Employer argued only current employees were entitled to bonus
A British Columbia executive is entitled to bonuses during his notice period that he would have received had he still been employed, the B.C. Supreme Court has ruled.
Henry Szczypiorkowski, 62, was a senior manager, commercial real estate lending, for Vancouver-based Coast Capital Savings Credit Union. On Oct. 18, 2010, Szczypiorkowski sent an email to several other employees, including his supervisor, containing sexual jokes. Coast Capital felt this violated its code of ethics and business conduct, which Szczypiorkowski had previously signed indicating he understood it.
After an investigation, Szczypiorkowski admitted he probably should not have sent the email, but Coast Capital decided to terminate his employment for violating its policies. He was officially terminated on Nov. 16, 2010.
Szczypiorkowski filed a claim for wrongful dismissal, but Coast Capital withdrew its claim of just cause. However, it maintained it acted reasonably in the wake of Szczypiorkowski’s violation of its policies. The credit union paid him eight weeks’ statutory termination notice and later offered six months’ pay in lieu of notice, which Szczypiorkowski rejected.
The court found that an appropriate notice period was 18 months, given Szczypiorkowski’s position and his 19 years of service. Szczypiorkowski argued that he was entitled to be put in the same position as before the breach of contract occurred, so he deserved not only his salary for 18 months, but also any bonuses during that period. Coast Capital countered that its bonuses were based on team targets and employees must be “in the employ of the credit union” to be eligible to participate. Also, Coast Capital pointed to its bonus guideline that said employees on a performance improvement plan were not eligible, since Szczypiorkowski’s policy violation would have warranted such a plan had he not been terminated for the misconduct.
The court found that since Coast Capital wrongfully dismissed Szczypiorkowski, he would have been otherwise employed and received his regular bonuses. It also found that the argument Szczypiorkowski would have been on a performance improvement plan had he not been fired was “mere speculation.” Since Szczypiorkowski received bonuses on a regular basis in the past, he was entitled to receive what he would have received during the 18-month notice period had he still been employed with Coast Capital, said the court.
“I am satisfied that the bonuses were clearly an integral and significant part of (Szczypiorkowski’s) compensation and as such ‘give rise to a reasonable expectation of a bonus’ if Mr. Szczypiorkowski had remained employed by (Coast Capital),” said the court.
