When an employee is terminated, they have an obligation to reasonably mitigate their damages by seeking comparable employment. If an employee fails to fulfill this duty, it may disentitle them from wrongful dismissal damages.
But how can this obligation be fulfilled and what is considered “reasonable” mitigation? Two cases from the Ontario Superior Court of Justice provide clarity with regard to when the duty is and is not fulfilled.
When is the obligation fulfilled?
In the case of Wall v M.H. Roe Sheet Metal, the Court found that the terminated employee had not failed in her mitigation efforts. The employee was 56 years old with 35 years of service. The employee was awarded a 24 month notice period.
The Court in Wall made the following findings in determining the employee fulfilled her obligation to mitigate her damages. While the employer had sent the employee 5,000 job leads, the employee was unqualified for most of the jobs. The employee did apply for 59 jobs but was not granted a single interview. The employee only had a high school education and had worked for the employer since she was 21 years old. The plaintiff did not look for a job in the first 4 months after her termination because she was in shock and did not have a computer to apply for jobs during the COVID lockdown. The employer did offer outplacement counselling; however this service would have obligated the employee to accept temporary work, so they Court found the employee was allowed to refuse the service. The employer offered the employee $1,400 towards career counseling but did not provide any company names that would provide a service for that price.
The Court further stated that the employer must prove that the employee conducted a less than reasonable search and that if they had completed a reasonable search, they would have obtained comparable employment.
When is the obligation not fulfilled?
In the case of Gannon v. Kinsdale Carriers, 2024 ONSC 1060, the Court found that the employee had failed in her mitigation efforts, and denied the employee common law reasonable notice despite her being wrongfully dismissed. The employee was 57 years old with 22 years of service.
The Court in Gannon found the employer provided the employee with contact information for a similar company to the employer which the employee contacted to inquire about a job opportunity. The employee was offered employment with the similar company that was comparable to that from which the employee had been terminated. The employee rejected the offer of employment stating she wanted to see what other options were available and pursue online courses. The Court found that the employee failed to reasonably mitigate her damages by rejecting an offer of comparable employment.
The Court further stated that comparable employment does not mean identical employment but employment comparable in status, hours, and remuneration to that from which the employee was terminated.
When an employee is wrongfully terminated, they have an obligation to reasonably mitigate their damages. If an employee can demonstrate they have applied to jobs and/or have been seeking comparable employment to that from which they were terminated, this may be sufficient to fulfill this obligation. If an employee rejects an offer of comparable employment, they may be found to have failed to mitigate their damages. When an employee is terminated, speaking to an employment lawyer early is important for both employees and employers to ensure laws are being complied with, employee’s rights have been taken into account, and all parties are fulfilling their duties and obligations.
More information? We’re here to help – info@wardlegal.ca This WARDS LAWYERS PC publication is for general information only. It is not legal advice, nor is it intended to be. Specific or more information may be necessary before advice could be provided for your particular circumstances.