'Onus is on the employer to be the one who ensures that communication is happening': lawyer
“It’s really important not to make assumptions when an employer has employees on a layoff, as is having good communication with those employees so they know what's going on and you know what they're doing.”
So says employment lawyer Ishat Reza of Zubas Flett Law in Toronto, after an Ontario court found that an employer who assumed a laid-off worker resigned when she found another job wrongfully dismissed the worker.
“The onus is on the employer to be the one who ensures that communication is happening during a layoff so they don't have misunderstandings like this,” says Reza.
The now-39-year-old worker was hired in December 2018 by Low & Low, an operator of funeral homes in Uxbridge, Ont., and Port Perry, Ont., to be a full-time licensed funeral director. She had no written employment contract.
In March 2020, the closure of schools due to the pandemic put pressure on the worker’s childcare responsibilities. She couldn’t be at work and care for her children at the same time, so she suggested that Low & Low lay her off. The company laid her off on March 20 and, as it turned out, it would have had to lay her off shortly afterwards anyway when public health and government orders restricted the level of funeral services the company could provide. Low & Low had to temporarily close one of its locations due to the restrictions.
“The initial layoff was fine, because it was actually the worker who had requested the time off because of her childcare needs when COVID happened, and then the employer realized that they also weren't able to maintain full staff,” says Reza.
Layoff lasted several months
Over the next few months, the worker and the company’s owner had several informal discussions, during which the worker regularly said she wanted to return to work for the company and the owner said there wasn’t enough work to recall her. Things were uncertain, so they couldn’t estimate when the worker would be able to return.
The worker received CERB benefits to help her through the layoff, but these eventually ran out. She discussed her financial concerns with Low & Low’s owner, but he couldn’t bring her back while the public health orders that kept business down were in effect.
Eventually, the worker accepted a full-time job with another employer on Oct. 27. The job was a maternity leave replacement position, which the worker thought would be good income until Low & Low recalled her.
A recruitment person from the other employer called Low & Low’s owner for a reference and background check, which the owner thought was a mistake because the worker was still his employee. After speaking with the recruitment person, he realized what was happening and provided a positive reference.
However, the owner felt blindsided and assumed that the worker had resigned from her position with the company. He felt this was confirmed when the worker called him to ask when she could pick up her things, including her funeral director license. The owner believed they were parting ways and wished her the best of luck moving forward, although he didn’t ask her to clarify if she would come back if he recalled her.
Worker said job was temporary
According to the worker, she told the owner that she was only taking the job as a fill-in until he recalled her, supported by an email she sent that said she “had to take a temporary job to get through all of this covid crap” and hoped to return to Low & Low’s “when things blow over and restrictions are dropped.”
Low & Low issued a record of employment for the worker on Nov. 4 indicating the reason for issuance was a layoff and that she wasn’t returning.
The worker filed a claim for wrongful dismissal damages, while Low & Low maintained that the worker had resigned.
The court found that it was understandable that the owner believed that the worker was resigning, as logic would dictate that the worker’s acceptance of one job excluded the other. However, the worker was legally entitled to hold multiple jobs with multiple employers unless she had a contract that prohibited it. Termination could be reasonable if one job prevented the worker from performing her duties, but this wasn’t an issue at the time because the worker was laid off, said the court.
Employer obliged to clarify resignation
The court noted that if the owner wanted to treat it as a resignation, then he was legally required to clarify it with the worker. If the worker confirmed that she was resigning and wouldn’t return to Low & Low if recalled, then the company could consider her to have resigned, the court said.
However, the court found that the worker made it clear that she intended to return to Low & Low when the COVID-19 restrictions were lifted and she wanted to work for the company.
“The employer just went ahead and assumed that because the worker got another job, that meant she had resigned,” says Reza. “But the court said that the employer had an obligation to clarify the issue with the worker as to whether it was actually a resignation - and what's interesting is why the employer assumed it was a resignation, because the [worker’s] email made it pretty clear that it was a temporary position and, when things cleared up with COVID, she wanted to come back.”
The court also found that it made no difference to the worker’s intentions that she suggested the layoff, as it was the company that ultimately invoked the layoff. The worker’s consent only ensured that there was no constructive dismissal, the court said.
“An employer can't just put somebody on a layoff unless it's allowed in their employment contract or it’s part of the usual way that the employment relationship goes, so people can claim a constructive dismissal unless through their actions they accept it,” says Reza. “In this case, if the worker had tried to claim a constructive dismissal, she wouldn't have been successful because she initiated it and, by her actions, she accepted being on this prolonged layoff.”
Wrongful dismissal
The court determined that the worker did not resign and instead was wrongfully dismissed by Low & Low. Although the worker argued that the termination date was the date of layoff on March 20, the court found that the termination happened on Nov. 4, when Low & Low considered her to have resigned and issued the record of employment. The worker wasn’t constructively dismissed as a consequence of her layoff being over-extended or not consenting to the layoff – the circumstances for which the Employment Standards Act, 2000 stipulate that the layoff date should be considered the termination date - but rather wrongfully dismissed when the record of employment was issued, the court said.
However, the court noted that time the worker spent on layoff should be considered as part of the period of employment for the purposes of calculating common law reasonable notice.
The court determined that the worker was entitled to 11 weeks’ pay in lieu of notice, minus the difference in what she earned with her new employer during the notice period. Low & Low was ordered to pay the worker $2,750 in wrongful dismissal damages plus $1,250 in costs.
The owner’s assumption that the worker resigned, despite the worker’s indicated intentions, was the heart of the problem, according to Reza.
“Best practice would be for an employer to clearly communicate with the employee about what they're doing, even if they land another job,” she says. “In this case, because the worker wasn't working for the employer at the time, she could take on another job because one of them didn't require her to be there and she wasn't getting paid at that point.”
“That assumption that just because she landed another job that she was no longer working for [Low & Low] didn't hold - the onus was on the employer to verify whether the fact that the worker received another job offer meant that she was resigning,” adds Reza. “That was really the misstep for the employer, as when the worker sent her email about it, she made clear that this was a temporary thing and her preference would be to come back.”
