran OCA 2015

The Ontario Court of Appeal in this 2015 decision accepted the evidence of the trial judge determining that the context of the alternate position offered by the employer denied the defence argument of need to accept. The issue was mitigation given a constructive dismissal. The Court noted the following findings of fact made at trial:

(i)The work environment at Vitran was unfriendly;

(ii) The work Morgan was offered as a freight analyst was of lesser importance than his job as a dock supervisor;

(iii) By accepting the freight analyst position, Morgan would have suffered a loss of dignity in the eyes of the dock workers he used to supervise. The freight analyst position had not been posted, so other employees would have known it was a position created specifically for Morgan because of his perceived ineptitude and would have been viewed as a demotion by other employees;

(iv) Morgan had been treated in an unacceptable manner by his employer in the period leading up to his constructive dismissal; and,

(v) Morgan’s personal relationships with his supervisors were acrimonious in the sense that no matter what Morgan did, they continued to criticize him.

AMEC Americas v MacWilliams NB CA May 2012

In May of 2012, the New Brunswick Court of Appeal considered and dismissed in AMEC Americas v MacWilliams, the employer’s argument that a settlement offer which allowed the plaintiff to return to work fit within the mitigation obligation as set out in Evans. The position met without success for two reasons, one of which was that the offer required a full release, secondly it fell short of the notice period set by the court and thirdly, it contained uncertainties.

Unlike the situation in Evans v. Teamsters Local Union No. 31, 2008 SCC 20 (CanLII), 2008 SCC 20, [2008] 1 S.C.R. 661, AMEC’s offer required Mr. MacWilliams to execute a full and final release of any claim he might have had. Moreover, the conditions attached to each offer of settlement were fertile ground for further disputes and litigation. Finally, and as the 20 months’ notice set by the trial judge demonstrates, AMEC’s offers did not measure up to Mr. MacWilliams’ legal entitlement.

Beggs v Westport BCCA Feb 2011

In February of 2011, the BC Court of Appeal considered but did not apply the ruling in Evans in Beggs v Westport Foods and upheld the decision of the trial judge which concluded that the plaintiff had no obligation to return to her employment.

Beggs was employed in a permanent part-time position as a clerk in the meat department for 10 years. She was well regarded. On February 18, 1999 her house burned down after which she immediately called her boss and advised that she did not know when she might be able to return to work. She moved in with her mother for five days and then into rental accommodation in the same trailer park where her home had been. On February 27, her phone was re-connected. In May or June her trailer was replaced.

In the first week following the fire, her boss tried to contact her by phone twice and found her phone had been disconnected. He did not try to contact her again. Equally the plaintiff made no attempts to contact the company. Her evidence was she did not do so that due to prior absences of 5 weeks due a friend’s death and 8 months due to a work related injury. The company testified that on these occasions, it contacted her once a week.

On March 16, 2009 the company issued a Record of Employment noting that the plaintiff had quit.

Unknown to the company, the plaintiff was suffering from anxiety and depression and had applied for EI sick benefits. This led to her discovery of the R o E which the plaintiff interpreted as termination of her employment.

Thereafter followed communications from respective counsel to one another. These letters became significant as they founded the basis of the court’s decision that it was an unreasonable expectation for the plaintiff to return to active employment. The correspondence, in essence, contained allegations of callous conduct, derogatory statements and the like.

The letter which requested the plaintiff return to work did not clearly set out the position to be offered but did refer to the need to communicate to the plaintiff “her employer’s expectations regarding her job”.

The Court of Appeal stated as follows:

[41] It was the subsequent exchange of correspondence between the parties’ lawyers, which began as a demand by the respondent’s lawyer for an immediate lump sum payment or litigation would be commenced, and ended with the appellant’s lawyer rejecting the respondent’s documented claim of illness as the reason for her absence, that effectively ended the employment relationship. By denying the respondent’s assertion that she had not quit her job in the face of medical evidence that she was unable to work, the appellant effectively dismissed the respondent. It was, in my view, the August 17, 2009 letter that constituted the clear and unequivocal act of dismissal.

