Law Times

Law timeS • September 16, 2013 Page 7 COMMENT Bills piling up as dysfunction grows at Queen's Park O ntario Premier Kathleen Wynne is apparently done talking and wants to get to back to work or, if not, go to the electorate. It all depends whether Andrea Horwath and the NDP will continue to prop up her government and what the cost of that support will be. We already know Progressive Conservative Leader Tim Hudak believes he's entitled to become the next premier of Ontario and is raring to start the campaign. With a Conservative want-of-confidence motion pending, Wynne's threats of calling an election ring a tad hollow. The legislature is back from summer break and so it's also back to work for the MPPs at Queen's Park who are paying the price for some seven or more months of inaction during which everything stalled save for the budget bill that managed to pass with NDP support. As I've often noted, the bills are piling up. More than that, as a Toronto Star editorial also pointed out last week, Wynne has done a lot of talking and collaborating, as she promised to do since winning the leadership, but she hasn't actually put anything substantive on the table. Perhaps she's taking a cue from her federal counterpart, Justin Trudeau, whose only policy statement is to decriminalize marijuana possession while suggesting he'll hold back on definitive economic and social policies until 2015. Trudeau's strategy is arguably sound. Why expose yourself to attack now from Prime Minister Stephen Harper when you can wait for him to make more mistakes and capitalize on them Wynne has since backed when an election rolls around? away from her election threat The point, however, is that Queen's but she's fully aware her regime Harper has a mandate; Wynne Park thus far has really consisted doesn't. It's incumbent upon of placating the teachers by her to take her leadership to throwing more money at them the general electorate and test and smoothing over scandals it there but it's also something or at least holding up her hands she's been avoiding because and claiming no knowledge. of the baggage her regime has What she needs is somebeen carrying since Day 1. thing she can take to the votBetween the gas plants, hiders that will distract and deflect den and found e-mails, the Ian Harvey from all of that baggage and legacy of Ornge and eHealth pointing the finger at the NDP Ontario, and perhaps a secret $500-million payoff to the teachers, Wyn- and the Conservatives for choking the legne has a massive burden but is perhaps islature into a standstill may well be it. At the same time, she'll also need to hoping voters' memories will fade. Indeed, an Innovative Research Group come up with and present a clear vision poll reported in The Globe and Mail sug- for Ontario's next five years along with a gests that may well be the case with Wyn- substantive plan to control spending withne ahead seven points over Hudak while out raising taxes. The key quote here was from Wynne in Horwath's approval rating has plummeted. Wynne has too much experience as a a scrum: "I'm going to do my best to make politician to believe one dubious poll but the legislature work. If it doesn't, the natural she certainly had a snap in her voice when outcome of that is that we go to an election." Hudak's response was just as telling: the legislature resumed as she suggested Horwath and Hudak are welcome to "Quite frankly, premier, that's like walking come to her office to discuss how to fix the in here, throwing up your hands, and saying backlog of bills and get legislation passed. that you've got no new ideas. You've spent At the top of her agenda will be the fiscal the last eight months in conversations. "You want to co-operate, you want to responsibility office, something Horwath will support since it was a condition for the get things done. I put idea after idea on the NDP's budget support, and the skin cancer floor, to bring accountability for taxpayers, prevention act that would ban teens from to get our economy moving again. It's time for action. We've got ideas if you don't." going to tanning beds. Political rhetoric aside, his point is on In fact, you'd probably have to go back the money: Ontario needs a clear course to the Full-Day Early Learning Statute Law Amendment Act of 2010 to find any of definitive action and the only way to do that is to win a majority because this game-changing legislation that passed. minority arrangement is as dysfunctional as it gets. Wynne will have to come up with a platform soon if she's going to go to the polls, but the more cynical suggestion is that she'll play nice with the NDP and bide for more time. In the meantime, the bills pile up. LT Ian Harvey has been a journalist for 35 years writing about a diverse range of issues including legal and political affairs. His e-mail address is ianharvey@rogers.com. CORRECTION A Sept. 9 article, "Lawyers call for higher damages in civil sexual assault cases," referred to a 2006 paper by Elizabeth Grace that noted awards for victims of abuse are rarely more than $50,000. To clarify, the paper was referring to punitive damages only and not general or other types of damages. In addition, the article suggested the non-pecuniary general damages cap for traditional personal injury cases necessarily applies to civil sexual abuse matters.  