By Kevin O’Neill

On April 5, 2012, the Supreme Court of Canada said it would hear IBM’s appeal from the British Columbia Court of Appeal’s 2011 decision in Waterman v. IBM Canada Ltd. This important case will likely allow the Supreme Court to re-examine damages principles arising in a wrongful dismissal action.

The case raises the question of what, if any, damages a terminated employee is entitled to if that person immediately starts receiving benefits from a fully funded pension or disability plan.

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By Hadiya Roderique

Working notice — the default under many pieces of employment standards in Canada — can be a way to reduce an organization’s cost of termination of employment. But what happens when an employee quits in response to getting fired before the end of the notice period? And what happens when the working notice isn’t reasonable. The recently decided British Columbia Court of Appeal case of Giza v. Sechelt School Bus Service Ltd., sheds some new light.

Facts
Raymond Giza was a five-year part-time school bus driver for the employer, Sechelt School Bus Service Ltd. He wasn’t subject to an agreement setting out an amount of notice to be given upon termination.

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By Marisa Victor and Sean McGurran

Following a recent decision by Ontario’s highest court, employers across Canada may now be on the hook for more termination pay when nonunion employees are laid off for an extended period.

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By Marisa Victor and Yael Wexler

An employment contract can provide certainty and protection for both the employer and employee. But what happens when it comes time to renew it? A recent Ontario case shows what can go wrong when an employer offers an existing employee a revised contract in order to address performance or other employment problems.

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By Hadiya Roderique

Severance obligations can be costly for Canadian employers since most employees are entitled to notice of termination or substantial pay in lieu of notice. A tricky issue is the impact of post-termination income on the obligations of the terminating employer.

Canadian employees are often under the mistaken impression that they have an unconditional entitlement to a large lump-sum severance payment even if they were to quickly start a new job and even if they receive other income during the notice period.

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By Lyne Duhaime
When an employee in Canada fails to fulfill his functions as expected, the ultimate consequence is a termination of employment “for cause,” which implies that no notice or other severance is paid to him by the employer. The Superior Court of Quebec recently went further.

In Valeurs mobilières Desjardins inc. v. Beaulne, an investment advisor was also ordered to pay his former employer, Valeurs mobilières Desjardins inc. (VMD), $141,233.96 with costs. Why? To compensate VMD for amounts it had to pay a client who suffered damages because of the advisor’s failure to follow the client’s instructions.

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By Ralph Nero and Keri Bennett

Historically, the character of employment or level of position has been an important factor in determining appropriate severance payments in Canada. Unskilled or lower-level employees have typically been entitled to less severance than more highly skilled and higher-level employees.

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by Thora A.Sigurdson

Canadian courts continue to struggle with clauses in employment contracts that contain post-employment noncompetition and nonsolicitation clauses, known as “restrictive covenants.” This is an important issue in Canada, where there is no concept of “at will” employment, and all employees are deemed to have some form of employment contact. But not all terms are equally enforceable.

The recent split decision of the Alberta Court of Appeal in Globex Foreign Exchange Corporation v. Kelcher, 2011 ABCA 240, provides an interesting reminder of the uncertainty in the law in this area. It also provides good lessons to those who want employees to agree to such restrictions.

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By Ian Campbell

There seems to have been an increase in cases where employees in Canada directly or publicly have challenged their supervisors or senior management. Maybe this is because of an increasing belief in their actual or perceived rights.

Of course employees have the right and should be encouraged to raise legitimate workplace concerns in appropriate circumstances. But recent decisions have confirmed that it’s not acceptable for employees to do so in a manner that is either disrespectful or unfairly undermines management’s integrity or reputation.

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By Karen Sargeant

You give your employee almost 32 weeks’ pay after terminating his employment without cause. He gets another job two weeks later. You’re off the hook, right? Maybe not.

The Ontario Superior Court of Justice in Brito v. Canac Kitchens, a Division of Kohler Canada Co. has recently said no. Instead, you may be required to “make the employee whole” in every respect, not just salary. That could mean disability benefits too, even after he starts his other job.

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