It was also that communication that likely foreclosed the possibility of any positive consideration by the respondent of the appellant’s August 28, 2009 offer of re-employment. This is confirmed by the respondent’s evidence that shortly after this exchange, she decided that she no longer wished to return to work for the appellant and accordingly rejected the appellant’s August 28, 2009 offer of re-employment.

[42] The unfortunate exchange of communications between the parties’ lawyers that ended the parties’ employment relationship could, in my view, have been averted had the parties or their lawyers spoken directly with one another about each of their understandings about the reason for the respondent’s failure to return to work after the fire. However, once the confrontational exchange of communications between the lawyers occurred, that option was foreclosed.

The Court also agreed with the trial judge who found that the offer of employment was “guarded and ambivalent”, as it failed to set out the terms of her employment, including the nature of her duties, the person to whom she would report and her remuneration. The court also noted that the offer of re-employment was made on August 28, after the company had rejected the plaintiff’s explanation for her absence.

Silva v Leippi BC CA Dec 2011

The December 2011 decision of the BC Court of Appeal in Silva v Leippi considered the plaintiff’s appeal from the trial decision.

Shawn Silva was de facto manager of Brentwood Salvage in the absence of the son of the owner, Curtis Leippi. The sole other employee was a yardman, Mr. Saini. The business was the salvage of old or damaged vehicles. Shortly after he began his employment, Silva began to purchase such cars for his own account. He used the company’s facilities to do so, all with the agreement of the owner.

In April of 2008, the owner of the business had reached a handshake agreement to sell the business. The buyer wished to retain the plaintiff. The plaintiff sent a letter on May 9 to the proposed owner requesting a 33% increase in his wages.

On May 14 the plaintiff was instructed by Curtis Leippi to stay home. On May 15 he was called by the new owner to advise he was no longer required as an employee. On the following day, he was advised by Mr. Leippi that he would not receive his severance nor his vehicles which were stored at the company facilities until a document was signed.

At trial, the plaintiff was found to be in violation of his obligation to mitigate. It was found that there was “at a minimum an implied offer ..to Mr. Silva”. The trial decision found that Silva was trying to extract more favourable employment terms which caused the buyer to go in another direction. Had Silva not taken this position, his employment would have continued, the court stated. The damage claim was hence dismissed at trial. The Court of Appeal agreed and upheld the trial judgment.

The court found that there was a “common understanding” that Silva’s employment was to be continued. The letters written by Silva were as follows:

Erin & Randy,

In regards to your request with my current employment.

I pride myself on working hard, marketing and selling a quality product for top dollar, and being profitable.

I go home every night believing I have accomplished success.

My duties and responsibilities will increase dramatically.

I am aware of the business and am willing to work hard to increase your profits and sales, and to dedicate myself to the success of your new business.

I feel in return I should be compensated for my efforts and dedication.

Shawn

The second letter read as follows:

In regards to your request with my current employment; I wish to retain my full medical, dental and life insurance that was accepted by my previous employer and is ready to transfer.

These were terms of my agreement to continued employment from November, although the progression of change of ownership delayed this matter.

I wish to retain my current vehicle storage arrangement for six vehicles in a secured location on the premise with which I will have clearly marked as my own, and would not cause disruption to your [business]. I believe that my time, effort and dedication to the success of your [business] is worth a 33% increase to my current wage, as which my job requirements will be more than doubled.

I appreciate your review on this matter.

Interestingly there was no reference at trial nor on appeal to the sentiments expressed on numerous occasions by the Supreme Court on the vulnerability of employees and the need for a protective view of the rights of employees on termination.

Sifton v Wheaton Pontiac BC CA Dec 2010

The above is a decision of the BC Court of Appeal released on December 2, 2010.