While the general damage awards in such cases have been increasing over the past 20 years, the Court of Appeal for Ontario and the Supreme Court of Canada haven't yet ruled on this issue and hence there's uncertainty as to whether the cap applies. Nonetheless, non-pecuniary  general damage awards in sexual abuse cases have remained below the cap until now. Employers should beware of job changes during working notice BY MONTY VERLINT For Law Times T from the conduct of the employer that amounts to repudiation of its essential obligations in the employment relationship. In this case, the Court of Appeal held that there was no question that the employee subjectively believed the company had peremptorily dismissed him. There was a sufficient evidentiary base to support the trial judge's finding that a reasonable person in his position would have come to the same conclusion. In the result, the Court of Appeal upheld the trial judge's award to the employee of the remaining 15 months payment in lieu of notice. In my view, the decision provides important guidance for employers and their counsel in this area. For example, if an employer is going to provide working notice of termination to an employee pursuant to a predefined severance clause, it should consider avoiding certain actions such as substantially changing the employee's duties, obligations, and authority during the working notice period; advising other staff or clients that the employee no longer works there; changing or terminating the employee's benefits; requiring the employee to work from home; taking away the employee's business cards, keys, mobile phone or other equipment; preventing the employee from visiting clients or customers; and making other changes suggesting an immediate termination of employment. Employers that fail to adhere to those suggestions might be at risk of an immediate action for breach of contract based on a predefined severance clause in the employee's employment agreement. Of course, the court decides each case on its own facts and there may be some leeway to make changes without constituting a wholesale termination of employment. It is always important to review each case carefully and analyze the effects employment changes may have on the overall relationship. LT u SPEAKER'S CORNER he decision of Bowes v. Goss Power Products Ltd. represented a substantial change from the case law that had existed prior to that time. Widely regarded as a win for employees who had a predefined severance amount contained in their employment contract, the ruling held that an employment agreement that stipulates a fixed term of notice or payment in lieu should be treated as fixing liquidated damages or a contractual amount. It follows that in such cases, there is no obligation on the part of the employee to mitigate the damages. More recently in another appellate decision, Allen v. Ainsworth Lumber Co. Ltd., an employer attempted to bypass the "no mitigation benefit" afforded to its employee under his employment contract by providing notice of termination instead of pay in lieu thereof. That way, the employee would not achieve a windfall of severance pay without deduction for mitigation as found in Bowes. The relevant termination clause stated: "Should it become necessary for Ainsworth Lumber Co. to sever our relationship, without cause, we will provide you with 15 months notice or pay in lieu pursuant to this paragraph shall discharge Ainsworth Lumber from any and all obligations which it may have to you arising from or in connection with this severance relationship." In Ainsworth, the employer handed the employee a letter purportedly advising him that it would terminate his employment in 15 months but that it was not necessary for him to report to work and he should instead spend his efforts looking for new employment. The letter also stated that if the employee found employment during the 15-month notice period, the employer would consider him to have resigned from the company and his salary and benefits would cease. The day after handing him the letter, the employer announced that the employee "left the company" and his replacement would start work in November. The employee did in fact find new employment prior to the end of the 15-month period at which time the company immediately ceased payments on the basis that he had mitigated any further damages. In response, the employee sued the company for breach of contract alleging he had no duty to mitigate his damages and he was entitled to the remaining 15 months pay in lieu as a debt due under his employment agreement (as found in Bowes). The company, on the other hand, disagreed and took the position that the employee was "not yet terminated" from his employment. In support of its argument, the employer cited the fact that it continued to pay the employee's salary and other benefits and it merely changed his duties in order to allow him to search for new employment. In addition, it argued the employee had accepted the changes. Based on all of the circumstances, including the events that took place after termination, the trial judge found the company had immediately dismissed the employee and held that the "working notice of termination" was simply a "masquerade." In doing so, the court found that the company's action went beyond mere repudiation and constituted a wholesale termination of the employment contract. The fact that the company banished the employee from the premises, removed all of his duties, and cut off his means of communication with his colleagues supported the finding that it had immediately terminated him. The court also placed significant weight on the fact that the day after his departure, the employer issued a press release stating the employee had "left the company." The British Columbia Court of Appeal upheld the finding. It stated that a finding of dismissal is a finding of fact and the test is an objective one. Dismissal is a matter of substance over form. Termination of employment may arise from express notice or be implied www.lawtimesnews.com Monty Verlint is a lawyer specializing in employment law at Kuretzky Vassos Henderson LLP in Toronto. He can be reached at 416-865-0504 or by email at montyv@kuretzkyvassos.com.

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