Ontario Court of Appeal looks at dismissal of sales employee after dissatisfied customer complains
The Ontario Court of Appeal recently put employers on notice: a customer complaint, without direct evidence from the complainant, cannot justify a termination for cause.
In Williamson v. Brandt Tractor Ltd., the court found that the company wrongfully dismissed an employee who was entitled to 17 months' pay in lieu of notice.
The appeal was allowed only in part, reducing the award by $32,881 to account for income he earned at a new job during the notice period.
Lack of admissible evidence
Brandt Tractor dismissed the salesperson after a customer filed a complaint against him. In the August 30, 2021, incident, a customer expressed dissatisfaction with his handling of a sale of a piece of equipment.
The company argued that this incident, viewed against the employee’s prior work history, was enough to justify dismissal without notice or pay. However, a trial judge disagreed, and the Court of Appeal upheld that conclusion in its April 16, 2026 decision.
While the court accepted that a complaint had been made, no admissible evidence from the customer as to what had occurred was ever produced at trial. Without it, Brandt Tractor could not establish that the incident crossed the threshold required to legally justify termination.
The appeal court found no grounds to intervene. Brandt Tractor "has not established that the trial judge made an extricable legal error or a palpable and overriding error," it said.
Was job search enough?
Brandt Tractor also argued that the salesperson failed to properly search for new work after his dismissal, pointing to his own admission that he had not pursued comparable roles in the sales field. A dismissed employee is generally expected to take reasonable steps to find new work, reducing the former employer's damages.
The court rejected this argument. An employer must prove not only that the employee failed to search for comparable work, but that comparable work was available, and the employee would have secured the job had reasonable steps been taken.
"The appellant failed to establish that comparable employment was available," the court found.
"The respondent's choice not to seek employment in the sales field did not relieve the appellant of its burden in this regard."
Deducting earnings despite lower-paying job
Brandt Tractor lost on cause and on mitigation, but the court found one error in the trial judge's decision. The salesperson had found new work during the 17-month notice period, but the trial judge refused to deduct those earnings from the award because the new role was a "lower-paying or ranking position."
The Court of Appeal disagreed. The trial judge had relied on a concurring opinion from Brake v. PJ-M2R Restaurant Inc., 2017 at paragraphs 157–58, which the court found "does not state the law in Ontario." The majority in Brake established at paragraph 99 that "employment income earned during the notice period is generally to be treated as mitigation of loss."
The salesperson’s new job earnings of $32,881 were deducted accordingly. Having been found "largely successful on the appeal," the respondent was also awarded costs of $15,000, all inclusive.