Eric Sifton had been employed for 15 years by Harris GM in Nanaimo, British Columbia His prime responsibility was to train technicians and supervise their work in his job of Shop Foreman/Manager. He earned a base salary of $54,000 plus 1.5% of the gross service department revenues which by 2008 allowed him an annual income of $78,000.

In 2008 due to economic factors, many employees, including Sifton, agreed to voluntary wage reductions, which in Sifton’s case, reduced his earnings to roughly $60,000 annually. There was no agreed time limit to the reductions, but it was understood, that good times permitting, the wages would revert back to the former level.

The dealership was sold May 1 2009 to a competitor, the defendant. As a term of the sale, it had agreed to offer new employment to all employees at pre-reduction wage levels.

Sifton was told by the new owner that he would work as technician and “team leader”, and be paid as a technician plus a dollar an hour extra for doing duties similar to those he had done as a shop foreman.

Sifton worked one week and expressed his concern as to his duties and compensation to Mr. Gordon, the Manager, who responded in a “brusque manner” and advised Sifton he was being negative, which he refused to tolerate, that he would deal with negativity immediately and the offered terms were non-negotiable. Sifton sued.

The trial judge found a constructive dismissal and the Court of Appeal agreed. It is noted that on appeal, the defendant unsuccessfully moved to amend its defence to argue that it was Harris GM who had responsibility for the claim and not this defendant as Sifton declined its offer of employment.

The trial judge found that the rate of pay offered was “significantly lower”. In addition, the relationship was not “cordial”, given that Gordon was an assertive, insensitive person. Also Gordon’s statement that he would not tolerate negativity did not bode well for a harmonious working relationship. For these reasons, there was no mitigation obligation.

The Court of Appeal saw these findings as mixed questions of fact and law which hence required a palpable error for a reversal, which was not present.

McKee v Heritage OCA Dec 2009

The Ontario Court of Appeal also distinguished Evans/Mifsud in December of 2009 in McKee v Reid’s Heritage Homes. The court concluded that the offer of a further 6 months of engagement was reasonably refused in view of the apparent animosity that was reflected in the written communication from the company to the plaintiff:

Blevins wrote a letter to McKee on February 11, offering only a standard form employee contract with a 14-day notice period and “first pick” of one phase of any project in Guelph. In this same letter, Blevins opined that McKee’s subagents performed badly and this might have something to do with “how much [McKee was] taking off the top of every deal.” McKee rejected this offer. She also rejected Blevins’ March 3 offer of a six-month engagement whereby she could sell in her choice of one of two subdivisions.

[13] McKee testified that she rejected the time-limited offer because she felt that at her age she would do better to look for non-time-limited employment. Further, the “animosity” in the February 11 letter made her feel “uncomfortable”.

The Court concluded that this letter damaged the relationship to such an extent that she could not rationally be expected to remain employed:

However, those final offers themselves, when looked at in the context of Mr. Blevins’ admittedly “angry” letter, demonstrate that the relation between the defendant and the plaintiff had already drastically changed. By the final letter, the relationship was irreparably damaged.

Trial Court Decisions

J.J. v School District No. 43 (Coquitlam) BC SC April 2012

This case was a judicial review application from a decision of the British Columbia Human Rights Tribunal delivered by Justice Leask in April of 2012. The Tribunal had found the plaintiff to be the victim of discrimination and harassment. While it had provided a partial remedy, it had declined to reinstate and reduced the damage claim due its finding that she had failed to mitigate her damages as she had refused an offer of re-employment as of April 26, 2006 and hence her damage remedy ceased as of this date.

The Tribunal had determined that at the time the offer of re-employment was made by the school, the plaintiff was actively pursuing employment with the school herself, and hence concluded her failure to accept the offered position was a failure to mitigate.

