Unjust Dismissal Under Canada Labour Code

The Basics

The Unjust Dismissal remedy under S. 240 of the Canada Labour Code provided a new remedy to federally regulated employees. It provides powerful relief for lost income, reinstatement and following Wallace and Honda decisions, damages for emotional distress and punitive damages, where applicable.

Recently the arbitration hearings have been transferred to the Canadian Industrial Relations Board, as opposed to private adjudicators.

The remedy is one distinct from common law and very much more akin to arbitral and human rights principles which use the "make whole" concept for damage assessment.

A recent Supreme Court of Canada decision concluded that the adjudicator in that instance acted reasonably in concluding that the employer must have just cause to terminate, as opposed to terminating without cause on fair notice. This was a dramatic conclusion.

The issue of deference, that is deciding that the first level hearing officer acted reasonably, allows for contrasting outcomes, both of which may be reasonable. To date, no other cases have contradicted the Supreme Court decision.

Generally speaking, the first level decision, now the CIRB, is given considerable latitude to fashion the remedy.

These issues and more will be reviewed.