THE EMPLOYERS' EDGE
Employer’s "Appalling" Post-Termination Conduct Results in Significant Damages Award for Short-Service Employee
In our earlier blog, we shared various termination best practices which would both help ensure that an employee exits the organization smoothly and allow employers to mitigate potential risk. At this time, the final recommendations we offered involved parting ways with the employee in an amicable manner. In our view, adhering to this specific recommendation is not only the respectful and decent approach – but one that best minimizes the chance that the matter escalates going forward.
In a recent Supreme Court of British Columbia decision, an employer opted not to follow this particular piece of advice in the termination of a short-service employee. This poor decision ultimately resulted in the court awarding significant damages to the affected employee.
The 26-year old plaintiff employee had only been employed by the defendant employer for approximately 1.5 years in an entry-level position. The plaintiff was ultimately terminated on a without cause basis, as her position had been eliminated due to the implantation of a new automation process. At this time, she was initially offered her minimum termination entitlement of two (2) weeks' notice under the British Columbia Employment Standards Act (the "ESA").
Pretty straightforward so far right?
Following the termination meeting, the plaintiff reviewed the Employment Agreement she had originally signed upon commencing employment and realized it guaranteed a greater entitlement of thirty (30) days' pay in lieu of notice upon termination. Accordingly, she wrote to the defendant requesting this entitlement along with approximately two (2) weeks in unpaid wages. The defendant initially advised her that they would pay this entitlement, before indicating that she was required to visit the office to "meet with the team to finalize the termination and receive her pay."
This is where this matter began to go sideways for the defendant.
The plaintiff obliged and attended a meeting at the foreign address provided to her. However, she was not met by "the team", but rather an individual she had not previously met, Justin Liu ("Mr. Liu"). Unfortunately for the defendant, the plaintiff had the foresight to record this disconcerting meeting.
Mr. Liu immediately advised her that "her group" had "misplaced" and "misused" a significant sum of the company’s money over the past year. As a consequence, he alleged that her colleagues had agreed to forfeit their notice and severance entitlements. The plaintiff pleaded her case to Mr. Liu, reiterating the minimum entitlements owing to her pursuant to the ESA and her Employment Agreement but indicating she was willing to take less to conclude this matter. Mr. Liu responded by offering her the single payment of only $500 and explicitly refused to provide the plaintiff with her minimum entitlements under the ESA.
In making this lowball offer, Mr. Liu indicated, "If you want it, you can take it; if you don’t -- like, I don’t care if this costs me 100 grand." The plaintiff responded by requested this offer in writing, prompting Mr. Liu to further provoke her stating, "This is the one time you’re meeting with me. If you don’t want it, we’ll send you the contract, go to the employment board […] If you got to sue, you got to sue. Go for it […] You know what? I think its best just to go to the employment board."
The plaintiff ultimately heeded Mr. Liu’s advice and proceeded to commence a legal action against the defendant.
Following a thorough review of the facts, the court offered these conclusions:
- The defendant had significantly breached their obligation of good faith and fair dealing by withholding the plaintiff’s unpaid wages and statutory severance;
- Acting on behalf of the defendant, Mr. Liu’s conduct during the post-termination meeting was appalling, harsh and reprehensible. He made false and serious allegations of financial impropriety, used aggressive and intimidating language and repeatedly engaged in a range of bullying and intimidation tactics; and
- Upon receiving the civil claim, in an ongoing effort to intimidate, the defendant proceeded to make further unfounded serious allegations despite admitting that the plaintiff had been dismissed without cause.
The court indicated that these factors taken as a whole, called for awards of:
- $25,000 in aggravated damages, to compensate the plaintiff for the damage caused by the defendant;
- $35,000 in punitive damages, to effectively deter and also to denounce the range of misconduct in this matter; and
- $5,660 reflecting eight (8) weeks' pay in lieu of notice.
When reflecting upon this matter, it is important to recall that as an entry-level employee the plaintiff only earned approximately $650 weekly. As such, her minimum entitlement under the ESA of two (2) weeks' notice was equivalent to approximately $1,300, and her contractual entitlement of thirty (30) days' notice was equivalent to approximately $2,800. However, as a direct consequence of the defendant’s blatant disregard of the minimum termination entitlements owing to the plaintiff under employment standards legislation, in conjunction with their inflammatory nature throughout this matter – the defendant is now on the hook to pay the plaintiff over $65,000!
As such, the takeaways are clear. Prior to the termination meeting, it is important to consult with your legal counsel to effectively set the termination in motion. At all times during and following the termination, employers should treat the employee with dignity and respect, allowing them to move on from the organization in an amicable manner. Following the termination, employers must pay out any amounts owing to the employee pursuant to employment standards legislation.
While terminations are never easy – they certainly do not need to be this hostile or unnecessarily expensive. The CCP team can assist employers experiencing difficulty navigating their termination obligations, with expert legal advice and ways to minimize liability. Please contact one of our lawyers who can assist with all of your workplace concerns.
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