The Court concluded, however, that simply because the plaintiff was seeking employment with the school, did not end the analysis. Such conduct did not, therefore, mean that the law mandated her return to work. The Tribunal still had to apply the relevant test as to whether such an offer would have subjected the plaintiff to an acrimonious or hostile work environment. On these facts, given the finding that the plaintiff was sexually harassed in 2004 and the subject of sexual discrimination throughout most of the time prior to 2006, the school should be required to prove that the work environment was suitable. The decision was set aside on remedy and sent back for a re-hearing on mitigation and remedy.

Ghanny v Downtown Toyota OSC June 2012

The Ontario Superior Court applied the mitigation obligation in Ghanny v 498326 Ontario Limited, a June 2012 decision written by Belobaba, J.

Aleem Ghanny was employed at Downtown Toyota as Service Manager, earning $80,000 annually. He had been employed for 18 years. He was told in June of 2008 that his job would end but he would be relocated to Downtown Suzuki as Parts and Service Manager at the same salary. This latter company was a recently acquired and related dealership. The company assured him that his years of service would be recognized. It was expected that the Suzuki dealership would be become a Lexus dealer and failing that, his job was not at risk. It was clear that the plaintiff was well regarded. The claim was dismissed.

Jadubir v Martinrea OSC March 2012

The Ontario Superior Court in Jadubir v Martinrea International, a decision released in March of 2012 considered again the plaintiff’s mitigation obligation where the position offered was a lesser salary.

The plaintiff was employed for a period of 15 years as a Lead Hand toolmaker. He and almost all other employees were laid off on December 18, 2008. The parties agreed that the ESA stipulated that the date of recall to avoid a termination of employment under the ESA was August 31, 2009. The Act also states that a failure to recall deems termination to have occurred on the first day of the layoff.

The company made an offer to the plaintiff to return to work at a lesser wage rate which was refused. The position offered was a toolmaker at $28 per hour, which was a $7 per hour decrease from his former position of Lead Hand. Hence the plaintiff’s employment was terminated due to the operation of the ESA. The plaintiff was paid his ESA entitlements of $33,600.

The parties disagreed as to the operative date of dismissal. The plaintiff asserted this to be December 18, 2008 and the employer August 31, 2009. The company also argued that the plaintiff should have accepted the position offered by way of mitigation, albeit at a lower salary.

The Court accepted the termination date as December 18, 2008.

As to the mitigation obligation, the Court found that the plaintiff should have accepted the alternate position and reduced his damage claim accordingly. The Court appeared to accept the defence evidence that there was no material difference in work done by a Lead Hand or toolmaker, the apparent issue being that there was no visible loss of prestige, nor was the work demeaning, although these words are not spoken in the decision. The plaintiff had found employment elsewhere at $24 per hour.

Haddock v Thrifty Foods BCSC July 2011

This is a July 2011 decision of the BC Supreme Court. Brooke Haddock worked in total for 16 years with differing entities of the defendant, most recently for Quadcam Holdings from 1998 to 2004. He last held the position of seafood department manager, being aptly surnamed for this function. He was assigned a new function as clerk-2, allegedly for cause. His salary was reduced by the sum of $6,500 annually from roughly $38,000, a 16% decrease in rate of pay.

The court found that these facts allowed for a constructive dismissal but the plaintiff should have accepted the alternate position as a mitigation obligation as “one of those rather exceptional cases”. The plaintiff also suffered from personal issues of alcoholism and stress due to his separation from his spouse, which was not shown as a factor in reaching this conclusion:

69] The evidence in this case has established there was no “atmosphere of hostility, embarrassment or humiliation”, in particular considering that Mr. Haddock was not being asked to return to the seafood department. Furthermore, there is no evidence to suggest the relationship between Mr. Haddock and Mr. Ackinclose was “so acrimonious that a reasonable person would not expect those sides to work together in harmony.”

[170] Indeed, according to the August 11, 2004 email Mr. Boizard sent to Ms. Hermann, “Jeff agreed to help Brooke move forward in this new role, although ‘reputation’ may make things difficult for him.”

