Reasonable notice awards for short-term employees were gradually increasing
The British Columbia Court of Appeal is trying to slow a recent trend in which short-term employees in non-management positions have been awarded disproportionately large notice periods in wrongful dismissal cases, though it upheld a five-month notice period award for a Vancouver salesperson who was fired after nine months of service.
The court addressed the issue in the appeal of five months’ notice awarded to Jennifer Saalfeld, 37. Saalfeld was hired by Vancouver-based anti-theft software manufacturer Absolute Software on Oct. 16, 2006, and began work on Nov. 13. She was hired to be a territory manager who would pursue sales to the United States government. Her ten years’ experience in software sales as well as dealing with the U.S. government sealed the deal for her hiring.
Saalfeld already held a sales position with another software company when she applied to Absolute but left because she saw an opportunity for higher earnings and career growth with Absolute. She shared a quarterly sales target for the territory with a U.S.-based executive but didn’t have any managerial duties. She was only responsible for her own results.
Fired after nine months
On July 24, 2007, Absolute, unhappy with Saalfeld’s performance, fired her. Since she had only been with the company for nine months, it paid her one week’s salary in lieu of notice and all salary and benefits earned up to that point. It also refunded her contributions to the employee share ownership plan.
The trial court ruled Saalfeld was entitled to five months’ notice despite her short tenure at Absolute because of her extensive experience and expertise. Though she didn’t have managerial responsibilities, the court found her position “was a responsible and relatively senior one” that warranted special consideration. It also took into account it took Saalfeld nine months to find another job.
Absolute appealed the decision, arguing five months’ notice was unreasonable and disproportionate for a non-managerial employee with such short service time with the company. Saalfeld’s counsel argued it had become standard in British Columbia case law, as well in other provinces, to award notice periods of five to six months when the employee had been employed for less than three years and, though Saalfeld didn’t have managerial responsibility, her position was still significant enough to warrant that much notice.
Court cautioned against disproportionate notice periods
The B.C. Court of Appeal upheld the five months’ notice because of the length of time it took Saalfeld to find alternative employment, which demonstrated the lack of availability of a comparable job. However, the court cautioned in the absence of that factor in this particular case, the notice period was not appropriate for such a short period of service for an employee with Saalfeld’s characteristics.
“While B.C. precedents are consistent that proportionately longer notice periods are appropriate for employees dismissed in the first three years of their employment, I see little support for the proposition that five to six months is the norm in short service cases for employees in their thirties or early forties whose function is significant for their employer, but not one of senior management,” the court said.
The court referred to several B.C. cases where, similar to this situation, there was no inducement, bad faith or a particularly difficult job market and the employee was relatively young and the position didn’t have managerial responsibilities. These precedents, the court said, indicated two to three months was more appropriate for an employee such as Saalfeld with a period of service in the nine-month range.
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