Things have come a long way over the past 200 years since the days when workers could be punished with jail or physical chastisement. Now, Canadian workers are afforded numerous protections under employment law.
Such were the opening observations of Justice R.S. Echlin before launching into a judgment condemning the “hardball approach” of cabinetry company Canac Kitchens in yet another of a series of recent employee disputes. In this case, the wrongful dismissal of a long-time employee who became disabled during the notice period serves to illustrate the duty of an employer to “make the employee whole” for the entire duration of the notice period following his termination.
In 2003, the company underwent restructuring, and a 55-year old cabinet-maker was dismissed without cause in July. After serving the company for nearly 24 years, the company provided him the statutory minimum notice of 31.79 weeks for his length of service, plus benefits, again for the bare minimum of 8 weeks. Total notice: approximately 8 months.
The employee later obtained employment with another cabinetry company for significantly lower pay and no disability benefits. However, by November 2004, he underwent surgery for cancer and became disabled from work.
Rightful Notice—Almost 3 Times the Original
Justice Echlin noted that there can be no “rule of thumb” in Ontario for reasonable notice, but that notice must be determined on a case by case basis. Accordingly, he found the company’s provision of roughly 8 months notice insufficient and awarded the dismissed employee a total of 22 months, less the 8 months originally provided.
Disability Benefits during the Notice Period?
The question remained, though, as to whether the terminated employee was entitled to benefits from the time he became disabled in November 2004 to May 2005, being the end of the 22 month notice period. Had the employee been provided working notice, rather than pay-in-lieu, he would most certainly have been entitled to claim benefits coverage throughout the notice period. Canac, however, hoped that the bare minimums would cover its obligations.
What it did not gamble on was the faithful former employee later becoming disabled and opening a claim for benefits. When he did, the company chose to litigate throughout five long years, even claiming that the employee failed to mitigate his damages by purchasing alternate disability insurance.
After failing to prove that comparable coverage would have been available to the employe, the company then conceded to 17 weeks short-term disability. After its expiry, the issue of long-term disability followed. Ever resistant, the company launched more failed defences, and Justice Echlin awarded the employee long-term disability payments through to March 2007.
Points to Note
Justice Echlin’s judgment described Canac’s treatment of its faithful, long-time employee as “cavalier, harsh, malicious, reckless, outrageous and high-handed.” He went on to award the employee a further $15,000 in damages for the company’s “hardball approach.”
The case serves as a stark example of the high risk employers take in dismissing their employees with only the bare minimum notice, especially where employees with long tenures are involved.
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