Stewart v Keary Coyle NBQB Oct 2011

The New Brunswick Queens Bench in October of 2011 in Stewart v Keary Coyle Motors again considered the mitigation plea. The plaintiff had been employed as a computer business specialist, effectively performing clerical and administrative duties. She earned $14 per hour, an annual bonus of $300 and was provided a benefit plan. She was advised of her termination from this position and offered a new position as a receptionist at $12 per hour, no bonus, a three month delay in benefit coverage and a probationary term. She refused and sued.

The defendant stated that it had told the plaintiff that the probationary term and the benefits interruption would not apply to the plaintiff, yet failed to revise the letter as was requested. The court found no mitigation obligation, given the salary differential of 20%, the lack of benefits for three months and the probationary term. The trial judge also found that there would have been a loss of prestige but not to the point of humiliation.

Pennell v Imperial Paving BCSC Dec 2010

Pennell v Imperial Paving Limited is a December 2010 decision of BC Supreme Court which declined to apply the mitigation obligation. The plaintiff was employed as a dispatcher/project co-ordinator. She was advised that the company had re-organized as a result of which they were to be two dispatchers. She typically spent 4 hours a day on dispatching functions and 6 hours a day on project co-ordination responsibilities. She was offered and declined the offer of one of the dispatcher positions.

The trial judge accepted her evidence that she was told she could be a flag girl or flip burgers, should she not accept the offer. She was also told that when the second dispatcher arrived at 10 am each day, she would then have some “gofer” duties. She had been previously working 60 hours a week and would now be given 40 hours a week.

The trial judge found that it was reasonable for her to conclude that this represented a reduction in income as she had been paid an hourly rate. The alterations were announced to her at a general office meeting, not at a personal one on one meeting.

The court concluded that the manner of dealing with the plaintiff was disrespectful and that she had good reason to anticipate an unworkable environment. The claim succeeded

Whiting v First Data Canada Merchant Solutions BCSC May 2010

The BC Supreme Court again dealt with this issue in Whiting v First Data Canada Solutions, a decision released in May of 2010.

The plaintiff was employed with the defendant, a company which provided electronic commerce payment processing systems for Visa, Mastercard and Interac payments. It was affiliated from 2000 to 2010 with the TD Bank, a relationship which was known as the Payment Card Alliance Canada or “PCAC Alliance”. The plaintiff was hired specifically for this function.

The plaintiff began his employment in July of 2003 as a senior salesperson and from late 2004, he focused largely on corporate sales and by 2009, all his clientele were in this market segment. The PCAC Alliance was a fixed term contract which expired in 2010 and the plaintiff’s function, then titled as director of corporate sales was over.

An alternate position was offered, such being director of corporate and mid-market sales, the compensation for which was to be a mid-market sales model. The remuneration from this position would have “significantly reduced the plaintiff’s damages”.

Prior to termination, the defendant had capped a commission claim to $30,000 which was initially earned at the sum of $51,376. The plaintiff negotiated payment of a further sum of $15,000. The plaintiff was also owed a second commission of $9,339 which the employer asserted “for some unfathomable reason”, that this sum was included in the $15,000 settlement of the prior claim. This was determined by the trial judge to have been arbitrary.

This became an important issue as to the defence plea of mitigation with respect to its amended offer of alternate employment as this was found to have created an atmosphere of hostility and for that reason his refusal to accept the alternative employment was sustained.

It is to be noted that, for other reasons relating to a third party offer, the claim was denied.

Palmer v Clemco BCSC Feb 2010

The Court of Appeal considered and agreed with the test required of an offer of employment in the mitigation context as was expressed in the February 2010 decision of the BC Supreme Court trial decision in Palmer v Clemco:

[104] In my view the mere fact that an employer offers to enter into discussions concerning possible re-employment, and discussions ensue, is insufficient to prove a failure to mitigate, should those discussion subsequently be broken off. There must be a concrete offer with well-defined terms, especially those concerning compensation. Only such an offer is capable of reasoned consideration in the context of a wrongful dismissal claim.

For this reason, the mitigation defence failed.

MacKinnon v Acadia NSSC Sept 2009

MacKinnon v Acadia University is a September 2009 decision of Justice Gregory Warner of the Nova Scotia Supreme Court.

Paula MacKinnon began employment with the university in December of 1988. By July of 1997 she was appointed Provost for a five year term and then became a member of senior management. Her title was altered to that of Vice-President Student Affairs in August of 2004. Her role in the administration was seen to be crucial and continually changing with differing projects, assignments and responsibilities with the area of “Student Life”. From 1997 to 2007, she was the principal senior administrator, reporting to the president for all the activities of the University outside of academics, the physical facilities and finance/administration.

On May 24, 2007, the president advised the plaintiff that the president was to assume responsibility for Enrollment and Admissions and that the plaintiff was to focus on important issues in the athletic department and Student Affairs. The trial judge found that the plaintiff “acknowledged that these were big and serious issues”:

Dr. Gottlieb advised that Ms. Cook MacKinnon needed to focus on important issues in the athletic department and Student Affairs (including the partly empty residences). Ms. Cook MacKinnon acknowledged these were big and serious issues. They discussed and they agreed that Ms. Cook MacKinnon’s “plate was full” and Ms. Cook MacKinnon acknowledged that she could use more time for these other issues. Dr. Gottlieb advised her that she was taking direct oversight because of the pressure from the Board to deal with the issue, to protect Ms. Cook MacKinnon from the Board, and to protect her job. She did not advise Ms. Cook MacKinnon that there would be any changes in her title, salary or other responsibilities.

Other fact findings relevant to this meeting were that “I find that Dr. Gottlieb stated that she had made her decision, and said nothing else to suggest that she might change her mind or would discuss it further”. These were significant findings as the plaintiff, contrary to this conclusion, had testified that she had thought she and the president were to discuss this again at the next meeting set for May 31.

The decision was announced at the next management meeting on May 30. At the scheduled personal meeting of May 31, the plaintiff hand delivered a letter from legal counsel asserting constructive dismissal. A response was requested by June 5. The president had planned to be absent until June 6. A conciliatory reply had been drafted and was awaiting her signature upon her return. The letter applauded the plaintiff and requested her to remain in the employ of the university. The trial judge found that the plaintiff knew that the president would be absent until June 6. On June 5, at 11 pm, the plaintiff turned off her blackberry and cleaned out her office early the following day. The plaintiff’s counsel wrote to the defendant on June 6. When the president returned the unsigned conciliatory letter and the latter letter were on her desk. The conciliatory letter was never sent.

The court found that there was not a constructive termination. While the removal of the enrollment and admissions from the plaintiff’s portfolio was a change, it was not seen as fundamental as it was implicit that the plaintiff’s responsibilities were subject to change, both additions and deletions.

As to mitigation, while obiter, given the above finding, nonetheless stated that Mifsud, while “much maligned and seldom applied” was yet endorsed in Evans. The court found here that “whether rare or not” this is one case in which the plaintiff ought to have remained employed and should have worked out her notice. The president was supportive of the plaintiff and although there may have been issues between them, it was a normal working relationship, and any momentary embarrassment ought to have been repaired by reasonable people. The case was accordingly dismissed. Then again, had the facts supported a fundamental change, this obiter would likely have taken a different turn.

Besse v Machner BCSC Sept 2009

The BC Supreme Court considered this issue again in the September 2009 decision of Besse v Dr. A. S. Machner Inc. Dr. Machner had recently purchased the dental practice from Dr. Drobis in September of 2007.

The plaintiff, a full time receptionist began a medical leave in October 2007, intending to return to work following her recovery, which was assessed as three to six months.

The employer, mistakenly believing in his right to do so, on January 14, 2008 effected a temporary lay-off of 12 weeks and 6 days. This letter followed several meetings between the parties in which it was stated by the employer that business was slow and according to the plaintiff, that she was likely to be replaced in a few years due to her age. She also said that the employer had suggested that the prior dentist-employer had liability to pay her severance.

Upon receiving a letter from plaintiff’s counsel, the employer offered to the plaintiff the right to return to work with full pay and benefits commencing on the date when she was medically fit to return to work and any salary lost due to the temporary lay-off. The employee counsel replied by asserting that she was terminated and sought severance. Employer counsel replied by noting that the employer thought highly of the plaintiff, admitted an error in placing her on temporary lay-off and sought her return to work.

The plaintiff was then living in Hope, British Columbia She decided in the third week of February to move to Gibsons, B.C., where her husband had worked for the past three years.

The Court concluded that the imposition of the temporary lay-off was termination of the plaintiff’s employment. The Court determined that the plaintiff was in violation of her obligation to return to her employment with the defendant. In making this decision, the Court noted that (1) the tone of communication was respectful, (2) there was no objectively regarded stigma or loss of dignity or concerns for the workplace atmosphere. The claim accordingly failed.

Chappel v Umberto BCSC June 2009

The B.C. Supreme Court again looked at the circumstances of the termination and the impact of the communications on the parties in June of 2009 in Chappel v Umberto Management, in this instance, deciding that the relationship was ruptured by the statements of the employer and also the delay in offering to the plaintiff the right to return to work:

In light of my conclusions regarding the circumstances surrounding Ms. Chapple’s termination, and the fact that the employee/employer relationship was over, I find that Ms. Chapple’s failure to return to work at Il Caminetto is not a failure to mitigate her damages. I have determined that Mr. Menghi stated, in front of other employees, that Ms. Chapple was not welcome in any of his restaurants. He advised Ms. Chapple during their telephone conversation of January 21, 2007, that he did not want Ms. Chapple setting foot in his restaurants again.

[96] Finally, I have determined that if Mr. Menghi considered that Ms. Chapple’s services were valuable and that he wanted her to return to work, he would have taken active steps to get her back to work immediately.

Antworth v Fabricville NB QB March 2009

This is a decision of the New Brunswick Court of Queen’s Bench decided in March of 2009. The plaintiff worked for the company for 21 years.

The plaintiff initially was a store manager in Fredericton from February 1985 until 1986, after which she was given two additional stores in Saint John and in Moncton. In 1987 she became District Manager and a second store in Moncton was added to her responsibilities. In 1990 a store opened in P.E.I. By 1993 she was the manager responsible for six stores. In February 1993 she was appointed supervisor of the two of the stores plus two more in Newfoundland. She was no longer the store manager in Fredericton but her office was in the Fredericton store.

In late December 2004, the two Atlantic supervisors had their territories switched and each lost their “top stores”. Both were given two Montreal stores and Montreal supervisors were assigned the stores in Halifax and St. John’s.

Antworth and the other affected supervisor raised their concerns about the changes without any consequence. Their travel time increased from “about 5 days a month to about 9 days a month”.

Prior to the changes, Antworth was responsible for four stores in Nova Scotia, one in Charlottetown and one in Fredericton. Now she had seven stores instead of six. There was one in Fredericton, Bathurst and Sydney and two in Moncton and Montreal. Travel was arranged by the Montreal office and it took about 9 travel days a month to visit each store.

In November of 2005, she was asked to visit each store twice a month, a request which would mean she was travelling “22 out of 20 business days a month”.

A finding of constructive dismissal was made. The issue of mitigation was decided in the plaintiff’s favour. The company had alleged an offer of a store manager position was made. A store manager earned less than half of the plaintiff’s salary. Also the trial judge noted that the demeanor of the company witnesses at trial showed considerable animosity to the plaintiff, who “could not reasonably be expected to continue to work for them”.

Colwell v Cornerstone OSC Dec 2008

Justice Little of the Ontario Superior Court considered the defence plea of mitigation in Colwell v Cornerstone Properties, a decision released in December of 2008. The plaintiff had been employed as commercial manager at the Oxbury Mall in London, Ontario for a total employment period of 7 years. In late August of 2004 she had learned, while in the company of her immediate superior, that he had installed a secret camera in the ceiling of her office. She ultimately discovered that he had installed it personally in November of 2003. He had explained to her that its purpose was to assist in the detection of thefts by maintenance staff and that he had full confidence in her and wanted her to remain in her position.

The plaintiff knew that there had been no thefts from her office, that she kept no money in her office, questioned why she was not advised of the camera and in short, did not believe the explanation. She terminated her employment, alleged constructive dismissal and sued.

The court agreed with the constructive dismissal plea and also found that there was no obligation to mitigate in such circumstances where her privacy was invaded in such a manner.

Loehle v Puralator OSC Dec 2006

Loehle v Puralator is a 2008 decision of the Ontario Superior Court of Gordon, J. upholding the mitigation obligation and dismissing the action. A constructive dismissal was found as of December 5, 2006. The plaintiff, 47 years old with a high school education, was hired in February 2001 as National Claims Manager. In October of the same year, this office was relocated. The company offered a six month severance package or a four month management development program. The plaintiff chose the latter and upon its completion, was transferred to the Hamilton warehouse facility as a unit manager.

Mr. Loehle was responsible for the midnight shift at which product was received, sorted and distributed to courier vehicles. Although the posting called for 7.5 hours a day, it was found he worked 12 hour daily shifts. He was paid $50,000 plus an annual bonus. The position was graded internally as a Grade 9 level.

In October 2002, two internal postings were released for grade 11 managers for the internal audit department. Loehle was offered one such position at a salary level of $55,000 plus bonus. This position was open ended, although he agreed he was verbally told it would be a three year assignment. He was well regarded in this position and received regular salary increments.

In December of 2005, the three year period expired. The plaintiff was not re-assigned as was contemplated initially. He was told to find his own position internally, an unusual company practice.

In January of 2006, he was assigned to a six month management program known as ‘Six Sigma”, the details of which were never explained. He was asked to do audits as he had done in the past. He applied for six vacant management positions without success.

In July of 2006, HR advised him to apply for a unit manager position. He declined. He was assigned to an audit in Montreal. In September he was again advised to accept a unit manager position and again declined.

In November he was offered a unit manager position without a salary decrease, as had been the case previously. On December 5 he was formally offered the position in writing at his then salary of $64,000, which he again declined.

He asserted a constructive dismissal. On April 9, 2007 he accepted an offer at $58,000 with a company in London, Ontario.

The trial judge agreed that the facts showed a constructive dismissal. With respect to the mitigation issue, the court noted that in Mifsud, there were issues raised as to the employee’s performance. The court noted that to analyze the duty to mitigate, there must be scrutiny given to the conduct of management and the environment surrounding the demoted position.

The plaintiff testified that he did not accept the demoted position due to stress and working conditions from his prior assignment as unit manager in Hamilton and his concern with respect to losing credibility with other employees should he return to this position even at another warehouse. The court stated that this view was not the correct test as the plaintiff had used his subjective view with reference to a permanent transfer as opposed to the correct topic, namely, his “assignment as unit manager as a temporary measure while conducting a search for employment elsewhere”.

A critical aspect to this decision was the high regard expressed by management of the plaintiff’s abilities and that the salary was the same. The court concluded a reasonable person would have accepted the position and dismissed the action. It is hard to imagine an employer being more generous and considerate as the defendant was in this instance.

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About the Author: David Harris — Canadian Employment Law •
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